Sinar Mas Multiartha (SMMA) SWOT Analysis / TOWS Matrix / MBA Resources
Insurance (Accident & Health)
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Sinar Mas Multiartha (Indonesia)
Based on various researches at Oak Spring University , Sinar Mas Multiartha is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, increasing energy prices, increasing commodity prices,
cloud computing is disrupting traditional business models, technology disruption, etc
Introduction to SWOT Analysis of Sinar Mas Multiartha
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Sinar Mas Multiartha can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sinar Mas Multiartha, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sinar Mas Multiartha 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 Sinar Mas Multiartha can be done for the following purposes –
1. Strategic planning of Sinar Mas Multiartha
2. Improving business portfolio management of Sinar Mas Multiartha
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Insurance (Accident & Health) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Sinar Mas Multiartha
Strengths of Sinar Mas Multiartha | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sinar Mas Multiartha are -
Ability to recruit top talent
– Sinar Mas Multiartha is one of the leading players in the Insurance (Accident & Health) industry in Indonesia. It is in a position to attract the best talent available in Indonesia. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Sinar Mas Multiartha has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Insurance (Accident & Health) industry. Secondly the value chain collaborators of Sinar Mas Multiartha have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Sinar Mas Multiartha is one of the most innovative firm in Insurance (Accident & Health) sector.
Analytics focus
– Sinar Mas Multiartha 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 Insurance (Accident & Health) industry. The technology infrastructure of Indonesia is also helping 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
– Sinar Mas Multiartha has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sinar Mas Multiartha 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.
Strong track record of project management in the Insurance (Accident & Health) industry
– Sinar Mas Multiartha is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Sinar Mas Multiartha in Insurance (Accident & Health) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Sinar Mas Multiartha has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Sinar Mas Multiartha staying ahead in the Insurance (Accident & Health) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Sinar Mas Multiartha has one of the best training and development program in Financial industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Diverse revenue streams
– Sinar Mas Multiartha is present in almost all the verticals within the Insurance (Accident & Health) industry. This has provided Sinar Mas Multiartha 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.
Sustainable margins compare to other players in Insurance (Accident & Health) industry
– Sinar Mas Multiartha has clearly differentiated products in the market place. This has enabled Sinar Mas Multiartha to fetch slight price premium compare to the competitors in the Insurance (Accident & Health) industry. The sustainable margins have also helped Sinar Mas Multiartha to invest into research and development (R&D) and innovation.
Learning organization
- Sinar Mas Multiartha is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Sinar Mas Multiartha is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Sinar Mas Multiartha emphasize – knowledge, initiative, and innovation.
Weaknesses of Sinar Mas Multiartha | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sinar Mas Multiartha are -
Employees’ less understanding of Sinar Mas Multiartha strategy
– From the outside it seems that the employees of Sinar Mas Multiartha 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.
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 Sinar Mas Multiartha supply chain. Even after few cautionary changes, Sinar Mas Multiartha is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sinar Mas Multiartha vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Indonesia, Sinar Mas Multiartha needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Sinar Mas Multiartha 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.
Workers concerns about automation
– As automation is fast increasing in the Insurance (Accident & Health) industry, Sinar Mas Multiartha 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 strategic competitive environment developments
– As Sinar Mas Multiartha is one of the leading players in the Insurance (Accident & Health) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Insurance (Accident & Health) industry in last five years.
Aligning sales with marketing
– From the outside it seems that Sinar Mas Multiartha needs to have more collaboration between its sales team and marketing team. Sales professionals in the Insurance (Accident & Health) industry have deep experience in developing customer relationships. Marketing department at Sinar Mas Multiartha can leverage the sales team experience to cultivate customer relationships as Sinar Mas Multiartha is planning to shift buying processes online.
High bargaining power of channel partners in Insurance (Accident & Health) industry
– because of the regulatory requirements in Indonesia, Sinar Mas Multiartha 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 Insurance (Accident & Health) industry.
