SWOT Analysis / TOWS Matrix for Apexindo Pratama Duta (Indonesia)
Based on various researches at Oak Spring University , Apexindo Pratama Duta is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, increasing energy prices, central banks are concerned over increasing inflation,
banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, etc
Introduction to SWOT Analysis of Apexindo Pratama Duta
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Apexindo Pratama Duta can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Apexindo Pratama Duta, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Apexindo Pratama Duta 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 Apexindo Pratama Duta can be done for the following purposes –
1. Strategic planning of Apexindo Pratama Duta
2. Improving business portfolio management of Apexindo Pratama Duta
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Oil Well Services & Equipment sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Apexindo Pratama Duta
Strengths of Apexindo Pratama Duta | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Apexindo Pratama Duta are -
Diverse revenue streams
– Apexindo Pratama Duta is present in almost all the verticals within the Oil Well Services & Equipment industry. This has provided Apexindo Pratama Duta 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.
High brand equity
– Apexindo Pratama Duta has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Apexindo Pratama Duta to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Oil Well Services & Equipment industry
– Apexindo Pratama Duta has clearly differentiated products in the market place. This has enabled Apexindo Pratama Duta to fetch slight price premium compare to the competitors in the Oil Well Services & Equipment industry. The sustainable margins have also helped Apexindo Pratama Duta to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Apexindo Pratama Duta has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Oil Well Services & Equipment industry. Secondly the value chain collaborators of Apexindo Pratama Duta have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Apexindo Pratama Duta in Oil Well Services & Equipment industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Apexindo Pratama Duta 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.
Innovation driven organization
– Apexindo Pratama Duta is one of the most innovative firm in Oil Well Services & Equipment sector.
Successful track record of launching new products
– Apexindo Pratama Duta has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Apexindo Pratama Duta 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.
Learning organization
- Apexindo Pratama Duta 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 Apexindo Pratama Duta is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Apexindo Pratama Duta emphasize – knowledge, initiative, and innovation.
Strong track record of project management in the Oil Well Services & Equipment industry
– Apexindo Pratama Duta is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Apexindo Pratama Duta has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Apexindo Pratama Duta staying ahead in the Oil Well Services & Equipment industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Apexindo Pratama Duta 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.
Weaknesses of Apexindo Pratama Duta | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Apexindo Pratama Duta are -
Skills based hiring in Oil Well Services & Equipment industry
– The stress on hiring functional specialists at Apexindo Pratama Duta 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.
Need for greater diversity
– Apexindo Pratama Duta 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.
High cash cycle compare to competitors
Apexindo Pratama Duta has a high cash cycle compare to other players in the Oil Well Services & Equipment 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 operating costs
– Compare to the competitors, Apexindo Pratama Duta has high operating costs in the Oil Well Services & Equipment industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Apexindo Pratama Duta lucrative customers.
Lack of clear differentiation of Apexindo Pratama Duta products
– To increase the profitability and margins on the products, Apexindo Pratama Duta needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of Indonesia, Apexindo Pratama Duta needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Apexindo Pratama Duta supply chain. Even after few cautionary changes, Apexindo Pratama Duta is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Apexindo Pratama Duta vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– From the outside it seems that Apexindo Pratama Duta needs to have more collaboration between its sales team and marketing team. Sales professionals in the Oil Well Services & Equipment industry have deep experience in developing customer relationships. Marketing department at Apexindo Pratama Duta can leverage the sales team experience to cultivate customer relationships as Apexindo Pratama Duta is planning to shift buying processes online.
High dependence on Apexindo Pratama Duta ‘s star products
– The top 2 products and services of Apexindo Pratama Duta still accounts for major business revenue. This dependence on star products in Oil Well Services & Equipment industry has resulted into insufficient focus on developing new products, even though Apexindo Pratama Duta has relatively successful track record of launching new products.
Products dominated business model
– Even though Apexindo Pratama Duta has some of the most successful models in the Oil Well Services & Equipment industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Apexindo Pratama Duta should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Apexindo Pratama Duta 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.
Apexindo Pratama Duta Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Apexindo Pratama Duta are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Apexindo Pratama Duta can use these opportunities to build new business models that can help the communities that Apexindo Pratama Duta operates in. Secondly it can use opportunities from government spending in Oil Well Services & Equipment sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Oil Well Services & Equipment industry, but it has also influenced the consumer preferences. Apexindo Pratama Duta can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Apexindo Pratama Duta can improve the customer journey of consumers in the Oil Well Services & Equipment 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, Apexindo Pratama Duta 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Apexindo Pratama Duta in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Oil Well Services & Equipment industry, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Apexindo Pratama Duta to increase its market reach. Apexindo Pratama Duta 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Oil Well Services & Equipment industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Apexindo Pratama Duta 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. Apexindo Pratama Duta 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 Apexindo Pratama Duta 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 Apexindo Pratama Duta 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. Apexindo Pratama Duta can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Apexindo Pratama Duta has opened avenues for new revenue streams for the organization in Oil Well Services & Equipment industry. This can help Apexindo Pratama Duta to build a more holistic ecosystem for Apexindo Pratama Duta products in the Oil Well Services & Equipment industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Apexindo Pratama Duta has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Oil Well Services & Equipment sector. This continuous investment in analytics has enabled Apexindo Pratama Duta to build a competitive advantage using analytics. The analytics driven competitive advantage can help Apexindo Pratama Duta to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Apexindo Pratama Duta can use the latest technology developments to improve its manufacturing and designing process in Oil Well Services & Equipment 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.
Leveraging digital technologies
– Apexindo Pratama Duta 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.
Threats Apexindo Pratama Duta External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Apexindo Pratama Duta are -
Environmental challenges
– Apexindo Pratama Duta 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. Apexindo Pratama Duta can take advantage of this fund but it will also bring new competitors in the Oil Well Services & Equipment 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Apexindo Pratama Duta in Oil Well Services & Equipment industry. The Oil Well Services & Equipment 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.
Regulatory challenges
– Apexindo Pratama Duta 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 Oil Well Services & Equipment industry regulations.
Shortening product life cycle
– it is one of the major threat that Apexindo Pratama Duta is facing in Oil Well Services & Equipment sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Apexindo Pratama Duta in the Oil Well Services & Equipment sector and impact the bottomline of the organization.
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. Apexindo Pratama Duta 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.
Technology acceleration in Forth Industrial Revolution
– Apexindo Pratama Duta has witnessed rapid integration of technology during Covid-19 in the Oil Well Services & Equipment industry. As one of the leading players in the industry, Apexindo Pratama Duta needs to keep up with the evolution of technology in the Oil Well Services & Equipment 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.
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. Apexindo Pratama Duta needs to understand the core reasons impacting the Oil Well Services & Equipment industry. This will help it in building a better workplace.
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 Apexindo Pratama Duta business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Oil Well Services & Equipment industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Apexindo Pratama Duta can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Apexindo Pratama Duta
– 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 Apexindo Pratama Duta.
Consumer confidence and its impact on Apexindo Pratama Duta 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 Oil Well Services & Equipment industry and other sectors.
Weighted SWOT Analysis of Apexindo Pratama Duta Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Apexindo Pratama Duta 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 Apexindo Pratama Duta 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 Apexindo Pratama Duta 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 Apexindo Pratama Duta 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 Apexindo Pratama Duta needs to make to build a sustainable competitive advantage.
