Strategy - Canon

CANON Strategic Analysis
CONTENTS
PART 01 Introduction
PART 02 SWOT-Canon Strategic Analysis
PART 03 Core Competency Analysis
PART 04 Conclusion
PART 01
Introduction
Introduction Overview
Canon Inc. is a Japanese multinational corporation headquartered in Ōta,

Tokyo, Japan, and was founded in 1937. It’s specializing in optical, imaging, and
industrial products, such as lenses, cameras, medical equipment, scanners, printers,
and semiconductor manufacturing equipment.Currently, Canon has over 200
subsidiaries around the world and employs more than 100,000 people.
Reputation
l On August 10, 2020, Canon ranked 380th on the 《Fortune Global 500 list in 2020》.
l In January 2020, Canon ranked 194th in the 《2020 Global 500 Most Valuable Brands list》.
l In October 2019, Canon ranked 41st in the 《2019 Forbes Global 100 Digital Economy List》.
l In August 2019, the Institute of Intellectual Property Owners (IPO) announced the 《 List of
the Top 300 U.S. Utility Model Patent Granting Institutions in 2018》, and Canon ranked 3rd.
Resource:
http://www.fortunechina.com/fortune500/c/2020-08/10/content_372148.htm
https://cj.sina.com.cn/articles/view/2134283845/7f36964501900rma0
http://www.forbeschina.com/lists/1724
https://www.patentdocs.org/2019/08/ipo-releases-list-of-top-300-patent-holders-for-2018.html
Introduction
History
1973
Found the origin of Canon- “Precision Optical Instruments
1940 Laboratory” in Japan
Precision Optical made a significant contribution to Japanese medical
imaging technology when it developed the nation‘s first indirect x-ray
camera. 1950s
Good quality of its lenses made Canon gave its foothold in international
market:
- Created a U.S. subsidiary, based in New York, in 1955
1960s - Formed a European subsidiary, headquartered in Geneva in 1957
Became the dominant Japanese producer of middle-priced cameras,
more than tripling in size in 1963.
1970s
1980s Change management and sales practices. Began to streamline its
Introduce new products in the 1980s to compete effectively in mature operations and chain of command and market its products more
markets: electronic typewriter, laser printer, facsimile machines and etc. ; aggressively.
in camera, Canon reached top after the launch of the EOS (electronic 1990s
optical system) autofocus SLR in 1987. Canon‘s key product areas, notably copiers and cameras got
matured and slowdown development. Canon continued its
2000s historic commitment to high expenditures on research and
Global expansion: In 2012, Canon‘s global market share in the sale of development to go through this tough time.
printers, copiers and multifunction devices was 20.90%. In 2015, Canon
acquired Swedish Security Camera maker Axis Communications. In 2017,
Canon Europe announced acquired the London-based printing startup Present
Kite. In2020, announced a cooperation with a Fujitsu. Still continue…
Introduction Global Market of Canon in 2019
Japan
In 2019, Sales in Japan amounted to ¥872.5 billion, or 24.3% of consolidated net sales. Sales
of the IT solutions business and laser printers increased, thanks to the securing of some major
contracts and growth in sales to certain industries. Despite a higher market share for
interchangeable-lens cameras, sales struggled due to the impact of market contraction.
The Americas
In 2019, sales in the Americas amounted to ¥1,029.1 billion, or 28.6% of consolidated net
sales. Canon Canada is responding to changes in the market and tapping into new customer
segments and markets by. In the office equipment business, Canon U.S.A. is further
strengthening relationships with dealers by holding annual meetings with the top dealers US.
Europe (Europe, Middle East, Africa)

Sales in Europe amounted to ¥882.5 billion, or 24.6% of consolidated net sales. Canon Europe oversees business in the EMEA region—Europe, the Middle
East and Africa. Operating in approximately 120 markets, Canon is proposing new products and solutions tailored to customer needs while strengthening its
sales network.Looking to strengthen its customer service capabilities,Canon Europe has continued to expand its business activities in the Middle East and
Africa, and this year opened its first office and business solutions showroom in Riyadh, Saudi Arabia.
Asia and Oceania

