Toshiba Ome Works Case Solution

The Harvard Business Review published a case study that primarily focuses on Toshiba Ome Works. The following case solution has been designed to give the reader an overview about the business world along with a clear understanding of its growth dynamics. Recently, Toshiba Ome Works has been subjected to strategic as well as managerial problems that require immediate attention so that they can be resolved to allow future growth, expansion, and competitive edge within the marketplace. This case study solution is being written to provide a strategic solution to Toshiba Ome Works using various appropriate tools and frameworks. Harvard Business Review’s case studies involve a central problem that is faced by a particular company. The problem identified involves strategic and managerial implications for the company. Therefore, it is important for readers to critically identify the problem Toshiba Ome Works faces. Moreover, it is also essential to highlight the key stakeholders that are impacted and influenced by the problem identified.

External Environmental Analysis

The external environment holds significant importance for Toshiba Ome Works to ensure that the company is able to respond to all the changes in the macro-environment. This is because Toshiba Ome Works cannot control the factors and thus can directly influence the company's operations (Indris & Primiana, 2015). The external environment of Toshiba Ome Works will be assessed using PESTLE Analysis.

Political

• A stable political environment provides a favorable market growth trend for Toshiba Ome Works.

• It is important for Toshiba Ome Works to analyze the pressure groups, and social environment activists. The company can make close collaborations with these groups to achieve company goals (Wang, Wang, & Shi, 2022).

• High restrictions on trade and high levels of taxes can contribute to the complex business environment for Toshiba Ome Works by impacting imports and exports.

Economic

• Toshiba Ome Works can benefit from wide-range opportunities in business growth by operating in developing economies (Munro, 2017).

• High GDP can determine the long-term growth strategies of Toshiba Ome Works, signaling the ability of consumers to spend on more products.

• Higher rates of interests can provide Toshiba Ome Works with more investment opportunities.

• The flexibility in the labor market allows Toshiba Ome Works to take advantage of higher workforce productivity.

Social

• The selection of appropriate demographic segments has allowed Toshiba Ome Works to select the right segments of the market that have high growth potential.

• The research on gender roles has helped Toshiba Ome Works to develop and align communication as well as marketing strategies accordingly.

• Toshiba Ome Works has been successful in understanding the norms and cultures of different countries by developing local teams and partnerships (Hueske, Endrikat, & Guenther, 2015).

Technological

• The adoption of innovative marketing techniques that involves communication technologies has allowed Toshiba Ome Works to collaborate successfully with consumers.

• The company has stayed ahead in the market, and can significantly increase its market share by placing its major focus on emerging technologies (Akpoviroro & Owotutu, 2018).

• Toshiba Ome Works should maximize its profits by investing in disruptive technologies.

Environmental

• It is crucial for Toshiba Ome Works to adopt effective waste management practices to reduce environmental pollution (J. K, W. J, & D., 2016).

• Toshiba Ome Works should adopt eco-friendly products to establish better relationships with the stakeholders.

• Toshiba Ome Works can take advantage of subsidies offered in renewable technologies to achieve the long-term goal of sustainability.

Legal

• Toshiba Ome Works should follow proper laws concerning employee health and safety, and anti-discrimination laws to effectively develop HRM.

• Consumer protection laws are also important for Toshiba Ome Works as it involves the consumer protection from fraudulent marketing (S. Samusenko, S. Plaskova, & A. Prodanova, 2020).

• Toshiba Ome Works can gain a competitive advantage, and can position itself strongly in the market by protecting intellectual property laws.

Porter’s Five Forces Analysis

Threat of New Entrants

• It is difficult to achieve economies of scale in Toshiba Ome Works’s industry, making it a weaker force for new entrants.

• There are high capital requirements in the industry. This makes it difficult for new businesses to set up their companies, and compete against Toshiba Ome Works.

• The industry has a strong product differentiation, and heavy investment is needed for customer acquisition. Thus, Toshiba Ome Works can focus on innovation to differentiate itself from its competitors (H. Th. Bruijl, 2018).

• There are strict legal requirements to join the industry in which Toshiba Ome Works operates, making it difficult for new entrants to enter the market.

Bargaining Power of Suppliers

• The bargaining power of suppliers in the industry is weak.

• Toshiba Ome Works operates in an industry with a higher number of suppliers. This means that suppliers do not have much control over their prices.

• Standardized products that have low switching costs are provided by suppliers allowing buyers like Toshiba Ome Works to easily switch their suppliers (Fabbri & F.Klapper, 2016).

• Raw materials can be purchased at lower prices by Toshiba Ome Works. The company can also switch suppliers for more reasonable pricing.

