Fujishoji (6257) SWOT Analysis / TOWS Matrix / MBA Resources
Casinos & Gaming
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Fujishoji (Japan)
Based on various researches at Oak Spring University , Fujishoji is operating in a macro-environment that has been destablized by – banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, increasing commodity prices, talent flight as more people leaving formal jobs, wage bills are increasing,
competitive advantages are harder to sustain because of technology dispersion, there is increasing trade war between United States & China, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Fujishoji can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Fujishoji, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Fujishoji 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 Fujishoji can be done for the following purposes –
1. Strategic planning of Fujishoji
2. Improving business portfolio management of Fujishoji
3. Assessing feasibility of the new initiative in Japan
4. Making a Casinos & Gaming sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Fujishoji
Strengths of Fujishoji | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Fujishoji are -
Operational resilience
– The operational resilience strategy of Fujishoji comprises – understanding the underlying the factors in the Casinos & Gaming industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Sustainable margins compare to other players in Casinos & Gaming industry
– Fujishoji has clearly differentiated products in the market place. This has enabled Fujishoji to fetch slight price premium compare to the competitors in the Casinos & Gaming industry. The sustainable margins have also helped Fujishoji to invest into research and development (R&D) and innovation.
Ability to lead change in Casinos & Gaming
– Fujishoji is one of the leading players in the Casinos & Gaming industry in Japan. Over the years it has not only transformed the business landscape in the Casinos & Gaming industry in Japan but also across the existing markets. The ability to lead change has enabled Fujishoji in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Casinos & Gaming industry
- digital transformation varies from industry to industry. For Fujishoji digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Fujishoji 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
– Fujishoji has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Casinos & Gaming industry. Secondly the value chain collaborators of Fujishoji have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Fujishoji 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 Casinos & Gaming 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.
Cross disciplinary teams
– Horizontal connected teams at the Fujishoji 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.
Low bargaining power of suppliers
– Suppliers of Fujishoji in the Services sector have low bargaining power. Fujishoji has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Fujishoji to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Fujishoji 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.
Successful track record of launching new products
– Fujishoji has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Fujishoji 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.
Ability to recruit top talent
– Fujishoji is one of the leading players in the Casinos & Gaming 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.
High brand equity
– Fujishoji has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Fujishoji to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of Fujishoji | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Fujishoji are -
High operating costs
– Compare to the competitors, Fujishoji has high operating costs in the Casinos & Gaming industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Fujishoji lucrative customers.
Compensation and incentives
– The revenue per employee of Fujishoji is just above the Casinos & Gaming 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.
Ability to respond to the competition
– As the decision making is very deliberative at Fujishoji, in the dynamic environment of Casinos & Gaming industry it has struggled to respond to the nimble upstart competition. Fujishoji has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Fujishoji has a high cash cycle compare to other players in the Casinos & Gaming industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Lack of clear differentiation of Fujishoji products
– To increase the profitability and margins on the products, Fujishoji needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of Japan, Fujishoji needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the Casinos & Gaming industry, Fujishoji 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.
Capital Spending Reduction
– Even during the low interest decade, Fujishoji 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 Casinos & Gaming industry using digital technology.
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 Fujishoji supply chain. Even after few cautionary changes, Fujishoji is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Fujishoji vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Fujishoji is dominated by functional specialists. It is not different from other players in the Casinos & Gaming industry, but Fujishoji needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Fujishoji to focus more on services in the Casinos & Gaming industry rather than just following the product oriented approach.
Aligning sales with marketing
– From the outside it seems that Fujishoji needs to have more collaboration between its sales team and marketing team. Sales professionals in the Casinos & Gaming industry have deep experience in developing customer relationships. Marketing department at Fujishoji can leverage the sales team experience to cultivate customer relationships as Fujishoji is planning to shift buying processes online.
Fujishoji Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Fujishoji are -
Developing new processes and practices
– Fujishoji can develop new processes and procedures in Casinos & Gaming 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Fujishoji can use these opportunities to build new business models that can help the communities that Fujishoji operates in. Secondly it can use opportunities from government spending in Casinos & Gaming sector.
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. Fujishoji can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Fujishoji 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
– Fujishoji can use the latest technology developments to improve its manufacturing and designing process in Casinos & Gaming 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Fujishoji can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Fujishoji has opened avenues for new revenue streams for the organization in Casinos & Gaming industry. This can help Fujishoji to build a more holistic ecosystem for Fujishoji products in the Casinos & Gaming industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Fujishoji can improve the customer journey of consumers in the Casinos & Gaming 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.
Building a culture of innovation
– managers at Fujishoji 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 Casinos & Gaming industry.
Low interest rates
– Even though inflation is raising its head in most developed economies, Fujishoji 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Fujishoji 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 Fujishoji to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Casinos & Gaming industry, but it has also influenced the consumer preferences. Fujishoji can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Fujishoji has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Casinos & Gaming sector. This continuous investment in analytics has enabled Fujishoji to build a competitive advantage using analytics. The analytics driven competitive advantage can help Fujishoji to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Fujishoji External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Fujishoji are -
Shortening product life cycle
– it is one of the major threat that Fujishoji is facing in Casinos & Gaming sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Fujishoji.
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. Fujishoji needs to understand the core reasons impacting the Casinos & Gaming industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Casinos & Gaming industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Fujishoji can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Fujishoji 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. Fujishoji can take advantage of this fund but it will also bring new competitors in the Casinos & Gaming industry.
High dependence on third party suppliers
– Fujishoji 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 Fujishoji 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 Casinos & Gaming industry and other sectors.
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 Fujishoji in the Casinos & Gaming sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Fujishoji 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 Fujishoji 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. Fujishoji 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 acceleration in Forth Industrial Revolution
– Fujishoji has witnessed rapid integration of technology during Covid-19 in the Casinos & Gaming industry. As one of the leading players in the industry, Fujishoji needs to keep up with the evolution of technology in the Casinos & Gaming 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
– Fujishoji 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 Casinos & Gaming industry.
Weighted SWOT Analysis of Fujishoji Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Fujishoji 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 Fujishoji 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 Fujishoji 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 Fujishoji 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 Fujishoji needs to make to build a sustainable competitive advantage.
