SWOT Analysis / TOWS Matrix for Hitachi Maxell Ltd (Japan)
Based on various researches at Oak Spring University , Hitachi Maxell Ltd is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, increasing household debt because of falling income levels, technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy,
central banks are concerned over increasing inflation, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Hitachi Maxell Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Hitachi Maxell Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hitachi Maxell Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hitachi Maxell Ltd 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 Hitachi Maxell Ltd can be done for the following purposes –
1. Strategic planning of Hitachi Maxell Ltd
2. Improving business portfolio management of Hitachi Maxell Ltd
3. Assessing feasibility of the new initiative in Japan
4. Making a Audio & Video Equipment sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hitachi Maxell Ltd
Strengths of Hitachi Maxell Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hitachi Maxell Ltd are -
Learning organization
- Hitachi Maxell Ltd 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 Hitachi Maxell Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Hitachi Maxell Ltd emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Hitachi Maxell Ltd is one of the most innovative firm in Audio & Video Equipment sector.
Cross disciplinary teams
– Horizontal connected teams at the Hitachi Maxell Ltd 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.
Organizational Resilience of Hitachi Maxell Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing Hitachi Maxell Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Hitachi Maxell Ltd is present in almost all the verticals within the Audio & Video Equipment industry. This has provided Hitachi Maxell Ltd 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.
Strong track record of project management in the Audio & Video Equipment industry
– Hitachi Maxell Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Hitachi Maxell Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hitachi Maxell Ltd 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.
Superior customer experience
– The customer experience strategy of Hitachi Maxell Ltd in Audio & Video Equipment industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Audio & Video Equipment industry
– Hitachi Maxell Ltd has clearly differentiated products in the market place. This has enabled Hitachi Maxell Ltd to fetch slight price premium compare to the competitors in the Audio & Video Equipment industry. The sustainable margins have also helped Hitachi Maxell Ltd to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Hitachi Maxell Ltd is one of the leading players in the Audio & Video Equipment 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.
Ability to lead change in Audio & Video Equipment
– Hitachi Maxell Ltd is one of the leading players in the Audio & Video Equipment industry in Japan. Over the years it has not only transformed the business landscape in the Audio & Video Equipment industry in Japan but also across the existing markets. The ability to lead change has enabled Hitachi Maxell Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Audio & Video Equipment industry
- digital transformation varies from industry to industry. For Hitachi Maxell Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hitachi Maxell Ltd 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.
Weaknesses of Hitachi Maxell Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hitachi Maxell Ltd are -
Workers concerns about automation
– As automation is fast increasing in the Audio & Video Equipment industry, Hitachi Maxell Ltd needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Ability to respond to the competition
– As the decision making is very deliberative at Hitachi Maxell Ltd, in the dynamic environment of Audio & Video Equipment industry it has struggled to respond to the nimble upstart competition. Hitachi Maxell Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– From the outside it seems that Hitachi Maxell Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Audio & Video Equipment industry have deep experience in developing customer relationships. Marketing department at Hitachi Maxell Ltd can leverage the sales team experience to cultivate customer relationships as Hitachi Maxell Ltd is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Hitachi Maxell Ltd is dominated by functional specialists. It is not different from other players in the Audio & Video Equipment industry, but Hitachi Maxell Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hitachi Maxell Ltd to focus more on services in the Audio & Video Equipment industry rather than just following the product oriented approach.
Employees’ less understanding of Hitachi Maxell Ltd strategy
– From the outside it seems that the employees of Hitachi Maxell Ltd don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High cash cycle compare to competitors
Hitachi Maxell Ltd has a high cash cycle compare to other players in the Audio & Video Equipment industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hitachi Maxell Ltd is slow explore the new channels of communication. These new channels of communication can help Hitachi Maxell Ltd to provide better information regarding Audio & Video Equipment products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Hitachi Maxell Ltd has some of the most successful models in the Audio & Video Equipment industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Hitachi Maxell Ltd should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Hitachi Maxell Ltd is one of the leading players in the Audio & Video Equipment industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Audio & Video Equipment industry in last five years.
Capital Spending Reduction
– Even during the low interest decade, Hitachi Maxell Ltd 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 Audio & Video Equipment industry using digital technology.
High dependence on Hitachi Maxell Ltd ‘s star products
– The top 2 products and services of Hitachi Maxell Ltd still accounts for major business revenue. This dependence on star products in Audio & Video Equipment industry has resulted into insufficient focus on developing new products, even though Hitachi Maxell Ltd has relatively successful track record of launching new products.
Hitachi Maxell Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Hitachi Maxell Ltd are -
Use of Bitcoin and other crypto currencies for transactions in Audio & Video Equipment industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Hitachi Maxell Ltd in the Audio & Video Equipment industry. Now Hitachi Maxell Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hitachi Maxell Ltd 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 Hitachi Maxell Ltd to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hitachi Maxell Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Hitachi Maxell Ltd 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.
Manufacturing automation
– Hitachi Maxell Ltd can use the latest technology developments to improve its manufacturing and designing process in Audio & Video Equipment 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hitachi Maxell Ltd 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 Hitachi Maxell Ltd to hire the very best people irrespective of their geographical location.
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 Hitachi Maxell Ltd 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.
Using analytics as competitive advantage
– Hitachi Maxell Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Audio & Video Equipment sector. This continuous investment in analytics has enabled Hitachi Maxell Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hitachi Maxell Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Hitachi Maxell Ltd can improve the customer journey of consumers in the Audio & Video Equipment 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 Hitachi Maxell Ltd to increase its market reach. Hitachi Maxell Ltd 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.
Learning at scale
– Online learning technologies has now opened space for Hitachi Maxell Ltd 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Audio & Video Equipment industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hitachi Maxell Ltd 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. Hitachi Maxell Ltd 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Audio & Video Equipment industry, but it has also influenced the consumer preferences. Hitachi Maxell Ltd can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Hitachi Maxell Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Hitachi Maxell Ltd 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.
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. Hitachi Maxell Ltd needs to understand the core reasons impacting the Audio & Video Equipment industry. This will help it in building a better workplace.
Increasing wage structure of Hitachi Maxell Ltd
– 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 Hitachi Maxell Ltd.
Technology acceleration in Forth Industrial Revolution
– Hitachi Maxell Ltd has witnessed rapid integration of technology during Covid-19 in the Audio & Video Equipment industry. As one of the leading players in the industry, Hitachi Maxell Ltd needs to keep up with the evolution of technology in the Audio & Video Equipment sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Stagnating economy with rate increase
– Hitachi Maxell Ltd 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 Audio & Video Equipment industry.
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 Hitachi Maxell Ltd business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Hitachi Maxell Ltd 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. Hitachi Maxell Ltd can take advantage of this fund but it will also bring new competitors in the Audio & Video Equipment industry.
Regulatory challenges
– Hitachi Maxell Ltd needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Audio & Video Equipment industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Audio & Video Equipment industry are lowering. It can presents Hitachi Maxell Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Audio & Video Equipment sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hitachi Maxell Ltd in Audio & Video Equipment industry. The Audio & Video Equipment 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.
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 Hitachi Maxell Ltd.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hitachi Maxell Ltd 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 Hitachi Maxell Ltd prominent markets.
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.
Weighted SWOT Analysis of Hitachi Maxell Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Hitachi Maxell Ltd 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 Hitachi Maxell Ltd 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 Hitachi Maxell Ltd 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 Hitachi Maxell Ltd 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 Hitachi Maxell Ltd needs to make to build a sustainable competitive advantage.