Increasing silos among functional specialists
– The organizational structure of Sinar Mas Multiartha is dominated by functional specialists. It is not different from other players in the Insurance (Accident & Health) industry, but Sinar Mas Multiartha needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sinar Mas Multiartha to focus more on services in the Insurance (Accident & Health) industry rather than just following the product oriented approach.
High dependence on Sinar Mas Multiartha ‘s star products
– The top 2 products and services of Sinar Mas Multiartha still accounts for major business revenue. This dependence on star products in Insurance (Accident & Health) industry has resulted into insufficient focus on developing new products, even though Sinar Mas Multiartha has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Sinar Mas Multiartha 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 Insurance (Accident & Health) industry using digital technology.
Sinar Mas Multiartha Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Sinar Mas Multiartha are -
Leveraging digital technologies
– Sinar Mas Multiartha 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Sinar Mas Multiartha 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 Sinar Mas Multiartha to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Sinar Mas Multiartha to increase its market reach. Sinar Mas Multiartha 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.
Learning at scale
– Online learning technologies has now opened space for Sinar Mas Multiartha 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.
Use of Bitcoin and other crypto currencies for transactions in Insurance (Accident & Health) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Sinar Mas Multiartha in the Insurance (Accident & Health) industry. Now Sinar Mas Multiartha can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sinar Mas Multiartha is facing challenges because of the dominance of functional experts in the organization. Sinar Mas Multiartha can utilize new technology in the field of Insurance (Accident & Health) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sinar Mas Multiartha can use these opportunities to build new business models that can help the communities that Sinar Mas Multiartha operates in. Secondly it can use opportunities from government spending in Insurance (Accident & Health) sector.
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 Sinar Mas Multiartha 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.
Creating value in data economy
– The success of analytics program of Sinar Mas Multiartha has opened avenues for new revenue streams for the organization in Insurance (Accident & Health) industry. This can help Sinar Mas Multiartha to build a more holistic ecosystem for Sinar Mas Multiartha products in the Insurance (Accident & Health) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Sinar Mas Multiartha has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Insurance (Accident & Health) sector. This continuous investment in analytics has enabled Sinar Mas Multiartha to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sinar Mas Multiartha to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Insurance (Accident & Health) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Sinar Mas Multiartha can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Sinar Mas Multiartha can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
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. Sinar Mas Multiartha can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sinar Mas Multiartha in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Insurance (Accident & Health) industry, and it will provide faster access to the consumers.
Threats Sinar Mas Multiartha External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Sinar Mas Multiartha are -
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. Sinar Mas Multiartha 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.
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 Sinar Mas Multiartha business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Sinar Mas Multiartha 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. Sinar Mas Multiartha can take advantage of this fund but it will also bring new competitors in the Insurance (Accident & Health) industry.
Stagnating economy with rate increase
– Sinar Mas Multiartha 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 Insurance (Accident & Health) industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sinar Mas Multiartha in Insurance (Accident & Health) industry. The Insurance (Accident & Health) 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sinar Mas Multiartha 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 Sinar Mas Multiartha prominent markets.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Insurance (Accident & Health) industry are lowering. It can presents Sinar Mas Multiartha with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Insurance (Accident & Health) sector.
Easy access to finance
– Easy access to finance in Insurance (Accident & Health) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Sinar Mas Multiartha can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Sinar Mas Multiartha may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Insurance (Accident & Health) sector.
Shortening product life cycle
– it is one of the major threat that Sinar Mas Multiartha is facing in Insurance (Accident & Health) sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Sinar Mas Multiartha has witnessed rapid integration of technology during Covid-19 in the Insurance (Accident & Health) industry. As one of the leading players in the industry, Sinar Mas Multiartha needs to keep up with the evolution of technology in the Insurance (Accident & Health) 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.
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. Sinar Mas Multiartha needs to understand the core reasons impacting the Insurance (Accident & Health) industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Sinar Mas Multiartha Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Sinar Mas Multiartha 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 Sinar Mas Multiartha 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 Sinar Mas Multiartha 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 Sinar Mas Multiartha 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 Sinar Mas Multiartha needs to make to build a sustainable competitive advantage.
