Case Study Description of Governor Basuki Tjahaja Purnama and Jakarta's Transformation
City transformation is complex. This case study examines the combination of policies and management decisions undertaken by Mr Basuki Tjahaja Purnama (Ahok) in transforming Jakarta, the capital city of Indonesia. Jakarta had been facing serious urban development issues that affect the economy and political stability of Indonesia. Despite well-laid out plans where he aimed to alter the oft-regarded corrupt and incapable bureaucracy in Jakarta into a clean, capable and efficient administration, Ahok faced many leadership challenges when implementing large-scale transformation of major city in a developing country.
Authors :: Andreas Pazi Raharso, June Gwee, Boon Siong Neo
Swot Analysis of "Governor Basuki Tjahaja Purnama and Jakarta's Transformation" written by Andreas Pazi Raharso, June Gwee, Boon Siong Neo includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Jakarta Ahok facing as an external strategic factors. Some of the topics covered in Governor Basuki Tjahaja Purnama and Jakarta's Transformation case study are - Strategic Management Strategies, Innovation, Leadership, Policy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Governor Basuki Tjahaja Purnama and Jakarta's Transformation casestudy better are - – supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, increasing household debt because of falling income levels,
there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Governor Basuki Tjahaja Purnama and Jakarta's Transformation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Governor Basuki Tjahaja Purnama and Jakarta's Transformation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Jakarta Ahok, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Jakarta Ahok 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation can be done for the following purposes –
1. Strategic planning using facts provided in Governor Basuki Tjahaja Purnama and Jakarta's Transformation case study
2. Improving business portfolio management of Jakarta Ahok
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Jakarta Ahok
Strengths Governor Basuki Tjahaja Purnama and Jakarta's Transformation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Jakarta Ahok in Governor Basuki Tjahaja Purnama and Jakarta's Transformation Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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.
Ability to recruit top talent
– Jakarta Ahok is one of the leading recruiters in the industry. Managers in the Governor Basuki Tjahaja Purnama and Jakarta's Transformation are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Jakarta Ahok is one of the most innovative firm in sector. Manager in Governor Basuki Tjahaja Purnama and Jakarta's Transformation Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Jakarta Ahok 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Jakarta Ahok digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Jakarta Ahok 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.
Cross disciplinary teams
– Horizontal connected teams at the Jakarta Ahok 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.
Strong track record of project management
– Jakarta Ahok is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Jakarta Ahok 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 Andreas Pazi Raharso, June Gwee, Boon Siong Neo 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.
High brand equity
– Jakarta Ahok has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Jakarta Ahok to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Jakarta Ahok is present in almost all the verticals within the industry. This has provided firm in Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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.
Low bargaining power of suppliers
– Suppliers of Jakarta Ahok in the sector have low bargaining power. Governor Basuki Tjahaja Purnama and Jakarta's Transformation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Jakarta Ahok to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Jakarta Ahok 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.
Weaknesses Governor Basuki Tjahaja Purnama and Jakarta's Transformation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Governor Basuki Tjahaja Purnama and Jakarta's Transformation are -
No frontier risks strategy
– After analyzing the HBR case study Governor Basuki Tjahaja Purnama and Jakarta's Transformation, it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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.
Lack of clear differentiation of Jakarta Ahok products
– To increase the profitability and margins on the products, Jakarta Ahok needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation can leverage the sales team experience to cultivate customer relationships as Jakarta Ahok is planning to shift buying processes online.
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 Jakarta Ahok supply chain. Even after few cautionary changes mentioned in the HBR case study - Governor Basuki Tjahaja Purnama and Jakarta's Transformation, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Jakarta Ahok vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, Andreas Pazi Raharso, June Gwee, Boon Siong Neo suggests that, Jakarta Ahok 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.
Low market penetration in new markets
– Outside its home market of Jakarta Ahok, firm in the HBR case study Governor Basuki Tjahaja Purnama and Jakarta's Transformation needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Governor Basuki Tjahaja Purnama and Jakarta's Transformation HBR case study mentions - Jakarta Ahok 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Governor Basuki Tjahaja Purnama and Jakarta's Transformation, it seems that the employees of Jakarta Ahok 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.
Interest costs
– Compare to the competition, Jakarta Ahok 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Jakarta Ahok 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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 Jakarta Ahok has relatively successful track record of launching new products.
Opportunities Governor Basuki Tjahaja Purnama and Jakarta's Transformation | 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation are -
Building a culture of innovation
– managers at Jakarta Ahok 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 Strategy & Execution segment.
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 Jakarta Ahok 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.
Creating value in data economy
– The success of analytics program of Jakarta Ahok has opened avenues for new revenue streams for the organization in the industry. This can help Jakarta Ahok to build a more holistic ecosystem as suggested in the Governor Basuki Tjahaja Purnama and Jakarta's Transformation case study. Jakarta Ahok can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Jakarta Ahok can use these opportunities to build new business models that can help the communities that Jakarta Ahok operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Jakarta Ahok in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Jakarta Ahok can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Jakarta Ahok 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Jakarta Ahok to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Jakarta Ahok can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Jakarta Ahok 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Jakarta Ahok 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, Governor Basuki Tjahaja Purnama and Jakarta's Transformation, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Jakarta Ahok can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Jakarta Ahok can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Jakarta Ahok 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 Jakarta Ahok to hire the very best people irrespective of their geographical location.
Threats Governor Basuki Tjahaja Purnama and Jakarta's Transformation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Governor Basuki Tjahaja Purnama and Jakarta's Transformation are -
Increasing wage structure of Jakarta Ahok
– 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 Jakarta Ahok.
Technology acceleration in Forth Industrial Revolution
– Jakarta Ahok has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Jakarta Ahok needs to keep up with the evolution of technology in the Strategy & Execution 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Jakarta Ahok with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
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. Jakarta Ahok needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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 Jakarta Ahok.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Jakarta Ahok 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation .
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.
Stagnating economy with rate increase
– Jakarta Ahok 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.
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. Jakarta Ahok 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.
Regulatory challenges
– Jakarta Ahok 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 Strategy & Execution industry regulations.
Consumer confidence and its impact on Jakarta Ahok 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 dependence on third party suppliers
– Jakarta Ahok 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.
Weighted SWOT Analysis of Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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 Governor Basuki Tjahaja Purnama and Jakarta's Transformation 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 Jakarta Ahok needs to make to build a sustainable competitive advantage.
