Mitsui (Conglomerate) SWOT Analysis / Matrix

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SWOT analysis is a vital strategic planning tool that can be used by Mitsui (Conglomerate) managers to do a situational analysis of the company . It is an important technique to map out the present Strengths (S), Weakness (W), Opportunities (O) & Threats (T) Mitsui (Conglomerate) is facing in its current business environment.

The Mitsui (Conglomerate) is one of the leading organizatations in its industry. Mitsui (Conglomerate) maintains its prominent position in market by critically analyzing and reviewing the SWOT analysis.  SWOT analysis an immensenly interactive process and requires effective coordination among various departments within the company such as – marketing, finance, operations, management information systems and strategic planning.

The SWOT Analysis framework helps an organization to identify the internal strategic factors such as -strengths and weaknesses, & external strategic factors such as - opportunities and threats. It leads to a 2X2 matrix – also called SWOT Matrix.

The Strengths-Weaknesses-Opportunities-Threats (SWOT) Analysis / Matrix enables the managers of the Mitsui (Conglomerate) to develop four types of strategies:

• SO (strengths-opportunities) Strategies
• WO (weaknesses-opportunities) Strategies
• ST (strengths-threats) Strategies
•  WT (weaknesses-threats) Strategies

SWOT Matrix Strategies Objective

The primary purpose of SWOT matrix is to identify the strategies that a firm can utilize to exploit external opportunities, counter threats, and build on & protect Mitsui (Conglomerate) strengths, and eradicate its weaknesses.

Step by Step Guide to Mitsui (Conglomerate) SWOT Analysis

Strengths of Mitsui (Conglomerate) – Internal Strategic Factors

As one of the leading organizations in its industry, Mitsui (Conglomerate) has numerous strengths that help it to thrive in the market place. These strengths not only help it to protect the market share in existing markets but also help in penetrating new markets. Based on Fern Fort University extensive research – some of the strengths of Mitsui (Conglomerate) are –

• Strong distribution network – Over the years Mitsui (Conglomerate) has built a reliable distribution network that can reach majority of its potential market.
• Strong Free Cash Flow – Mitsui (Conglomerate) has strong free cash flows that provide resources in the hand of the company to expand into new projects.
• Strong dealer community – It has built a culture among distributor & dealers where the dealers not only promote company’s products but also invest in training the sales team to explain to the customer how he/she can extract the maximum benefits out of the products.
• Highly skilled workforce through successful training and learning programs. Mitsui (Conglomerate) is investing huge resources in training and development of its employees resulting in a workforce that is not only highly skilled but also motivated to achieve more.
• High level of customer satisfaction – the company with its dedicated customer relationship management department has able to achieve a high level of customer satisfaction among present customers and good brand equity among the potential customers.
• Highly successful at Go To Market strategies for its products.
• Automation of activities brought consistency of quality to Mitsui (Conglomerate) products and has enabled the company to scale up and scale down based on the demand conditions in the market.
• Good Returns on Capital Expenditure – Mitsui (Conglomerate) is relatively successful at execution of new projects and generated good returns on capital expenditure by building new revenue streams.

Weakness of Mitsui (Conglomerate) – Internal Strategic Factors

Weakness are the areas where Mitsui (Conglomerate) can improve upon. Strategy is about making choices and weakness are the areas where a firm can improve using SWOT analysis and build on its competitive advantage and strategic positioning.

• The profitability ratio and Net Contribution % of Mitsui (Conglomerate) are below the industry average.
• Financial planning is not done properly and efficiently. The current asset ratio and liquid asset ratios suggest that the company can use the cash more efficiently than what it is doing at present.
• There are gaps in the product range sold by the company. This lack of choice can give a new competitor a foothold in the market.
• Limited success outside core business – Even though Mitsui (Conglomerate) is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
• The company has not being able to tackle the challenges present by the new entrants in the segment and has lost small market share in the niche categories. Mitsui (Conglomerate) has to build internal feedback mechanism directly from sales team on ground to counter these challenges.
• Investment in Research and Development is below the fastest growing players in the industry. Even though Mitsui (Conglomerate) is spending above the industry average on Research and Development, it has not been able to compete with the leading players in the industry in terms of innovation. It has come across as a mature firm looking forward to bring out products based on tested features in the market.
• Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, Mitsui (Conglomerate) needs to put more money in technology to integrate the processes across the board. Right now the investment in technologies is not at par with the vision of the company.

