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Publish Date: 2024-12-03

Harvard Case - Akira Fukabori and Kevin Kajitani at avatarin (A) (Abridged)

"Akira Fukabori and Kevin Kajitani at avatarin (A) (Abridged)" Harvard business case study is written by Linda A. Hill, Emily Tedards. It deals with the challenges in the field of General Management. The case study is 34 page(s) long and it was first published on : Jun 1, 2021

At Fern Fort University, we recommend that Akira Fukabori and Kevin Kajitani implement a strategic plan that focuses on leveraging Avatarin's existing strengths in innovation, technology, and globalization to achieve sustainable growth in the emerging markets. This plan should prioritize strategic alliances, digital transformation, and corporate social responsibility initiatives to establish a strong brand reputation and foster long-term value creation.

2. Background

The case study focuses on Avatarin, a Japanese company specializing in the production of high-quality, customized prosthetic limbs. The company is facing a critical juncture as it seeks to expand its operations into emerging markets, particularly in Asia and Africa. The two protagonists, Akira Fukabori, the CEO, and Kevin Kajitani, the head of international business, are grappling with the challenges of navigating cultural differences, adapting to diverse regulatory environments, and managing the complexities of international expansion.

3. Analysis of the Case Study

To analyze the case, we can employ a combination of frameworks:

a) SWOT Analysis:

  • Strengths: Avatarin possesses strong technical expertise, a reputation for quality products, and a dedicated team of engineers and technicians. Their innovative approach to prosthetic design and manufacturing has established a competitive advantage in the market.
  • Weaknesses: The company lacks experience in international markets, particularly in emerging economies. They also need to develop a more robust marketing strategy to reach target audiences in diverse cultural contexts.
  • Opportunities: The global demand for prosthetics is increasing, driven by rising healthcare needs and an aging population. Emerging markets present significant growth potential due to their large populations and increasing disposable incomes.
  • Threats: Competition from local and international players, fluctuating currency exchange rates, and potential regulatory hurdles pose risks to Avatarin's expansion plans.

b) Porter's Five Forces:

  • Threat of new entrants: The prosthetic industry is relatively specialized, with a high barrier to entry due to the need for technical expertise and regulatory compliance. However, the threat of new entrants could increase with the emergence of new technologies and business models.
  • Bargaining power of buyers: Buyers in the prosthetic market have relatively low bargaining power due to the limited availability of alternative products and the necessity of specialized care. However, the increasing availability of online platforms could empower buyers to seek better prices and services.
  • Bargaining power of suppliers: Suppliers of raw materials and components have moderate bargaining power, as Avatarin relies on a limited number of specialized suppliers. However, the company can mitigate this risk by diversifying its supply chain and negotiating favorable contracts.
  • Threat of substitute products: The threat of substitute products is relatively low, as prosthetic limbs are essential for individuals with limb loss and have no readily available alternatives. However, advancements in technologies like robotics and artificial intelligence could potentially lead to the development of new and more advanced solutions.
  • Competitive rivalry: The prosthetic market is competitive, with established players like Ottobock and Ossur. However, Avatarin can differentiate itself through its focus on customization, innovation, and ethical sourcing practices.

c) Corporate Social Responsibility (CSR):

Avatarin's commitment to CSR is a key differentiator. By prioritizing ethical sourcing, fair labor practices, and community engagement, the company can build a strong brand reputation and attract customers who value socially responsible products and services.

4. Recommendations

To achieve sustainable growth in emerging markets, Avatarin should implement the following recommendations:

a) Strategic Alliances: Form strategic partnerships with local healthcare providers, NGOs, and government agencies in target markets. These partnerships will provide access to local expertise, distribution channels, and patient networks.

b) Digital Transformation: Invest in digital marketing and e-commerce platforms to reach a wider audience and streamline operations. This includes developing a user-friendly website, engaging in social media marketing, and exploring online sales channels.

c) Cultural Sensitivity: Conduct thorough market research to understand the cultural nuances and healthcare needs of target markets. This will enable Avatarin to tailor its products and services to meet local preferences and regulations.

d) Corporate Social Responsibility (CSR): Develop a robust CSR strategy that aligns with local needs and priorities. This could include initiatives focused on training local technicians, providing financial assistance to disadvantaged individuals, and promoting accessibility for people with disabilities.

e) Talent Management: Invest in hiring and developing a diverse and culturally competent workforce that can effectively navigate the complexities of international operations. This includes providing training on cross-cultural communication, ethical business practices, and local regulations.

f) Operations Strategy: Optimize manufacturing processes and supply chain management to meet the specific requirements of emerging markets. This could involve establishing local manufacturing facilities, partnering with local suppliers, and implementing lean management principles to improve efficiency and reduce costs.

g) Marketing Strategy: Develop a targeted marketing strategy that leverages local media channels, community outreach programs, and influencer marketing to build brand awareness and generate leads.

h) Technology and Analytics: Utilize data analytics to track performance, identify trends, and make informed decisions about product development, marketing, and customer service.

