WDB Holdings Co Ltd (2475) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for WDB Holdings Co Ltd (Japan)

Based on various researches at Oak Spring University , WDB Holdings Co Ltd is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, etc

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Introduction to SWOT Analysis of WDB Holdings Co Ltd

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that WDB Holdings Co Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the WDB Holdings Co Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which WDB Holdings Co 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of WDB Holdings Co Ltd can be done for the following purposes –
1. Strategic planning of WDB Holdings Co Ltd
2. Improving business portfolio management of WDB Holdings Co Ltd
3. Assessing feasibility of the new initiative in Japan
4. Making a Business Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of WDB Holdings Co Ltd

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Strengths of WDB Holdings Co Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of WDB Holdings Co Ltd are -

High brand equity

– WDB Holdings Co Ltd has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled WDB Holdings Co Ltd to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Operational resilience

– The operational resilience strategy of WDB Holdings Co Ltd comprises – understanding the underlying the factors in the Business Services 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.

Analytics focus

– WDB Holdings Co Ltd is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Business Services industry. The technology infrastructure of Japan is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.

Digital Transformation in Business Services industry

- digital transformation varies from industry to industry. For WDB Holdings Co Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. WDB Holdings Co 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.

Highly skilled collaborators

– WDB Holdings Co Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Business Services industry. Secondly the value chain collaborators of WDB Holdings Co Ltd have helped the firm to develop new products and bring them quickly to the marketplace.

Sustainable margins compare to other players in Business Services industry

– WDB Holdings Co Ltd has clearly differentiated products in the market place. This has enabled WDB Holdings Co Ltd to fetch slight price premium compare to the competitors in the Business Services industry. The sustainable margins have also helped WDB Holdings Co Ltd to invest into research and development (R&D) and innovation.

Ability to lead change in Business Services

– WDB Holdings Co Ltd is one of the leading players in the Business Services industry in Japan. Over the years it has not only transformed the business landscape in the Business Services industry in Japan but also across the existing markets. The ability to lead change has enabled WDB Holdings Co Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Cross disciplinary teams

– Horizontal connected teams at the WDB Holdings Co 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.

Strong track record of project management in the Business Services industry

– WDB Holdings Co 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.

Ability to recruit top talent

– WDB Holdings Co Ltd is one of the leading players in the Business Services 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.

Effective Research and Development (R&D)

– WDB Holdings Co Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – WDB Holdings Co Ltd staying ahead in the Business Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Organizational Resilience of WDB Holdings Co Ltd

– The covid-19 pandemic has put organizational resilience at the centre of everthing WDB Holdings Co Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

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Weaknesses of WDB Holdings Co Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of WDB Holdings Co Ltd are -

Ability to respond to the competition

– As the decision making is very deliberative at WDB Holdings Co Ltd, in the dynamic environment of Business Services industry it has struggled to respond to the nimble upstart competition. WDB Holdings Co Ltd has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Skills based hiring in Business Services industry

– The stress on hiring functional specialists at WDB Holdings Co Ltd 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.

No frontier risks strategy

– From the 10K / annual statement of WDB Holdings Co Ltd, it seems that company is thinking out the frontier risks that can impact Business Services industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.

Need for greater diversity

– WDB Holdings Co Ltd 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 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 WDB Holdings Co Ltd supply chain. Even after few cautionary changes, WDB Holdings Co Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left WDB Holdings Co Ltd vulnerable to further global disruptions in South East Asia.

Slow to strategic competitive environment developments

– As WDB Holdings Co Ltd is one of the leading players in the Business Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Business Services industry in last five years.

Compensation and incentives

– The revenue per employee of WDB Holdings Co Ltd is just above the Business Services industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.

Aligning sales with marketing

– From the outside it seems that WDB Holdings Co Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Business Services industry have deep experience in developing customer relationships. Marketing department at WDB Holdings Co Ltd can leverage the sales team experience to cultivate customer relationships as WDB Holdings Co Ltd is planning to shift buying processes online.

Increasing silos among functional specialists

– The organizational structure of WDB Holdings Co Ltd is dominated by functional specialists. It is not different from other players in the Business Services industry, but WDB Holdings Co Ltd needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help WDB Holdings Co Ltd to focus more on services in the Business Services industry rather than just following the product oriented approach.

High dependence on WDB Holdings Co Ltd ‘s star products

– The top 2 products and services of WDB Holdings Co Ltd still accounts for major business revenue. This dependence on star products in Business Services industry has resulted into insufficient focus on developing new products, even though WDB Holdings Co Ltd has relatively successful track record of launching new products.

High bargaining power of channel partners in Business Services industry

– because of the regulatory requirements in Japan, WDB Holdings Co Ltd 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 Business Services industry.

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WDB Holdings Co Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of WDB Holdings Co Ltd are -

Building a culture of innovation

– managers at WDB Holdings Co Ltd 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 Business Services industry.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Business Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. WDB Holdings Co 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. WDB Holdings Co 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.

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 WDB Holdings Co 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.

Leveraging digital technologies

– WDB Holdings Co Ltd can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.

Using analytics as competitive advantage

– WDB Holdings Co Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Business Services sector. This continuous investment in analytics has enabled WDB Holdings Co Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help WDB Holdings Co Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for WDB Holdings Co 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 WDB Holdings Co Ltd to hire the very best people irrespective of their geographical location.

Learning at scale

– Online learning technologies has now opened space for WDB Holdings Co 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, WDB Holdings Co Ltd 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, WDB Holdings Co Ltd is facing challenges because of the dominance of functional experts in the organization. WDB Holdings Co Ltd can utilize new technology in the field of Business Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Better consumer reach

– The expansion of the 5G network will help WDB Holdings Co Ltd to increase its market reach. WDB Holdings Co 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, WDB Holdings Co 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 WDB Holdings Co 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.

Developing new processes and practices

– WDB Holdings Co Ltd can develop new processes and procedures in Business Services industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects WDB Holdings Co Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

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Threats WDB Holdings Co Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of WDB Holdings Co Ltd are -

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, WDB Holdings Co 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 WDB Holdings Co Ltd prominent markets.

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. WDB Holdings Co Ltd 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.

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 WDB Holdings Co Ltd business can come under increasing regulations regarding data privacy, data security, etc.

Easy access to finance

– Easy access to finance in Business Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. WDB Holdings Co Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Business Services industry are lowering. It can presents WDB Holdings Co Ltd with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Business Services sector.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for WDB Holdings Co Ltd in Business Services industry. The Business Services 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 WDB Holdings Co Ltd in the Business Services sector and impact the bottomline of the organization.

Increasing wage structure of WDB Holdings Co 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 WDB Holdings Co Ltd.

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 WDB Holdings Co Ltd.

Shortening product life cycle

– it is one of the major threat that WDB Holdings Co Ltd is facing in Business Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

High dependence on third party suppliers

– WDB Holdings Co Ltd 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.

Consumer confidence and its impact on WDB Holdings Co Ltd 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 Business Services 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.

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Weighted SWOT Analysis of WDB Holdings Co Ltd Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at WDB Holdings Co 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 WDB Holdings Co 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 WDB Holdings Co 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 WDB Holdings Co 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 WDB Holdings Co Ltd needs to make to build a sustainable competitive advantage.

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