Multistrada Arah Sarana (MASA) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Multistrada Arah Sarana (Indonesia)

Based on various researches at Oak Spring University , Multistrada Arah Sarana is operating in a macro-environment that has been destablized by – increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, etc

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Introduction to SWOT Analysis of Multistrada Arah Sarana

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Multistrada Arah Sarana can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Multistrada Arah Sarana, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Multistrada Arah Sarana 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Multistrada Arah Sarana can be done for the following purposes –
1. Strategic planning of Multistrada Arah Sarana
2. Improving business portfolio management of Multistrada Arah Sarana
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Tires sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Multistrada Arah Sarana

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Strengths of Multistrada Arah Sarana | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Multistrada Arah Sarana are -

Highly skilled collaborators

– Multistrada Arah Sarana has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Tires industry. Secondly the value chain collaborators of Multistrada Arah Sarana have helped the firm to develop new products and bring them quickly to the marketplace.

Diverse revenue streams

– Multistrada Arah Sarana is present in almost all the verticals within the Tires industry. This has provided Multistrada Arah Sarana 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.

Operational resilience

– The operational resilience strategy of Multistrada Arah Sarana comprises – understanding the underlying the factors in the Tires 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.

Ability to recruit top talent

– Multistrada Arah Sarana is one of the leading players in the Tires 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.

Digital Transformation in Tires industry

- digital transformation varies from industry to industry. For Multistrada Arah Sarana digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Multistrada Arah Sarana 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.

Innovation driven organization

– Multistrada Arah Sarana is one of the most innovative firm in Tires sector.

Cross disciplinary teams

– Horizontal connected teams at the Multistrada Arah Sarana 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.

Learning organization

- Multistrada Arah Sarana 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 Multistrada Arah Sarana is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Multistrada Arah Sarana emphasize – knowledge, initiative, and innovation.

Sustainable margins compare to other players in Tires industry

– Multistrada Arah Sarana has clearly differentiated products in the market place. This has enabled Multistrada Arah Sarana to fetch slight price premium compare to the competitors in the Tires industry. The sustainable margins have also helped Multistrada Arah Sarana to invest into research and development (R&D) and innovation.

Strong track record of project management in the Tires industry

– Multistrada Arah Sarana is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Successful track record of launching new products

– Multistrada Arah Sarana has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Multistrada Arah Sarana 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.

Low bargaining power of suppliers

– Suppliers of Multistrada Arah Sarana in the Consumer Cyclical sector have low bargaining power. Multistrada Arah Sarana has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Multistrada Arah Sarana to manage not only supply disruptions but also source products at highly competitive prices.

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Weaknesses of Multistrada Arah Sarana | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Multistrada Arah Sarana are -

Lack of clear differentiation of Multistrada Arah Sarana products

– To increase the profitability and margins on the products, Multistrada Arah Sarana needs to provide more differentiated products than what it is currently offering in the marketplace.

Slow to strategic competitive environment developments

– As Multistrada Arah Sarana is one of the leading players in the Tires industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Tires industry in last five years.

Compensation and incentives

– The revenue per employee of Multistrada Arah Sarana is just above the Tires industry average. It 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.

Products dominated business model

– Even though Multistrada Arah Sarana has some of the most successful models in the Tires industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Multistrada Arah Sarana should strive to include more intangible value offerings along with its core products and services.

High operating costs

– Compare to the competitors, Multistrada Arah Sarana has high operating costs in the Tires industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Multistrada Arah Sarana lucrative customers.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Multistrada Arah Sarana is slow explore the new channels of communication. These new channels of communication can help Multistrada Arah Sarana to provide better information regarding Tires products and services. It can also build an online community to further reach out to potential customers.

High cash cycle compare to competitors

Multistrada Arah Sarana has a high cash cycle compare to other players in the Tires industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Aligning sales with marketing

– From the outside it seems that Multistrada Arah Sarana needs to have more collaboration between its sales team and marketing team. Sales professionals in the Tires industry have deep experience in developing customer relationships. Marketing department at Multistrada Arah Sarana can leverage the sales team experience to cultivate customer relationships as Multistrada Arah Sarana is planning to shift buying processes online.

