SWOT Analysis / TOWS Matrix for Asuransi Tugu Pratama (Indonesia)
Based on various researches at Oak Spring University , Asuransi Tugu Pratama is operating in a macro-environment that has been destablized by – increasing commodity prices, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs,
competitive advantages are harder to sustain because of technology dispersion, technology disruption, etc
Introduction to SWOT Analysis of Asuransi Tugu Pratama
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Asuransi Tugu Pratama can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Asuransi Tugu Pratama, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Asuransi Tugu Pratama 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 Asuransi Tugu Pratama can be done for the following purposes –
1. Strategic planning of Asuransi Tugu Pratama
2. Improving business portfolio management of Asuransi Tugu Pratama
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Insurance (Prop. & Casualty) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Asuransi Tugu Pratama
Strengths of Asuransi Tugu Pratama | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Asuransi Tugu Pratama are -
Cross disciplinary teams
– Horizontal connected teams at the Asuransi Tugu Pratama 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.
Diverse revenue streams
– Asuransi Tugu Pratama is present in almost all the verticals within the Insurance (Prop. & Casualty) industry. This has provided Asuransi Tugu Pratama 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.
Ability to lead change in Insurance (Prop. & Casualty)
– Asuransi Tugu Pratama is one of the leading players in the Insurance (Prop. & Casualty) industry in Indonesia. Over the years it has not only transformed the business landscape in the Insurance (Prop. & Casualty) industry in Indonesia but also across the existing markets. The ability to lead change has enabled Asuransi Tugu Pratama in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management in the Insurance (Prop. & Casualty) industry
– Asuransi Tugu Pratama is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Asuransi Tugu Pratama 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 Asuransi Tugu Pratama is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Asuransi Tugu Pratama emphasize – knowledge, initiative, and innovation.
High brand equity
– Asuransi Tugu Pratama has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Asuransi Tugu Pratama to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Asuransi Tugu Pratama in the Financial sector have low bargaining power. Asuransi Tugu Pratama has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Asuransi Tugu Pratama to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Asuransi Tugu Pratama in Insurance (Prop. & Casualty) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy of Asuransi Tugu Pratama comprises – understanding the underlying the factors in the Insurance (Prop. & Casualty) 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 Asuransi Tugu Pratama 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.
Effective Research and Development (R&D)
– Asuransi Tugu Pratama has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Asuransi Tugu Pratama staying ahead in the Insurance (Prop. & Casualty) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Asuransi Tugu Pratama 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 (Prop. & Casualty) 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.
Weaknesses of Asuransi Tugu Pratama | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Asuransi Tugu Pratama are -
High cash cycle compare to competitors
Asuransi Tugu Pratama has a high cash cycle compare to other players in the Insurance (Prop. & Casualty) industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High dependence on Asuransi Tugu Pratama ‘s star products
– The top 2 products and services of Asuransi Tugu Pratama still accounts for major business revenue. This dependence on star products in Insurance (Prop. & Casualty) industry has resulted into insufficient focus on developing new products, even though Asuransi Tugu Pratama has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, Asuransi Tugu Pratama has high operating costs in the Insurance (Prop. & Casualty) industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Asuransi Tugu Pratama lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Asuransi Tugu Pratama is dominated by functional specialists. It is not different from other players in the Insurance (Prop. & Casualty) industry, but Asuransi Tugu Pratama needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Asuransi Tugu Pratama to focus more on services in the Insurance (Prop. & Casualty) industry rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Asuransi Tugu Pratama 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.
Employees’ less understanding of Asuransi Tugu Pratama strategy
– From the outside it seems that the employees of Asuransi Tugu Pratama 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.
No frontier risks strategy
– From the 10K / annual statement of Asuransi Tugu Pratama, it seems that company is thinking out the frontier risks that can impact Insurance (Prop. & Casualty) 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.
Aligning sales with marketing
– From the outside it seems that Asuransi Tugu Pratama needs to have more collaboration between its sales team and marketing team. Sales professionals in the Insurance (Prop. & Casualty) industry have deep experience in developing customer relationships. Marketing department at Asuransi Tugu Pratama can leverage the sales team experience to cultivate customer relationships as Asuransi Tugu Pratama is planning to shift buying processes online.
