The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Battle of the Asian Transshipment Hubs: PSA versus PTP (A)
This case from a three-case series that includes S-0110 and S-0111 explores competitive strategies in a mature industry within the context of the Asia-Pacific region and is appropriate for use in competitive dynamics, international business, or business strategy courses. The state-owned Port of Singapore Authority wanted to become the World's Port of Call. The port of Singapore was one the world's busiest and a model of efficiency and operational excellence. But, by the end of 2001, it had lost two key customers to an emerging competitor, the port of Tanjung Pelepas (PTP), in neighboring Malaysia. In 2002, the Chinese shipper COSCO Pacific was considering a shift to PTP. By 2003, the port of Singapore had laid off staff and tried to explain the reasons behind the layoffs.
Swot Analysis of "The Battle of the Asian Transshipment Hubs: PSA versus PTP (A)" written by Ming-Jer Chen, Jin Leong includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Port Ptp facing as an external strategic factors. Some of the topics covered in The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) case study are - Strategic Management Strategies, Decision making, Emerging markets, Globalization, Strategic planning and Global Business.
Some of the macro environment factors that can be used to understand the The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) casestudy better are - – increasing government debt because of Covid-19 spendings, banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices, geopolitical disruptions,
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 The Battle of the Asian Transshipment Hubs: PSA versus PTP (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Port Ptp, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Port Ptp 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 The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) can be done for the following purposes –
1. Strategic planning using facts provided in The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) case study
2. Improving business portfolio management of Port Ptp
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Port Ptp
Strengths The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Port Ptp in The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) Harvard Business Review case study are -
Sustainable margins compare to other players in Global Business industry
– The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) firm has clearly differentiated products in the market place. This has enabled Port Ptp to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Port Ptp to invest into research and development (R&D) and innovation.
High brand equity
– Port Ptp has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Port Ptp to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Port Ptp is one of the most innovative firm in sector. Manager in The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Port Ptp has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Port Ptp has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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.
Superior customer experience
– The customer experience strategy of Port Ptp in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Port Ptp is one of the leading recruiters in the industry. Managers in the The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Port Ptp digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Port Ptp 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.
Diverse revenue streams
– Port Ptp is present in almost all the verticals within the industry. This has provided firm in The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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.
Organizational Resilience of Port Ptp
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Port Ptp does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Port Ptp 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
– Port Ptp is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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 Port Ptp supply chain. Even after few cautionary changes mentioned in the HBR case study - The Battle of the Asian Transshipment Hubs: PSA versus PTP (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Port Ptp vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, Port Ptp 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. Port Ptp 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.
High cash cycle compare to competitors
Port Ptp 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Battle of the Asian Transshipment Hubs: PSA versus PTP (A), in the dynamic environment Port Ptp has struggled to respond to the nimble upstart competition. Port Ptp has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study The Battle of the Asian Transshipment Hubs: PSA versus PTP (A), it seems that company is thinking about the frontier risks that can impact Global Business 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.
Interest costs
– Compare to the competition, Port Ptp 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.
High operating costs
– Compare to the competitors, firm in the HBR case study The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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 Port Ptp 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Battle of the Asian Transshipment Hubs: PSA versus PTP (A), it seems that the employees of Port Ptp 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.
Need for greater diversity
– Port Ptp 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Battle of the Asian Transshipment Hubs: PSA versus PTP (A), is just above the industry average. Port Ptp 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, Port Ptp 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.
Opportunities The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) | 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 The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) are -
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 Port Ptp in the consumer business. Now Port Ptp can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Port Ptp 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Port Ptp can use these opportunities to build new business models that can help the communities that Port Ptp operates in. Secondly it can use opportunities from government spending in Global Business sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Port Ptp 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 Port Ptp to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Port Ptp to increase its market reach. Port Ptp 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.
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 Port Ptp 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Port Ptp 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, Port Ptp 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, The Battle of the Asian Transshipment Hubs: PSA versus PTP (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Port Ptp in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Buying journey improvements
– Port Ptp can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Port Ptp can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Port Ptp 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 Global Business segment.
Loyalty marketing
– Port Ptp 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.
Threats The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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 The Battle of the Asian Transshipment Hubs: PSA versus PTP (A), Port Ptp may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Port Ptp 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 Port Ptp
– 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 Port Ptp.
High dependence on third party suppliers
– Port Ptp 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.
Stagnating economy with rate increase
– Port Ptp 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.
Technology acceleration in Forth Industrial Revolution
– Port Ptp has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Port Ptp needs to keep up with the evolution of technology in the Global Business 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.
Regulatory challenges
– Port Ptp 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 Global Business industry regulations.
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 Port Ptp.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Port Ptp 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 The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) .
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. Port Ptp needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Port Ptp in the Global Business industry. The Global Business 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.
Weighted SWOT Analysis of The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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 The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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 The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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 The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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 The Battle of the Asian Transshipment Hubs: PSA versus PTP (A) 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 Port Ptp needs to make to build a sustainable competitive advantage.