Opportunities for Mitsui (Conglomerate) – External Strategic Factors

• Government green drive also opens an opportunity for procurement of Mitsui (Conglomerate) products by the state as well as federal government contractors.
• New environmental policies – The new opportunities will create a level playing field for all the players in the industry. It represent a great opportunity for Mitsui (Conglomerate) to drive home its advantage in new technology and gain market share in the new product category.
• The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as Mitsui (Conglomerate) to increase its profitability.
• The market development will lead to dilution of competitor’s advantage and enable Mitsui (Conglomerate) to increase its competitiveness compare to the other competitors.
• Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Mitsui (Conglomerate).
• The new technology provides an opportunity to Mitsui (Conglomerate) to practices differentiated pricing strategy in the new market. It will enable the firm to maintain its loyal customers with great service and lure new customers through other value oriented propositions.
• New customers from online channel – Over the past few years the company has invested vast sum of money into the online platform. This investment has opened new sales channel for Mitsui (Conglomerate). In the next few years the company can leverage this opportunity by knowing its customer better and serving their needs using big data analytics.
• Organization’s core competencies can be a success in similar other products field. A comparative example could be - GE healthcare research helped it in developing better Oil drilling machines.

Threats Mitsui (Conglomerate) Facing - External Strategic Factors

• Intense competition – Stable profitability has increased the number of players in the industry over last two years which has put downward pressure on not only profitability but also on overall sales.
• No regular supply of innovative products – Over the years the company has developed numerous products but those are often response to the development by other players. Secondly the supply of new products is not regular thus leading to high and low swings in the sales number over period of time.
• Growing strengths of local distributors also presents a threat in some markets as the competition is paying higher margins to the local distributors.
• The company can face lawsuits in various markets given - different laws and continuous fluctuations regarding product standards in those markets.
• New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
• The demand of the highly profitable products is seasonal in nature and any unlikely event during the peak season may impact the profitability of the company in short to medium term.
• Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.
• Rising raw material can pose a threat to the Mitsui (Conglomerate) profitability.

Limitations of SWOT Analysis for Mitsui (Conglomerate)

Although the SWOT analysis is widely used as a strategic planning tool, the analysis does have its share of limitations.

• Certain capabilities or factors of an organization can be both a strength and weakness at the same time. This is one of the major limitations of SWOT analysis . For example changing environmental regulations can be both a threat to company it can also be an opportunity in a sense that it will enable the company to be on a level playing field or at advantage to competitors if it able to develop the products faster than the competitors.
• SWOT does not show how to achieve a competitive advantage, so it must not be an end in itself.
• The matrix is only a starting point for a discussion on how proposed strategies could be implemented. It provided an evaluation window but not an implementation plan based on strategic competitiveness of Mitsui (Conglomerate)
• SWOT is a static assessment - analysis of status quo with few prospective changes. As circumstances, capabilities, threats, and strategies change, the dynamics of a competitive environment may not be revealed in a single matrix.
• SWOT analysis may lead the firm to overemphasize a single internal or external factor in formulating strategies. There are interrelationships among the key internal and external factors that SWOT does not reveal that may be important in devising strategies.

Weighted SWOT Analysis of Mitsui (Conglomerate)

In light of the above mentioned limitations of the SWOT analysis / matrix, corporate managers decided to provide weightage to each internal strength and weakness of the firm. Organizations also assess the likelihood of events taking place in the coming future and how strong their impact could be on company's performance.

This method is called Weighted SWOT analysis. It is better than doing simplistic SWOT analysis because with Weighted SWOT Analysis Mitsui (Conglomerate) managers can focus on the most critical factors and discount the non-important one. It also solves the long list problem where organizations ends up making a long list but none of the factors deemed too critical.

Limitation of Weighted SWOT analysis of Mitsui (Conglomerate)

This approach also suffers from one major drawback - it focus on individual importance of factor rather than how they are collectively important and impact the business holistically.

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SWOT Worksheet & Template

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References / Citations & Bibliography

• M. E. Porter, Competitive Strategy(New York: Free Press, 1980)
• A. D. Chandler, Strategy and Structure (Cambridge, Mass.: MIT Press, 1962)
• O. E. Williamson, Markets and Hierarchies(New York: Free Press, 1975);
• L. Wrigley, Divisional Autonomy and Diversification (PhD, Harvard Business School, 1970)
• R. E. White, Generic Business Strategies, Organizational Context and Performance: An Empirical Investigation, Strategic Management Journal7 (1986)