SWOT Analysis / TOWS Matrix for Daiko Denshi Tsushin (Japan)
Based on various researches at Oak Spring University , Daiko Denshi Tsushin is operating in a macro-environment that has been destablized by – increasing commodity prices, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing household debt because of falling income levels, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Daiko Denshi Tsushin
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Daiko Denshi Tsushin can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Daiko Denshi Tsushin, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Daiko Denshi Tsushin 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 Daiko Denshi Tsushin can be done for the following purposes –
1. Strategic planning of Daiko Denshi Tsushin
2. Improving business portfolio management of Daiko Denshi Tsushin
3. Assessing feasibility of the new initiative in Japan
4. Making a Retail (Technology) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Daiko Denshi Tsushin
Strengths of Daiko Denshi Tsushin | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Daiko Denshi Tsushin are -
Training and development
– Daiko Denshi Tsushin has one of the best training and development program in Services 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.
Highly skilled collaborators
– Daiko Denshi Tsushin has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Retail (Technology) industry. Secondly the value chain collaborators of Daiko Denshi Tsushin have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management in the Retail (Technology) industry
– Daiko Denshi Tsushin is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Daiko Denshi Tsushin is one of the most innovative firm in Retail (Technology) sector.
Sustainable margins compare to other players in Retail (Technology) industry
– Daiko Denshi Tsushin has clearly differentiated products in the market place. This has enabled Daiko Denshi Tsushin to fetch slight price premium compare to the competitors in the Retail (Technology) industry. The sustainable margins have also helped Daiko Denshi Tsushin to invest into research and development (R&D) and innovation.
Ability to lead change in Retail (Technology)
– Daiko Denshi Tsushin is one of the leading players in the Retail (Technology) industry in Japan. Over the years it has not only transformed the business landscape in the Retail (Technology) industry in Japan but also across the existing markets. The ability to lead change has enabled Daiko Denshi Tsushin in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Daiko Denshi Tsushin 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 Daiko Denshi Tsushin is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Daiko Denshi Tsushin emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Daiko Denshi Tsushin has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Daiko Denshi Tsushin 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.
Low bargaining power of suppliers
– Suppliers of Daiko Denshi Tsushin in the Services sector have low bargaining power. Daiko Denshi Tsushin has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Daiko Denshi Tsushin to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Daiko Denshi Tsushin 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.
Diverse revenue streams
– Daiko Denshi Tsushin is present in almost all the verticals within the Retail (Technology) industry. This has provided Daiko Denshi Tsushin 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)
– Daiko Denshi Tsushin has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Daiko Denshi Tsushin staying ahead in the Retail (Technology) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of Daiko Denshi Tsushin | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Daiko Denshi Tsushin are -
Ability to respond to the competition
– As the decision making is very deliberative at Daiko Denshi Tsushin, in the dynamic environment of Retail (Technology) industry it has struggled to respond to the nimble upstart competition. Daiko Denshi Tsushin has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Daiko Denshi Tsushin is slow explore the new channels of communication. These new channels of communication can help Daiko Denshi Tsushin to provide better information regarding Retail (Technology) products and services. It can also build an online community to further reach out to potential customers.
Employees’ less understanding of Daiko Denshi Tsushin strategy
– From the outside it seems that the employees of Daiko Denshi Tsushin 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.
Lack of clear differentiation of Daiko Denshi Tsushin products
– To increase the profitability and margins on the products, Daiko Denshi Tsushin 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, Daiko Denshi Tsushin needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Daiko Denshi Tsushin supply chain. Even after few cautionary changes, Daiko Denshi Tsushin is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Daiko Denshi Tsushin vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Daiko Denshi Tsushin has some of the most successful models in the Retail (Technology) industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Daiko Denshi Tsushin should strive to include more intangible value offerings along with its core products and services.
Skills based hiring in Retail (Technology) industry
– The stress on hiring functional specialists at Daiko Denshi Tsushin 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.
High bargaining power of channel partners in Retail (Technology) industry
– because of the regulatory requirements in Japan, Daiko Denshi Tsushin is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Retail (Technology) industry.
Need for greater diversity
– Daiko Denshi Tsushin 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 decision making process
– As mentioned earlier in the report, Daiko Denshi Tsushin has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Retail (Technology) industry over the last five years. Daiko Denshi Tsushin 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.
Daiko Denshi Tsushin Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Daiko Denshi Tsushin are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Retail (Technology) industry, but it has also influenced the consumer preferences. Daiko Denshi Tsushin can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Daiko Denshi Tsushin can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Daiko Denshi Tsushin in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Retail (Technology) industry, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Daiko Denshi Tsushin has opened avenues for new revenue streams for the organization in Retail (Technology) industry. This can help Daiko Denshi Tsushin to build a more holistic ecosystem for Daiko Denshi Tsushin products in the Retail (Technology) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Daiko Denshi Tsushin 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Daiko Denshi Tsushin 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 Daiko Denshi Tsushin to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Daiko Denshi Tsushin can use these opportunities to build new business models that can help the communities that Daiko Denshi Tsushin operates in. Secondly it can use opportunities from government spending in Retail (Technology) sector.
Learning at scale
– Online learning technologies has now opened space for Daiko Denshi Tsushin 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
– Daiko Denshi Tsushin can use the latest technology developments to improve its manufacturing and designing process in Retail (Technology) 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Daiko Denshi Tsushin 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 Daiko Denshi Tsushin to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Daiko Denshi Tsushin is facing challenges because of the dominance of functional experts in the organization. Daiko Denshi Tsushin can utilize new technology in the field of Retail (Technology) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Retail (Technology) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Daiko Denshi Tsushin 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. Daiko Denshi Tsushin 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.
Better consumer reach
– The expansion of the 5G network will help Daiko Denshi Tsushin to increase its market reach. Daiko Denshi Tsushin will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Threats Daiko Denshi Tsushin External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Daiko Denshi Tsushin are -
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 Daiko Denshi Tsushin in the Retail (Technology) sector and impact the bottomline of the organization.
Environmental challenges
– Daiko Denshi Tsushin 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. Daiko Denshi Tsushin can take advantage of this fund but it will also bring new competitors in the Retail (Technology) industry.
Consumer confidence and its impact on Daiko Denshi Tsushin 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 Retail (Technology) industry and other sectors.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Daiko Denshi Tsushin may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Retail (Technology) sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Daiko Denshi Tsushin 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 Daiko Denshi Tsushin prominent markets.
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
– Daiko Denshi Tsushin 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Retail (Technology) industry are lowering. It can presents Daiko Denshi Tsushin with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Retail (Technology) sector.
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 Retail (Technology) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Daiko Denshi Tsushin can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Daiko Denshi Tsushin
– 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 Daiko Denshi Tsushin.
Shortening product life cycle
– it is one of the major threat that Daiko Denshi Tsushin is facing in Retail (Technology) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Daiko Denshi Tsushin needs to understand the core reasons impacting the Retail (Technology) industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Daiko Denshi Tsushin Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Daiko Denshi Tsushin 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 Daiko Denshi Tsushin 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 Daiko Denshi Tsushin 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 Daiko Denshi Tsushin 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 Daiko Denshi Tsushin needs to make to build a sustainable competitive advantage.