Sales in the Asia and Oceania region amounted to ¥809.2 billion, or 22.5% of consolidated net sales. Canon has continuously endeavored to expand sales of
office multifunction devices by promoting the high-quality services they offer. In China, Canon established a sales structure spanning all business divisions
and vigorously ramped up solution proposals combining multiple products. In Oceania, Canon have chalked up strong growth in sales to large corporations.
Moreover, BPO and IT services have been brisk. PPT模板下载：www.1ppt.com/moban/ 行业PPT模板：www.1ppt.com/hangye/
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Resource: Canon global annual report in 2019

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Introduction
Product Segment
Laser Printers Multifunction Devices

Provide laser MFDs and laser printers that offer low- Provide models of office multi-function devices (“MFDs”) with
power consumption, compact body design, and high the launch of image RUNNER ADVANCE models offering
productivity . significantly enhanced security features and cloud service
integration.
Cameras MEDICAL
The total number of EOS-series interchangeable lens
Canon seeks to further develop and strengthen its
cameras surpassed 100 million mark. As for mirrorless
medical business by turning it into one of the next-
cameras, Canon successively launched the full-frame EOS
generation business pillars centering on Canon
RP and the compact and lightweight EOS M6 Mark II.
Medical Systems (“CMSC”).
Inkjet Printers Lithography Equipment

Canon expects its semiconductor lithography equipment
Canon increased its market share of the consumer-oriented business to grow as well. Canon also expects its flat panel
inkjet printer market by growing sales of large-refillable ink display (FPD) business to expand over the medium to long-
tank models, particularly in emerging markets. term due to growing demand in the display market for large-
screen televisions and high-definition smart phones.
Introduction Market Performance
For Canon‘s market performance in 2019 , its consolidated net sales for 2019 totaled
¥3,593.3 billion (–9.1% year on year) and the gross profit ratio was 44.8%. Operating profit
came to ¥174.7 billion (–49.1% year on year), while net income attributable to Canon Inc.
was ¥125.1 billion (–50.5% year on year).
The global economy in 2019 slowed overall. Against this backdrop, Canon strived to
improve earnings by pursuing efficiency in all areas of business, from R&D through to
Resource: Canon global annual report in 2019 production and the launch and sales of new products.
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PART 02
Canon :
SWOT Analysis
Canon SWOT Analysis
The Canon Inc. is one of the leading firms in its industry. Canon Inc. maintains its dominant position in market by critically analyzing and
reviewing the SWOT analysis. SWOT analysis an immensely interactive process and requires effective coordination among various
departments within the company such as – marketing, finance, operations, management information systems and strategic planning.
- Innovation paces still behind the leading players

- Rely on specific outside suppliers for certain key
components
New Product Portfolio - - Difficulties inventory management
Diversity in businesses - - Too depends on HP Inc. for a significant part of
Strong and continuous R&D ability - Strengths Weaknesses its business
Customer Loyalty - - Unable to adequately anticipate developments
of new business
S W - Difficulties in Expansion: Rapid M&A but hard
to integrate
Demand in constructing Smart City - O T

