Naigai Trans Line (9384) SWOT Analysis / TOWS Matrix / MBA Resources
Water Transportation
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Naigai Trans Line (Japan)
Based on various researches at Oak Spring University , Naigai Trans Line is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, increasing commodity prices, cloud computing is disrupting traditional business models,
technology disruption, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Naigai Trans Line
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Naigai Trans Line can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Naigai Trans Line, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Naigai Trans Line 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 Naigai Trans Line can be done for the following purposes –
1. Strategic planning of Naigai Trans Line
2. Improving business portfolio management of Naigai Trans Line
3. Assessing feasibility of the new initiative in Japan
4. Making a Water Transportation sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Naigai Trans Line
Strengths of Naigai Trans Line | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Naigai Trans Line are -
Low bargaining power of suppliers
– Suppliers of Naigai Trans Line in the Transportation sector have low bargaining power. Naigai Trans Line has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Naigai Trans Line to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Naigai Trans Line in Water Transportation industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Naigai Trans Line 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.
Effective Research and Development (R&D)
– Naigai Trans Line has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Naigai Trans Line staying ahead in the Water Transportation industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Naigai Trans Line is present in almost all the verticals within the Water Transportation industry. This has provided Naigai Trans Line 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 Naigai Trans Line comprises – understanding the underlying the factors in the Water Transportation 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.
Digital Transformation in Water Transportation industry
- digital transformation varies from industry to industry. For Naigai Trans Line digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Naigai Trans Line 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.
Organizational Resilience of Naigai Trans Line
– The covid-19 pandemic has put organizational resilience at the centre of everthing Naigai Trans Line does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Naigai Trans Line is one of the most innovative firm in Water Transportation sector.
Ability to recruit top talent
– Naigai Trans Line is one of the leading players in the Water Transportation 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.
Successful track record of launching new products
– Naigai Trans Line has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Naigai Trans Line 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.
Cross disciplinary teams
– Horizontal connected teams at the Naigai Trans Line 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.
Weaknesses of Naigai Trans Line | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Naigai Trans Line are -
No frontier risks strategy
– From the 10K / annual statement of Naigai Trans Line, it seems that company is thinking out the frontier risks that can impact Water Transportation 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.
Aligning sales with marketing
– From the outside it seems that Naigai Trans Line needs to have more collaboration between its sales team and marketing team. Sales professionals in the Water Transportation industry have deep experience in developing customer relationships. Marketing department at Naigai Trans Line can leverage the sales team experience to cultivate customer relationships as Naigai Trans Line is planning to shift buying processes online.
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 Naigai Trans Line supply chain. Even after few cautionary changes, Naigai Trans Line is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Naigai Trans Line vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Naigai Trans Line has a high cash cycle compare to other players in the Water Transportation industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Interest costs
– Compare to the competition, Naigai Trans Line 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, Naigai Trans Line has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Water Transportation industry over the last five years. Naigai Trans Line 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.
Low market penetration in new markets
– Outside its home market of Japan, Naigai Trans Line needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Compensation and incentives
– The revenue per employee of Naigai Trans Line is just above the Water Transportation 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 Naigai Trans Line ‘s star products
– The top 2 products and services of Naigai Trans Line still accounts for major business revenue. This dependence on star products in Water Transportation industry has resulted into insufficient focus on developing new products, even though Naigai Trans Line has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative at Naigai Trans Line, in the dynamic environment of Water Transportation industry it has struggled to respond to the nimble upstart competition. Naigai Trans Line has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring in Water Transportation industry
– The stress on hiring functional specialists at Naigai Trans Line 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.
Naigai Trans Line Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Naigai Trans Line are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Naigai Trans Line is facing challenges because of the dominance of functional experts in the organization. Naigai Trans Line can utilize new technology in the field of Water Transportation industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, 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, Naigai Trans Line can use these opportunities to build new business models that can help the communities that Naigai Trans Line operates in. Secondly it can use opportunities from government spending in Water Transportation sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Naigai Trans Line can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Naigai Trans Line in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Water Transportation industry, and it will provide faster access to the consumers.
Learning at scale
– Online learning technologies has now opened space for Naigai Trans Line 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.
Loyalty marketing
– Naigai Trans Line 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.
Developing new processes and practices
– Naigai Trans Line can develop new processes and procedures in Water Transportation 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.
Building a culture of innovation
– managers at Naigai Trans Line 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 Water Transportation industry.
Creating value in data economy
– The success of analytics program of Naigai Trans Line has opened avenues for new revenue streams for the organization in Water Transportation industry. This can help Naigai Trans Line to build a more holistic ecosystem for Naigai Trans Line products in the Water Transportation industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Naigai Trans Line can use the latest technology developments to improve its manufacturing and designing process in Water Transportation 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.
Buying journey improvements
– Naigai Trans Line can improve the customer journey of consumers in the Water Transportation 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Naigai Trans Line 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 Naigai Trans Line to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Naigai Trans Line to increase its market reach. Naigai Trans Line 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.
Threats Naigai Trans Line External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Naigai Trans Line are -
High dependence on third party suppliers
– Naigai Trans Line 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.
Regulatory challenges
– Naigai Trans Line 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 Water Transportation industry regulations.
Stagnating economy with rate increase
– Naigai Trans Line 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 Water Transportation industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Naigai Trans Line in Water Transportation industry. The Water Transportation 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.
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 Naigai Trans Line business can come under increasing regulations regarding data privacy, data security, etc.
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 Naigai Trans Line
– 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 Naigai Trans Line.
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. Naigai Trans Line 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.
Consumer confidence and its impact on Naigai Trans Line 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 Water Transportation industry and other sectors.
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.
Easy access to finance
– Easy access to finance in Water Transportation industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Naigai Trans Line can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Naigai Trans Line is facing in Water Transportation sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Naigai Trans Line may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Water Transportation sector.
Weighted SWOT Analysis of Naigai Trans Line Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Naigai Trans Line 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 Naigai Trans Line 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 Naigai Trans Line 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 Naigai Trans Line 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 Naigai Trans Line needs to make to build a sustainable competitive advantage.