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 - – geopolitical disruptions, central banks are concerned over increasing inflation, increasing energy prices, cloud computing is disrupting traditional business models, technology disruption, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization,
digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, 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 -
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.
Strong track record of project management
– Romania Carle is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Romania Carle has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
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.
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.
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.
Ability to lead change in Sales & Marketing field
– Romania Carle is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Romania Carle in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Sales & Marketing industry
– Alpen Bank: Launching the Credit Card in Romania (Brief Case) firm has clearly differentiated products in the market place. This has enabled Romania Carle to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Romania Carle to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Romania Carle in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
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.
Diverse revenue streams
– Romania Carle is present in almost all the verticals within the industry. This has provided firm in Alpen Bank: Launching the Credit Card in Romania (Brief Case) case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
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 -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Alpen Bank: Launching the Credit Card in Romania (Brief Case), it seems that the employees of Romania Carle don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
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.
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.
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.
Workers concerns about automation
– As automation is fast increasing in the segment, Romania Carle needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
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.
Slow decision making process
– As mentioned earlier in the report, Romania Carle has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Romania Carle even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Slow to strategic competitive environment developments
– As Alpen Bank: Launching the Credit Card in Romania (Brief Case) HBR case study mentions - Romania Carle takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Alpen Bank: Launching the Credit Card in Romania (Brief Case), is just above the industry average. Romania Carle needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
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 cash cycle compare to competitors
Romania Carle has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
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 -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Romania Carle to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Romania Carle to hire the very best people irrespective of their geographical location.
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.
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.
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.
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.
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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Romania Carle can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Loyalty marketing
– Romania Carle has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
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.
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.
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.
Leveraging digital technologies
– Romania Carle can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
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.
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 -
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.
Technology acceleration in Forth Industrial Revolution
– Romania Carle has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Romania Carle needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High dependence on third party suppliers
– Romania Carle high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Consumer confidence and its impact on Romania Carle demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
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.
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.
Increasing wage structure of Romania Carle
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Romania Carle.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Romania Carle in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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.
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.
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.
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.
