Tuesday, February 21, 2012

SWOT Analysis

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Strength, Weakness, Opportunity, and Threat

Analysis for Kyocera Corporation

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A SWOT Analysis of the Kyocera Corporation

In April of 15, Kazuo Inamori started a small ceramics company in Kyoto, Japan. With only three million yen in capital, and a work force of only twenty-eight employees, Kyoto Ceramics (later shortened to Kyocera) began to produce quality ceramic products. Since then it has grown into a corporation that produces various business equipment, electronic devices, and ceramic products. The corporation now has over fourteen thousand employees, and over one hundred and fifteen billion yen in capital. The corporation owns one hundred and sixty-one group companies with over forty-four thousand employees. (Kyocera homepage, 00, http// company/gaiyou.html)

During the early 160’s the company was off to a tough start. Inamori was not trained in management, and started off doing what he thought was right. One of the first objectives his company embodied was customer satisfaction. Inamori was totally committed to putting out quality products, and pleasing his customers. The employees would work sixteen-hour days, six days a week, and would stay in a company dormitory. (Miller, 18) This work ethic was in keeping with Japanese customs, and would pave the way for the future success of the company.

The market for Kyocera products was not very strong in Japan in the early 160’s. Inamori realized that in order for his company to grow, he would have to venture away from the rigid Japanese business customs and mindset. In 16 Inamori traveled to the United States, and realized that there was a lot of potential in the emerging semiconductor business. In 168 a representative office was opened in California. (Kyocera homepage, 00, http//

Initially the company was known more for their customer support than they were for their products. Inamori’s belief in customer satisfaction quickly earned him a spotless reputation in the United States. They were able to help customers develop high technology solutions, when other companies simply would not, or could not. They would also provide solutions in days, when their competitors would take weeks.

During the 170’s and 180’s, the company began to diversify. Kyocera acquired many new businesses that were on the verge of bankruptcy. The company also entered many new markets through start up companies. They would find an attractive company, which was struggling for capital to get off their feet, and buy it. This has lead to Kyocera’s wide range of products.

Today the Kyocera Corporation is a leading manufacturer of telecommunications, information, and optical precision equipment, as well as ceramic components used in semiconductor parts. The Kyocera Corporation has grown to be one of the most admired companies in Japan and abroad. (Miller, 18) They have successfully integrated new ideas and approaches to problem solving with traditional beliefs and business customs.


One of the greatest strengths that Kyocera has is diversification. The company has more than one hundred and sixty companies making products in seventeen broad categories. Kyocera Corporation grosses over six billion dollars a year, and produces three-fifths of the world’s ceramic semiconductor packages. Kyocera has shown the ability to adapt to changing market conditions and has gotten into strong growth areas while they were still in their earliest stages.

The Kyocera Corporation prides itself on its ability to take care of customers and treat everyone sincerely. Every morning, workers discuss a twelve-chapter blue book, which instills a competitive spirit, while reinforcing the companies’ motto, “Respect the divine and love people.” (Kyocera homepage, 00, http// rinen.html) Workers with the company are known to be fiercely loyal, even though their hard work is not rewarded with monetary bonuses. Instead they are expected to work for possible promotions in the company, the knowledge that they have done the best job they could possibly do, and the fact that they have taken care of the customer. Not surprisingly, the morale of the employees is quite high.

Two-thirds of Kyocera Corporations sales come from their ceramic products. These are broken into three broad, ever growing fields. They are quality of life products, environmental preservation products, and information and communications products. Some of the products included in these groups range from semiconductor parts, to solar panels, to dental and hip joint implants. (Kyocera homepage, 00, http//global.kyocera .com/company/keiei.html)

When Kyocera enters into a new market, they do a very good analysis before hand. For that reason, their plans for acquisition of new companies usually goes as planned. If for some reason the newly acquired company does not meet the needs of the corporation, or turns out to be a bad purchase, they have found ways for the technology to benefit the already established companies.

Kyocera has established itself as an industry leader in many different fields. They have over forty years of experience, and have proven their management skills time and time again. Kyocera is sure to enjoy a long, and prosperous life as a corporation.


