SWOT Analysis / TOWS Matrix for Taihei Dengyo Kaisha (Japan)
Based on various researches at Oak Spring University , Taihei Dengyo Kaisha is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, increasing household debt because of falling income levels,
technology disruption, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Taihei Dengyo Kaisha
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Taihei Dengyo Kaisha can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Taihei Dengyo Kaisha, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha can be done for the following purposes –
1. Strategic planning of Taihei Dengyo Kaisha
2. Improving business portfolio management of Taihei Dengyo Kaisha
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 Taihei Dengyo Kaisha
Strengths of Taihei Dengyo Kaisha | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Taihei Dengyo Kaisha are -
Diverse revenue streams
– Taihei Dengyo Kaisha is present in almost all the verticals within the Business Services industry. This has provided Taihei Dengyo Kaisha 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.
Highly skilled collaborators
– Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Taihei Dengyo Kaisha has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Taihei Dengyo Kaisha 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.
Successful track record of launching new products
– Taihei Dengyo Kaisha has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Taihei Dengyo Kaisha 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.
Operational resilience
– The operational resilience strategy of Taihei Dengyo Kaisha 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.
Learning organization
- Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Taihei Dengyo Kaisha emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Business Services industry
– Taihei Dengyo Kaisha has clearly differentiated products in the market place. This has enabled Taihei Dengyo Kaisha to fetch slight price premium compare to the competitors in the Business Services industry. The sustainable margins have also helped Taihei Dengyo Kaisha to invest into research and development (R&D) and innovation.
Training and development
– Taihei Dengyo Kaisha has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Ability to lead change in Business Services
– Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha 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
– Taihei Dengyo Kaisha is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Taihei Dengyo Kaisha 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.
Weaknesses of Taihei Dengyo Kaisha | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Taihei Dengyo Kaisha are -
Skills based hiring in Business Services industry
– The stress on hiring functional specialists at Taihei Dengyo Kaisha 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.
Aligning sales with marketing
– From the outside it seems that Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha can leverage the sales team experience to cultivate customer relationships as Taihei Dengyo Kaisha is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative at Taihei Dengyo Kaisha, in the dynamic environment of Business Services industry it has struggled to respond to the nimble upstart competition. Taihei Dengyo Kaisha has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Taihei Dengyo Kaisha is slow explore the new channels of communication. These new channels of communication can help Taihei Dengyo Kaisha to provide better information regarding Business Services products and services. It can also build an online community to further reach out to potential customers.
Employees’ less understanding of Taihei Dengyo Kaisha strategy
– From the outside it seems that the employees of Taihei Dengyo Kaisha 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.
No frontier risks strategy
– From the 10K / annual statement of Taihei Dengyo Kaisha, 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.
Slow to strategic competitive environment developments
– As Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha 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.
High dependence on Taihei Dengyo Kaisha ‘s star products
– The top 2 products and services of Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the Business Services industry, Taihei Dengyo Kaisha 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.
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 Taihei Dengyo Kaisha supply chain. Even after few cautionary changes, Taihei Dengyo Kaisha is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Taihei Dengyo Kaisha vulnerable to further global disruptions in South East Asia.
Taihei Dengyo Kaisha Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Taihei Dengyo Kaisha are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Taihei Dengyo Kaisha 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
– Taihei Dengyo Kaisha can improve the customer journey of consumers in the Business Services 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.
Developing new processes and practices
– Taihei Dengyo Kaisha 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.
Learning at scale
– Online learning technologies has now opened space for Taihei Dengyo Kaisha 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 Business Services industry, but it has also influenced the consumer preferences. Taihei Dengyo Kaisha can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Taihei Dengyo Kaisha 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. Taihei Dengyo Kaisha 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Taihei Dengyo Kaisha can use these opportunities to build new business models that can help the communities that Taihei Dengyo Kaisha operates in. Secondly it can use opportunities from government spending in Business Services sector.
Building a culture of innovation
– managers at Taihei Dengyo Kaisha 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.
Creating value in data economy
– The success of analytics program of Taihei Dengyo Kaisha has opened avenues for new revenue streams for the organization in Business Services industry. This can help Taihei Dengyo Kaisha to build a more holistic ecosystem for Taihei Dengyo Kaisha products in the Business Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Taihei Dengyo Kaisha can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Taihei Dengyo Kaisha 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
– Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha to build a competitive advantage using analytics. The analytics driven competitive advantage can help Taihei Dengyo Kaisha to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Taihei Dengyo Kaisha External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Taihei Dengyo Kaisha are -
Regulatory challenges
– Taihei Dengyo Kaisha 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 Business Services industry regulations.
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 Taihei Dengyo Kaisha in the Business Services sector and impact the bottomline of the organization.
Consumer confidence and its impact on Taihei Dengyo Kaisha 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Taihei Dengyo Kaisha 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha prominent markets.
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 Taihei Dengyo Kaisha.
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 Taihei Dengyo Kaisha business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Taihei Dengyo Kaisha
– 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 Taihei Dengyo Kaisha.
Environmental challenges
– Taihei Dengyo Kaisha 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. Taihei Dengyo Kaisha can take advantage of this fund but it will also bring new competitors in the Business Services industry.
Technology acceleration in Forth Industrial Revolution
– Taihei Dengyo Kaisha has witnessed rapid integration of technology during Covid-19 in the Business Services industry. As one of the leading players in the industry, Taihei Dengyo Kaisha needs to keep up with the evolution of technology in the Business Services 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
– Taihei Dengyo Kaisha 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 Business Services 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. Taihei Dengyo Kaisha 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.
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.
Weighted SWOT Analysis of Taihei Dengyo Kaisha Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha 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 Taihei Dengyo Kaisha needs to make to build a sustainable competitive advantage.