A Challenger's Strategy: Pinar Abay at ING Bank Turkey SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of A Challenger's Strategy: Pinar Abay at ING Bank Turkey
In 2013, Pinar Abay was appointed as the CEO of ING Bank Turkey. At 34, she was the youngest bank CEO in Turkey's history. Her appointment raised eyebrows because of her youth and because her career at McKinsey had given her no day-to-day bank management experience. ING, however, wanted a younger leader who could relate to Turkey's young and digitally savvy population. Upon her appointment, Abay determined that major changes were required in operations, personnel and culture. She adopted a variety of innovative approaches to making these changes, ranging from non-traditional hires to sitting for hours in call centers to personally answering customer complaints on Twitter. As Turkey's 12th largest bank, however, ING Turkey lacked scale, so Abay and her team considered a number of non-traditional ways to organize distribution and market the bank to promote growth.
Authors :: Paul M. Healy, Gautam Mukunda, Esel Cekin
Swot Analysis of "A Challenger's Strategy: Pinar Abay at ING Bank Turkey" written by Paul M. Healy, Gautam Mukunda, Esel Cekin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Abay Ing facing as an external strategic factors. Some of the topics covered in A Challenger's Strategy: Pinar Abay at ING Bank Turkey case study are - Strategic Management Strategies, Change management, Emerging markets, Growth strategy, Innovation, Leadership, Organizational culture, Talent management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the A Challenger's Strategy: Pinar Abay at ING Bank Turkey casestudy better are - – increasing transportation and logistics costs, increasing commodity prices, geopolitical disruptions, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, wage bills are increasing,
cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of A Challenger's Strategy: Pinar Abay at ING Bank Turkey
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in A Challenger's Strategy: Pinar Abay at ING Bank Turkey case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Abay Ing, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Abay Ing 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey can be done for the following purposes –
1. Strategic planning using facts provided in A Challenger's Strategy: Pinar Abay at ING Bank Turkey case study
2. Improving business portfolio management of Abay Ing
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Abay Ing
Strengths A Challenger's Strategy: Pinar Abay at ING Bank Turkey | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Abay Ing in A Challenger's Strategy: Pinar Abay at ING Bank Turkey Harvard Business Review case study are -
Successful track record of launching new products
– Abay Ing has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Abay Ing 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.
Ability to recruit top talent
– Abay Ing is one of the leading recruiters in the industry. Managers in the A Challenger's Strategy: Pinar Abay at ING Bank Turkey are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Abay Ing 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 Abay Ing 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.
Learning organization
- Abay Ing 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 Abay Ing is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in A Challenger's Strategy: Pinar Abay at ING Bank Turkey Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Abay Ing is one of the most innovative firm in sector. Manager in A Challenger's Strategy: Pinar Abay at ING Bank Turkey Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Abay Ing in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Finance & Accounting field
– Abay Ing 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 Abay Ing in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Abay Ing 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.
Training and development
– Abay Ing has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Abay Ing digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Abay Ing 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.
High brand equity
– Abay Ing has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Abay Ing to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses A Challenger's Strategy: Pinar Abay at ING Bank Turkey | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of A Challenger's Strategy: Pinar Abay at ING Bank Turkey are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study A Challenger's Strategy: Pinar Abay at ING Bank Turkey, it seems that the employees of Abay Ing 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.
Aligning sales with marketing
– It come across in the case study A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey can leverage the sales team experience to cultivate customer relationships as Abay Ing is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study A Challenger's Strategy: Pinar Abay at ING Bank Turkey, is just above the industry average. Abay Ing 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Abay Ing 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 cash cycle compare to competitors
Abay Ing 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.
High operating costs
– Compare to the competitors, firm in the HBR case study A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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 Abay Ing 's lucrative customers.
Need for greater diversity
– Abay Ing 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study A Challenger's Strategy: Pinar Abay at ING Bank Turkey, in the dynamic environment Abay Ing has struggled to respond to the nimble upstart competition. Abay Ing has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Abay Ing has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow to strategic competitive environment developments
– As A Challenger's Strategy: Pinar Abay at ING Bank Turkey HBR case study mentions - Abay Ing 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.
Slow decision making process
– As mentioned earlier in the report, Abay Ing 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. Abay Ing 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.
Opportunities A Challenger's Strategy: Pinar Abay at ING Bank Turkey | 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey are -
Using analytics as competitive advantage
– Abay Ing 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Abay Ing to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Abay Ing can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Abay Ing can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Abay Ing in the consumer business. Now Abay Ing can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Abay Ing can use these opportunities to build new business models that can help the communities that Abay Ing operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Developing new processes and practices
– Abay Ing can develop new processes and procedures in Finance & Accounting 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Abay Ing in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
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 Abay Ing 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Abay Ing is facing challenges because of the dominance of functional experts in the organization. A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Abay Ing can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Abay Ing can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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.
Building a culture of innovation
– managers at Abay Ing 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 Finance & Accounting segment.
Better consumer reach
– The expansion of the 5G network will help Abay Ing to increase its market reach. Abay Ing 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.
Threats A Challenger's Strategy: Pinar Abay at ING Bank Turkey External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study A Challenger's Strategy: Pinar Abay at ING Bank Turkey are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study A Challenger's Strategy: Pinar Abay at ING Bank Turkey, Abay Ing may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Increasing wage structure of Abay Ing
– 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 Abay Ing.
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.
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.
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. Abay Ing 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 Abay Ing in the Finance & Accounting sector and impact the bottomline of the organization.
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 Abay Ing.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Abay Ing with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Abay Ing 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Abay Ing 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey .
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Abay Ing can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Abay Ing 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.
High dependence on third party suppliers
– Abay Ing 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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 A Challenger's Strategy: Pinar Abay at ING Bank Turkey 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 Abay Ing needs to make to build a sustainable competitive advantage.
