Based on various researches at Oak Spring University , Mitsui Engineering & Shipbuilding is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models,
banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Mitsui Engineering & Shipbuilding
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Mitsui Engineering & Shipbuilding can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mitsui Engineering & Shipbuilding, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mitsui Engineering & Shipbuilding 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 Mitsui Engineering & Shipbuilding can be done for the following purposes –
1. Strategic planning of Mitsui Engineering & Shipbuilding
2. Improving business portfolio management of Mitsui Engineering & Shipbuilding
3. Assessing feasibility of the new initiative in Japan
4. Making a Water Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Mitsui Engineering & Shipbuilding
Strengths of Mitsui Engineering & Shipbuilding | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mitsui Engineering & Shipbuilding are -
Learning organization
- Mitsui Engineering & Shipbuilding is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Mitsui Engineering & Shipbuilding is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Mitsui Engineering & Shipbuilding emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Mitsui Engineering & Shipbuilding
– The covid-19 pandemic has put organizational resilience at the centre of everthing Mitsui Engineering & Shipbuilding does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Mitsui Engineering & Shipbuilding 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.
High brand equity
– Mitsui Engineering & Shipbuilding has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mitsui Engineering & Shipbuilding to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy of Mitsui Engineering & Shipbuilding comprises – understanding the underlying the factors in the Water Transportation 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.
Sustainable margins compare to other players in Water Transportation industry
– Mitsui Engineering & Shipbuilding has clearly differentiated products in the market place. This has enabled Mitsui Engineering & Shipbuilding to fetch slight price premium compare to the competitors in the Water Transportation industry. The sustainable margins have also helped Mitsui Engineering & Shipbuilding to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Mitsui Engineering & Shipbuilding has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Water Transportation industry. Secondly the value chain collaborators of Mitsui Engineering & Shipbuilding have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Water Transportation industry
- digital transformation varies from industry to industry. For Mitsui Engineering & Shipbuilding digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mitsui Engineering & Shipbuilding has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Strong track record of project management in the Water Transportation industry
– Mitsui Engineering & Shipbuilding is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Mitsui Engineering & Shipbuilding is present in almost all the verticals within the Water Transportation industry. This has provided Mitsui Engineering & Shipbuilding 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.
Effective Research and Development (R&D)
– Mitsui Engineering & Shipbuilding has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Mitsui Engineering & Shipbuilding staying ahead in the Water Transportation industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Mitsui Engineering & Shipbuilding has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Mitsui Engineering & Shipbuilding 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.
Weaknesses of Mitsui Engineering & Shipbuilding | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Mitsui Engineering & Shipbuilding are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mitsui Engineering & Shipbuilding is slow explore the new channels of communication. These new channels of communication can help Mitsui Engineering & Shipbuilding to provide better information regarding Water Transportation products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners in Water Transportation industry
– because of the regulatory requirements in Japan, Mitsui Engineering & Shipbuilding is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Water Transportation industry.
Products dominated business model
– Even though Mitsui Engineering & Shipbuilding has some of the most successful models in the Water Transportation industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Mitsui Engineering & Shipbuilding should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Mitsui Engineering & Shipbuilding 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.
Ability to respond to the competition
– As the decision making is very deliberative at Mitsui Engineering & Shipbuilding, in the dynamic environment of Water Transportation industry it has struggled to respond to the nimble upstart competition. Mitsui Engineering & Shipbuilding has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Mitsui Engineering & Shipbuilding is dominated by functional specialists. It is not different from other players in the Water Transportation industry, but Mitsui Engineering & Shipbuilding needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Mitsui Engineering & Shipbuilding to focus more on services in the Water Transportation industry rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Mitsui Engineering & Shipbuilding has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Water Transportation industry over the last five years. Mitsui Engineering & Shipbuilding even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Capital Spending Reduction
– Even during the low interest decade, Mitsui Engineering & Shipbuilding 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 Water Transportation industry using digital technology.
High operating costs
– Compare to the competitors, Mitsui Engineering & Shipbuilding has high operating costs in the Water Transportation industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Mitsui Engineering & Shipbuilding lucrative customers.
Low market penetration in new markets
– Outside its home market of Japan, Mitsui Engineering & Shipbuilding needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Mitsui Engineering & Shipbuilding is one of the leading players in the Water Transportation industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Water Transportation industry in last five years.
Mitsui Engineering & Shipbuilding Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Mitsui Engineering & Shipbuilding are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Mitsui Engineering & Shipbuilding 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 Mitsui Engineering & Shipbuilding to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mitsui Engineering & Shipbuilding 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.
Use of Bitcoin and other crypto currencies for transactions in Water Transportation industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Mitsui Engineering & Shipbuilding in the Water Transportation industry. Now Mitsui Engineering & Shipbuilding can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mitsui Engineering & Shipbuilding can use these opportunities to build new business models that can help the communities that Mitsui Engineering & Shipbuilding operates in. Secondly it can use opportunities from government spending in Water Transportation sector.
Learning at scale
– Online learning technologies has now opened space for Mitsui Engineering & Shipbuilding 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.
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 Mitsui Engineering & Shipbuilding 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mitsui Engineering & Shipbuilding can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Mitsui Engineering & Shipbuilding can improve the customer journey of consumers in the Water Transportation 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.
Better consumer reach
– The expansion of the 5G network will help Mitsui Engineering & Shipbuilding to increase its market reach. Mitsui Engineering & Shipbuilding 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Water Transportation industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Mitsui Engineering & Shipbuilding 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. Mitsui Engineering & Shipbuilding 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.
Loyalty marketing
– Mitsui Engineering & Shipbuilding has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Building a culture of innovation
– managers at Mitsui Engineering & Shipbuilding can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Water Transportation industry.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Water Transportation industry, but it has also influenced the consumer preferences. Mitsui Engineering & Shipbuilding can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Mitsui Engineering & Shipbuilding External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Mitsui Engineering & Shipbuilding are -
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Mitsui Engineering & Shipbuilding needs to understand the core reasons impacting the Water Transportation industry. This will help it in building a better workplace.
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.
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 Mitsui Engineering & Shipbuilding business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Mitsui Engineering & Shipbuilding 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 Water Transportation industry and other sectors.
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 Mitsui Engineering & Shipbuilding.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mitsui Engineering & Shipbuilding can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate Mitsui Engineering & Shipbuilding prominent markets.
High dependence on third party suppliers
– Mitsui Engineering & Shipbuilding 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Mitsui Engineering & Shipbuilding may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Water Transportation sector.
Environmental challenges
– Mitsui Engineering & Shipbuilding 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. Mitsui Engineering & Shipbuilding can take advantage of this fund but it will also bring new competitors in the Water Transportation 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. Mitsui Engineering & Shipbuilding 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mitsui Engineering & Shipbuilding in Water Transportation industry. The Water Transportation industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Mitsui Engineering & Shipbuilding in the Water Transportation sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Water Transportation industry are lowering. It can presents Mitsui Engineering & Shipbuilding with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Water Transportation sector.
Weighted SWOT Analysis of Mitsui Engineering & Shipbuilding Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Mitsui Engineering & Shipbuilding 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 Mitsui Engineering & Shipbuilding 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 Mitsui Engineering & Shipbuilding 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 Mitsui Engineering & Shipbuilding 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 Mitsui Engineering & Shipbuilding needs to make to build a sustainable competitive advantage.