5. Basis of Recommendations

The recommendations are based on the following considerations:

  • Core competencies and consistency with mission: The recommendations align with Avatarin's core competencies in innovation, technology, and quality craftsmanship. They also support the company's mission to provide high-quality prosthetic limbs that improve the lives of individuals with limb loss.
  • External customers and internal clients: The recommendations prioritize the needs of both external customers and internal clients. By focusing on cultural sensitivity, ethical sourcing, and employee development, Avatarin can build strong relationships with customers and retain a motivated and engaged workforce.
  • Competitors: The recommendations aim to differentiate Avatarin from its competitors by leveraging its strengths in innovation, CSR, and digital transformation.
  • Attractiveness ' quantitative measures if applicable: While specific financial projections are not provided in the case study, the recommendations are expected to generate a positive return on investment through increased market share, improved efficiency, and enhanced brand reputation.

6. Conclusion

Avatarin has a significant opportunity to expand its operations into emerging markets and achieve sustainable growth. By implementing a strategic plan that prioritizes innovation, digital transformation, and corporate social responsibility, the company can establish a strong brand presence, attract new customers, and contribute to the well-being of individuals with limb loss worldwide.

7. Discussion

  • Alternative options: Avatarin could consider alternative expansion strategies, such as acquiring existing prosthetic companies in target markets or focusing solely on online sales. However, these options may require significant capital investment and present different challenges.
  • Risks and key assumptions: The success of Avatarin's expansion plans depends on several key assumptions, including the continued growth of the prosthetic market, the availability of qualified personnel, and the ability to navigate regulatory hurdles. The company needs to carefully assess these risks and develop contingency plans to mitigate potential challenges.

8. Next Steps

To implement the recommendations, Avatarin should take the following steps:

  • Develop a detailed strategic plan: This plan should outline specific goals, timelines, and resource allocation for each recommendation.
  • Conduct market research and competitor analysis: Gain a deeper understanding of target markets and identify key competitors.
  • Establish partnerships and alliances: Initiate discussions with potential partners in target markets.
  • Invest in technology and digital infrastructure: Develop a digital marketing strategy and upgrade IT systems to support international operations.
  • Develop a robust CSR strategy: Define specific CSR initiatives that align with local needs and priorities.
  • Recruit and train a diverse workforce: Invest in talent development and ensure that employees are equipped to handle the challenges of international expansion.
  • Monitor progress and make adjustments: Regularly track progress and make necessary adjustments to the strategic plan based on market conditions and performance data.

By taking these steps, Avatarin can successfully navigate the complexities of international expansion and achieve its growth objectives while upholding its commitment to ethical business practices and social responsibility.

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Case Description

In 2016, Akira Fukabori and Kevin Kajitani, aeronautical engineers at All Nippon Airways Co., Ltd., began to wonder why, in a world of accelerating globalization and digital connectivity, those who lived in far-remote villages or impoverished urban areas could not access high quality education or healthcare. They believed that with a faster, cheaper mode of transportation, they could democratize the world's resources-bring the right people or resources together to the right places at the right time. Although teleportation was still the "stuff of science-fiction," teleporting human consciousness and skills to remote locations through robots was not. Their vision was to build an "avatar service platform"-a global infrastructure of general-purpose avatar robots that humans could rent, like Uber or AirBnB, to perform surgery, defuse a bomb, visit elderly grandparents, attend school, or vacation in distant physical environments. In Akira and Kevin's eyes, ANA was in the mobility business, not just the airline business. They influenced senior management to invest $22 million to fund the ANA AVATAR XPRIZE and, with ANA's support, built a global avatar ecosystem of technologists, start-ups, corporates, non-profits, and government, including the Japanese Aerospace Exploration Agency. As they worked to advance the technology and regulatory landscape, they also generated demand for avatar services-for that, they needed to change the mindset of the general public. By 2020, the "ANA AVATAR" program, as they called it, had made significant progress, and Akira and Kevin initiated the process to spin out of ANA, and launch a start-up, "avatarin." Then, COVID-19 upended reality. The years they thought it would take to create widespread demand for avatar-enabled telepresence had evaporated. Now, the question was, how should they deploy their start-up team to meet the humanitarian need, investor, and partner expectations?

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