Bumi Teknokultura (BTEK) SWOT Analysis / TOWS Matrix / MBA Resources
Forestry & Wood Products
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Bumi Teknokultura (Indonesia)
Based on various researches at Oak Spring University , Bumi Teknokultura is operating in a macro-environment that has been destablized by – supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, increasing energy prices, wage bills are increasing, technology disruption, increasing government debt because of Covid-19 spendings,
increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Bumi Teknokultura
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Bumi Teknokultura can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bumi Teknokultura, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bumi Teknokultura 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 Bumi Teknokultura can be done for the following purposes –
1. Strategic planning of Bumi Teknokultura
2. Improving business portfolio management of Bumi Teknokultura
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Forestry & Wood Products sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bumi Teknokultura
Strengths of Bumi Teknokultura | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bumi Teknokultura are -
Diverse revenue streams
– Bumi Teknokultura is present in almost all the verticals within the Forestry & Wood Products industry. This has provided Bumi Teknokultura 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 Bumi Teknokultura comprises – understanding the underlying the factors in the Forestry & Wood Products 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.
Organizational Resilience of Bumi Teknokultura
– The covid-19 pandemic has put organizational resilience at the centre of everthing Bumi Teknokultura does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Bumi Teknokultura is one of the leading players in the Forestry & Wood Products 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.
High switching costs
– The high switching costs that Bumi Teknokultura 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.
High brand equity
– Bumi Teknokultura has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bumi Teknokultura to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Bumi Teknokultura is one of the most innovative firm in Forestry & Wood Products sector.
Superior customer experience
– The customer experience strategy of Bumi Teknokultura in Forestry & Wood Products industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Bumi Teknokultura 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 Bumi Teknokultura is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Bumi Teknokultura emphasize – knowledge, initiative, and innovation.
Ability to lead change in Forestry & Wood Products
– Bumi Teknokultura is one of the leading players in the Forestry & Wood Products industry in Indonesia. Over the years it has not only transformed the business landscape in the Forestry & Wood Products industry in Indonesia but also across the existing markets. The ability to lead change has enabled Bumi Teknokultura in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Bumi Teknokultura 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 Forestry & Wood Products 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.
Digital Transformation in Forestry & Wood Products industry
- digital transformation varies from industry to industry. For Bumi Teknokultura digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bumi Teknokultura 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.
Weaknesses of Bumi Teknokultura | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bumi Teknokultura are -
Slow decision making process
– As mentioned earlier in the report, Bumi Teknokultura has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Forestry & Wood Products industry over the last five years. Bumi Teknokultura 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.
Products dominated business model
– Even though Bumi Teknokultura has some of the most successful models in the Forestry & Wood Products industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Bumi Teknokultura should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– From the outside it seems that Bumi Teknokultura needs to have more collaboration between its sales team and marketing team. Sales professionals in the Forestry & Wood Products industry have deep experience in developing customer relationships. Marketing department at Bumi Teknokultura can leverage the sales team experience to cultivate customer relationships as Bumi Teknokultura is planning to shift buying processes online.
Need for greater diversity
– Bumi Teknokultura has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Skills based hiring in Forestry & Wood Products industry
– The stress on hiring functional specialists at Bumi Teknokultura has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative at Bumi Teknokultura, in the dynamic environment of Forestry & Wood Products industry it has struggled to respond to the nimble upstart competition. Bumi Teknokultura has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Bumi Teknokultura 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 Forestry & Wood Products industry using digital technology.
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 Bumi Teknokultura supply chain. Even after few cautionary changes, Bumi Teknokultura is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Bumi Teknokultura vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the Forestry & Wood Products industry, Bumi Teknokultura 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.
No frontier risks strategy
– From the 10K / annual statement of Bumi Teknokultura, it seems that company is thinking out the frontier risks that can impact Forestry & Wood Products industry. 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.
Lack of clear differentiation of Bumi Teknokultura products
– To increase the profitability and margins on the products, Bumi Teknokultura needs to provide more differentiated products than what it is currently offering in the marketplace.
Bumi Teknokultura Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Bumi Teknokultura are -
Using analytics as competitive advantage
– Bumi Teknokultura has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Forestry & Wood Products sector. This continuous investment in analytics has enabled Bumi Teknokultura to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bumi Teknokultura to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bumi Teknokultura in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Forestry & Wood Products industry, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Forestry & Wood Products industry, but it has also influenced the consumer preferences. Bumi Teknokultura can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Forestry & Wood Products industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Bumi Teknokultura 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. Bumi Teknokultura 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. Bumi Teknokultura can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Bumi Teknokultura 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.
Developing new processes and practices
– Bumi Teknokultura can develop new processes and procedures in Forestry & Wood Products 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.
Loyalty marketing
– Bumi Teknokultura 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.
Buying journey improvements
– Bumi Teknokultura can improve the customer journey of consumers in the Forestry & Wood Products industry by using analytics and artificial intelligence. It 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Bumi Teknokultura can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Bumi Teknokultura can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Bumi Teknokultura 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, Bumi Teknokultura can use these opportunities to build new business models that can help the communities that Bumi Teknokultura operates in. Secondly it can use opportunities from government spending in Forestry & Wood Products sector.
Threats Bumi Teknokultura External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Bumi Teknokultura are -
Environmental challenges
– Bumi Teknokultura 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. Bumi Teknokultura can take advantage of this fund but it will also bring new competitors in the Forestry & Wood Products industry.
Regulatory challenges
– Bumi Teknokultura needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Forestry & Wood Products industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bumi Teknokultura in Forestry & Wood Products industry. The Forestry & Wood Products industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Bumi Teknokultura needs to understand the core reasons impacting the Forestry & Wood Products industry. This will help it in building a better workplace.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Bumi Teknokultura may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Forestry & Wood Products sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bumi Teknokultura 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 Bumi Teknokultura prominent markets.
Consumer confidence and its impact on Bumi Teknokultura 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 Forestry & Wood Products industry and other sectors.
High dependence on third party suppliers
– Bumi Teknokultura 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.
Shortening product life cycle
– it is one of the major threat that Bumi Teknokultura is facing in Forestry & Wood Products sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Bumi Teknokultura business can come under increasing regulations regarding data privacy, data security, etc.
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 Bumi Teknokultura.
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 Bumi Teknokultura in the Forestry & Wood Products sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Bumi Teknokultura Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Bumi Teknokultura 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 Bumi Teknokultura 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 Bumi Teknokultura 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 Bumi Teknokultura 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 Bumi Teknokultura needs to make to build a sustainable competitive advantage.