Trends in Digitalization -
Development in new business and technology - - Threats from the development of cell phone industry
Technological development can help improve - - Intense competition from Strong competitors
opportunities threats - High prices of raw materials add pressure
efficiency and reduce costs
Increasing demand in Medical device - - Changes in the print environment may affect Canon’s
New environmental policies- business
- Declining economic trends in Canon’s major markets
- International market exchange rate fluctuations
Canon SWOT Analysis
Strength of Canon
Canon has launched a new business portfolio that complements its traditional core businesses of office
New Product equipment: office MFDs, laser printers, laser MFPs, digital production printers etc. and cameras with four
Portfolio new businesses: commercial printing, network cameras, medical and industrial equipment. To achieve a
comprehensive development in various market segment and to satisfy different customers’ need.
Canon insists on reinforcing and expanding new businesses while creating future businesses, which help
Diversity in achieved its continuous development . Through continuously strategic M&As, Canon successively acquired
businesses good-standing companies possessing a degree of scale and expertise in many growth fields, which enabled
Canon to set up new pillars of business in various industries like the medical, commercial printing, industrial
equipment and network camera fields.
Strong and Canon continues to increase its investment in innovation and R&D. Canon are keeping pushing ahead with a
continuous selection and concentration approach toward its in-house R&D projects and stepping up Canon
R&D ability engagement in open innovation to leverage the technology and knowledge of organizations outside the
Canon Group.
Canon insists on providing excellent products and maintaining a good brand image to attract loyal
Customer customers. At the same time, Canon insists on continuous innovation, keeping pace with the fashion,
Loyalty technology development, meeting new requirements of customers, and forming a good and continuous
relationship with customer groups.
Canon SWOT Analysis
Weakness of Canon
u Innovation paces still behind the leading players

Canon has invested and will continue to invest actively in next-generation technologies.
But the investment in R&D and innovation ability are still not beyond the top level. if
its competitors produce these or competing technologies in a more timely or effective
manner, Canon’s operating results may be materially adversely affected.
u Rely on specific outside suppliers for certain key components

Canon relies on specific outside suppliers for critical components and special materials
used in its products. In some cases, Canon may be forced to discontinue production if
such parts and special materials suffer from quality problems or are in short supply.
Further, the prices of components and special materials purchased from specific outside
suppliers may rise which may increase the cost and affect Canon’s operating results.
u Difficulties inventory management

Canon generally experiences seasonal trends in the sales of its consumer-oriented
products. Canon has little control over the various factors that produce these seasonal
trends. Accordingly, it is difficult to predict short-term demand, placing pressure on
Canon’s inventory management and logistics systems. If product supply from Canon
exceeds actual demand, excess inventory will put downward pressure on selling prices
and raise inefficiency in cash management, potentially reducing Canon’s revenue.
Canon SWOT Analysis
Weakness of Canon
u Too depends on HP Inc. for a significant part of its business
Canon depends on HP Inc. for a significant part of its business. As a result, Canon’s
business and operating results may be affected by the policies, business and operating
results of HP Inc. Any decision by HP Inc. management to limit or reduce the scope of its
relationship with Canon would adversely affect Canon’s business and operating results.
u Unable to adequately anticipate developments of new business

Canon may not be able to adequately anticipate developments related to its medical
device business, including changes to the market environment and developments related
to medical device approvals, certifications and health insurance coverage. Canon may
become less competitive if it cannot anticipate whether new technologies will have the
expected clinical effects or developments in the market or regulatory environment for
such technologies.
u Difficulties in Expansion: Rapid M&A but hard to integrate

Canon makes strategic acquisitions of other companies for the purpose of business
expansion. However, weak business trends or disappointing performance by partners
or acquired companies may adversely affect the success of such activities. The success
of certain operation activities may be adversely affected by the inability of Canon and
its partners or acquired companies to successfully define and reach common objectives.
Canon SWOT Analysis
Threats of Canon
Canon is one of the world’s leading manufacturers of office multifunction devices (“MFDs”), plain paper copying machines,
laser printers, cameras, inkjet printers, diagnostic equipment and lithography equipment. Primarily because of the nature of
the business and geographic areas in which Canon operates and the highly competitive nature of the industries to which it
belongs, Canon is subject to a variety of risks and uncertainties.
Threats from the development of cell phone industry

Smart phones are constantly updated and developed rapidly. Cell phone cameras are also constantly being upgraded, which can
meet most consumers‘ needs for photography. Some mobile phones camera pixels can even reach the pixel level of SLR cameras.
At the same time, mobile phones are very portable, leading to a decline in the demand for cameras.
Intense competition from Strong competitors

