Koyosha (7946) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Koyosha (Japan)

Based on various researches at Oak Spring University , Koyosha is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, there is backlash against globalization, wage bills are increasing, talent flight as more people leaving formal jobs, geopolitical disruptions, increasing energy prices, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, etc

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Introduction to SWOT Analysis of Koyosha

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Koyosha can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Koyosha, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Koyosha 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Koyosha can be done for the following purposes –
1. Strategic planning of Koyosha
2. Improving business portfolio management of Koyosha
3. Assessing feasibility of the new initiative in Japan
4. Making a Printing Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Koyosha

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Strengths of Koyosha | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Koyosha are -

Ability to lead change in Printing Services

– Koyosha is one of the leading players in the Printing Services industry in Japan. Over the years it has not only transformed the business landscape in the Printing Services industry in Japan but also across the existing markets. The ability to lead change has enabled Koyosha in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Diverse revenue streams

– Koyosha is present in almost all the verticals within the Printing Services industry. This has provided Koyosha 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.

Analytics focus

– Koyosha 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 Printing 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.

Highly skilled collaborators

– Koyosha has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Printing Services industry. Secondly the value chain collaborators of Koyosha have helped the firm to develop new products and bring them quickly to the marketplace.

Operational resilience

– The operational resilience strategy of Koyosha comprises – understanding the underlying the factors in the Printing Services industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.

Learning organization

- Koyosha 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 Koyosha is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Koyosha emphasize – knowledge, initiative, and innovation.

Digital Transformation in Printing Services industry

- digital transformation varies from industry to industry. For Koyosha digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Koyosha 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

– Koyosha 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.

Sustainable margins compare to other players in Printing Services industry

– Koyosha has clearly differentiated products in the market place. This has enabled Koyosha to fetch slight price premium compare to the competitors in the Printing Services industry. The sustainable margins have also helped Koyosha to invest into research and development (R&D) and innovation.

Low bargaining power of suppliers

– Suppliers of Koyosha in the Services sector have low bargaining power. Koyosha has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Koyosha to manage not only supply disruptions but also source products at highly competitive prices.

Innovation driven organization

– Koyosha is one of the most innovative firm in Printing Services sector.

High brand equity

– Koyosha has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Koyosha to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

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Weaknesses of Koyosha | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Koyosha are -

High bargaining power of channel partners in Printing Services industry

– because of the regulatory requirements in Japan, Koyosha 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 Printing Services industry.

Compensation and incentives

– The revenue per employee of Koyosha is just above the Printing 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.

High cash cycle compare to competitors

Koyosha has a high cash cycle compare to other players in the Printing Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

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 Koyosha supply chain. Even after few cautionary changes, Koyosha is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Koyosha vulnerable to further global disruptions in South East Asia.

Need for greater diversity

– Koyosha 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.

Capital Spending Reduction

– Even during the low interest decade, Koyosha 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 Printing Services industry using digital technology.

No frontier risks strategy

– From the 10K / annual statement of Koyosha, it seems that company is thinking out the frontier risks that can impact Printing Services industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.

Skills based hiring in Printing Services industry

– The stress on hiring functional specialists at Koyosha 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, Koyosha has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Printing Services industry over the last five years. Koyosha 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.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Koyosha is slow explore the new channels of communication. These new channels of communication can help Koyosha to provide better information regarding Printing 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 Koyosha is dominated by functional specialists. It is not different from other players in the Printing Services industry, but Koyosha needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Koyosha to focus more on services in the Printing Services industry rather than just following the product oriented approach.

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Koyosha Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Koyosha are -

Creating value in data economy

– The success of analytics program of Koyosha has opened avenues for new revenue streams for the organization in Printing Services industry. This can help Koyosha to build a more holistic ecosystem for Koyosha products in the Printing Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Better consumer reach

– The expansion of the 5G network will help Koyosha to increase its market reach. Koyosha 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.

Developing new processes and practices

– Koyosha can develop new processes and procedures in Printing Services 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Koyosha can use these opportunities to build new business models that can help the communities that Koyosha operates in. Secondly it can use opportunities from government spending in Printing Services sector.

Low interest rates

– Even though inflation is raising its head in most developed economies, Koyosha 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.

Use of Bitcoin and other crypto currencies for transactions in Printing Services industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Koyosha in the Printing Services industry. Now Koyosha can target international markets with far fewer capital restrictions requirements than the existing system.

Learning at scale

– Online learning technologies has now opened space for Koyosha 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Koyosha in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Printing Services industry, and it will provide faster access to the consumers.

Building a culture of innovation

– managers at Koyosha 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 Printing Services industry.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Koyosha 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 Koyosha to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Koyosha can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

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. Koyosha can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Loyalty marketing

– Koyosha 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.

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Threats Koyosha External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Koyosha are -

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Koyosha may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Printing Services sector.

Easy access to finance

– Easy access to finance in Printing Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Koyosha can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Technology acceleration in Forth Industrial Revolution

– Koyosha has witnessed rapid integration of technology during Covid-19 in the Printing Services industry. As one of the leading players in the industry, Koyosha needs to keep up with the evolution of technology in the Printing Services 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Koyosha 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 Koyosha prominent markets.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Printing Services industry are lowering. It can presents Koyosha with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Printing Services sector.

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. Koyosha 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.

Shortening product life cycle

– it is one of the major threat that Koyosha is facing in Printing Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Consumer confidence and its impact on Koyosha 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 Printing Services industry and other sectors.

Increasing wage structure of Koyosha

– 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 Koyosha.

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.

High dependence on third party suppliers

– Koyosha 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.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Koyosha in Printing Services industry. The Printing 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.

Regulatory challenges

– Koyosha 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 Printing Services industry regulations.

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Weighted SWOT Analysis of Koyosha Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Koyosha 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 Koyosha 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 Koyosha 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 Koyosha 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 Koyosha needs to make to build a sustainable competitive advantage.

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