Alpen Bank: Launching the Credit Card in Romania (Brief Case) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Alpen Bank: Launching the Credit Card in Romania (Brief Case)
Winner of the 2014 Case Centre Award in the category of "Economics, Politics and Business Environment." When students have the English-language PDF of this Brief Case in a coursepack, they will also have the option to purchase an audio version.In 2006, the country manager for Alpen Bank in Romania, Gregory Carle, considers whether to recommend the launch of a credit card business. The firm rejected the idea several years earlier because of poor economic conditions in Romania. However, Romania is experiencing a period of economic growth after joining the European Union and Carle believes it is time to reconsider the opportunity despite continued skepticism within the company. Carle faces several important decisions before he can present his plan to the head of International Consumer Businesses. He must decide whether to launch a credit card business in Romania, how to position the credit card, and how to acquire new customers most effectively. This case is appropriate for use in the product policy module of a general marketing course, in a new product course, or in a services management course. Students are required to complete a quantitative assignment as part of case analysis.
Swot Analysis of "Alpen Bank: Launching the Credit Card in Romania (Brief Case)" written by V. Kasturi Rangan, Sunru Yong includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Romania Carle facing as an external strategic factors. Some of the topics covered in Alpen Bank: Launching the Credit Card in Romania (Brief Case) case study are - Strategic Management Strategies, International business, Marketing, Product development, Supply chain and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Alpen Bank: Launching the Credit Card in Romania (Brief Case) casestudy better are - – increasing energy prices, central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, increasing government debt because of Covid-19 spendings,
talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Alpen Bank: Launching the Credit Card in Romania (Brief Case)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Alpen Bank: Launching the Credit Card in Romania (Brief Case) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Romania Carle, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Romania Carle operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Alpen Bank: Launching the Credit Card in Romania (Brief Case) can be done for the following purposes –
1. Strategic planning using facts provided in Alpen Bank: Launching the Credit Card in Romania (Brief Case) case study
2. Improving business portfolio management of Romania Carle
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Romania Carle
Strengths Alpen Bank: Launching the Credit Card in Romania (Brief Case) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Romania Carle in Alpen Bank: Launching the Credit Card in Romania (Brief Case) Harvard Business Review case study are -
Innovation driven organization
– Romania Carle is one of the most innovative firm in sector. Manager in Alpen Bank: Launching the Credit Card in Romania (Brief Case) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Romania Carle are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Learning organization
- Romania Carle is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Romania Carle is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Alpen Bank: Launching the Credit Card in Romania (Brief Case) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Romania Carle has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Romania Carle has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Operational resilience
– The operational resilience strategy in the Alpen Bank: Launching the Credit Card in Romania (Brief Case) Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Highly skilled collaborators
– Romania Carle has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Alpen Bank: Launching the Credit Card in Romania (Brief Case) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Romania Carle
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Romania Carle does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Romania Carle has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Alpen Bank: Launching the Credit Card in Romania (Brief Case) Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High brand equity
– Romania Carle has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Romania Carle to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Romania Carle is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by V. Kasturi Rangan, Sunru Yong can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Effective Research and Development (R&D)
– Romania Carle has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Romania Carle in the sector have low bargaining power. Alpen Bank: Launching the Credit Card in Romania (Brief Case) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Romania Carle to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Alpen Bank: Launching the Credit Card in Romania (Brief Case) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Alpen Bank: Launching the Credit Card in Romania (Brief Case) are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Alpen Bank: Launching the Credit Card in Romania (Brief Case), in the dynamic environment Romania Carle has struggled to respond to the nimble upstart competition. Romania Carle has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Romania Carle products
– To increase the profitability and margins on the products, Romania Carle needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Romania Carle 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Alpen Bank: Launching the Credit Card in Romania (Brief Case) HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Romania Carle has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, V. Kasturi Rangan, Sunru Yong suggests that, Romania Carle is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Skills based hiring
– The stress on hiring functional specialists at Romania Carle has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Romania Carle is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Romania Carle, firm in the HBR case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– It come across in the case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Alpen Bank: Launching the Credit Card in Romania (Brief Case) can leverage the sales team experience to cultivate customer relationships as Romania Carle is planning to shift buying processes online.
Interest costs
– Compare to the competition, Romania Carle has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Need for greater diversity
– Romania Carle has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Opportunities Alpen Bank: Launching the Credit Card in Romania (Brief Case) | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Romania Carle can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Romania Carle in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Romania Carle can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Romania Carle can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Alpen Bank: Launching the Credit Card in Romania (Brief Case), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Romania Carle has opened avenues for new revenue streams for the organization in the industry. This can help Romania Carle to build a more holistic ecosystem as suggested in the Alpen Bank: Launching the Credit Card in Romania (Brief Case) case study. Romania Carle can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Romania Carle can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Romania Carle can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Romania Carle to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Better consumer reach
– The expansion of the 5G network will help Romania Carle to increase its market reach. Romania Carle will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Romania Carle is facing challenges because of the dominance of functional experts in the organization. Alpen Bank: Launching the Credit Card in Romania (Brief Case) case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Romania Carle in the consumer business. Now Romania Carle can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Romania Carle can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Developing new processes and practices
– Romania Carle can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Learning at scale
– Online learning technologies has now opened space for Romania Carle to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Threats Alpen Bank: Launching the Credit Card in Romania (Brief Case) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) are -
Environmental challenges
– Romania Carle needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Romania Carle can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Romania Carle business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Romania Carle is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Romania Carle needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Romania Carle in the Sales & Marketing sector and impact the bottomline of the organization.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Romania Carle can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Romania Carle.
Stagnating economy with rate increase
– Romania Carle can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Romania Carle can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Alpen Bank: Launching the Credit Card in Romania (Brief Case), Romania Carle may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Romania Carle with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Romania Carle needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Weighted SWOT Analysis of Alpen Bank: Launching the Credit Card in Romania (Brief Case) Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Alpen Bank: Launching the Credit Card in Romania (Brief Case) is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Alpen Bank: Launching the Credit Card in Romania (Brief Case) is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Romania Carle needs to make to build a sustainable competitive advantage.