SWOT Analysis / TOWS Matrix for Fujikura Rubber Ltd (Japan)
Based on various researches at Oak Spring University , Fujikura Rubber Ltd is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, there is increasing trade war between United States & China, geopolitical disruptions, challanges to central banks by blockchain based private currencies,
wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Fujikura Rubber Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Fujikura Rubber Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Fujikura Rubber Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Fujikura Rubber Ltd 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 Fujikura Rubber Ltd can be done for the following purposes –
1. Strategic planning of Fujikura Rubber Ltd
2. Improving business portfolio management of Fujikura Rubber Ltd
3. Assessing feasibility of the new initiative in Japan
4. Making a Fabricated Plastic & Rubber sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Fujikura Rubber Ltd
Strengths of Fujikura Rubber Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Fujikura Rubber Ltd are -
Learning organization
- Fujikura Rubber Ltd 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 Fujikura Rubber Ltd is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Fujikura Rubber Ltd emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Fabricated Plastic & Rubber industry
– Fujikura Rubber Ltd has clearly differentiated products in the market place. This has enabled Fujikura Rubber Ltd to fetch slight price premium compare to the competitors in the Fabricated Plastic & Rubber industry. The sustainable margins have also helped Fujikura Rubber Ltd to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Fujikura Rubber Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Fujikura Rubber Ltd 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.
Organizational Resilience of Fujikura Rubber Ltd
– The covid-19 pandemic has put organizational resilience at the centre of everthing Fujikura Rubber Ltd does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy of Fujikura Rubber Ltd comprises – understanding the underlying the factors in the Fabricated Plastic & Rubber industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Ability to lead change in Fabricated Plastic & Rubber
– Fujikura Rubber Ltd is one of the leading players in the Fabricated Plastic & Rubber industry in Japan. Over the years it has not only transformed the business landscape in the Fabricated Plastic & Rubber industry in Japan but also across the existing markets. The ability to lead change has enabled Fujikura Rubber Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Fujikura Rubber Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Fabricated Plastic & Rubber industry. Secondly the value chain collaborators of Fujikura Rubber Ltd have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Fujikura Rubber Ltd 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 Fabricated Plastic & Rubber 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.
Superior customer experience
– The customer experience strategy of Fujikura Rubber Ltd in Fabricated Plastic & Rubber industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Fujikura Rubber Ltd is present in almost all the verticals within the Fabricated Plastic & Rubber industry. This has provided Fujikura Rubber Ltd 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.
Effective Research and Development (R&D)
– Fujikura Rubber Ltd has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Fujikura Rubber Ltd staying ahead in the Fabricated Plastic & Rubber industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management in the Fabricated Plastic & Rubber industry
– Fujikura Rubber Ltd is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of Fujikura Rubber Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Fujikura Rubber Ltd are -
Employees’ less understanding of Fujikura Rubber Ltd strategy
– From the outside it seems that the employees of Fujikura Rubber Ltd 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.
Products dominated business model
– Even though Fujikura Rubber Ltd has some of the most successful models in the Fabricated Plastic & Rubber industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Fujikura Rubber Ltd should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Japan, Fujikura Rubber Ltd needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Fujikura Rubber Ltd 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.
Lack of clear differentiation of Fujikura Rubber Ltd products
– To increase the profitability and margins on the products, Fujikura Rubber Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Fujikura Rubber Ltd is slow explore the new channels of communication. These new channels of communication can help Fujikura Rubber Ltd to provide better information regarding Fabricated Plastic & Rubber products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Fujikura Rubber Ltd has a high cash cycle compare to other players in the Fabricated Plastic & Rubber industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
No frontier risks strategy
– From the 10K / annual statement of Fujikura Rubber Ltd, it seems that company is thinking out the frontier risks that can impact Fabricated Plastic & Rubber 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.
