SWOT Analysis / TOWS Matrix for Okura Holdings (Hong Kong)
Based on various researches at Oak Spring University , Okura Holdings is operating in a macro-environment that has been destablized by – geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China,
increasing government debt because of Covid-19 spendings, technology disruption, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Okura Holdings can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Okura Holdings, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Okura Holdings 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 Okura Holdings can be done for the following purposes –
1. Strategic planning of Okura Holdings
2. Improving business portfolio management of Okura Holdings
3. Assessing feasibility of the new initiative in Hong Kong
4. Making a Casinos & Gaming sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Okura Holdings
Strengths of Okura Holdings | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Okura Holdings are -
Successful track record of launching new products
– Okura Holdings has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Okura Holdings 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.
Digital Transformation in Casinos & Gaming industry
- digital transformation varies from industry to industry. For Okura Holdings digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Okura Holdings 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.
Sustainable margins compare to other players in Casinos & Gaming industry
– Okura Holdings has clearly differentiated products in the market place. This has enabled Okura Holdings to fetch slight price premium compare to the competitors in the Casinos & Gaming industry. The sustainable margins have also helped Okura Holdings to invest into research and development (R&D) and innovation.
– The operational resilience strategy of Okura Holdings comprises – understanding the underlying the factors in the Casinos & Gaming 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.
Highly skilled collaborators
– Okura Holdings has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Casinos & Gaming industry. Secondly the value chain collaborators of Okura Holdings have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Okura Holdings
– The covid-19 pandemic has put organizational resilience at the centre of everthing Okura Holdings does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Okura Holdings 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.
High brand equity
– Okura Holdings has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Okura Holdings to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Casinos & Gaming
– Okura Holdings is one of the leading players in the Casinos & Gaming industry in Hong Kong. Over the years it has not only transformed the business landscape in the Casinos & Gaming industry in Hong Kong but also across the existing markets. The ability to lead change has enabled Okura Holdings in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management in the Casinos & Gaming industry
– Okura Holdings 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
– Okura Holdings is one of the leading players in the Casinos & Gaming industry in Hong Kong. It is in a position to attract the best talent available in Hong Kong. The firm has a robust talent identification program that helps in identifying the brightest.
- Okura Holdings 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 Okura Holdings is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Okura Holdings emphasize – knowledge, initiative, and innovation.
Weaknesses of Okura Holdings | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Okura Holdings are -
Products dominated business model
– Even though Okura Holdings has some of the most successful models in the Casinos & Gaming industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Okura Holdings should strive to include more intangible value offerings along with its core products and services.
High dependence on Okura Holdings ‘s star products
– The top 2 products and services of Okura Holdings still accounts for major business revenue. This dependence on star products in Casinos & Gaming industry has resulted into insufficient focus on developing new products, even though Okura Holdings has relatively successful track record of launching new products.
High bargaining power of channel partners in Casinos & Gaming industry
– because of the regulatory requirements in Hong Kong, Okura Holdings 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 Casinos & Gaming industry.
Increasing silos among functional specialists
– The organizational structure of Okura Holdings is dominated by functional specialists. It is not different from other players in the Casinos & Gaming industry, but Okura Holdings needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Okura Holdings to focus more on services in the Casinos & Gaming industry rather than just following the product oriented approach.
Employees’ less understanding of Okura Holdings strategy
– From the outside it seems that the employees of Okura Holdings 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.
Slow to strategic competitive environment developments
– As Okura Holdings is one of the leading players in the Casinos & Gaming industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Casinos & Gaming industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the Casinos & Gaming industry, Okura Holdings 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.
No frontier risks strategy
– From the 10K / annual statement of Okura Holdings, it seems that company is thinking out the frontier risks that can impact Casinos & Gaming 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.
Compensation and incentives
– The revenue per employee of Okura Holdings is just above the Casinos & Gaming 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 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 Okura Holdings supply chain. Even after few cautionary changes, Okura Holdings is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Okura Holdings vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Okura Holdings 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.
Okura Holdings Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Okura Holdings are -
Developing new processes and practices
– Okura Holdings can develop new processes and procedures in Casinos & Gaming 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.
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. Okura Holdings can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Okura Holdings 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Okura Holdings 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 Okura Holdings to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Okura Holdings 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 Casinos & Gaming industry.
Using analytics as competitive advantage
– Okura Holdings has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Casinos & Gaming sector. This continuous investment in analytics has enabled Okura Holdings to build a competitive advantage using analytics. The analytics driven competitive advantage can help Okura Holdings to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
– Okura Holdings 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Okura Holdings is facing challenges because of the dominance of functional experts in the organization. Okura Holdings can utilize new technology in the field of Casinos & Gaming industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Okura Holdings 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 Okura Holdings to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Okura Holdings can improve the customer journey of consumers in the Casinos & Gaming 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.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Okura Holdings to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Okura Holdings can use these opportunities to build new business models that can help the communities that Okura Holdings operates in. Secondly it can use opportunities from government spending in Casinos & Gaming sector.
– Okura Holdings can use the latest technology developments to improve its manufacturing and designing process in Casinos & Gaming 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.
Threats Okura Holdings External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Okura Holdings are -
– 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 Okura Holdings in the Casinos & Gaming sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Okura Holdings is facing in Casinos & Gaming sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Okura Holdings 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.
Easy access to finance
– Easy access to finance in Casinos & Gaming industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Okura Holdings can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Okura Holdings business can come under increasing regulations regarding data privacy, data security, etc.
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 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. Okura Holdings needs to understand the core reasons impacting the Casinos & Gaming industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Okura Holdings has witnessed rapid integration of technology during Covid-19 in the Casinos & Gaming industry. As one of the leading players in the industry, Okura Holdings needs to keep up with the evolution of technology in the Casinos & Gaming 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.
– 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.
Consumer confidence and its impact on Okura Holdings 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 Casinos & Gaming industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Casinos & Gaming industry are lowering. It can presents Okura Holdings with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Casinos & Gaming sector.
– Okura Holdings 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. Okura Holdings can take advantage of this fund but it will also bring new competitors in the Casinos & Gaming 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 Okura Holdings.
Weighted SWOT Analysis of Okura Holdings Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Okura Holdings 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 Okura Holdings 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 Okura Holdings 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 Okura Holdings 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 Okura Holdings needs to make to build a sustainable competitive advantage.