While it’s imperative for an organization to be aware of its strengths, it is also very important to be aware of its weaknesses. Kyocera has been in operation for over forty years because management has had the keen ability to determine the organization’s deficiencies. With all that Kyocera does right, it is difficult to pinpoint the organization’s weaknesses. Due to the fact that Kyocera Corportation has many subsidiaries, management must be concerned with the headquarters along with entirely separate organizations from various industries. An accurate analysis should be considered from an internal and external viewpoint. It’s important that the analysis be truthful so that actions can be taken to overcome the weaknesses as quickly as possible. From the viewpoint of the entire Kyocera Corportation, there are a few potential weaknesses that could be minimized so as not to impair customer satisfaction. Internally, the management techniques could be adjusted to reflect a more “Westernized” style of management. The company motto “respect the divine and love the people” obviously does not apply to employees. The pressure for employees to work long hours, offer complete devotion, to marry other employees and be buried in the company cemetery could be preventing Kyocera from attracting quality employees. Although it has been successful in the past, Kyocera now has a greater number of employees (and customers) who are not accustomed to the Japanese culture. Kyocera maintains the Japanese reward system where individuals do not receive any additional pay and the idea that superior workers should contribute their capabilities for the “good of the entire group” (Miller, 18). In the past it may have been enough to encourage individuals to excel; however, today (even in Japan where collectivism is not as strong as it has been in previous generations) a more modern approach to motivation could have a positive effect.

Even though the amoeba style of management used by Kyocera has obvious benefits (such as small manageable group size, and leaders are selected on qualifications) there are not any incentives to attain a position of leadership. The head of the amoeba (or leadership role) includes the same workplace and employee benefits as other team members. Also, the amobea’s performance goals are too rigid. The group develops monthly goals and annual goals. The monthly goal plans do not change, even in response to industry fluctations. Master annual goals are revised mid-year to reflect changing conditions but monthly goals are not altered once the yearly goals are set into motion (Miller, 18). The technology industry is so volatile that such rigid adherence to goals could cost Kyocera profits if they are not able to adapt to the ever- changing global market on a more short-term basis.

Koycer’s solar energy group went for more than twenty years with out showing regular profits and avoided being criticized because they were able to show progress (Miller, 18). The inability to alter goals or issue a designated amount or time or money for specific divisions or specifically Research and Development projects could be a weakness. Using the resources of the larger corporation allows less successful divisions to maintain operation. If it eventually pays off from the development of new products or new technology, then in the long run it would be worth the investment. However, the costs associated with such practices could prove insurmountable if left unmonitored. Currently the optics division of Kyocera Corporation is experiencing a decrease in sales of seventeen percent due to the lessening demand for optical communication components (Kyocera, 00). This trend could continue, yet the optics division would remain unchanged because of funding provided by the parent corporation in the hope that it will eventually turn a significant profit; meanwhile they are using valuable resources that could offer greater benefit somewhere else. If the division can show that it is progressing in some significant way, it will be allowed to operate unchanged.

While diversification is a strength it could also be listed as a weakness. Kyocera has locations in seventeen different countries producing products in over nine different industries, though some are interrelated. They even provide real estate services! In the past Kyocera acquired business instead of starting new businesses from the ground level. Instead of specializing in any specific field they seem to prefer vertical integration. Even though it is reasonable to believe that for all the success Kyocera has had, there have been some unsuccessful business ventures that are still in progress in the hope that it will eventually turn a profit.


Even though Kyocera is hugely successful, there is always room for improvement. The technology industry is in constant motion and those organizations that remain on the cutting edge will benefit significantly. One obvious opportunity that exists is the advancement of solar energy products. Half of the world’s population has no electricity and seventy percent do not have water within their domestic location. The virtually unmet needs of the undeveloped or underdeveloped countries for communication services offer a huge market with little competition.

As recent as September 00 Kyocera Wireless Corporation announced management changeover due to changes in economic and market environments as a greater emphasis was placed on scale and the pursuit of integration for the telecom industry (Kyocera, 00). Kyocera purchased Qualcomm in 001 and became one of the leaders in the CDMA segment (newest technology for data transmission). This is evidence of the power of Kyocera’s innovation and funding. They regularly invest in the future developments of products for their various industries while withstanding market changes. The opportunities for new technology in the various fields of Kyocera Corporation are virtually endless. As trade regulations decrease across the global market, Kyocera has the ability to move the manufacturing and packaging of its products to the least costly location.

Of course, there is room for management to improve its relationship with their employees. Kyocera could offer incentive plans, better working hours and improved working conditions. The use of video conferencing could reduce the cost and conflict associated with the current management meetings. The opportunity exist to take an even greater share of the market in each respective industry if Kyocera strives to attain customer satisfaction with quality products and services while offering competitive pricing.


