SWOT Analysis / TOWS Matrix for KANAME KOGYO (Japan)
Based on various researches at Oak Spring University , KANAME KOGYO is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, increasing energy prices, increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization,
customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that KANAME KOGYO can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the KANAME KOGYO, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which KANAME KOGYO 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 KANAME KOGYO can be done for the following purposes –
1. Strategic planning of KANAME KOGYO
2. Improving business portfolio management of KANAME KOGYO
3. Assessing feasibility of the new initiative in Japan
4. Making a Waste Management Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of KANAME KOGYO
Strengths of KANAME KOGYO | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of KANAME KOGYO are -
Low bargaining power of suppliers
– Suppliers of KANAME KOGYO in the Services sector have low bargaining power. KANAME KOGYO has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps KANAME KOGYO to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– KANAME KOGYO is one of the most innovative firm in Waste Management Services sector.
Superior customer experience
– The customer experience strategy of KANAME KOGYO in Waste Management Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Waste Management Services industry
- digital transformation varies from industry to industry. For KANAME KOGYO digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. KANAME KOGYO 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.
Diverse revenue streams
– KANAME KOGYO is present in almost all the verticals within the Waste Management Services industry. This has provided KANAME KOGYO 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)
– KANAME KOGYO has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – KANAME KOGYO staying ahead in the Waste Management Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Waste Management Services industry
– KANAME KOGYO has clearly differentiated products in the market place. This has enabled KANAME KOGYO to fetch slight price premium compare to the competitors in the Waste Management Services industry. The sustainable margins have also helped KANAME KOGYO to invest into research and development (R&D) and innovation.
Strong track record of project management in the Waste Management Services industry
– KANAME KOGYO is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– KANAME KOGYO has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Waste Management Services industry. Secondly the value chain collaborators of KANAME KOGYO have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- KANAME KOGYO 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 KANAME KOGYO is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at KANAME KOGYO emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the KANAME KOGYO 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.
Analytics focus
– KANAME KOGYO 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 Waste Management Services 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.
Weaknesses of KANAME KOGYO | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of KANAME KOGYO are -
Interest costs
– Compare to the competition, KANAME KOGYO 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.
High operating costs
– Compare to the competitors, KANAME KOGYO has high operating costs in the Waste Management Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract KANAME KOGYO lucrative customers.
Skills based hiring in Waste Management Services industry
– The stress on hiring functional specialists at KANAME KOGYO 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.
Slow decision making process
– As mentioned earlier in the report, KANAME KOGYO has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Waste Management Services industry over the last five years. KANAME KOGYO 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.
Compensation and incentives
– The revenue per employee of KANAME KOGYO is just above the Waste Management 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.
Workers concerns about automation
– As automation is fast increasing in the Waste Management Services industry, KANAME KOGYO 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.
Need for greater diversity
– KANAME KOGYO 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, KANAME KOGYO is slow explore the new channels of communication. These new channels of communication can help KANAME KOGYO to provide better information regarding Waste Management Services products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of KANAME KOGYO is dominated by functional specialists. It is not different from other players in the Waste Management Services industry, but KANAME KOGYO needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help KANAME KOGYO to focus more on services in the Waste Management Services industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Japan, KANAME KOGYO needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, KANAME KOGYO 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 Waste Management Services industry using digital technology.
KANAME KOGYO Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of KANAME KOGYO are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Waste Management Services industry, but it has also influenced the consumer preferences. KANAME KOGYO can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help KANAME KOGYO to increase its market reach. KANAME KOGYO 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 KANAME KOGYO in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Waste Management Services industry, and it will provide faster access to the consumers.
Use of Bitcoin and other crypto currencies for transactions in Waste Management Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for KANAME KOGYO in the Waste Management Services industry. Now KANAME KOGYO can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, KANAME KOGYO 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.
Creating value in data economy
– The success of analytics program of KANAME KOGYO has opened avenues for new revenue streams for the organization in Waste Management Services industry. This can help KANAME KOGYO to build a more holistic ecosystem for KANAME KOGYO products in the Waste Management Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for KANAME KOGYO 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 KANAME KOGYO to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at KANAME KOGYO 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 Waste Management Services industry.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects KANAME KOGYO can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 KANAME KOGYO 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.
Learning at scale
– Online learning technologies has now opened space for KANAME KOGYO 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.
Using analytics as competitive advantage
– KANAME KOGYO has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Waste Management Services sector. This continuous investment in analytics has enabled KANAME KOGYO to build a competitive advantage using analytics. The analytics driven competitive advantage can help KANAME KOGYO to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– KANAME KOGYO 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.
Threats KANAME KOGYO External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of KANAME KOGYO are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for KANAME KOGYO in Waste Management Services industry. The Waste Management 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Waste Management Services industry are lowering. It can presents KANAME KOGYO with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Waste Management Services sector.
Shortening product life cycle
– it is one of the major threat that KANAME KOGYO is facing in Waste Management Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 KANAME KOGYO in the Waste Management Services sector and impact the bottomline of the organization.
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 KANAME KOGYO 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.
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. KANAME KOGYO needs to understand the core reasons impacting the Waste Management Services industry. This will help it in building a better workplace.
Increasing wage structure of KANAME KOGYO
– 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 KANAME KOGYO.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, KANAME KOGYO 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 KANAME KOGYO prominent markets.
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 Waste Management Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. KANAME KOGYO can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on KANAME KOGYO 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 Waste Management Services industry and other sectors.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, KANAME KOGYO may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Waste Management Services sector.
Weighted SWOT Analysis of KANAME KOGYO Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at KANAME KOGYO 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 KANAME KOGYO 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 KANAME KOGYO 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 KANAME KOGYO 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 KANAME KOGYO needs to make to build a sustainable competitive advantage.