Competitors like Nikon, Sonny, Fujifilm has been continuously improving innovation capabilities, launching new products,
and upgrading service to continuously expand market share.
High prices of raw materials could negatively impact Canon’s profitability

Increases in prices for raw materials that Canon uses in manufacturing such as steel, non-ferrous metals and petrochemical
products may lead to higher production costs and Canon may not be able to pass these increased production costs onto the
sales prices of its products. Such increases in prices for raw materials could adversely affect Canon’s operating results.
Canon SWOT Analysis
Threats of Canon
Changes in the print environment may affect Canon’s business

In the business machines market for such products as office MFDs, copying machines
and printers, customers are increasingly looking for ways to cut costs while protecting
the environment. From this perspective, Managed Print Services ("MPS"), which aim to
optimize printing efficiencies in the office, have become popular in recent years. This
trend could lead to a decrease in business machine print volumes.
Declining economic trends in Canon’s major markets may adversely affect its
operating results
Canon’s business activities are deployed globally in Japan, the United States, Europe,
Asia, and in other regions. Declines in consumption and restrained investment due to
economic downturn in these major markets may affect Canon’s operating results.
International market exchange rate fluctuations

Canon derives a significant portion of its revenue from its international operations.
As a result, Canon’s operating results and financial position have been and may
continue to be significantly affected by changes in the value of the yen versus
foreign currencies.
Canon SWOT Analysis
Opportunities of Canon
Demand in constructing Smart City provides Canon chances of entering new markets
Owing to development of IoT and AI, network camera systems that can perform advanced video analytics, including face
recognition and abnormality detection, have become essential in the infrastructure for a safe and secure Smart City. This
demand encourages Canon to build network camera systems that utilize the cutting-edge video analytic technology. For
example, when monitoring cities, public facilities or stadiums, the output can be used in security planning and the efficient
placement of security staff. This demand can speed up Canon‘s pace to be a global leader in network visual solutions,
addressing new demands in the coming Smart City era.
Trends in Digitalization encourage Conon to accelerate Business Expansion

Commercial printing market demand is rapidly shifting from plate- based high-volume offset printing to high-mix, small-
lot, quick-turnaround digital printing. Based on this demand, Canon plans to ramp up expansion and development in the
industrial printing field, an area expected to see even stronger growth in digital printing.
Development in new business and technology helps develop more comprehensive price strategy
As consumer demand continues to improve with the changes of the times, in response, electronic products are
constantly updated and iterated. The development of new technology and expansion in new business provide an
opportunity to Canon Inc. to practice differentiated pricing strategy in more markets and new business. It will enable the
firm to maintain its loyal customers with great service and lure new customers through other value-oriented proposals.
Canon SWOT Analysis
Opportunities of Canon
u Technological development can help Canon improve efficiency and reduce u New environmental policies
costs
The new opportunities will create a level playing field for all the
The development of technology gives Canon a chance to boost
players in the industry. It represents a great opportunity for Canon Inc.
productivity, further reducing costs through automation and in-house
to drive home its advantage in new technology and gain market share
production. They can also boost white-collar productivity by streamlining
in the new product category.
operations with the use of robotic process automation (RPA) and AI.
u Increasing demand in medical device encourages Canon step into

medical industry
Demand for prevention, early diagnosis and treatment of disease is
growing due to aging populations, primarily in developed countries, and
increasing affluence in emerging markets. Demand is also increasing for
healthcare IT solutions to ease the burden on healthcare professionals
and enhance diagnostic support through effective use of vast quantities
of imaging data. The growing demand also provides an opportunity to
expand Canon’s business operations by leveraging its strengths in
diagnostic imaging equipment, AI and imaging analysis.
PART 03
Core Competence
Analysis
Canon Core Competence Analysis
Each busines unit composition of sales
OFFICE BUSINESS UNIT IMAGING SYSTEM MEDICAL SYSTEM INDUSTRY AND OTHERS BUSINESS UNIT
Main Products Main Products Main Products Main Products