Threats are negative external forces that inhibit a company’s ability to achieve its objectives. Threats to a business could be new competitors entering the local market, a government regulation that affects the company, an economic recession, rising interest rates, technology advances or price wars with competitors.

There are several threats that Kyocera Industrial Ceramics Corporation could encounter because of its global market and the constant introduction of new products.

First, we will discuss increased trade barriers. The government can place restrictions on the importing and exporting of goods of a company in the global market. Kyocera has a large global market with sixty-two manufacturing plants, one hundred sixty-one group companies and thirty-four subsidiaries in Europe. (Kyocera) Since the attacks of September 11, the United States Customs office has increased security for travelers as well as shipment of goods to and from other countries.

Kyocera manufactures products that could pose a threat such as knives, scissors and slitters made from a material called Zirconia. This material is used to produce a high quality product for sharpness. Manufacturing this type of product could make importing and exporting very difficult if Kyocera does not maintain an alliance with the government.

Kyocera has taken this threat seriously and was recently accepted as a member of the Customs-Trade Partnership Against Terrorism (C-TPAT) program. This program is a joint government-business initiative to give corporations an active role in the war against terrorism by building cooperative relationships that strengthen supply chain and border security.

As a member of this program, Kyocera has demonstrated that it has met all C-TPAT supply chain security requirements and has committed to ensuring the ongoing integrity of its corporate security practices. (Kyocera,n.d)

Second, new competition has always been a major threat for Kyocera. One of the main competitors, CoorsTek, formerly Coors Porcelain Company, a division of Coors Brewing Company, triggered the United States Department of Commerce’s interest in the ceramic packaging industry when it claimed that Kyocera domination of the industry constituted a threat to national security and economic competitiveness. Although the threat was overturned by firms lobbying on behalf of Kyocera, Kyocera must continue to safeguard against these threats. (Miller, 181, C46)

Also with the threat of new competition enters new products and services. As new companies enter the market they usually develop a new product or service. CoorsTek announced a new service that could potentially become a threat to Kyocera.

CoorsTek has demonstrated this threat by creating specialized teams to work with customers to quickly design, develop, manufacture, and deliver new products. These teams are called “Rapid Product Introduction Teams.” According to Mark Petty, Vice President of Sales and Marketing for CoorsTek, “”This service provides a complete solution to customers requiring a fast response to market demands.”” (Hartman, 00)

This is a service that Kyocera currently does not provide although they work closely with their customers and potential customers in designing and technical assistance of products at no extra charge.

In its core business area of ceramic housing for semiconductors, Kyocera faces its most important threat from plastics. This was because plastic proved to be an effective low-cost alternative for housing many of the semiconductors used in the personal computer industry. (Miller, 18, C46)

Third, there may be new regulations that the government can enforce in reference to international trade laws. The role of national governments in foreign trade is significantly greater in domestic transactions. Every country in the world has regulations regarding how products may either enter, transverse or leave is borders. This is because governments generally tax goods imported from foreign countries. (Alberta-Canada)

These regulations stem from a country’s desire to protect its domestic industry from the perceived harm associated with foreign competition. While this protection often takes the form of punitive tariff duties, they can also extend to import quotas and embargoes against specific products.

With Kyocera having companies all over the world, these regulations can have a substantial bearing on the exporting of goods. These regulations can differ significantly from one nation to another. The continued presence of tariffs makes it necessary to maintain elaborate control systems to regulate and monitor the international flow of goods.

With threats constantly being a factor in any corporation, Kyocera is headed in the right direction. They are continuously seeking ways to overcome potential threats to their company.


Kyocera is a multi-faceted and multi-cultural company with endless ideas for design, development and production of various products. They are entering a new age of revolution, the environmental revolution, and have hit this challenge head on. Kyocera believes they are uniquely suited to support this critical element by their advanced ceramic materials and advanced technology.

Kyocera should continue striving for excellence in customer satisfaction and providing a high quality product at the best price.


(00, April ). Kyocera Industrial Ceramics Corporation News. Kyocera Industrial Ceramics Corporation Accepted into U.S. Customs C-TPAT Program. Retrieved September 7, 00, from http//

Exporting your products. (n.d.) Retrieved September 7, 00,

from http//

Hartman, Harrison. (00). CoorsTek Amazing Solutions. CoorsTek Announces New Rapid Product Introduction Team. Retrieved September 7, 00, from http//

Miller, Alex (18). Strategic management (rd ed.). Boston, Massachusetts McGraw-Hill.

(00). Kyocera Europe. Foundation. Retrieved September 7, 00, from http//

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