Toyo Kanetsu KK (6369) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Toyo Kanetsu KK (Japan)

Based on various researches at Oak Spring University , Toyo Kanetsu KK is operating in a macro-environment that has been destablized by – technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, increasing transportation and logistics costs, there is backlash against globalization, etc

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Introduction to SWOT Analysis of Toyo Kanetsu KK

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Toyo Kanetsu KK can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Toyo Kanetsu KK, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Toyo Kanetsu KK 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 Toyo Kanetsu KK can be done for the following purposes –
1. Strategic planning of Toyo Kanetsu KK
2. Improving business portfolio management of Toyo Kanetsu KK
3. Assessing feasibility of the new initiative in Japan
4. Making a Containers & Packaging sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Toyo Kanetsu KK

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Strengths of Toyo Kanetsu KK | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Toyo Kanetsu KK are -

Superior customer experience

– The customer experience strategy of Toyo Kanetsu KK in Containers & Packaging industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Ability to lead change in Containers & Packaging

– Toyo Kanetsu KK is one of the leading players in the Containers & Packaging industry in Japan. Over the years it has not only transformed the business landscape in the Containers & Packaging industry in Japan but also across the existing markets. The ability to lead change has enabled Toyo Kanetsu KK in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Innovation driven organization

– Toyo Kanetsu KK is one of the most innovative firm in Containers & Packaging sector.

Strong track record of project management in the Containers & Packaging industry

– Toyo Kanetsu KK is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Sustainable margins compare to other players in Containers & Packaging industry

– Toyo Kanetsu KK has clearly differentiated products in the market place. This has enabled Toyo Kanetsu KK to fetch slight price premium compare to the competitors in the Containers & Packaging industry. The sustainable margins have also helped Toyo Kanetsu KK to invest into research and development (R&D) and innovation.

Effective Research and Development (R&D)

– Toyo Kanetsu KK has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Toyo Kanetsu KK staying ahead in the Containers & Packaging 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

– Toyo Kanetsu KK has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Toyo Kanetsu KK 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.

Learning organization

- Toyo Kanetsu KK 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 Toyo Kanetsu KK is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Toyo Kanetsu KK emphasize – knowledge, initiative, and innovation.

Training and development

– Toyo Kanetsu KK has one of the best training and development program in Basic Materials 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.

Cross disciplinary teams

– Horizontal connected teams at the Toyo Kanetsu KK 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.

Operational resilience

– The operational resilience strategy of Toyo Kanetsu KK comprises – understanding the underlying the factors in the Containers & Packaging 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.

Low bargaining power of suppliers

– Suppliers of Toyo Kanetsu KK in the Basic Materials sector have low bargaining power. Toyo Kanetsu KK has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Toyo Kanetsu KK to manage not only supply disruptions but also source products at highly competitive prices.

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Weaknesses of Toyo Kanetsu KK | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Toyo Kanetsu KK are -

Need for greater diversity

– Toyo Kanetsu KK 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 operating costs

– Compare to the competitors, Toyo Kanetsu KK has high operating costs in the Containers & Packaging industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Toyo Kanetsu KK lucrative customers.

Slow to strategic competitive environment developments

– As Toyo Kanetsu KK is one of the leading players in the Containers & Packaging industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Containers & Packaging industry in last five years.

Lack of clear differentiation of Toyo Kanetsu KK products

– To increase the profitability and margins on the products, Toyo Kanetsu KK needs to provide more differentiated products than what it is currently offering in the marketplace.

Slow decision making process

– As mentioned earlier in the report, Toyo Kanetsu KK has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Containers & Packaging industry over the last five years. Toyo Kanetsu KK 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.

Ability to respond to the competition

– As the decision making is very deliberative at Toyo Kanetsu KK, in the dynamic environment of Containers & Packaging industry it has struggled to respond to the nimble upstart competition. Toyo Kanetsu KK has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Workers concerns about automation

– As automation is fast increasing in the Containers & Packaging industry, Toyo Kanetsu KK 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.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Toyo Kanetsu KK is slow explore the new channels of communication. These new channels of communication can help Toyo Kanetsu KK to provide better information regarding Containers & Packaging products and services. It can also build an online community to further reach out to potential customers.

High bargaining power of channel partners in Containers & Packaging industry

– because of the regulatory requirements in Japan, Toyo Kanetsu KK 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 Containers & Packaging industry.

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

Employees’ less understanding of Toyo Kanetsu KK strategy

– From the outside it seems that the employees of Toyo Kanetsu KK 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.

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Toyo Kanetsu KK Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Toyo Kanetsu KK are -

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Containers & Packaging industry, but it has also influenced the consumer preferences. Toyo Kanetsu KK can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Manufacturing automation

– Toyo Kanetsu KK can use the latest technology developments to improve its manufacturing and designing process in Containers & Packaging 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.

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 Toyo Kanetsu KK 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.

Developing new processes and practices

– Toyo Kanetsu KK can develop new processes and procedures in Containers & Packaging 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Toyo Kanetsu KK 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.

Using analytics as competitive advantage

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

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Toyo Kanetsu KK can use these opportunities to build new business models that can help the communities that Toyo Kanetsu KK operates in. Secondly it can use opportunities from government spending in Containers & Packaging sector.

Buying journey improvements

– Toyo Kanetsu KK can improve the customer journey of consumers in the Containers & Packaging 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Toyo Kanetsu KK is facing challenges because of the dominance of functional experts in the organization. Toyo Kanetsu KK can utilize new technology in the field of Containers & Packaging industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Use of Bitcoin and other crypto currencies for transactions in Containers & Packaging industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Toyo Kanetsu KK in the Containers & Packaging industry. Now Toyo Kanetsu KK can target international markets with far fewer capital restrictions requirements than the existing system.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Toyo Kanetsu KK 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 Toyo Kanetsu KK to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Toyo Kanetsu KK 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 Toyo Kanetsu KK to hire the very best people irrespective of their geographical location.

Better consumer reach

– The expansion of the 5G network will help Toyo Kanetsu KK to increase its market reach. Toyo Kanetsu KK 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.

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Threats Toyo Kanetsu KK External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Toyo Kanetsu KK are -

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Toyo Kanetsu KK in Containers & Packaging industry. The Containers & Packaging 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

– Toyo Kanetsu KK 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 Containers & Packaging industry.

Technology acceleration in Forth Industrial Revolution

– Toyo Kanetsu KK has witnessed rapid integration of technology during Covid-19 in the Containers & Packaging industry. As one of the leading players in the industry, Toyo Kanetsu KK needs to keep up with the evolution of technology in the Containers & Packaging 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.

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 Toyo Kanetsu KK.

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 Toyo Kanetsu KK business can come under increasing regulations regarding data privacy, data security, etc.

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. Toyo Kanetsu KK 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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Toyo Kanetsu KK may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Containers & Packaging sector.

Easy access to finance

– Easy access to finance in Containers & Packaging industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Toyo Kanetsu KK can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

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.

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. Toyo Kanetsu KK needs to understand the core reasons impacting the Containers & Packaging industry. This will help it in building a better workplace.

Shortening product life cycle

– it is one of the major threat that Toyo Kanetsu KK is facing in Containers & Packaging sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Environmental challenges

– Toyo Kanetsu KK 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. Toyo Kanetsu KK can take advantage of this fund but it will also bring new competitors in the Containers & Packaging industry.

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 Toyo Kanetsu KK in the Containers & Packaging sector and impact the bottomline of the organization.

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Weighted SWOT Analysis of Toyo Kanetsu KK Template, Example

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

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