Bank Mestika Dharma (BBMD) SWOT Analysis / TOWS Matrix / MBA Resources
S&Ls/Savings Banks
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Bank Mestika Dharma (Indonesia)
Based on various researches at Oak Spring University , Bank Mestika Dharma is operating in a macro-environment that has been destablized by – increasing commodity prices, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions,
customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Bank Mestika Dharma
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Bank Mestika Dharma can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bank Mestika Dharma, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bank Mestika Dharma 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 Bank Mestika Dharma can be done for the following purposes –
1. Strategic planning of Bank Mestika Dharma
2. Improving business portfolio management of Bank Mestika Dharma
3. Assessing feasibility of the new initiative in Indonesia
4. Making a S&Ls/Savings Banks sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bank Mestika Dharma
Strengths of Bank Mestika Dharma | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bank Mestika Dharma are -
High brand equity
– Bank Mestika Dharma has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bank Mestika Dharma to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Bank Mestika Dharma 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 Bank Mestika Dharma is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Bank Mestika Dharma emphasize – knowledge, initiative, and innovation.
Digital Transformation in S&Ls/Savings Banks industry
- digital transformation varies from industry to industry. For Bank Mestika Dharma digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bank Mestika Dharma 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.
High switching costs
– The high switching costs that Bank Mestika Dharma 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.
Innovation driven organization
– Bank Mestika Dharma is one of the most innovative firm in S&Ls/Savings Banks sector.
Operational resilience
– The operational resilience strategy of Bank Mestika Dharma comprises – understanding the underlying the factors in the S&Ls/Savings Banks 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.
Effective Research and Development (R&D)
– Bank Mestika Dharma has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Bank Mestika Dharma staying ahead in the S&Ls/Savings Banks industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in S&Ls/Savings Banks industry
– Bank Mestika Dharma has clearly differentiated products in the market place. This has enabled Bank Mestika Dharma to fetch slight price premium compare to the competitors in the S&Ls/Savings Banks industry. The sustainable margins have also helped Bank Mestika Dharma to invest into research and development (R&D) and innovation.
Ability to lead change in S&Ls/Savings Banks
– Bank Mestika Dharma is one of the leading players in the S&Ls/Savings Banks industry in Indonesia. Over the years it has not only transformed the business landscape in the S&Ls/Savings Banks industry in Indonesia but also across the existing markets. The ability to lead change has enabled Bank Mestika Dharma in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Bank Mestika Dharma in S&Ls/Savings Banks industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Bank Mestika Dharma is present in almost all the verticals within the S&Ls/Savings Banks industry. This has provided Bank Mestika Dharma 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.
Successful track record of launching new products
– Bank Mestika Dharma has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bank Mestika Dharma 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.
Weaknesses of Bank Mestika Dharma | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bank Mestika Dharma are -
Slow decision making process
– As mentioned earlier in the report, Bank Mestika Dharma has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the S&Ls/Savings Banks industry over the last five years. Bank Mestika Dharma 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.
Ability to respond to the competition
– As the decision making is very deliberative at Bank Mestika Dharma, in the dynamic environment of S&Ls/Savings Banks industry it has struggled to respond to the nimble upstart competition. Bank Mestika Dharma has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on Bank Mestika Dharma ‘s star products
– The top 2 products and services of Bank Mestika Dharma still accounts for major business revenue. This dependence on star products in S&Ls/Savings Banks industry has resulted into insufficient focus on developing new products, even though Bank Mestika Dharma has relatively successful track record of launching new products.
Aligning sales with marketing
– From the outside it seems that Bank Mestika Dharma needs to have more collaboration between its sales team and marketing team. Sales professionals in the S&Ls/Savings Banks industry have deep experience in developing customer relationships. Marketing department at Bank Mestika Dharma can leverage the sales team experience to cultivate customer relationships as Bank Mestika Dharma is planning to shift buying processes online.
High bargaining power of channel partners in S&Ls/Savings Banks industry
– because of the regulatory requirements in Indonesia, Bank Mestika Dharma 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 S&Ls/Savings Banks industry.