l Laser printer based MFDs l Interchangeable-lens digital l Digital radiography systems l Semiconductor lithography equipment
Laser printers l FPD (Flat panel display) lithography
l cameras l Diagnostic X-ray systems equipment
l Office multifunction l Digital compact cameras l Computed tomography (CT) l Vacuum thin-film deposition equipment
devices (MFDs) l Interchangeable lenses systems l Organic LED (OLED) panel manufacturing
l Digital continuous feed l Compact photo printers l Magnetic resonance imaging equipment
presses l Inkjet printers (MRI) systems l Die bonders
Digital sheet-fed presses l Network cameras
l l Large format inkjet printers l Diagnostic ultrasound systems l Digital camcorders
l Wide-format printers l Commercial photo printers l Clinical chemistry analyzers l Digital cinema cameras
l Document solutions l Image scanners l Ophthalmic equipment l Multimedia projectors
l Calculators l Broadcast equipment
l Micromotors
l Handy terminals
Resource: Canon global annual report in 2019 l Document scanners
Canon –Company Tree
-Compact photo -Digital radiography -Network cameras

-Digital continuous - Digital compact -Semiconductor lithography
- Laser printer printers systems - Clinical
feed presses cameras -Digital camcorders equipment
-Inkjet printers -Diagnostic X-ray systems
End based MFDs -Digital sheet-fed - Interchangeable -Large format
chemistry -Digital cinema cameras -FPD (Flat panel display)
-Office -Computed tomography analyzers -Multimedia projectors lithography equipment
Products presses lenses inkjet printers (CT) systems
multifunction -Wide-format - Ophthalmic -Broadcast equipment -Vacuum thin-film
devices (MFDs) -Commercial -Magnetic resonance equipment -Micromotors deposition equipment
printers photo printers imaging (MRI) systems
- Laser printers -Handy terminals -Organic LED (OLED) panel
-Document -Image scanners -Diagnostic ultrasound
-Document scanners manufacturing equipment
solutions -Calculators systems -Die bonders
Business OFFICE BUSINESS UNIT IMAGING SYSTEM MEDICAL SYSTEM INDUSTRY AND OTHERS BUSINESS UNIT
Unit
Core MFDs/ Laser Printer Cameras/Printers/ Scanners Diagnostic Systems Digital Image Electronics
Product
Competency
Optical Technology Sensor Technology Image Processing Technology R&D
Developing core competencies
White space Mega opportunities

-New Imaging Solution - Build Smart city network camera systems
new
-Joint Research Aimed at Realizing - Conduct medical and healthy care system
Autologous iPS Cells - Commercial printing
- Network cameras
Business
-Detecting Cracks with AI Technology
Fill in the blanks Premier plus 10

-Development in office MFDs, laser
-Innovation and R&D
- AI technology Development
current
printers, laser MFPs, digital production

- Initiatives for Environmentally Friendly
printers
Manufacturing and Enhanced Product Quality
-Automation and In-house Production
-Globally Optimized Production
current new
Optical Technology
Camera performance depends on optical technology, Optical Sensor Technology

