SWOT Analysis / TOWS Matrix for Toyo Gosei (Japan)
Based on various researches at Oak Spring University , Toyo Gosei is operating in a macro-environment that has been destablized by – digital marketing is dominated by two big players Facebook and Google, increasing energy prices, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies,
increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Toyo Gosei can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Toyo Gosei, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Toyo Gosei 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 Gosei can be done for the following purposes –
1. Strategic planning of Toyo Gosei
2. Improving business portfolio management of Toyo Gosei
3. Assessing feasibility of the new initiative in Japan
4. Making a Photography sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Toyo Gosei
Strengths of Toyo Gosei | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Toyo Gosei are -
Successful track record of launching new products
– Toyo Gosei has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Toyo Gosei 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 Toyo Gosei in the Consumer Cyclical sector have low bargaining power. Toyo Gosei has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Toyo Gosei to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Photography industry
– Toyo Gosei has clearly differentiated products in the market place. This has enabled Toyo Gosei to fetch slight price premium compare to the competitors in the Photography industry. The sustainable margins have also helped Toyo Gosei to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Toyo Gosei has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Photography industry. Secondly the value chain collaborators of Toyo Gosei have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Toyo Gosei
– The covid-19 pandemic has put organizational resilience at the centre of everthing Toyo Gosei does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Toyo Gosei 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 Gosei is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Toyo Gosei emphasize – knowledge, initiative, and innovation.
Digital Transformation in Photography industry
- digital transformation varies from industry to industry. For Toyo Gosei digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Toyo Gosei 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.
Training and development
– Toyo Gosei has one of the best training and development program in Consumer Cyclical 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.
Cross disciplinary teams
– Horizontal connected teams at the Toyo Gosei 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
– Toyo Gosei 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 Photography 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.
Innovation driven organization
– Toyo Gosei is one of the most innovative firm in Photography sector.
High brand equity
– Toyo Gosei has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Toyo Gosei to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of Toyo Gosei | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Toyo Gosei are -
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 Gosei supply chain. Even after few cautionary changes, Toyo Gosei is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Toyo Gosei vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Toyo Gosei is one of the leading players in the Photography industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Photography industry in last five years.
Employees’ less understanding of Toyo Gosei strategy
– From the outside it seems that the employees of Toyo Gosei 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.
Skills based hiring in Photography industry
– The stress on hiring functional specialists at Toyo Gosei 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.
Lack of clear differentiation of Toyo Gosei products
– To increase the profitability and margins on the products, Toyo Gosei needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– From the outside it seems that Toyo Gosei needs to have more collaboration between its sales team and marketing team. Sales professionals in the Photography industry have deep experience in developing customer relationships. Marketing department at Toyo Gosei can leverage the sales team experience to cultivate customer relationships as Toyo Gosei is planning to shift buying processes online.
Products dominated business model
– Even though Toyo Gosei has some of the most successful models in the Photography industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Toyo Gosei should strive to include more intangible value offerings along with its core products and services.
High dependence on Toyo Gosei ‘s star products
– The top 2 products and services of Toyo Gosei still accounts for major business revenue. This dependence on star products in Photography industry has resulted into insufficient focus on developing new products, even though Toyo Gosei has relatively successful track record of launching new products.
Need for greater diversity
– Toyo Gosei 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, Toyo Gosei has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Photography industry over the last five years. Toyo Gosei 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.
High cash cycle compare to competitors
Toyo Gosei has a high cash cycle compare to other players in the Photography industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Toyo Gosei Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Toyo Gosei are -
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Photography industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Toyo Gosei 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 Gosei 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.
Developing new processes and practices
– Toyo Gosei can develop new processes and procedures in Photography 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.
Building a culture of innovation
– managers at Toyo Gosei 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 Photography industry.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Toyo Gosei is facing challenges because of the dominance of functional experts in the organization. Toyo Gosei can utilize new technology in the field of Photography industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Creating value in data economy
– The success of analytics program of Toyo Gosei has opened avenues for new revenue streams for the organization in Photography industry. This can help Toyo Gosei to build a more holistic ecosystem for Toyo Gosei products in the Photography industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Toyo Gosei 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.
Buying journey improvements
– Toyo Gosei can improve the customer journey of consumers in the Photography 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Toyo Gosei 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 Toyo Gosei to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Toyo Gosei can use the latest technology developments to improve its manufacturing and designing process in Photography 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Photography industry, but it has also influenced the consumer preferences. Toyo Gosei 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 Toyo Gosei can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions in Photography industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Toyo Gosei in the Photography industry. Now Toyo Gosei can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Toyo Gosei can use these opportunities to build new business models that can help the communities that Toyo Gosei operates in. Secondly it can use opportunities from government spending in Photography sector.
Threats Toyo Gosei External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Toyo Gosei are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Photography industry are lowering. It can presents Toyo Gosei with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Photography sector.
Technology acceleration in Forth Industrial Revolution
– Toyo Gosei has witnessed rapid integration of technology during Covid-19 in the Photography industry. As one of the leading players in the industry, Toyo Gosei needs to keep up with the evolution of technology in the Photography 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Toyo Gosei may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Photography sector.
Increasing wage structure of Toyo Gosei
– 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 Toyo Gosei.
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.
Consumer confidence and its impact on Toyo Gosei 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 Photography industry and other sectors.
Stagnating economy with rate increase
– Toyo Gosei 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 Photography industry.
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 Gosei.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Toyo Gosei 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 Gosei 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.
Regulatory challenges
– Toyo Gosei 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 Photography industry regulations.
Shortening product life cycle
– it is one of the major threat that Toyo Gosei is facing in Photography sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Toyo Gosei 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.
Weighted SWOT Analysis of Toyo Gosei Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Toyo Gosei 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 Gosei 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 Gosei 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 Gosei 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 Gosei needs to make to build a sustainable competitive advantage.