Increasing silos among functional specialists

– The organizational structure of Multistrada Arah Sarana is dominated by functional specialists. It is not different from other players in the Tires industry, but Multistrada Arah Sarana needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Multistrada Arah Sarana to focus more on services in the Tires industry rather than just following the product oriented approach.

High dependence on Multistrada Arah Sarana ‘s star products

– The top 2 products and services of Multistrada Arah Sarana still accounts for major business revenue. This dependence on star products in Tires industry has resulted into insufficient focus on developing new products, even though Multistrada Arah Sarana has relatively successful track record of launching new products.

Low market penetration in new markets

– Outside its home market of Indonesia, Multistrada Arah Sarana needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

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Multistrada Arah Sarana Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Multistrada Arah Sarana are -

Using analytics as competitive advantage

– Multistrada Arah Sarana has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Tires sector. This continuous investment in analytics has enabled Multistrada Arah Sarana to build a competitive advantage using analytics. The analytics driven competitive advantage can help Multistrada Arah Sarana 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 Tires industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Multistrada Arah Sarana 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. Multistrada Arah Sarana 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.

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 Multistrada Arah Sarana 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.

Leveraging digital technologies

– Multistrada Arah Sarana 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Multistrada Arah Sarana can use these opportunities to build new business models that can help the communities that Multistrada Arah Sarana operates in. Secondly it can use opportunities from government spending in Tires sector.

Low interest rates

– Even though inflation is raising its head in most developed economies, Multistrada Arah Sarana 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.

Building a culture of innovation

– managers at Multistrada Arah Sarana 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 Tires industry.

Use of Bitcoin and other crypto currencies for transactions in Tires industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Multistrada Arah Sarana in the Tires industry. Now Multistrada Arah Sarana can target international markets with far fewer capital restrictions requirements than the existing system.

Better consumer reach

– The expansion of the 5G network will help Multistrada Arah Sarana to increase its market reach. Multistrada Arah Sarana 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Multistrada Arah Sarana 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 Multistrada Arah Sarana to hire the very best people irrespective of their geographical location.

Learning at scale

– Online learning technologies has now opened space for Multistrada Arah Sarana 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Multistrada Arah Sarana 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 Multistrada Arah Sarana to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Multistrada Arah Sarana can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

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Threats Multistrada Arah Sarana External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Multistrada Arah Sarana are -

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.

Easy access to finance

– Easy access to finance in Tires industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Multistrada Arah Sarana can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Stagnating economy with rate increase

– Multistrada Arah Sarana 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 Tires industry.

High dependence on third party suppliers

– Multistrada Arah Sarana 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.

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. Multistrada Arah Sarana needs to understand the core reasons impacting the Tires industry. This will help it in building a better workplace.

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. Multistrada Arah Sarana 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.

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 Multistrada Arah Sarana.

Environmental challenges

– Multistrada Arah Sarana 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. Multistrada Arah Sarana can take advantage of this fund but it will also bring new competitors in the Tires industry.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Multistrada Arah Sarana may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Tires sector.

Increasing wage structure of Multistrada Arah Sarana

– 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 Multistrada Arah Sarana.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Tires industry are lowering. It can presents Multistrada Arah Sarana with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Tires sector.

Shortening product life cycle

– it is one of the major threat that Multistrada Arah Sarana is facing in Tires sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Technology acceleration in Forth Industrial Revolution

– Multistrada Arah Sarana has witnessed rapid integration of technology during Covid-19 in the Tires industry. As one of the leading players in the industry, Multistrada Arah Sarana needs to keep up with the evolution of technology in the Tires 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.

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Weighted SWOT Analysis of Multistrada Arah Sarana Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Multistrada Arah Sarana 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 Multistrada Arah Sarana 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 Multistrada Arah Sarana 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 Multistrada Arah Sarana 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 Multistrada Arah Sarana needs to make to build a sustainable competitive advantage.

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