Asia Pulp & Paper: Implementing the Forest Conservation Policy SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Asia Pulp & Paper: Implementing the Forest Conservation Policy
Indonesia's Asia Pulp & Paper (APP), the world's largest pulp and paper company, was attacked in 2011 by Greenpeace in a global campaign against buyers of APP packaging, particularly Mattel. The managing director of APP's sustainability and stakeholder engagement (SSE) had to address lost sales and the accusation of greenwashing and devise an appropriate response to Greenpeace's challenge while implementing the APP Group chairman's goals to promote climate conservation, community, and commerce. In November 2014, the managing director of SSE had to assess the current progress of the Forest Conservation Policy and APP's relationships with its stakeholders. Hugh Thomas is affiliated with Chinese University of Hong Kong. Shige Makino is affiliated with Chinese University of Hong Kong.
Authors :: Hugh Thomas, Shigefumi Makino, KA Wai Boby Shiu
Swot Analysis of "Asia Pulp & Paper: Implementing the Forest Conservation Policy" written by Hugh Thomas, Shigefumi Makino, KA Wai Boby Shiu includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Pulp Sse facing as an external strategic factors. Some of the topics covered in Asia Pulp & Paper: Implementing the Forest Conservation Policy case study are - Strategic Management Strategies, International business, Strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Asia Pulp & Paper: Implementing the Forest Conservation Policy casestudy better are - – increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic ,
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 Asia Pulp & Paper: Implementing the Forest Conservation Policy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Asia Pulp & Paper: Implementing the Forest Conservation Policy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pulp Sse, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pulp Sse 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy can be done for the following purposes –
1. Strategic planning using facts provided in Asia Pulp & Paper: Implementing the Forest Conservation Policy case study
2. Improving business portfolio management of Pulp Sse
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Pulp Sse
Strengths Asia Pulp & Paper: Implementing the Forest Conservation Policy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Pulp Sse in Asia Pulp & Paper: Implementing the Forest Conservation Policy Harvard Business Review case study are -
Organizational Resilience of Pulp Sse
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Pulp Sse does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Pulp Sse 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Pulp Sse in the sector have low bargaining power. Asia Pulp & Paper: Implementing the Forest Conservation Policy has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Pulp Sse to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Leadership & Managing People industry
– Asia Pulp & Paper: Implementing the Forest Conservation Policy firm has clearly differentiated products in the market place. This has enabled Pulp Sse to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Pulp Sse to invest into research and development (R&D) and innovation.
Ability to lead change in Leadership & Managing People field
– Pulp Sse 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 Pulp Sse in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Pulp Sse 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.
Ability to recruit top talent
– Pulp Sse is one of the leading recruiters in the industry. Managers in the Asia Pulp & Paper: Implementing the Forest Conservation Policy 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
– Pulp Sse is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Asia Pulp & Paper: Implementing the Forest Conservation Policy 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Pulp Sse digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Pulp Sse 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.
Analytics focus
– Pulp Sse 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 Hugh Thomas, Shigefumi Makino, KA Wai Boby Shiu 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.
Successful track record of launching new products
– Pulp Sse has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Pulp Sse 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.
Weaknesses Asia Pulp & Paper: Implementing the Forest Conservation Policy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Asia Pulp & Paper: Implementing the Forest Conservation Policy are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Asia Pulp & Paper: Implementing the Forest Conservation Policy, in the dynamic environment Pulp Sse has struggled to respond to the nimble upstart competition. Pulp Sse has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Pulp Sse supply chain. Even after few cautionary changes mentioned in the HBR case study - Asia Pulp & Paper: Implementing the Forest Conservation Policy, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Pulp Sse vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Pulp Sse 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Pulp Sse is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Asia Pulp & Paper: Implementing the Forest Conservation Policy can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Pulp Sse 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy 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 Pulp Sse 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study Asia Pulp & Paper: Implementing the Forest Conservation Policy, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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.
Capital Spending Reduction
– Even during the low interest decade, Pulp Sse 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.
Aligning sales with marketing
– It come across in the case study Asia Pulp & Paper: Implementing the Forest Conservation Policy 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy can leverage the sales team experience to cultivate customer relationships as Pulp Sse is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Hugh Thomas, Shigefumi Makino, KA Wai Boby Shiu suggests that, Pulp Sse 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Asia Pulp & Paper: Implementing the Forest Conservation Policy 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 Pulp Sse has relatively successful track record of launching new products.
Opportunities Asia Pulp & Paper: Implementing the Forest Conservation Policy | 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy are -
Building a culture of innovation
– managers at Pulp Sse 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 Leadership & Managing People 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 Pulp Sse 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Pulp Sse in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Learning at scale
– Online learning technologies has now opened space for Pulp Sse 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Pulp Sse can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Pulp Sse 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.
Loyalty marketing
– Pulp Sse 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Pulp Sse 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, Asia Pulp & Paper: Implementing the Forest Conservation Policy, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Pulp Sse 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.
Manufacturing automation
– Pulp Sse can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
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. Pulp Sse can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Using analytics as competitive advantage
– Pulp Sse 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Pulp Sse to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Pulp Sse can develop new processes and procedures in Leadership & Managing People 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.
Threats Asia Pulp & Paper: Implementing the Forest Conservation Policy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Asia Pulp & Paper: Implementing the Forest Conservation Policy 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy, Pulp Sse may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Environmental challenges
– Pulp Sse 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. Pulp Sse can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Shortening product life cycle
– it is one of the major threat that Pulp Sse is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
High dependence on third party suppliers
– Pulp Sse 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 Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Pulp Sse can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Pulp Sse in the Leadership & Managing People sector and impact the bottomline 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. Pulp Sse needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Pulp Sse 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Pulp Sse in the Leadership & Managing People industry. The Leadership & Managing People 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.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Pulp Sse business can come under increasing regulations regarding data privacy, data security, etc.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Pulp Sse with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Asia Pulp & Paper: Implementing the Forest Conservation Policy 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy 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 Asia Pulp & Paper: Implementing the Forest Conservation Policy 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 Pulp Sse needs to make to build a sustainable competitive advantage.