APLO: Optimal Supply of Street Lights SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of APLO: Optimal Supply of Street Lights
APLO was a reputable supplier of LED lighting systems for diverse countries from Taiwan to the United Kingdom. In 2015, APLO signed a contract to supply and install 30,000 pieces of 60-watt ecological street lights in several towns within one of Indonesia's provinces. With over 250 million inhabitants, Indonesia was in dire need of modernizing its infrastructure as it expanded economically. Having already been contracted for street lighting in several parts of Jakarta, Indonesia's capital city, APLO was eager for more projects across Indonesia. Would APLO be able to make this its showcase project and win many more contracts throughout Indonesia's 34 provinces? Singfat Chu is affiliated with NUS Business School, Mochtar Riady Building.
Authors :: Singfat Chu, Nicole Lo, Clark Hsu, Masahiro Okumura
Swot Analysis of "APLO: Optimal Supply of Street Lights" written by Singfat Chu, Nicole Lo, Clark Hsu, Masahiro Okumura includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Aplo Indonesia's facing as an external strategic factors. Some of the topics covered in APLO: Optimal Supply of Street Lights case study are - Strategic Management Strategies, Manufacturing, Project management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the APLO: Optimal Supply of Street Lights casestudy better are - – there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices, geopolitical disruptions, increasing energy prices,
challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of APLO: Optimal Supply of Street Lights
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in APLO: Optimal Supply of Street Lights case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Aplo Indonesia's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Aplo Indonesia's 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 APLO: Optimal Supply of Street Lights can be done for the following purposes –
1. Strategic planning using facts provided in APLO: Optimal Supply of Street Lights case study
2. Improving business portfolio management of Aplo Indonesia's
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 Aplo Indonesia's
Strengths APLO: Optimal Supply of Street Lights | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Aplo Indonesia's in APLO: Optimal Supply of Street Lights Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Aplo Indonesia's in the sector have low bargaining power. APLO: Optimal Supply of Street Lights has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Aplo Indonesia's to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Aplo Indonesia's 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 Singfat Chu, Nicole Lo, Clark Hsu, Masahiro Okumura 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.
Ability to recruit top talent
– Aplo Indonesia's is one of the leading recruiters in the industry. Managers in the APLO: Optimal Supply of Street Lights 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
– Aplo Indonesia's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Aplo Indonesia's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Aplo Indonesia's 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
– Aplo Indonesia's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in APLO: Optimal Supply of Street Lights 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.
Ability to lead change in Leadership & Managing People field
– Aplo Indonesia's 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 Aplo Indonesia's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Aplo Indonesia's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Aplo Indonesia's 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.
Effective Research and Development (R&D)
– Aplo Indonesia's 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 APLO: Optimal Supply of Street Lights - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the APLO: Optimal Supply of Street Lights 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.
High switching costs
– The high switching costs that Aplo Indonesia's 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.
Highly skilled collaborators
– Aplo Indonesia's 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 APLO: Optimal Supply of Street Lights HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses APLO: Optimal Supply of Street Lights | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of APLO: Optimal Supply of Street Lights are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Aplo Indonesia's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study APLO: Optimal Supply of Street Lights can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Aplo Indonesia's is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Aplo Indonesia's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Aplo Indonesia's to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Aplo Indonesia's has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - APLO: Optimal Supply of Street Lights should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Aplo Indonesia's 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.
Aligning sales with marketing
– It come across in the case study APLO: Optimal Supply of Street Lights 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 APLO: Optimal Supply of Street Lights can leverage the sales team experience to cultivate customer relationships as Aplo Indonesia's is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Aplo Indonesia's 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 decision making process
– As mentioned earlier in the report, Aplo Indonesia's 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. Aplo Indonesia's 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 star products
– The top 2 products and services of the firm as mentioned in the APLO: Optimal Supply of Street Lights 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 Aplo Indonesia's has relatively successful track record of launching new products.
Lack of clear differentiation of Aplo Indonesia's products
– To increase the profitability and margins on the products, Aplo Indonesia's needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Aplo Indonesia's 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study APLO: Optimal Supply of Street Lights, is just above the industry average. Aplo Indonesia's 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.
Opportunities APLO: Optimal Supply of Street Lights | 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 APLO: Optimal Supply of Street Lights are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Aplo Indonesia's 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, APLO: Optimal Supply of Street Lights, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Aplo Indonesia's has opened avenues for new revenue streams for the organization in the industry. This can help Aplo Indonesia's to build a more holistic ecosystem as suggested in the APLO: Optimal Supply of Street Lights case study. Aplo Indonesia's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Aplo Indonesia's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. APLO: Optimal Supply of Street Lights 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Aplo Indonesia's is facing challenges because of the dominance of functional experts in the organization. APLO: Optimal Supply of Street Lights 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.
Manufacturing automation
– Aplo Indonesia's 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Aplo Indonesia's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Aplo Indonesia's in the consumer business. Now Aplo Indonesia's can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Aplo Indonesia's 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.
Better consumer reach
– The expansion of the 5G network will help Aplo Indonesia's to increase its market reach. Aplo Indonesia's 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.
Using analytics as competitive advantage
– Aplo Indonesia's 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 APLO: Optimal Supply of Street Lights - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Aplo Indonesia's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Aplo Indonesia's 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.
Learning at scale
– Online learning technologies has now opened space for Aplo Indonesia's 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.
Building a culture of innovation
– managers at Aplo Indonesia's 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.
Threats APLO: Optimal Supply of Street Lights External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study APLO: Optimal Supply of Street Lights are -
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. Aplo Indonesia's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Aplo Indonesia's 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.
Stagnating economy with rate increase
– Aplo Indonesia's 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Aplo Indonesia's 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 Aplo Indonesia's 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.
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 Aplo Indonesia's business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Aplo Indonesia's
– 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 Aplo Indonesia's.
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.
Shortening product life cycle
– it is one of the major threat that Aplo Indonesia's is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Aplo Indonesia's has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Aplo Indonesia's needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study APLO: Optimal Supply of Street Lights, Aplo Indonesia's 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Aplo Indonesia's 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 APLO: Optimal Supply of Street Lights .
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.
Weighted SWOT Analysis of APLO: Optimal Supply of Street Lights 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 APLO: Optimal Supply of Street Lights 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 APLO: Optimal Supply of Street Lights 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 APLO: Optimal Supply of Street Lights 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 APLO: Optimal Supply of Street Lights 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 Aplo Indonesia's needs to make to build a sustainable competitive advantage.