• Toshiba Ome Works can benefit from a variety of suppliers as it can have multiple suppliers for its various geographical areas (Cho, Ke, & Han, 2019).

Bargaining Power of Buyers

• The bargaining power of buyers in the Toshiba Ome Works industry is weak.

• There is a high product differentiation in the industry, making it difficult for buyers to switch to alternative firms.

• Toshiba Ome Works can come with differentiated and innovative products to attract more buyers of the industry (Zhao, Zuo, & Wu, 2016).

• Buyers of this industry has low incomes. This means they prefer to purchase items at lower prices, making them more price sensitive. Organizations like Toshiba Ome Works can offer lower prices to attract customers.

Threat of Substitute Products or Services

• There are few substitute products available in the industry in which Toshiba Ome Works operates.

• Expensive substitutes are available in the industry of Toshiba Ome Works, making it difficult for buyers to switch to those substitutes (Aithal, 2016).

Rivalry Among Existing Firms

• The rivalry among existing firms is moderate to weak.

• There are few competitors in the industry in which Toshiba Ome Works operates.

• A large market share is enjoyed by fewer firms in the industry. This means that more competitive actions will be made to become leaders in the market (Seema, 2016).

• The industry in which Toshiba Ome Works operates has highly differentiated products, making it difficult for companies to win each other customers.

• Toshiba Ome Works can focus on making more differentiated products to gain a strong competitive edge in the market (Zhao, Zuo, & Wu, 2016).

Internal Environmental Analysis

Toshiba Ome Works can use internal environmental analysis to identify and evaluate the competitive positioning of a company in the business environment. This involves conducting a SWOT Analysis that can help Toshiba Ome Works to identify the company’s internal strengths, weaknesses, opportunities, and threats (Halmaghi, Iancue, & Băcilă, 2017).

SWOT Analysis

Strengths

• Toshiba Ome Works has a strong distribution network that has allowed it to make its products available to large customers within the given timeframe.

• A strong presence on social media platforms has allowed Toshiba Ome Works to have a high level of customer engagement (Rizaldi, 2015).

• Toshiba Ome Works has been successful in building a large product portfolio, so unique and distinctive products can be offered to consumers.

• Toshiba Ome Works has a strong brand image in the market.

• A low-cost structure of Toshiba Ome Works has allowed it to manufacture products at lower costs, so they become affordable for consumers to purchase.

• The financial position of Toshiba Ome Works is strong as the company has generated higher profits over the past years (Phadermrod, M.Crowder, & B.Wills, 2019).

• Toshiba Ome Works has invested in the training and development of its employees to keep them motivates, leading to higher efficiency and productivity.

Weaknesses

• The expenditure of Toshiba Ome Works on its research and development is comparatively less to other competitors of the market.

• Toshiba Ome Works uses a centralized decision-making process that takes time and reduces operational efficiency (Ahmadi, Dileepan, & K. Wheatley, 2016).

• There are high rental costs because Toshiba Ome Works operates on more of the rental properties rather than purchasing them.

• There is no workforce diversification in Toshiba Ome Works. This makes it difficult for the employees to adjust with the different workers who belong to different backgrounds.

Opportunities

• Since the online shopping has increased significantly, Toshiba Ome Works can take it as an opportunity to expand its online presence.

• Toshiba Ome Works can make use of social media platforms to market its products, with more customers interactions.

• Due to more technological developments, Toshiba Ome Works can make its operations more automated so that overall company costs can be reduced (Ahmadi, Dileepan, & K. Wheatley, 2016).

• Globalization provides an opportunity to Toshiba Ome Works to expand its operations in multiple countries.

• Toshiba Ome Works can enter in a niche market and sell distinctive products to gain a competitive advantage.

• The increase in the demand of environmentally friendly goods, Toshiba Ome Works, can place its major focus on making such products (E.Quezada, A.Reinao, & I.Palominos, 2019).

Threats

• In recent times, there has been an increase in the bargaining power of suppliers, making it difficult for Toshiba Ome Works to buy raw materials at lower costs.

• Numerous players are entering the industry, posing a major threat to Toshiba Ome Works.

• There has been constant pressure on Toshiba Ome Works to conduct frequent research to understand the changing customer tastes and preferences (Kolbina, 2015).

• Technological advancements require workforce training. This adds to the costs of Toshiba Ome Works.

VRIO Analysis

Toshiba Ome Works uses VRIO Analysis to assess and evaluate the company resources to determine the competitiveness, and strategic advantage.

Valuable

• Toshiba Ome Works has a strong brand image and engages in corporate social responsibility.

