SWOT Analysis / TOWS Matrix for Kawai Musical Instruments (Japan)
Based on various researches at Oak Spring University , Kawai Musical Instruments is operating in a macro-environment that has been destablized by – increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, increasing commodity prices,
increasing energy prices, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Kawai Musical Instruments
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kawai Musical Instruments can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kawai Musical Instruments, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kawai Musical Instruments 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 Kawai Musical Instruments can be done for the following purposes –
1. Strategic planning of Kawai Musical Instruments
2. Improving business portfolio management of Kawai Musical Instruments
3. Assessing feasibility of the new initiative in Japan
4. Making a Recreational Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kawai Musical Instruments
Strengths of Kawai Musical Instruments | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kawai Musical Instruments are -
Strong track record of project management in the Recreational Products industry
– Kawai Musical Instruments is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Kawai Musical Instruments 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 Kawai Musical Instruments is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Kawai Musical Instruments emphasize – knowledge, initiative, and innovation.
High brand equity
– Kawai Musical Instruments has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kawai Musical Instruments to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Recreational Products industry
– Kawai Musical Instruments has clearly differentiated products in the market place. This has enabled Kawai Musical Instruments to fetch slight price premium compare to the competitors in the Recreational Products industry. The sustainable margins have also helped Kawai Musical Instruments to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Kawai Musical Instruments 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.
Successful track record of launching new products
– Kawai Musical Instruments has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kawai Musical Instruments 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 Kawai Musical Instruments in Recreational Products industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Kawai Musical Instruments is present in almost all the verticals within the Recreational Products industry. This has provided Kawai Musical Instruments 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.
Operational resilience
– The operational resilience strategy of Kawai Musical Instruments comprises – understanding the underlying the factors in the Recreational Products 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.
Ability to recruit top talent
– Kawai Musical Instruments is one of the leading players in the Recreational Products 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 Recreational Products
– Kawai Musical Instruments is one of the leading players in the Recreational Products industry in Japan. Over the years it has not only transformed the business landscape in the Recreational Products industry in Japan but also across the existing markets. The ability to lead change has enabled Kawai Musical Instruments in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Kawai Musical Instruments has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Kawai Musical Instruments staying ahead in the Recreational Products industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of Kawai Musical Instruments | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kawai Musical Instruments are -
Lack of clear differentiation of Kawai Musical Instruments products
– To increase the profitability and margins on the products, Kawai Musical Instruments needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative at Kawai Musical Instruments, in the dynamic environment of Recreational Products industry it has struggled to respond to the nimble upstart competition. Kawai Musical Instruments has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ less understanding of Kawai Musical Instruments strategy
– From the outside it seems that the employees of Kawai Musical Instruments 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.
Slow to strategic competitive environment developments
– As Kawai Musical Instruments is one of the leading players in the Recreational Products industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Recreational Products industry in last five years.
Increasing silos among functional specialists
– The organizational structure of Kawai Musical Instruments is dominated by functional specialists. It is not different from other players in the Recreational Products industry, but Kawai Musical Instruments needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kawai Musical Instruments to focus more on services in the Recreational Products industry rather than just following the product oriented approach.
High dependence on Kawai Musical Instruments ‘s star products
– The top 2 products and services of Kawai Musical Instruments still accounts for major business revenue. This dependence on star products in Recreational Products industry has resulted into insufficient focus on developing new products, even though Kawai Musical Instruments has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, Kawai Musical Instruments has high operating costs in the Recreational Products industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Kawai Musical Instruments lucrative customers.
Skills based hiring in Recreational Products industry
– The stress on hiring functional specialists at Kawai Musical Instruments 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kawai Musical Instruments is slow explore the new channels of communication. These new channels of communication can help Kawai Musical Instruments to provide better information regarding Recreational Products products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Kawai Musical Instruments has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Slow decision making process
– As mentioned earlier in the report, Kawai Musical Instruments has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Recreational Products industry over the last five years. Kawai Musical Instruments 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.
Kawai Musical Instruments Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Kawai Musical Instruments are -
Creating value in data economy
– The success of analytics program of Kawai Musical Instruments has opened avenues for new revenue streams for the organization in Recreational Products industry. This can help Kawai Musical Instruments to build a more holistic ecosystem for Kawai Musical Instruments products in the Recreational Products industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Kawai Musical Instruments 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.
Better consumer reach
– The expansion of the 5G network will help Kawai Musical Instruments to increase its market reach. Kawai Musical Instruments 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 Recreational Products industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Kawai Musical Instruments 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. Kawai Musical Instruments 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, Kawai Musical Instruments can use these opportunities to build new business models that can help the communities that Kawai Musical Instruments operates in. Secondly it can use opportunities from government spending in Recreational Products sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kawai Musical Instruments is facing challenges because of the dominance of functional experts in the organization. Kawai Musical Instruments can utilize new technology in the field of Recreational Products industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kawai Musical Instruments 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 Kawai Musical Instruments 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 Kawai Musical Instruments can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Kawai Musical Instruments 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.
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. Kawai Musical Instruments can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Kawai Musical Instruments 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.
Use of Bitcoin and other crypto currencies for transactions in Recreational Products industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Kawai Musical Instruments in the Recreational Products industry. Now Kawai Musical Instruments can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Recreational Products industry, but it has also influenced the consumer preferences. Kawai Musical Instruments can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Kawai Musical Instruments External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Kawai Musical Instruments are -
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 Kawai Musical Instruments in the Recreational Products sector and impact the bottomline 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. Kawai Musical Instruments needs to understand the core reasons impacting the Recreational Products industry. This will help it in building a better workplace.
Environmental challenges
– Kawai Musical Instruments 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. Kawai Musical Instruments can take advantage of this fund but it will also bring new competitors in the Recreational Products industry.
Regulatory challenges
– Kawai Musical Instruments 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 Recreational Products industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Kawai Musical Instruments may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Recreational Products sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kawai Musical Instruments in Recreational Products industry. The Recreational Products 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.
Stagnating economy with rate increase
– Kawai Musical Instruments 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 Recreational Products industry.
Technology acceleration in Forth Industrial Revolution
– Kawai Musical Instruments has witnessed rapid integration of technology during Covid-19 in the Recreational Products industry. As one of the leading players in the industry, Kawai Musical Instruments needs to keep up with the evolution of technology in the Recreational Products 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Recreational Products industry are lowering. It can presents Kawai Musical Instruments with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Recreational Products sector.
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.
Increasing wage structure of Kawai Musical Instruments
– 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 Kawai Musical Instruments.
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.
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 Kawai Musical Instruments.
Weighted SWOT Analysis of Kawai Musical Instruments Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Kawai Musical Instruments 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 Kawai Musical Instruments 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 Kawai Musical Instruments 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 Kawai Musical Instruments 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 Kawai Musical Instruments needs to make to build a sustainable competitive advantage.