Akbank: Options in Digital Banking, Chinese Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Akbank: Options in Digital Banking, Chinese Version
This case discusses the digitalization strategies of a leading bank in Turkey, Akbank, and how to position its digital banking products going forward. The Turkish banking industry was undergoing a transformation prompted by the demands of the country's digitally savvy, young population, and by new regulations on consumer banking that threatened banks' profitability. Akbank had a legacy as the best financial services company in Turkey, but it knew it needed to innovate to maintain that reputation in the digital era. The bank's chairman, CEO, and EVP of digital banking unit were evaluating their options. Should they have a separate P&L for the digital banking unit? Should they create a separate brand for digital banking? How should they structure digital banking so Akbank would remain profitable while achieving the vision for innovation and growth laid out by the bank's chairman?
Swot Analysis of "Akbank: Options in Digital Banking, Chinese Version" written by Rajiv Lal, Esel Cekin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Akbank Banking facing as an external strategic factors. Some of the topics covered in Akbank: Options in Digital Banking, Chinese Version case study are - Strategic Management Strategies, Change management, Competition, Emerging markets, Regulation, Technology and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Akbank: Options in Digital Banking, Chinese Version casestudy better are - – challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions,
banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Akbank: Options in Digital Banking, Chinese Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Akbank: Options in Digital Banking, Chinese Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Akbank Banking, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Akbank Banking 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 Akbank: Options in Digital Banking, Chinese Version can be done for the following purposes –
1. Strategic planning using facts provided in Akbank: Options in Digital Banking, Chinese Version case study
2. Improving business portfolio management of Akbank Banking
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 Akbank Banking
Strengths Akbank: Options in Digital Banking, Chinese Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Akbank Banking in Akbank: Options in Digital Banking, Chinese Version Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Akbank Banking in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Akbank Banking is one of the most innovative firm in sector. Manager in Akbank: Options in Digital Banking, Chinese Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Akbank Banking digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Akbank Banking has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Effective Research and Development (R&D)
– Akbank Banking 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 Akbank: Options in Digital Banking, Chinese Version - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Akbank Banking 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 Akbank Banking is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Akbank: Options in Digital Banking, Chinese Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Sales & Marketing industry
– Akbank: Options in Digital Banking, Chinese Version firm has clearly differentiated products in the market place. This has enabled Akbank Banking to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Akbank Banking to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Akbank Banking has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Akbank Banking 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.
Diverse revenue streams
– Akbank Banking is present in almost all the verticals within the industry. This has provided firm in Akbank: Options in Digital Banking, Chinese Version 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.
High brand equity
– Akbank Banking has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Akbank Banking to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Sales & Marketing field
– Akbank Banking 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 Akbank Banking in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Akbank Banking is one of the leading recruiters in the industry. Managers in the Akbank: Options in Digital Banking, Chinese Version are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Akbank Banking 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 Rajiv Lal, Esel Cekin 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.
Weaknesses Akbank: Options in Digital Banking, Chinese Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Akbank: Options in Digital Banking, Chinese Version are -
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Akbank Banking supply chain. Even after few cautionary changes mentioned in the HBR case study - Akbank: Options in Digital Banking, Chinese Version, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Akbank Banking vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Akbank Banking has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Akbank: Options in Digital Banking, Chinese Version should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Akbank Banking 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Akbank: Options in Digital Banking, Chinese Version, it seems that the employees of Akbank Banking 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.
Increasing silos among functional specialists
– The organizational structure of Akbank Banking is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Akbank Banking needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Akbank Banking to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Akbank Banking, firm in the HBR case study Akbank: Options in Digital Banking, Chinese Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Akbank: Options in Digital Banking, Chinese Version, is just above the industry average. Akbank Banking 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.
Aligning sales with marketing
– It come across in the case study Akbank: Options in Digital Banking, Chinese Version 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 Akbank: Options in Digital Banking, Chinese Version can leverage the sales team experience to cultivate customer relationships as Akbank Banking is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Akbank Banking 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 strategic competitive environment developments
– As Akbank: Options in Digital Banking, Chinese Version HBR case study mentions - Akbank Banking 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.
No frontier risks strategy
– After analyzing the HBR case study Akbank: Options in Digital Banking, Chinese Version, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Opportunities Akbank: Options in Digital Banking, Chinese Version | 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 Akbank: Options in Digital Banking, Chinese Version are -
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. Akbank Banking can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Akbank Banking 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Akbank Banking 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 Akbank Banking to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Akbank Banking can use these opportunities to build new business models that can help the communities that Akbank Banking operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Developing new processes and practices
– Akbank Banking 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Akbank Banking 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, Akbank Banking 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, Akbank: Options in Digital Banking, Chinese Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Akbank Banking can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Akbank: Options in Digital Banking, Chinese Version suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
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 Akbank Banking in the consumer business. Now Akbank Banking can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Akbank Banking is facing challenges because of the dominance of functional experts in the organization. Akbank: Options in Digital Banking, Chinese Version 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.
Using analytics as competitive advantage
– Akbank Banking has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Akbank: Options in Digital Banking, Chinese Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Akbank Banking to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Akbank Banking 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.
Building a culture of innovation
– managers at Akbank Banking can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Threats Akbank: Options in Digital Banking, Chinese Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Akbank: Options in Digital Banking, Chinese Version are -
Regulatory challenges
– Akbank Banking 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.
Stagnating economy with rate increase
– Akbank Banking 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Akbank Banking with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Akbank Banking.
Environmental challenges
– Akbank Banking 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. Akbank Banking can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Akbank Banking will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
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 Akbank Banking in the Sales & Marketing sector and impact the bottomline of the organization.
Consumer confidence and its impact on Akbank Banking 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. Akbank Banking needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Akbank Banking 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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Akbank Banking 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 Akbank: Options in Digital Banking, Chinese Version .
Technology acceleration in Forth Industrial Revolution
– Akbank Banking has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Akbank Banking 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.
Weighted SWOT Analysis of Akbank: Options in Digital Banking, Chinese Version 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 Akbank: Options in Digital Banking, Chinese Version 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 Akbank: Options in Digital Banking, Chinese Version 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 Akbank: Options in Digital Banking, Chinese Version 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 Akbank: Options in Digital Banking, Chinese Version 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 Akbank Banking needs to make to build a sustainable competitive advantage.
