SWOT Analysis / TOWS Matrix for IRRC Corporation (Japan)
Based on various researches at Oak Spring University , IRRC Corporation is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices, there is increasing trade war between United States & China,
geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that IRRC Corporation can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the IRRC Corporation, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which IRRC Corporation 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 IRRC Corporation can be done for the following purposes –
1. Strategic planning of IRRC Corporation
2. Improving business portfolio management of IRRC Corporation
3. Assessing feasibility of the new initiative in Japan
4. Making a Insurance (Miscellaneous) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of IRRC Corporation
Strengths of IRRC Corporation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of IRRC Corporation are -
Superior customer experience
– The customer experience strategy of IRRC Corporation in Insurance (Miscellaneous) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the IRRC Corporation 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.
Highly skilled collaborators
– IRRC Corporation has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Insurance (Miscellaneous) industry. Secondly the value chain collaborators of IRRC Corporation have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– IRRC Corporation has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – IRRC Corporation staying ahead in the Insurance (Miscellaneous) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– IRRC Corporation is one of the most innovative firm in Insurance (Miscellaneous) sector.
Ability to recruit top talent
– IRRC Corporation is one of the leading players in the Insurance (Miscellaneous) 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.
Successful track record of launching new products
– IRRC Corporation has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. IRRC Corporation 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.
High switching costs
– The high switching costs that IRRC Corporation 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.
Ability to lead change in Insurance (Miscellaneous)
– IRRC Corporation is one of the leading players in the Insurance (Miscellaneous) industry in Japan. Over the years it has not only transformed the business landscape in the Insurance (Miscellaneous) industry in Japan but also across the existing markets. The ability to lead change has enabled IRRC Corporation in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– IRRC Corporation has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled IRRC Corporation to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of IRRC Corporation in the Financial sector have low bargaining power. IRRC Corporation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps IRRC Corporation to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of IRRC Corporation
– The covid-19 pandemic has put organizational resilience at the centre of everthing IRRC Corporation does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses of IRRC Corporation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of IRRC Corporation are -
Interest costs
– Compare to the competition, IRRC Corporation 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.
Aligning sales with marketing
– From the outside it seems that IRRC Corporation needs to have more collaboration between its sales team and marketing team. Sales professionals in the Insurance (Miscellaneous) industry have deep experience in developing customer relationships. Marketing department at IRRC Corporation can leverage the sales team experience to cultivate customer relationships as IRRC Corporation is planning to shift buying processes online.
High dependence on IRRC Corporation ‘s star products
– The top 2 products and services of IRRC Corporation still accounts for major business revenue. This dependence on star products in Insurance (Miscellaneous) industry has resulted into insufficient focus on developing new products, even though IRRC Corporation has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, IRRC Corporation has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Insurance (Miscellaneous) industry over the last five years. IRRC Corporation 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.
Ability to respond to the competition
– As the decision making is very deliberative at IRRC Corporation, in the dynamic environment of Insurance (Miscellaneous) industry it has struggled to respond to the nimble upstart competition. IRRC Corporation has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, IRRC Corporation 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 Insurance (Miscellaneous) industry using digital technology.
Workers concerns about automation
– As automation is fast increasing in the Insurance (Miscellaneous) industry, IRRC Corporation 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.
Lack of clear differentiation of IRRC Corporation products
– To increase the profitability and margins on the products, IRRC Corporation needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of IRRC Corporation is just above the Insurance (Miscellaneous) 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, IRRC Corporation is slow explore the new channels of communication. These new channels of communication can help IRRC Corporation to provide better information regarding Insurance (Miscellaneous) products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– IRRC Corporation 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.
IRRC Corporation Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of IRRC Corporation are -
Leveraging digital technologies
– IRRC Corporation 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, IRRC Corporation is facing challenges because of the dominance of functional experts in the organization. IRRC Corporation can utilize new technology in the field of Insurance (Miscellaneous) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– IRRC Corporation can develop new processes and procedures in Insurance (Miscellaneous) 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.
Creating value in data economy
– The success of analytics program of IRRC Corporation has opened avenues for new revenue streams for the organization in Insurance (Miscellaneous) industry. This can help IRRC Corporation to build a more holistic ecosystem for IRRC Corporation products in the Insurance (Miscellaneous) 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 IRRC Corporation 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 IRRC Corporation to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects IRRC Corporation 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 Insurance (Miscellaneous) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for IRRC Corporation in the Insurance (Miscellaneous) industry. Now IRRC Corporation can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– IRRC Corporation has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Insurance (Miscellaneous) sector. This continuous investment in analytics has enabled IRRC Corporation to build a competitive advantage using analytics. The analytics driven competitive advantage can help IRRC Corporation to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for IRRC Corporation 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.
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. IRRC Corporation can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for IRRC Corporation in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Insurance (Miscellaneous) industry, and it will provide faster access to the consumers.
Manufacturing automation
– IRRC Corporation can use the latest technology developments to improve its manufacturing and designing process in Insurance (Miscellaneous) 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Insurance (Miscellaneous) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. IRRC Corporation 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. IRRC Corporation 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.
Threats IRRC Corporation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of IRRC Corporation are -
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.
Shortening product life cycle
– it is one of the major threat that IRRC Corporation is facing in Insurance (Miscellaneous) 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 IRRC Corporation in the Insurance (Miscellaneous) 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 IRRC Corporation business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– IRRC Corporation 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. IRRC Corporation can take advantage of this fund but it will also bring new competitors in the Insurance (Miscellaneous) industry.
Regulatory challenges
– IRRC Corporation 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 Insurance (Miscellaneous) 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. IRRC Corporation 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, IRRC Corporation 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 IRRC Corporation prominent markets.
Technology acceleration in Forth Industrial Revolution
– IRRC Corporation has witnessed rapid integration of technology during Covid-19 in the Insurance (Miscellaneous) industry. As one of the leading players in the industry, IRRC Corporation needs to keep up with the evolution of technology in the Insurance (Miscellaneous) 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.
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 IRRC Corporation.
Increasing wage structure of IRRC Corporation
– 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 IRRC Corporation.
Stagnating economy with rate increase
– IRRC Corporation 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 Insurance (Miscellaneous) 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. IRRC Corporation needs to understand the core reasons impacting the Insurance (Miscellaneous) industry. This will help it in building a better workplace.
Weighted SWOT Analysis of IRRC Corporation Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at IRRC Corporation 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 IRRC Corporation 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 IRRC Corporation 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 IRRC Corporation 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 IRRC Corporation needs to make to build a sustainable competitive advantage.