• Toshiba Ome Works has a high brand recognition because of the quality of products it offers to its customers (Ariyani & Daryanto, 2018).

• The distribution system of Toshiba Ome Works is valued all round the world. The company has been able to successfully establish strong relationships with its suppliers.

• Toshiba Ome Works focuses on continuous innovation in its business. The company has expanded this innovation in its multiple functional areas.

• There are potential growth opportunities in the market, and Toshiba Ome Works has been able to penetrate the market through its ability to raise large funds.

Rare

• Toshiba Ome Works operates globally. This global presence has allowed the company to increase its customer base (Miethlich & G. Oldenburg, 2019).

• Toshiba Ome Works has an organizational culture that promotes more teamwork, innovation, and creativity among its employees, that leads to a competitive advantage.

• Since Toshiba Ome Works has a global presence, it allows the company to easily adapt to different cultures, norms and values.

• The risk-taking ability of Toshiba Ome Works is strong. This provides more opportunities to the company to penetrate different markets.

Inimitable

• The inimitable resource for Toshiba Ome Works is its high-quality products. These products have allowed consumers to make repeat purchases.

• Toshiba Ome Works operates through multiple locations of stores in different companies, allowing easy access to products.

• Strong marketing communications have been used by Toshiba Ome Works to attract more customers.

• Toshiba Ome Works has been using integrated technology that has allowed it to offer competitive pricing to its customers (Ariwibowo, Saputro, & Haryanto, 2021).

• Toshiba Ome Works maintains an excellent customer service that has enabled it to have a high brand engagement.

Organization

• Strong financial position has allowed Toshiba Ome Works to explore more product development opportunities.

• Toshiba Ome Works is successfully maintaining the efficiency and effectiveness of its business operations with the help of more integrated and advanced technology.

• Employees are given both in-house and off-the-job training opportunities by Toshiba Ome Works that allow more skills development (Adnan, Abdulhamid, & Sohail, 2018).

• The strong value chain and distribution network has enabled Toshiba Ome Works to increase its revenue through the sale of its products.

Marketing Mix

Marketing Mix is needed by Toshiba Ome Works to formulate effective strategies to achieve the company objectives.

Product

• Toshiba Ome Works has five product categories. Each of these categories has a product line that involves more variety of products (Išoraitė, 2016).

• Highly differentiated products are offered by Toshiba Ome Works to its customers. These distinctive products are not easily available at competitors.

• The products of Toshiba Ome Works are of higher quality, and thus, customers pay more prices for these products.

• Toshiba Ome Works designs products with traditional designs giving customers more product variety.

• Toshiba Ome Works offers multiple sizes for its every product to make it easy for its customers to select the right product.

• Warranty and same-day delivery option if also provided by Toshiba Ome Works to its customers.

Price

• Toshiba Ome Works follows a competitive pricing strategy.

• To attract more customers, bundle pricing has also been used by the company.

• Little higher prices are charged for products that are sold online because of the delivery costs (Thabit & Raewf, 2018).

• Optional product pricing strategy is also adopted by Toshiba Ome Works for some of its products, such as a base product is offered for a certain price, and there are separate prices for its accessories.

• Regular promotional prices are also offered by Toshiba Ome Works to its customers.

Place

• Toshiba Ome Works uses two channels for its product distribution. This includes online selling and through own stores.

• There are more than multiple stores owned by Toshiba Ome Works globally. This ensures easy product availability to customers (Pogorelova, Yakhneeva, & Agafonova, 2016).

• Toshiba Ome Works has partnered with delivery service companies to distribute its products effectively to consumers.

• Toshiba Ome Works has also adopted an omni-channel distribution system.

Promotion

• Toshiba Ome Works uses a traditional promotional strategy that involves TV advertisements (Fan, Y.K.Lau, & Zhao, 2015).

• Social media advertisements are also adopted by Toshiba Ome Works to increase brand awareness.

• Toshiba Ome Works takes part in various events and exhibitions as a way of promoting its products.

• Large sales force is used to provide the customers with a more personal experience.

• Toshiba Ome Works also makes use of influencer marketing to increase the demand for its products.

• Regular content and deals are posted on the social media pages of Toshiba Ome Works to attract and retain customers.

Value Chain Analysis

Toshiba Ome Works can use Value Chain Analysis to identify and assess inter-relationships as well as interdependencies.

Primary Activities

• Toshiba Ome Works’s primary activities involves the production and selling of products to the final consumers (Mintz, J.Gilbride, & Lenk, 2021).

• Toshiba Ome Works has a strong relationship with the suppliers. This ensures that the product is received, stored, and distributed in a timely manner.

• Operational activities of Toshiba Ome Works are effectively aligned.