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 Fujikura Rubber Ltd supply chain. Even after few cautionary changes, Fujikura Rubber Ltd is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Fujikura Rubber Ltd vulnerable to further global disruptions in South East Asia.
High dependence on Fujikura Rubber Ltd ‘s star products
– The top 2 products and services of Fujikura Rubber Ltd still accounts for major business revenue. This dependence on star products in Fabricated Plastic & Rubber industry has resulted into insufficient focus on developing new products, even though Fujikura Rubber Ltd has relatively successful track record of launching new products.
Skills based hiring in Fabricated Plastic & Rubber industry
– The stress on hiring functional specialists at Fujikura Rubber Ltd 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.
Fujikura Rubber Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Fujikura Rubber Ltd are -
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 Fujikura Rubber Ltd 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Fujikura Rubber Ltd can use these opportunities to build new business models that can help the communities that Fujikura Rubber Ltd operates in. Secondly it can use opportunities from government spending in Fabricated Plastic & Rubber sector.
Manufacturing automation
– Fujikura Rubber Ltd can use the latest technology developments to improve its manufacturing and designing process in Fabricated Plastic & Rubber 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.
Learning at scale
– Online learning technologies has now opened space for Fujikura Rubber Ltd 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.
Leveraging digital technologies
– Fujikura Rubber Ltd can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
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. Fujikura Rubber Ltd can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Fujikura Rubber Ltd 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 Fabricated Plastic & Rubber industry.
Creating value in data economy
– The success of analytics program of Fujikura Rubber Ltd has opened avenues for new revenue streams for the organization in Fabricated Plastic & Rubber industry. This can help Fujikura Rubber Ltd to build a more holistic ecosystem for Fujikura Rubber Ltd products in the Fabricated Plastic & Rubber industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Fujikura Rubber Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Fabricated Plastic & Rubber sector. This continuous investment in analytics has enabled Fujikura Rubber Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help Fujikura Rubber Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Fujikura Rubber Ltd to increase its market reach. Fujikura Rubber Ltd 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Fujikura Rubber Ltd 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Fujikura Rubber Ltd 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 Fujikura Rubber Ltd to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Use of Bitcoin and other crypto currencies for transactions in Fabricated Plastic & Rubber industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Fujikura Rubber Ltd in the Fabricated Plastic & Rubber industry. Now Fujikura Rubber Ltd can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Fujikura Rubber Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Fujikura Rubber Ltd are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Fujikura Rubber Ltd in Fabricated Plastic & Rubber industry. The Fabricated Plastic & Rubber 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Fujikura Rubber Ltd 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 Fujikura Rubber Ltd prominent markets.
Stagnating economy with rate increase
– Fujikura Rubber Ltd 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 Fabricated Plastic & Rubber industry.
Shortening product life cycle
– it is one of the major threat that Fujikura Rubber Ltd is facing in Fabricated Plastic & Rubber sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Fujikura Rubber Ltd 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 Fabricated Plastic & Rubber industry regulations.
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. Fujikura Rubber Ltd 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.
Easy access to finance
– Easy access to finance in Fabricated Plastic & Rubber industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Fujikura Rubber Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Fujikura Rubber Ltd business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Fujikura Rubber Ltd has witnessed rapid integration of technology during Covid-19 in the Fabricated Plastic & Rubber industry. As one of the leading players in the industry, Fujikura Rubber Ltd needs to keep up with the evolution of technology in the Fabricated Plastic & Rubber 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.
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 dependence on third party suppliers
– Fujikura Rubber Ltd 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 Fujikura Rubber Ltd 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 Fabricated Plastic & Rubber industry and other sectors.
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 Fujikura Rubber Ltd.
Weighted SWOT Analysis of Fujikura Rubber Ltd Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Fujikura Rubber Ltd 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 Fujikura Rubber Ltd 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 Fujikura Rubber Ltd 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 Fujikura Rubber Ltd 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 Fujikura Rubber Ltd needs to make to build a sustainable competitive advantage.
