Mandala Multifinance (MFIN) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Mandala Multifinance (Indonesia)

Based on various researches at Oak Spring University , Mandala Multifinance is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, there is backlash against globalization, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, technology disruption, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, etc

---

---

---

Introduction to SWOT Analysis of Mandala Multifinance

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

---

Strengths of Mandala Multifinance | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Mandala Multifinance are -

Sustainable margins compare to other players in Consumer Financial Services industry

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

Ability to recruit top talent

– Mandala Multifinance is one of the leading players in the Consumer Financial Services industry in Indonesia. It is in a position to attract the best talent available in Indonesia. The firm has a robust talent identification program that helps in identifying the brightest.

Cross disciplinary teams

– Horizontal connected teams at the Mandala Multifinance 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.

Ability to lead change in Consumer Financial Services

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

Operational resilience

– The operational resilience strategy of Mandala Multifinance comprises – understanding the underlying the factors in the Consumer Financial 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.

Effective Research and Development (R&D)

– Mandala Multifinance has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Mandala Multifinance staying ahead in the Consumer Financial Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Organizational Resilience of Mandala Multifinance

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

Learning organization

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

High switching costs

– The high switching costs that Mandala Multifinance 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.

Strong track record of project management in the Consumer Financial Services industry

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

Innovation driven organization

– Mandala Multifinance is one of the most innovative firm in Consumer Financial Services sector.

Successful track record of launching new products

– Mandala Multifinance has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Mandala Multifinance 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 Mandala Multifinance | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Mandala Multifinance are -

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mandala Multifinance is slow explore the new channels of communication. These new channels of communication can help Mandala Multifinance to provide better information regarding Consumer Financial Services products and services. It can also build an online community to further reach out to potential customers.

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

Slow decision making process

– As mentioned earlier in the report, Mandala Multifinance has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Consumer Financial Services industry over the last five years. Mandala Multifinance 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.

No frontier risks strategy

– From the 10K / annual statement of Mandala Multifinance, it seems that company is thinking out the frontier risks that can impact Consumer Financial 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 operating costs

– Compare to the competitors, Mandala Multifinance has high operating costs in the Consumer Financial Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Mandala Multifinance lucrative customers.

Workers concerns about automation

– As automation is fast increasing in the Consumer Financial Services industry, Mandala Multifinance needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.

Slow to strategic competitive environment developments

– As Mandala Multifinance is one of the leading players in the Consumer Financial Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Consumer Financial Services industry in last five years.

High dependence on Mandala Multifinance ‘s star products

– The top 2 products and services of Mandala Multifinance still accounts for major business revenue. This dependence on star products in Consumer Financial Services industry has resulted into insufficient focus on developing new products, even though Mandala Multifinance has relatively successful track record of launching new products.

Capital Spending Reduction

– Even during the low interest decade, Mandala Multifinance 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 Consumer Financial Services industry using digital technology.

Aligning sales with marketing

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

Lack of clear differentiation of Mandala Multifinance products

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

---

Mandala Multifinance Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Mandala Multifinance are -

Buying journey improvements

– Mandala Multifinance can improve the customer journey of consumers in the Consumer Financial 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.

Loyalty marketing

– Mandala Multifinance 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mandala Multifinance can use these opportunities to build new business models that can help the communities that Mandala Multifinance operates in. Secondly it can use opportunities from government spending in Consumer Financial Services sector.

Creating value in data economy

– The success of analytics program of Mandala Multifinance has opened avenues for new revenue streams for the organization in Consumer Financial Services industry. This can help Mandala Multifinance to build a more holistic ecosystem for Mandala Multifinance products in the Consumer Financial Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Developing new processes and practices

– Mandala Multifinance can develop new processes and procedures in Consumer Financial 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.

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

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

Redefining models of collaboration and team work

– As explained in the weaknesses section, Mandala Multifinance is facing challenges because of the dominance of functional experts in the organization. Mandala Multifinance can utilize new technology in the field of Consumer Financial Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Harnessing reconfiguration of the global supply chains

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

Leveraging digital technologies

– Mandala Multifinance 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, Mandala Multifinance 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.

Building a culture of innovation

– managers at Mandala Multifinance 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 Consumer Financial Services industry.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Mandala Multifinance can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Remote work and new talent hiring opportunities

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

---

Threats Mandala Multifinance External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Mandala Multifinance are -

Environmental challenges

– Mandala Multifinance 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. Mandala Multifinance can take advantage of this fund but it will also bring new competitors in the Consumer Financial Services 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.

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 Mandala Multifinance business can come under increasing regulations regarding data privacy, data security, etc.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Mandala Multifinance in Consumer Financial Services industry. The Consumer Financial 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.

Consumer confidence and its impact on Mandala Multifinance 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 Consumer Financial Services industry and other sectors.

Shortening product life cycle

– it is one of the major threat that Mandala Multifinance is facing in Consumer Financial Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Capital market disruption

– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Mandala Multifinance.

Regulatory challenges

– Mandala Multifinance 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 Consumer Financial Services industry regulations.

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. Mandala Multifinance 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.

Easy access to finance

– Easy access to finance in Consumer Financial Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Mandala Multifinance can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Technology acceleration in Forth Industrial Revolution

– Mandala Multifinance has witnessed rapid integration of technology during Covid-19 in the Consumer Financial Services industry. As one of the leading players in the industry, Mandala Multifinance needs to keep up with the evolution of technology in the Consumer Financial Services 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Mandala Multifinance 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 Mandala Multifinance prominent markets.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Consumer Financial Services industry are lowering. It can presents Mandala Multifinance with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Consumer Financial Services sector.

---

Weighted SWOT Analysis of Mandala Multifinance Template, Example

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

--- ---