Bukaka Teknik Utama (BUKK) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Bukaka Teknik Utama (Indonesia)

Based on various researches at Oak Spring University , Bukaka Teknik Utama is operating in a macro-environment that has been destablized by – talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, etc

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Introduction to SWOT Analysis of Bukaka Teknik Utama

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Bukaka Teknik Utama can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bukaka Teknik Utama, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bukaka Teknik Utama 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 Bukaka Teknik Utama can be done for the following purposes –
1. Strategic planning of Bukaka Teknik Utama
2. Improving business portfolio management of Bukaka Teknik Utama
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Construction Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bukaka Teknik Utama

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Strengths of Bukaka Teknik Utama | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Bukaka Teknik Utama are -

Operational resilience

– The operational resilience strategy of Bukaka Teknik Utama comprises – understanding the underlying the factors in the Construction Services 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.

Cross disciplinary teams

– Horizontal connected teams at the Bukaka Teknik Utama 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

- Bukaka Teknik Utama 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 Bukaka Teknik Utama is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Bukaka Teknik Utama emphasize – knowledge, initiative, and innovation.

Innovation driven organization

– Bukaka Teknik Utama is one of the most innovative firm in Construction Services sector.

Ability to lead change in Construction Services

– Bukaka Teknik Utama is one of the leading players in the Construction Services industry in Indonesia. Over the years it has not only transformed the business landscape in the Construction Services industry in Indonesia but also across the existing markets. The ability to lead change has enabled Bukaka Teknik Utama in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Training and development

– Bukaka Teknik Utama has one of the best training and development program in Capital Goods industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.

High switching costs

– The high switching costs that Bukaka Teknik Utama 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.

Analytics focus

– Bukaka Teknik Utama 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 Construction Services 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.

Highly skilled collaborators

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

Sustainable margins compare to other players in Construction Services industry

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

Organizational Resilience of Bukaka Teknik Utama

– The covid-19 pandemic has put organizational resilience at the centre of everthing Bukaka Teknik Utama does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Strong track record of project management in the Construction Services industry

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

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Weaknesses of Bukaka Teknik Utama | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Bukaka Teknik Utama are -

Employees’ less understanding of Bukaka Teknik Utama strategy

– From the outside it seems that the employees of Bukaka Teknik Utama 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.

Interest costs

– Compare to the competition, Bukaka Teknik Utama 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.

Low market penetration in new markets

– Outside its home market of Indonesia, Bukaka Teknik Utama needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

High bargaining power of channel partners in Construction Services industry

– because of the regulatory requirements in Indonesia, Bukaka Teknik Utama 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 Construction Services industry.

Lack of clear differentiation of Bukaka Teknik Utama products

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

No frontier risks strategy

– From the 10K / annual statement of Bukaka Teknik Utama, it seems that company is thinking out the frontier risks that can impact Construction Services 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.

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 Bukaka Teknik Utama supply chain. Even after few cautionary changes, Bukaka Teknik Utama is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Bukaka Teknik Utama vulnerable to further global disruptions in South East Asia.

Products dominated business model

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

Ability to respond to the competition

– As the decision making is very deliberative at Bukaka Teknik Utama, in the dynamic environment of Construction Services industry it has struggled to respond to the nimble upstart competition. Bukaka Teknik Utama has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Aligning sales with marketing

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

Slow decision making process

– As mentioned earlier in the report, Bukaka Teknik Utama has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Construction Services industry over the last five years. Bukaka Teknik Utama 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.

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Bukaka Teknik Utama Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Bukaka Teknik Utama are -

Leveraging digital technologies

– Bukaka Teknik Utama 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.

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 Bukaka Teknik Utama 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.

Changes in consumer behavior post Covid-19

– consumer behavior has changed in the Construction Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Bukaka Teknik Utama 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. Bukaka Teknik Utama 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.

Remote work and new talent hiring opportunities

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

Loyalty marketing

– Bukaka Teknik Utama 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.

Developing new processes and practices

– Bukaka Teknik Utama can develop new processes and procedures in Construction Services 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.

Buying journey improvements

– Bukaka Teknik Utama can improve the customer journey of consumers in the Construction Services 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.

Use of Bitcoin and other crypto currencies for transactions in Construction Services industry

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

Harnessing reconfiguration of the global supply chains

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

Using analytics as competitive advantage

– Bukaka Teknik Utama has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Construction Services sector. This continuous investment in analytics has enabled Bukaka Teknik Utama to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bukaka Teknik Utama to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Manufacturing automation

– Bukaka Teknik Utama can use the latest technology developments to improve its manufacturing and designing process in Construction Services 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 Bukaka Teknik Utama in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Construction Services industry, and it will provide faster access to the consumers.

Low interest rates

– Even though inflation is raising its head in most developed economies, Bukaka Teknik Utama 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.

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Threats Bukaka Teknik Utama External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Bukaka Teknik Utama are -

Learning curve for new practices

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

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 Bukaka Teknik Utama in the Construction Services sector and impact the bottomline of the organization.

High dependence on third party suppliers

– Bukaka Teknik Utama 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.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Bukaka Teknik Utama in Construction Services industry. The Construction Services 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.

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 Bukaka Teknik Utama.

Shortening product life cycle

– it is one of the major threat that Bukaka Teknik Utama is facing in Construction Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Environmental challenges

– Bukaka Teknik Utama 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. Bukaka Teknik Utama can take advantage of this fund but it will also bring new competitors in the Construction Services industry.

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. Bukaka Teknik Utama 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Bukaka Teknik Utama 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 Bukaka Teknik Utama prominent markets.

Stagnating economy with rate increase

– Bukaka Teknik Utama 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 Construction Services industry.

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.

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. Bukaka Teknik Utama needs to understand the core reasons impacting the Construction Services industry. This will help it in building a better workplace.

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.

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Weighted SWOT Analysis of Bukaka Teknik Utama Template, Example

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

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