No frontier risks strategy
– From the 10K / annual statement of Bank Mestika Dharma, it seems that company is thinking out the frontier risks that can impact S&Ls/Savings Banks 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.
Skills based hiring in S&Ls/Savings Banks industry
– The stress on hiring functional specialists at Bank Mestika Dharma 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.
Capital Spending Reduction
– Even during the low interest decade, Bank Mestika Dharma 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 S&Ls/Savings Banks industry using digital technology.
Lack of clear differentiation of Bank Mestika Dharma products
– To increase the profitability and margins on the products, Bank Mestika Dharma needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Bank Mestika Dharma has a high cash cycle compare to other players in the S&Ls/Savings Banks industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Compensation and incentives
– The revenue per employee of Bank Mestika Dharma is just above the S&Ls/Savings Banks 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.
Bank Mestika Dharma Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Bank Mestika Dharma are -
Building a culture of innovation
– managers at Bank Mestika Dharma 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 S&Ls/Savings Banks industry.
Developing new processes and practices
– Bank Mestika Dharma can develop new processes and procedures in S&Ls/Savings Banks 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.
Leveraging digital technologies
– Bank Mestika Dharma 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.
Loyalty marketing
– Bank Mestika Dharma 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.
Learning at scale
– Online learning technologies has now opened space for Bank Mestika Dharma 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.
Using analytics as competitive advantage
– Bank Mestika Dharma has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in S&Ls/Savings Banks sector. This continuous investment in analytics has enabled Bank Mestika Dharma to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bank Mestika Dharma to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Bank Mestika Dharma to increase its market reach. Bank Mestika Dharma 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bank Mestika Dharma can use these opportunities to build new business models that can help the communities that Bank Mestika Dharma operates in. Secondly it can use opportunities from government spending in S&Ls/Savings Banks sector.
Use of Bitcoin and other crypto currencies for transactions in S&Ls/Savings Banks industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Bank Mestika Dharma in the S&Ls/Savings Banks industry. Now Bank Mestika Dharma can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bank Mestika Dharma 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 Bank Mestika Dharma to hire the very best people irrespective of their geographical location.
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. Bank Mestika Dharma can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Bank Mestika Dharma can use the latest technology developments to improve its manufacturing and designing process in S&Ls/Savings Banks 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.
Creating value in data economy
– The success of analytics program of Bank Mestika Dharma has opened avenues for new revenue streams for the organization in S&Ls/Savings Banks industry. This can help Bank Mestika Dharma to build a more holistic ecosystem for Bank Mestika Dharma products in the S&Ls/Savings Banks industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Threats Bank Mestika Dharma External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Bank Mestika Dharma are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bank Mestika Dharma 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 Bank Mestika Dharma prominent markets.
Environmental challenges
– Bank Mestika Dharma 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. Bank Mestika Dharma can take advantage of this fund but it will also bring new competitors in the S&Ls/Savings Banks industry.
Stagnating economy with rate increase
– Bank Mestika Dharma 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 S&Ls/Savings Banks industry.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bank Mestika Dharma in S&Ls/Savings Banks industry. The S&Ls/Savings Banks 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. Bank Mestika Dharma needs to understand the core reasons impacting the S&Ls/Savings Banks 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.
Increasing wage structure of Bank Mestika Dharma
– 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 Bank Mestika Dharma.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Bank Mestika Dharma may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of S&Ls/Savings Banks sector.
Easy access to finance
– Easy access to finance in S&Ls/Savings Banks industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Bank Mestika Dharma can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Bank Mestika Dharma 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.
Consumer confidence and its impact on Bank Mestika Dharma 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 S&Ls/Savings Banks industry and other sectors.
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. Bank Mestika Dharma 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.
Weighted SWOT Analysis of Bank Mestika Dharma Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Bank Mestika Dharma 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 Bank Mestika Dharma 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 Bank Mestika Dharma 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 Bank Mestika Dharma 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 Bank Mestika Dharma needs to make to build a sustainable competitive advantage.