Lack of clear differentiation of Asuransi Tugu Pratama products
– To increase the profitability and margins on the products, Asuransi Tugu Pratama needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative at Asuransi Tugu Pratama, in the dynamic environment of Insurance (Prop. & Casualty) industry it has struggled to respond to the nimble upstart competition. Asuransi Tugu Pratama has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee of Asuransi Tugu Pratama is just above the Insurance (Prop. & Casualty) 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.
Asuransi Tugu Pratama Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Asuransi Tugu Pratama are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Asuransi Tugu Pratama 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 Asuransi Tugu Pratama to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Asuransi Tugu Pratama to increase its market reach. Asuransi Tugu Pratama 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.
Developing new processes and practices
– Asuransi Tugu Pratama can develop new processes and procedures in Insurance (Prop. & Casualty) 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Asuransi Tugu Pratama is facing challenges because of the dominance of functional experts in the organization. Asuransi Tugu Pratama can utilize new technology in the field of Insurance (Prop. & Casualty) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Asuransi Tugu Pratama can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Insurance (Prop. & Casualty) industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Asuransi Tugu Pratama 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. Asuransi Tugu Pratama 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.
Loyalty marketing
– Asuransi Tugu Pratama 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.
Using analytics as competitive advantage
– Asuransi Tugu Pratama has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Insurance (Prop. & Casualty) sector. This continuous investment in analytics has enabled Asuransi Tugu Pratama to build a competitive advantage using analytics. The analytics driven competitive advantage can help Asuransi Tugu Pratama to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Asuransi Tugu Pratama 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Asuransi Tugu Pratama 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.
Manufacturing automation
– Asuransi Tugu Pratama can use the latest technology developments to improve its manufacturing and designing process in Insurance (Prop. & Casualty) sector. 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Asuransi Tugu Pratama 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 (Prop. & Casualty) industry, and it will provide faster access to the consumers.
Use of Bitcoin and other crypto currencies for transactions in Insurance (Prop. & Casualty) industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Asuransi Tugu Pratama in the Insurance (Prop. & Casualty) industry. Now Asuransi Tugu Pratama can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Asuransi Tugu Pratama External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Asuransi Tugu Pratama are -
Stagnating economy with rate increase
– Asuransi Tugu Pratama 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 (Prop. & Casualty) industry.
Easy access to finance
– Easy access to finance in Insurance (Prop. & Casualty) industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Asuransi Tugu Pratama can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Insurance (Prop. & Casualty) industry are lowering. It can presents Asuransi Tugu Pratama with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Insurance (Prop. & Casualty) sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Asuransi Tugu Pratama in Insurance (Prop. & Casualty) industry. The Insurance (Prop. & Casualty) 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.
Technology acceleration in Forth Industrial Revolution
– Asuransi Tugu Pratama has witnessed rapid integration of technology during Covid-19 in the Insurance (Prop. & Casualty) industry. As one of the leading players in the industry, Asuransi Tugu Pratama needs to keep up with the evolution of technology in the Insurance (Prop. & Casualty) 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, Asuransi Tugu Pratama 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 (Prop. & Casualty) sector.
Shortening product life cycle
– it is one of the major threat that Asuransi Tugu Pratama is facing in Insurance (Prop. & Casualty) 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 Asuransi Tugu Pratama business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Asuransi Tugu Pratama
– 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 Asuransi Tugu Pratama.
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.
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.
Environmental challenges
– Asuransi Tugu Pratama 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. Asuransi Tugu Pratama can take advantage of this fund but it will also bring new competitors in the Insurance (Prop. & Casualty) industry.
Regulatory challenges
– Asuransi Tugu Pratama 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 Insurance (Prop. & Casualty) industry regulations.
Weighted SWOT Analysis of Asuransi Tugu Pratama Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Asuransi Tugu Pratama 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 Asuransi Tugu Pratama 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 Asuransi Tugu Pratama 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 Asuransi Tugu Pratama 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 Asuransi Tugu Pratama needs to make to build a sustainable competitive advantage.