Toyo Business Engineering (4828) SWOT Analysis / TOWS Matrix / MBA Resources
Computer Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Toyo Business Engineering (Japan)
Based on various researches at Oak Spring University , Toyo Business Engineering is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, there is backlash against globalization, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, wage bills are increasing,
talent flight as more people leaving formal jobs, technology disruption, etc
Introduction to SWOT Analysis of Toyo Business Engineering
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Toyo Business Engineering can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Toyo Business Engineering, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Toyo Business Engineering 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 Toyo Business Engineering can be done for the following purposes –
1. Strategic planning of Toyo Business Engineering
2. Improving business portfolio management of Toyo Business Engineering
3. Assessing feasibility of the new initiative in Japan
4. Making a Computer Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Toyo Business Engineering
Strengths of Toyo Business Engineering | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Toyo Business Engineering are -
Effective Research and Development (R&D)
– Toyo Business Engineering has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Toyo Business Engineering staying ahead in the Computer Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Toyo Business Engineering
– The covid-19 pandemic has put organizational resilience at the centre of everthing Toyo Business Engineering does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Computer Services industry
– Toyo Business Engineering has clearly differentiated products in the market place. This has enabled Toyo Business Engineering to fetch slight price premium compare to the competitors in the Computer Services industry. The sustainable margins have also helped Toyo Business Engineering to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Toyo Business Engineering 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.
Superior customer experience
– The customer experience strategy of Toyo Business Engineering in Computer Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Toyo Business Engineering has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Computer Services industry. Secondly the value chain collaborators of Toyo Business Engineering have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Toyo Business Engineering is one of the leading players in the Computer Services 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.
Learning organization
- Toyo Business Engineering 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 Business Engineering is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Toyo Business Engineering emphasize – knowledge, initiative, and innovation.
Ability to lead change in Computer Services
– Toyo Business Engineering is one of the leading players in the Computer Services industry in Japan. Over the years it has not only transformed the business landscape in the Computer Services industry in Japan but also across the existing markets. The ability to lead change has enabled Toyo Business Engineering in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Toyo Business Engineering has one of the best training and development program in Technology 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.
Strong track record of project management in the Computer Services industry
– Toyo Business Engineering is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Toyo Business Engineering in the Technology sector have low bargaining power. Toyo Business Engineering has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Toyo Business Engineering to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses of Toyo Business Engineering | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Toyo Business Engineering are -
Employees’ less understanding of Toyo Business Engineering strategy
– From the outside it seems that the employees of Toyo Business Engineering 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.
Capital Spending Reduction
– Even during the low interest decade, Toyo Business Engineering 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 Computer Services 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 Toyo Business Engineering supply chain. Even after few cautionary changes, Toyo Business Engineering is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Toyo Business Engineering vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Toyo Business Engineering has a high cash cycle compare to other players in the Computer Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Low market penetration in new markets
– Outside its home market of Japan, Toyo Business Engineering needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Toyo Business Engineering is dominated by functional specialists. It is not different from other players in the Computer Services industry, but Toyo Business Engineering needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Toyo Business Engineering to focus more on services in the Computer Services industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Toyo Business Engineering is one of the leading players in the Computer Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Computer Services industry in last five years.
Ability to respond to the competition
– As the decision making is very deliberative at Toyo Business Engineering, in the dynamic environment of Computer Services industry it has struggled to respond to the nimble upstart competition. Toyo Business Engineering has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Toyo Business Engineering has some of the most successful models in the Computer Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Toyo Business Engineering should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, Toyo Business Engineering has high operating costs in the Computer Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Toyo Business Engineering lucrative customers.
Compensation and incentives
– The revenue per employee of Toyo Business Engineering is just above the Computer Services industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Toyo Business Engineering Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Toyo Business Engineering are -
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. Toyo Business Engineering can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Computer Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Toyo Business Engineering 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. Toyo Business Engineering 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.
Building a culture of innovation
– managers at Toyo Business Engineering 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 Computer Services industry.
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 Business Engineering 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Toyo Business Engineering 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Toyo Business Engineering can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Toyo Business Engineering 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.
Learning at scale
– Online learning technologies has now opened space for Toyo Business Engineering 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.
Better consumer reach
– The expansion of the 5G network will help Toyo Business Engineering to increase its market reach. Toyo Business Engineering 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Toyo Business Engineering in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Computer Services industry, and it will provide faster access to the consumers.
Buying journey improvements
– Toyo Business Engineering can improve the customer journey of consumers in the Computer Services industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Developing new processes and practices
– Toyo Business Engineering can develop new processes and procedures in Computer Services industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Use of Bitcoin and other crypto currencies for transactions in Computer Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Toyo Business Engineering in the Computer Services industry. Now Toyo Business Engineering can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Toyo Business Engineering External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Toyo Business Engineering are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Toyo Business Engineering in Computer Services industry. The Computer Services industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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 Business Engineering.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Computer Services industry are lowering. It can presents Toyo Business Engineering with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Computer Services sector.
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 Business Engineering 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.
Regulatory challenges
– Toyo Business Engineering 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 Computer Services industry regulations.
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.
Technology acceleration in Forth Industrial Revolution
– Toyo Business Engineering has witnessed rapid integration of technology during Covid-19 in the Computer Services industry. As one of the leading players in the industry, Toyo Business Engineering needs to keep up with the evolution of technology in the Computer Services sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
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 Business Engineering needs to understand the core reasons impacting the Computer Services industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Toyo Business Engineering 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 Toyo Business Engineering prominent markets.
Stagnating economy with rate increase
– Toyo Business Engineering 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 Computer Services industry.
Easy access to finance
– Easy access to finance in Computer Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Toyo Business Engineering can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Toyo Business Engineering may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Computer Services sector.
Environmental challenges
– Toyo Business Engineering 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 Business Engineering can take advantage of this fund but it will also bring new competitors in the Computer Services industry.
Weighted SWOT Analysis of Toyo Business Engineering Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Toyo Business Engineering 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 Business Engineering 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 Business Engineering 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 Business Engineering 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 Business Engineering needs to make to build a sustainable competitive advantage.