• For inbound logistics, after the arrival of raw material, the company processes it to manufacture the final product (Hasan, Nekmahmud, & Yajuan, 2019).

• In terms of outbound logistics, Toshiba Ome Works has been able to set up optimal costs as well as efficient delivery processes to deliver the product on time.

• Toshiba Ome Works invests in its sales and marketing activities to build relationships with customers.

• Marketing funnel approach is used by Toshiba Ome Works to effectively devise and build sales and marketing activities.

• Toshiba Ome Works offers both pre-sale and post-sales services to its customers.

Secondary Activities

• Toshiba Ome Works has an effective infrastructure that has allowed the company to successfully optimize its value chain.

• The competitive pressure in terms of employee skill development, motivation, and commitment is reduced as Toshiba Ome Works has developed a strong HRM (Linkov, Carluccio, Pritchard, & Bhreasail, 2020).

• Toshiba Ome Works uses a cost minimization approach to reduce its costs by analyzing the costs associated with training and hiring the employees.

• Toshiba Ome Works has been using integrated technology in its value chain activities. This includes technological customer support, research and data analytics concerning product design, and automated software.

• The procurement activities of Toshiba Ome Works are effectively optimized with its inbound, outbound, and operational activities (Maheswari, Yudoko, & Adhiutama, 2019).

Market Penetration Strategies

• Toshiba Ome Works can increase the capacity of its production so it can reach more of the customers in its existing market.

• Toshiba Ome Works can focus on controlling the overhead costs so that it can offer competitive pricing that can attract customers of the market (Dawes, 2018).

• Investments can be made by Toshiba Ome Works in marketing and sales activities to increase the chances of successful market penetration.

• Toshiba Ome Works can design and develop a content that increases customer engagement within a particular marketplace.

• Toshiba Ome Works can assess and identify more enhanced distribution networks (Radpour, Mondal, & Kumar, 2017).

• Improved distribution systems and supply chains can improve the product accessibility for the customers, making it easier for Toshiba Ome Works to penetrate the market.

• Toshiba Ome Works can adopt price cuts in its products to compete in the market. This will give a company a competitive edge over its competitors.

• Toshiba Ome Works can plan strategies where it can focus on acquiring the leading players of the market. Such acquisitions will give the company an opportunity to reach more customer segments.

• Strategic partnerships and joint ventures agreements can be signed by Toshiba Ome Works to mitigate the risk factors, and to gain customer groups of the market.

• Toshiba Ome Works can come up with new and innovative features in its already existing product for the market (Daouda, Barth, & T. M. Ingenbleek, 2019).

Market Development Strategies

• It is important for Toshiba Ome Works to invest in the research and development department so potential markets can be identified (Hilman, Bohari, & Abdullah, 2018).

• Regional expansion strategy can be used by Toshiba Ome Works for growth purposes. This will also take into consideration the cultural differences.

• Toshiba Ome Works should also consider to expand its business operations in the international market. This will allow access to a larger customer base.

• New customer groups and segments should be explored by Toshiba Ome Works.

• Toshiba Ome Works should also invest in brand-building activities as it will give an opportunity to reach more potential customers (C. Koks & M. Kilika, 2016).

• Toshiba Ome Works should consider the market education in terms of its product. The company can significantly increase its sales by giving product awareness to new segments.

Product Development Strategies

• Toshiba Ome Works can come up with new improvements and modifications in the existing products to attract the market.

• Toshiba Ome Works should undergo the NPD process, so the company is able to assess and identify new points for its customers.

• Regular investments in the research and development will help Toshiba Ome Works to develop something new and innovative that can give a competitive advantage (Kalogiannidis & Mavratzas, 2020).

• Toshiba Ome Works can develop new products by getting into more strategic partnerships.

Diversification Strategies

• Toshiba Ome Works can adopt vertical diversification to develop business. This can be done by adding more products to the existing portfolio (Kalogiannidis & Mavratzas, 2020).

• Horizontal integration can also be adopted by Toshiba Ome Works, where the company can enter into a completely new product development phase that does not exist in the current product line.

• Toshiba Ome Works can also consider to conglomerate by starting a different business.

Conclusion

Based on all the models and frameworks discussed above, it is concluded that Toshiba Ome Works should focus on widening the existing product portfolio. Moreover, the psychological pricing strategy can be adopted. Toshiba Ome Works should also maintain close relationships with its suppliers to benefit from lower prices. Similarly, Toshiba Ome Works should develop more integrated outbound logistics for its perishable items. It is also important to continue producing quality and innovative products, so Toshiba Ome Works is less affected by the new emerging competition in the industry.

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