Unggul Indah Cahaya (UNIC) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Unggul Indah Cahaya (Indonesia)
Based on various researches at Oak Spring University , Unggul Indah Cahaya is operating in a macro-environment that has been destablized by – increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models,
wage bills are increasing, increasing energy prices, etc
Introduction to SWOT Analysis of Unggul Indah Cahaya
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Unggul Indah Cahaya can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Unggul Indah Cahaya, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Unggul Indah Cahaya 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 Unggul Indah Cahaya can be done for the following purposes –
1. Strategic planning of Unggul Indah Cahaya
2. Improving business portfolio management of Unggul Indah Cahaya
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Chemical Manufacturing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Unggul Indah Cahaya
Strengths of Unggul Indah Cahaya | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Unggul Indah Cahaya are -
Diverse revenue streams
– Unggul Indah Cahaya is present in almost all the verticals within the Chemical Manufacturing industry. This has provided Unggul Indah Cahaya a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to recruit top talent
– Unggul Indah Cahaya is one of the leading players in the Chemical Manufacturing 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.
– Unggul Indah Cahaya 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 Chemical Manufacturing 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.
Strong track record of project management in the Chemical Manufacturing industry
– Unggul Indah Cahaya is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
- Unggul Indah Cahaya 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 Unggul Indah Cahaya is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Unggul Indah Cahaya emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Unggul Indah Cahaya has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Unggul Indah Cahaya 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.
Innovation driven organization
– Unggul Indah Cahaya is one of the most innovative firm in Chemical Manufacturing sector.
Digital Transformation in Chemical Manufacturing industry
- digital transformation varies from industry to industry. For Unggul Indah Cahaya digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Unggul Indah Cahaya 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.
Sustainable margins compare to other players in Chemical Manufacturing industry
– Unggul Indah Cahaya has clearly differentiated products in the market place. This has enabled Unggul Indah Cahaya to fetch slight price premium compare to the competitors in the Chemical Manufacturing industry. The sustainable margins have also helped Unggul Indah Cahaya to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Unggul Indah Cahaya has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Chemical Manufacturing industry. Secondly the value chain collaborators of Unggul Indah Cahaya have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Unggul Indah Cahaya in the Basic Materials sector have low bargaining power. Unggul Indah Cahaya has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Unggul Indah Cahaya to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Unggul Indah Cahaya 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.
Weaknesses of Unggul Indah Cahaya | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Unggul Indah Cahaya are -
Need for greater diversity
– Unggul Indah Cahaya 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.
Skills based hiring in Chemical Manufacturing industry
– The stress on hiring functional specialists at Unggul Indah Cahaya 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.
Slow decision making process
– As mentioned earlier in the report, Unggul Indah Cahaya has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Chemical Manufacturing industry over the last five years. Unggul Indah Cahaya 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.
Lack of clear differentiation of Unggul Indah Cahaya products
– To increase the profitability and margins on the products, Unggul Indah Cahaya needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Unggul Indah Cahaya supply chain. Even after few cautionary changes, Unggul Indah Cahaya is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Unggul Indah Cahaya vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners in Chemical Manufacturing industry
– because of the regulatory requirements in Indonesia, Unggul Indah Cahaya 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 Chemical Manufacturing industry.
High cash cycle compare to competitors
Unggul Indah Cahaya has a high cash cycle compare to other players in the Chemical Manufacturing 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, Unggul Indah Cahaya has high operating costs in the Chemical Manufacturing industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Unggul Indah Cahaya lucrative customers.
Low market penetration in new markets
– Outside its home market of Indonesia, Unggul Indah Cahaya needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the Chemical Manufacturing industry, Unggul Indah Cahaya 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.
Increasing silos among functional specialists
– The organizational structure of Unggul Indah Cahaya is dominated by functional specialists. It is not different from other players in the Chemical Manufacturing industry, but Unggul Indah Cahaya needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Unggul Indah Cahaya to focus more on services in the Chemical Manufacturing industry rather than just following the product oriented approach.
Unggul Indah Cahaya Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Unggul Indah Cahaya are -
Leveraging digital technologies
– Unggul Indah Cahaya 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Unggul Indah Cahaya in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Chemical Manufacturing industry, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Chemical Manufacturing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Unggul Indah Cahaya 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. Unggul Indah Cahaya 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.
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 Unggul Indah Cahaya 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Unggul Indah Cahaya 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 Unggul Indah Cahaya to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Chemical Manufacturing industry, but it has also influenced the consumer preferences. Unggul Indah Cahaya can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Unggul Indah Cahaya can develop new processes and procedures in Chemical Manufacturing 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.
Learning at scale
– Online learning technologies has now opened space for Unggul Indah Cahaya 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.
Use of Bitcoin and other crypto currencies for transactions in Chemical Manufacturing industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Unggul Indah Cahaya in the Chemical Manufacturing industry. Now Unggul Indah Cahaya can target international markets with far fewer capital restrictions requirements than the existing system.
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. Unggul Indah Cahaya can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Unggul Indah Cahaya can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Unggul Indah Cahaya is facing challenges because of the dominance of functional experts in the organization. Unggul Indah Cahaya can utilize new technology in the field of Chemical Manufacturing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
– Unggul Indah Cahaya 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.
Threats Unggul Indah Cahaya External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Unggul Indah Cahaya are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Unggul Indah Cahaya may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Chemical Manufacturing sector.
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.
High dependence on third party suppliers
– Unggul Indah Cahaya 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.
Easy access to finance
– Easy access to finance in Chemical Manufacturing industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Unggul Indah Cahaya can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
– Unggul Indah Cahaya 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 Chemical Manufacturing industry regulations.
Increasing wage structure of Unggul Indah Cahaya
– 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 Unggul Indah Cahaya.
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 Unggul Indah Cahaya business can come under increasing regulations regarding data privacy, data security, etc.
– Unggul Indah Cahaya 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. Unggul Indah Cahaya can take advantage of this fund but it will also bring new competitors in the Chemical Manufacturing industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Unggul Indah Cahaya in Chemical Manufacturing industry. The Chemical Manufacturing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Technology acceleration in Forth Industrial Revolution
– Unggul Indah Cahaya has witnessed rapid integration of technology during Covid-19 in the Chemical Manufacturing industry. As one of the leading players in the industry, Unggul Indah Cahaya needs to keep up with the evolution of technology in the Chemical Manufacturing 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.
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 Unggul Indah Cahaya.
– 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.
Consumer confidence and its impact on Unggul Indah Cahaya 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 Chemical Manufacturing industry and other sectors.
Weighted SWOT Analysis of Unggul Indah Cahaya Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Unggul Indah Cahaya 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 Unggul Indah Cahaya 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 Unggul Indah Cahaya 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 Unggul Indah Cahaya 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 Unggul Indah Cahaya needs to make to build a sustainable competitive advantage.