which involves Canon’s special lens design, material
selection and such processing technologies as Tremendous advances have been made in
grinding and polishing. In lens processing, for example, Canon’s image sensors. Canon continues to
error tolerance is down to the nanometer-order level work at the forefront of these key
(one billionth of a millimeter). Optics are an Sensor semiconductor devices for digital cameras to
exceptionally high value-added analog technology achieve higher resolution, sensitivity and
that relies on Canon’s consummate expertise that functionality.
cannot be easily acquired by other competitors.
Image R&D
Image Processing Technology
Canon focuses on R&D, strengthening fundamental
Canon’s processing software for technologies and creating core competent
improving image quality has technologies, in order to provide innovative products
contributed to the excellence of R&D and services to society. In 2019, R&D expenses
Canon’s cameras and printers. The amounted to ¥298.5 billion, and the ratio of R&D
technology is the result of years of expenses to net sales was 8.3%. This focus on R&D
pursuing high image quality and has has also cemented Canon’s leading position in the
become a major asset for Canon. intellectual property field. In 2019, Canon was
granted 3,555 patents in the United States, the third
highest among all companies. This also represents a
first place ranking among Japanese companies for 15
consecutive years.
PART 04
Conclusion
Conclusion
Key Challenges for 2020
2020 is the final year of the Excellent Global Corporation Plan’s Phase V, which the entire Canon Group has been working on since 2016.
With IoT, AI and other innovations rapidly gaining increased momentum, renewed growth in the IT industry has brought major changes
on industrial structures and durable goods-based industries will need to revolutionize in order to survive. With that in mind, Canon’s
fundamental policy for 2020 is to accelerate and complete the grand strategic transformation. To that end, Canon’s priority will be to
tackle the following four key challenges.
Suggestion to overcomeChallenges
First, Canon must strengthen existing businesses. While these businesses continue to contract, they remain a major source
of Canon’s profits and the foundation that allows Canon new businesses to grow. Canon will endeavor to further boost
market share in each by developing more advanced products.
Second, Canon need continue to expand new businesses, to seek out strategic M&As, deepen collaboration within the
Group on such matters as production methods, joint procurement, and the exchange of technology. In doing so, Canon can
significantly reduce manufacturing costs and help establish our four new businesses of medical, commercial printing,
industrial equipment and network cameras as new pillars of earnings growth.
Conclusion
Third, Canon need to push structural reorganization. This involves reevaluating the scale
of existing businesses and streamlining organizations and personnel in line with the
transformation of our business portfolio. Canon will also pay close attention to changes
in world affairs and how Canon’s production bases might be affected and work on
building a global production system capable of flexibly adapting to changes.
Fourth, guided by a long-term perspective, Canon need to focus on new core businesses for
growth. Canon needs to focus on strategic transformation designed to accelerate growth in four
new businesses: commercial printing, network cameras, medical and industrial equipment, from
development to manufacturing, procurement and all the way to the cultivation of human
resources, to expand more market share in new area.
Conclusion
Ever since it was founded, Canon has passed on the spirit of innovation through its corporate DNA. Throughout its history,
Canon has met the challenges of the age by continuing to transform itself, create new value and evolve.
As society makes the leap from the IT age that began with digitalization to the IoT era, Canon now stands on the cusp of its
second great transformation. With the outlook for the global economy becoming increasingly uncertain, the environment
surrounding the manufacturing industry is growing harsher by the day. It is amidst such an environment that Canon will
accelerate and enhance its grand strategic transformation and overcome any challenges .
THANK YOU
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CANON Strategic Analysis

PART 02 SWOT-Canon Strategic Analysis

PART 03 Core Competency Analysis

Canon Inc. is a Japanese multinational corporation headquartered in Ōta,

Europe (Europe, Middle East, Africa)

Asia and Oceania

Resource: Canon global annual report in 2019

Laser Printers Multifunction Devices

Inkjet Printers Lithography Equipment

- Innovation paces still behind the leading players

Demand in constructing Smart City - O T

u Innovation paces still behind the leading players

u Rely on specific outside suppliers for certain key components

u Difficulties inventory management

u Unable to adequately anticipate developments of new business

u Difficulties in Expansion: Rapid M&A but hard to integrate

Threats from the development of cell phone industry

Intense competition from Strong competitors

High prices of raw materials could negatively impact Canon’s profitability

Changes in the print environment may affect Canon’s business

International market exchange rate fluctuations

Trends in Digitalization encourage Conon to accelerate Business Expansion

u Increasing demand in medical device encourages Canon step into

Each busines unit composition of sales

Main Products Main Products Main Products Main Products

-Compact photo -Digital radiography -Network cameras

Developing core competencies

White space Mega opportunities

-Detecting Cracks with AI Technology

Fill in the blanks Premier plus 10

printers, laser MFPs, digital production

Camera performance depends on optical technology, Optical Sensor Technology

Key Challenges for 2020

•Key Figures of Google

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