SWOT Analysis / TOWS Matrix for Kyowa Electronic Instrument (Japan)
Based on various researches at Oak Spring University , Kyowa Electronic Instrument is operating in a macro-environment that has been destablized by – increasing energy prices, there is backlash against globalization, challanges to central banks by blockchain based private currencies, technology disruption, cloud computing is disrupting traditional business models, increasing commodity prices, increasing transportation and logistics costs,
supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Kyowa Electronic Instrument
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kyowa Electronic Instrument can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kyowa Electronic Instrument, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kyowa Electronic Instrument 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 Kyowa Electronic Instrument can be done for the following purposes –
1. Strategic planning of Kyowa Electronic Instrument
2. Improving business portfolio management of Kyowa Electronic Instrument
3. Assessing feasibility of the new initiative in Japan
4. Making a Electronic Instr. & Controls sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kyowa Electronic Instrument
Strengths of Kyowa Electronic Instrument | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kyowa Electronic Instrument are -
Sustainable margins compare to other players in Electronic Instr. & Controls industry
– Kyowa Electronic Instrument has clearly differentiated products in the market place. This has enabled Kyowa Electronic Instrument to fetch slight price premium compare to the competitors in the Electronic Instr. & Controls industry. The sustainable margins have also helped Kyowa Electronic Instrument to invest into research and development (R&D) and innovation.
Digital Transformation in Electronic Instr. & Controls industry
- digital transformation varies from industry to industry. For Kyowa Electronic Instrument digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kyowa Electronic Instrument 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.
Effective Research and Development (R&D)
– Kyowa Electronic Instrument has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Kyowa Electronic Instrument staying ahead in the Electronic Instr. & Controls industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Kyowa Electronic Instrument in the Technology sector have low bargaining power. Kyowa Electronic Instrument has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kyowa Electronic Instrument to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Kyowa Electronic Instrument 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 Electronic Instr. & Controls 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.
Strong track record of project management in the Electronic Instr. & Controls industry
– Kyowa Electronic Instrument is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Kyowa Electronic Instrument is one of the leading players in the Electronic Instr. & Controls 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.
High brand equity
– Kyowa Electronic Instrument has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kyowa Electronic Instrument to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Kyowa Electronic Instrument
– The covid-19 pandemic has put organizational resilience at the centre of everthing Kyowa Electronic Instrument does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Kyowa Electronic Instrument 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.
Superior customer experience
– The customer experience strategy of Kyowa Electronic Instrument in Electronic Instr. & Controls industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Kyowa Electronic Instrument has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Electronic Instr. & Controls industry. Secondly the value chain collaborators of Kyowa Electronic Instrument have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Kyowa Electronic Instrument | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kyowa Electronic Instrument are -
Lack of clear differentiation of Kyowa Electronic Instrument products
– To increase the profitability and margins on the products, Kyowa Electronic Instrument needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of Japan, Kyowa Electronic Instrument needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Kyowa Electronic Instrument 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 Electronic Instr. & Controls industry using digital technology.
Slow to strategic competitive environment developments
– As Kyowa Electronic Instrument is one of the leading players in the Electronic Instr. & Controls industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Electronic Instr. & Controls industry in last five years.
High dependence on Kyowa Electronic Instrument ‘s star products
– The top 2 products and services of Kyowa Electronic Instrument still accounts for major business revenue. This dependence on star products in Electronic Instr. & Controls industry has resulted into insufficient focus on developing new products, even though Kyowa Electronic Instrument has relatively successful track record of launching new products.
Products dominated business model
– Even though Kyowa Electronic Instrument has some of the most successful models in the Electronic Instr. & Controls industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Kyowa Electronic Instrument should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Kyowa Electronic Instrument 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, Kyowa Electronic Instrument has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Electronic Instr. & Controls industry over the last five years. Kyowa Electronic Instrument 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.
Need for greater diversity
– Kyowa Electronic Instrument 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 cash cycle compare to competitors
Kyowa Electronic Instrument has a high cash cycle compare to other players in the Electronic Instr. & Controls industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kyowa Electronic Instrument is slow explore the new channels of communication. These new channels of communication can help Kyowa Electronic Instrument to provide better information regarding Electronic Instr. & Controls products and services. It can also build an online community to further reach out to potential customers.
Kyowa Electronic Instrument Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Kyowa Electronic Instrument are -
Better consumer reach
– The expansion of the 5G network will help Kyowa Electronic Instrument to increase its market reach. Kyowa Electronic Instrument 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 Kyowa Electronic Instrument in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Electronic Instr. & Controls industry, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kyowa Electronic Instrument can use these opportunities to build new business models that can help the communities that Kyowa Electronic Instrument operates in. Secondly it can use opportunities from government spending in Electronic Instr. & Controls sector.
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. Kyowa Electronic Instrument can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Kyowa Electronic Instrument 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kyowa Electronic Instrument is facing challenges because of the dominance of functional experts in the organization. Kyowa Electronic Instrument can utilize new technology in the field of Electronic Instr. & Controls industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Learning at scale
– Online learning technologies has now opened space for Kyowa Electronic Instrument 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.
Manufacturing automation
– Kyowa Electronic Instrument can use the latest technology developments to improve its manufacturing and designing process in Electronic Instr. & Controls 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.
Creating value in data economy
– The success of analytics program of Kyowa Electronic Instrument has opened avenues for new revenue streams for the organization in Electronic Instr. & Controls industry. This can help Kyowa Electronic Instrument to build a more holistic ecosystem for Kyowa Electronic Instrument products in the Electronic Instr. & Controls industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Kyowa Electronic Instrument can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Electronic Instr. & Controls industry, but it has also influenced the consumer preferences. Kyowa Electronic Instrument can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kyowa Electronic Instrument 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 Kyowa Electronic Instrument to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Kyowa Electronic Instrument 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.
Threats Kyowa Electronic Instrument External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Kyowa Electronic Instrument are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kyowa Electronic Instrument 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 Kyowa Electronic Instrument prominent markets.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kyowa Electronic Instrument in Electronic Instr. & Controls industry. The Electronic Instr. & Controls 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.
Shortening product life cycle
– it is one of the major threat that Kyowa Electronic Instrument is facing in Electronic Instr. & Controls sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Kyowa Electronic Instrument 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 Electronic Instr. & Controls industry regulations.
Stagnating economy with rate increase
– Kyowa Electronic Instrument 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 Electronic Instr. & Controls industry.
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. Kyowa Electronic Instrument needs to understand the core reasons impacting the Electronic Instr. & Controls industry. This will help it in building a better workplace.
Consumer confidence and its impact on Kyowa Electronic Instrument 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 Electronic Instr. & Controls industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Electronic Instr. & Controls industry are lowering. It can presents Kyowa Electronic Instrument with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Electronic Instr. & Controls sector.
Increasing wage structure of Kyowa Electronic Instrument
– 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 Kyowa Electronic Instrument.
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 Kyowa Electronic Instrument.
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.
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 Kyowa Electronic Instrument 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. Kyowa Electronic Instrument 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.
Weighted SWOT Analysis of Kyowa Electronic Instrument Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Kyowa Electronic Instrument 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 Kyowa Electronic Instrument 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 Kyowa Electronic Instrument 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 Kyowa Electronic Instrument 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 Kyowa Electronic Instrument needs to make to build a sustainable competitive advantage.