The Siam Commercial Bank: Weathering the Asian Storm (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Siam Commercial Bank: Weathering the Asian Storm (A)
This case describes the effects of the Asian Financial Crisis on the Siam Commercial Bank (SCB), the fourth largest Thai bank. It describes the actions taken by the Thai government to restore confidence in the Thai financial sector, and SCB's strategy for raising additional capital in international markets. The case allows for an analysis of how a financial crisis combined with more stringent government requirements may result in a vicious cycle of non-performing loans, lack of new credit extension, and economic slowdown. Students can discuss whether they consider SCB an attractive investment, and what SCB can do to increase confidence. The case can be used in classes on international business, or international financial markets. Can be used with the B case, UV1629.
Swot Analysis of "The Siam Commercial Bank: Weathering the Asian Storm (A)" written by Petra Christmann, Mark Sriaporn includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Scb Thai facing as an external strategic factors. Some of the topics covered in The Siam Commercial Bank: Weathering the Asian Storm (A) case study are - Strategic Management Strategies, Policy and Finance & Accounting.
Some of the macro environment factors that can be used to understand the The Siam Commercial Bank: Weathering the Asian Storm (A) casestudy better are - – digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, increasing energy prices, increasing transportation and logistics costs, technology disruption, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings,
supply chains are disrupted by pandemic , increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of The Siam Commercial Bank: Weathering the Asian Storm (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Siam Commercial Bank: Weathering the Asian Storm (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Scb Thai, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Scb Thai 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 Siam Commercial Bank: Weathering the Asian Storm (A) can be done for the following purposes –
1. Strategic planning using facts provided in The Siam Commercial Bank: Weathering the Asian Storm (A) case study
2. Improving business portfolio management of Scb Thai
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 Scb Thai
Strengths The Siam Commercial Bank: Weathering the Asian Storm (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Scb Thai in The Siam Commercial Bank: Weathering the Asian Storm (A) Harvard Business Review case study are -
Innovation driven organization
– Scb Thai is one of the most innovative firm in sector. Manager in The Siam Commercial Bank: Weathering the Asian Storm (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Scb Thai is present in almost all the verticals within the industry. This has provided firm in The Siam Commercial Bank: Weathering the Asian Storm (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.
Ability to recruit top talent
– Scb Thai is one of the leading recruiters in the industry. Managers in the The Siam Commercial Bank: Weathering the Asian Storm (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.
High brand equity
– Scb Thai has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Scb Thai to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Scb Thai in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Scb Thai 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 Petra Christmann, Mark Sriaporn 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 switching costs
– The high switching costs that Scb Thai 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.
Low bargaining power of suppliers
– Suppliers of Scb Thai in the sector have low bargaining power. The Siam Commercial Bank: Weathering the Asian Storm (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Scb Thai to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Scb Thai 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 The Siam Commercial Bank: Weathering the Asian Storm (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Scb Thai
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Scb Thai does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Scb Thai is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Scb Thai 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.
Weaknesses The Siam Commercial Bank: Weathering the Asian Storm (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Siam Commercial Bank: Weathering the Asian Storm (A) are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Siam Commercial Bank: Weathering the Asian Storm (A), is just above the industry average. Scb Thai 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.
Capital Spending Reduction
– Even during the low interest decade, Scb Thai 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.
No frontier risks strategy
– After analyzing the HBR case study The Siam Commercial Bank: Weathering the Asian Storm (A), it seems that company is thinking about the frontier risks that can impact Finance & Accounting 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The Siam Commercial Bank: Weathering the Asian Storm (A) 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 Scb Thai has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Scb Thai 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. Scb Thai 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 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 Scb Thai supply chain. Even after few cautionary changes mentioned in the HBR case study - The Siam Commercial Bank: Weathering the Asian Storm (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Scb Thai vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Scb Thai products
– To increase the profitability and margins on the products, Scb Thai needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Siam Commercial Bank: Weathering the Asian Storm (A), in the dynamic environment Scb Thai has struggled to respond to the nimble upstart competition. Scb Thai has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study The Siam Commercial Bank: Weathering the Asian Storm (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 Scb Thai 's lucrative customers.
Interest costs
– Compare to the competition, Scb Thai 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 cash cycle compare to competitors
Scb Thai has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Opportunities The Siam Commercial Bank: Weathering the Asian Storm (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 Siam Commercial Bank: Weathering the Asian Storm (A) are -
Using analytics as competitive advantage
– Scb Thai 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 The Siam Commercial Bank: Weathering the Asian Storm (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Scb Thai to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Scb Thai 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.
Developing new processes and practices
– Scb Thai 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.
Creating value in data economy
– The success of analytics program of Scb Thai has opened avenues for new revenue streams for the organization in the industry. This can help Scb Thai to build a more holistic ecosystem as suggested in the The Siam Commercial Bank: Weathering the Asian Storm (A) case study. Scb Thai can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Scb Thai in the consumer business. Now Scb Thai can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Scb Thai can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Better consumer reach
– The expansion of the 5G network will help Scb Thai to increase its market reach. Scb Thai 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Scb Thai can use these opportunities to build new business models that can help the communities that Scb Thai operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Buying journey improvements
– Scb Thai can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Siam Commercial Bank: Weathering the Asian Storm (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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Scb Thai 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 Scb Thai to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Scb Thai 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Scb Thai can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Scb Thai 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.
Threats The Siam Commercial Bank: Weathering the Asian Storm (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 Siam Commercial Bank: Weathering the Asian Storm (A) are -
Increasing wage structure of Scb Thai
– 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 Scb Thai.
Regulatory challenges
– Scb Thai 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 Finance & Accounting industry regulations.
Environmental challenges
– Scb Thai 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. Scb Thai can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Technology acceleration in Forth Industrial Revolution
– Scb Thai has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Scb Thai needs to keep up with the evolution of technology in the Finance & Accounting 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.
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 Scb Thai.
Consumer confidence and its impact on Scb Thai 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Scb Thai in the Finance & Accounting industry. The Finance & Accounting 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.
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. Scb Thai needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Scb Thai 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.
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. Scb Thai can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Scb Thai is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Scb Thai with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Scb Thai 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.
Weighted SWOT Analysis of The Siam Commercial Bank: Weathering the Asian Storm (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 Siam Commercial Bank: Weathering the Asian Storm (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 Siam Commercial Bank: Weathering the Asian Storm (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 Siam Commercial Bank: Weathering the Asian Storm (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 Siam Commercial Bank: Weathering the Asian Storm (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 Scb Thai needs to make to build a sustainable competitive advantage.
