Hokkaido Electric Power Co Inc (9509) SWOT Analysis / TOWS Matrix / MBA Resources
Electric Utilities
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Hokkaido Electric Power Co Inc (Japan)
Based on various researches at Oak Spring University , Hokkaido Electric Power Co Inc is operating in a macro-environment that has been destablized by – technology disruption, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic ,
competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Hokkaido Electric Power Co Inc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hokkaido Electric Power Co Inc can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hokkaido Electric Power Co Inc, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hokkaido Electric Power Co Inc operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Hokkaido Electric Power Co Inc can be done for the following purposes –
1. Strategic planning of Hokkaido Electric Power Co Inc
2. Improving business portfolio management of Hokkaido Electric Power Co Inc
3. Assessing feasibility of the new initiative in Japan
4. Making a Electric Utilities sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hokkaido Electric Power Co Inc
Strengths of Hokkaido Electric Power Co Inc | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hokkaido Electric Power Co Inc are -
Ability to recruit top talent
– Hokkaido Electric Power Co Inc is one of the leading players in the Electric Utilities industry in Japan. It is in a position to attract the best talent available in Japan. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Hokkaido Electric Power Co Inc has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hokkaido Electric Power Co Inc has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High switching costs
– The high switching costs that Hokkaido Electric Power Co Inc has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Cross disciplinary teams
– Horizontal connected teams at the Hokkaido Electric Power Co Inc are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Effective Research and Development (R&D)
– Hokkaido Electric Power Co Inc has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Hokkaido Electric Power Co Inc staying ahead in the Electric Utilities industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy of Hokkaido Electric Power Co Inc comprises – understanding the underlying the factors in the Electric Utilities industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Organizational Resilience of Hokkaido Electric Power Co Inc
– The covid-19 pandemic has put organizational resilience at the centre of everthing Hokkaido Electric Power Co Inc does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Hokkaido Electric Power Co Inc in Electric Utilities industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Hokkaido Electric Power Co Inc is present in almost all the verticals within the Electric Utilities industry. This has provided Hokkaido Electric Power Co Inc a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
High brand equity
– Hokkaido Electric Power Co Inc has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hokkaido Electric Power Co Inc to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management in the Electric Utilities industry
– Hokkaido Electric Power Co Inc is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Electric Utilities
– Hokkaido Electric Power Co Inc is one of the leading players in the Electric Utilities industry in Japan. Over the years it has not only transformed the business landscape in the Electric Utilities industry in Japan but also across the existing markets. The ability to lead change has enabled Hokkaido Electric Power Co Inc in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses of Hokkaido Electric Power Co Inc | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hokkaido Electric Power Co Inc are -
Need for greater diversity
– Hokkaido Electric Power Co Inc has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High cash cycle compare to competitors
Hokkaido Electric Power Co Inc has a high cash cycle compare to other players in the Electric Utilities industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Skills based hiring in Electric Utilities industry
– The stress on hiring functional specialists at Hokkaido Electric Power Co Inc has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Hokkaido Electric Power Co Inc has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the Electric Utilities industry using digital technology.
Low market penetration in new markets
– Outside its home market of Japan, Hokkaido Electric Power Co Inc needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on Hokkaido Electric Power Co Inc ‘s star products
– The top 2 products and services of Hokkaido Electric Power Co Inc still accounts for major business revenue. This dependence on star products in Electric Utilities industry has resulted into insufficient focus on developing new products, even though Hokkaido Electric Power Co Inc has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Hokkaido Electric Power Co Inc is dominated by functional specialists. It is not different from other players in the Electric Utilities industry, but Hokkaido Electric Power Co Inc needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hokkaido Electric Power Co Inc to focus more on services in the Electric Utilities industry rather than just following the product oriented approach.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Hokkaido Electric Power Co Inc supply chain. Even after few cautionary changes, Hokkaido Electric Power Co Inc is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hokkaido Electric Power Co Inc vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, Hokkaido Electric Power Co Inc has high operating costs in the Electric Utilities industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Hokkaido Electric Power Co Inc lucrative customers.
Slow to strategic competitive environment developments
– As Hokkaido Electric Power Co Inc is one of the leading players in the Electric Utilities industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Electric Utilities industry in last five years.
Products dominated business model
– Even though Hokkaido Electric Power Co Inc has some of the most successful models in the Electric Utilities industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Hokkaido Electric Power Co Inc should strive to include more intangible value offerings along with its core products and services.
Hokkaido Electric Power Co Inc Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hokkaido Electric Power Co Inc are -
Manufacturing automation
– Hokkaido Electric Power Co Inc can use the latest technology developments to improve its manufacturing and designing process in Electric Utilities sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Learning at scale
– Online learning technologies has now opened space for Hokkaido Electric Power Co Inc to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Electric Utilities industry, but it has also influenced the consumer preferences. Hokkaido Electric Power Co Inc can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Hokkaido Electric Power Co Inc has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Electric Utilities sector. This continuous investment in analytics has enabled Hokkaido Electric Power Co Inc to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hokkaido Electric Power Co Inc to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Hokkaido Electric Power Co Inc has opened avenues for new revenue streams for the organization in Electric Utilities industry. This can help Hokkaido Electric Power Co Inc to build a more holistic ecosystem for Hokkaido Electric Power Co Inc products in the Electric Utilities industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Hokkaido Electric Power Co Inc can improve the customer journey of consumers in the Electric Utilities industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Electric Utilities industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hokkaido Electric Power Co Inc can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Hokkaido Electric Power Co Inc can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Better consumer reach
– The expansion of the 5G network will help Hokkaido Electric Power Co Inc to increase its market reach. Hokkaido Electric Power Co Inc will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Hokkaido Electric Power Co Inc can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hokkaido Electric Power Co Inc can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help Hokkaido Electric Power Co Inc to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Hokkaido Electric Power Co Inc to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hokkaido Electric Power Co Inc can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hokkaido Electric Power Co Inc to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Hokkaido Electric Power Co Inc to hire the very best people irrespective of their geographical location.
Threats Hokkaido Electric Power Co Inc External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hokkaido Electric Power Co Inc are -
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Stagnating economy with rate increase
– Hokkaido Electric Power Co Inc can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the Electric Utilities industry.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Hokkaido Electric Power Co Inc will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Shortening product life cycle
– it is one of the major threat that Hokkaido Electric Power Co Inc is facing in Electric Utilities sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Hokkaido Electric Power Co Inc.
Consumer confidence and its impact on Hokkaido Electric Power Co Inc demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in Electric Utilities industry and other sectors.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Hokkaido Electric Power Co Inc business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Hokkaido Electric Power Co Inc high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Increasing wage structure of Hokkaido Electric Power Co Inc
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Hokkaido Electric Power Co Inc.
Environmental challenges
– Hokkaido Electric Power Co Inc needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Hokkaido Electric Power Co Inc can take advantage of this fund but it will also bring new competitors in the Electric Utilities industry.
Easy access to finance
– Easy access to finance in Electric Utilities industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hokkaido Electric Power Co Inc can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Hokkaido Electric Power Co Inc may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Electric Utilities sector.
Weighted SWOT Analysis of Hokkaido Electric Power Co Inc Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hokkaido Electric Power Co Inc needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of Hokkaido Electric Power Co Inc is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of Hokkaido Electric Power Co Inc is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Hokkaido Electric Power Co Inc to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Hokkaido Electric Power Co Inc needs to make to build a sustainable competitive advantage.