Indonesia Pondasi Raya Tbk PT (IDPR) SWOT Analysis / TOWS Matrix / MBA Resources
Construction Services
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Indonesia Pondasi Raya Tbk PT (Indonesia)
Based on various researches at Oak Spring University , Indonesia Pondasi Raya Tbk PT is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, increasing transportation and logistics costs, increasing commodity prices, increasing energy prices, talent flight as more people leaving formal jobs, geopolitical disruptions,
competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Indonesia Pondasi Raya Tbk PT
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Indonesia Pondasi Raya Tbk PT can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Indonesia Pondasi Raya Tbk PT, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Indonesia Pondasi Raya Tbk PT 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 Indonesia Pondasi Raya Tbk PT can be done for the following purposes –
1. Strategic planning of Indonesia Pondasi Raya Tbk PT
2. Improving business portfolio management of Indonesia Pondasi Raya Tbk PT
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 Indonesia Pondasi Raya Tbk PT
Strengths of Indonesia Pondasi Raya Tbk PT | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Indonesia Pondasi Raya Tbk PT are -
Ability to lead change in Construction Services
– Indonesia Pondasi Raya Tbk PT 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 Indonesia Pondasi Raya Tbk PT in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Indonesia Pondasi Raya Tbk PT in the Capital Goods sector have low bargaining power. Indonesia Pondasi Raya Tbk PT has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Indonesia Pondasi Raya Tbk PT to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management in the Construction Services industry
– Indonesia Pondasi Raya Tbk PT is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Indonesia Pondasi Raya Tbk PT is one of the leading players in the Construction 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.
Innovation driven organization
– Indonesia Pondasi Raya Tbk PT is one of the most innovative firm in Construction Services sector.
Sustainable margins compare to other players in Construction Services industry
– Indonesia Pondasi Raya Tbk PT has clearly differentiated products in the market place. This has enabled Indonesia Pondasi Raya Tbk PT to fetch slight price premium compare to the competitors in the Construction Services industry. The sustainable margins have also helped Indonesia Pondasi Raya Tbk PT to invest into research and development (R&D) and innovation.
Digital Transformation in Construction Services industry
- digital transformation varies from industry to industry. For Indonesia Pondasi Raya Tbk PT digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Indonesia Pondasi Raya Tbk PT has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
High switching costs
– The high switching costs that Indonesia Pondasi Raya Tbk PT 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.
Superior customer experience
– The customer experience strategy of Indonesia Pondasi Raya Tbk PT in Construction Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Indonesia Pondasi Raya Tbk PT has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Indonesia Pondasi Raya Tbk PT staying ahead in the Construction Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy of Indonesia Pondasi Raya Tbk PT 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.
Analytics focus
– Indonesia Pondasi Raya Tbk PT 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.
Weaknesses of Indonesia Pondasi Raya Tbk PT | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Indonesia Pondasi Raya Tbk PT are -
High bargaining power of channel partners in Construction Services industry
– because of the regulatory requirements in Indonesia, Indonesia Pondasi Raya Tbk PT 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.
Interest costs
– Compare to the competition, Indonesia Pondasi Raya Tbk PT 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.
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 Indonesia Pondasi Raya Tbk PT supply chain. Even after few cautionary changes, Indonesia Pondasi Raya Tbk PT is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Indonesia Pondasi Raya Tbk PT vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Indonesia Pondasi Raya Tbk PT 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 Construction Services industry using digital technology.
Slow decision making process
– As mentioned earlier in the report, Indonesia Pondasi Raya Tbk PT 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. Indonesia Pondasi Raya Tbk PT 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.
Need for greater diversity
– Indonesia Pondasi Raya Tbk PT 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Indonesia Pondasi Raya Tbk PT is slow explore the new channels of communication. These new channels of communication can help Indonesia Pondasi Raya Tbk PT to provide better information regarding Construction Services products and services. It can also build an online community to further reach out to potential customers.
Ability to respond to the competition
– As the decision making is very deliberative at Indonesia Pondasi Raya Tbk PT, in the dynamic environment of Construction Services industry it has struggled to respond to the nimble upstart competition. Indonesia Pondasi Raya Tbk PT has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Indonesia, Indonesia Pondasi Raya Tbk PT needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the Construction Services industry, Indonesia Pondasi Raya Tbk PT 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.
Products dominated business model
– Even though Indonesia Pondasi Raya Tbk PT 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. Indonesia Pondasi Raya Tbk PT should strive to include more intangible value offerings along with its core products and services.
Indonesia Pondasi Raya Tbk PT Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Indonesia Pondasi Raya Tbk PT are -
Developing new processes and practices
– Indonesia Pondasi Raya Tbk PT 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.
Manufacturing automation
– Indonesia Pondasi Raya Tbk PT 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.
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. Indonesia Pondasi Raya Tbk PT can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Using analytics as competitive advantage
– Indonesia Pondasi Raya Tbk PT 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 Indonesia Pondasi Raya Tbk PT to build a competitive advantage using analytics. The analytics driven competitive advantage can help Indonesia Pondasi Raya Tbk PT to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Indonesia Pondasi Raya Tbk PT can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Indonesia Pondasi Raya Tbk PT has opened avenues for new revenue streams for the organization in Construction Services industry. This can help Indonesia Pondasi Raya Tbk PT to build a more holistic ecosystem for Indonesia Pondasi Raya Tbk PT products in the Construction Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Indonesia Pondasi Raya Tbk PT 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 Indonesia Pondasi Raya Tbk PT to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Indonesia Pondasi Raya Tbk PT 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.
Building a culture of innovation
– managers at Indonesia Pondasi Raya Tbk PT 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 Construction Services industry.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Indonesia Pondasi Raya Tbk PT can use these opportunities to build new business models that can help the communities that Indonesia Pondasi Raya Tbk PT operates in. Secondly it can use opportunities from government spending in Construction Services sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Construction Services industry, but it has also influenced the consumer preferences. Indonesia Pondasi Raya Tbk PT can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Indonesia Pondasi Raya Tbk PT is facing challenges because of the dominance of functional experts in the organization. Indonesia Pondasi Raya Tbk PT can utilize new technology in the field of Construction Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
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. Indonesia Pondasi Raya Tbk PT 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. Indonesia Pondasi Raya Tbk PT 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.
Threats Indonesia Pondasi Raya Tbk PT External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Indonesia Pondasi Raya Tbk PT are -
Environmental challenges
– Indonesia Pondasi Raya Tbk PT 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. Indonesia Pondasi Raya Tbk PT can take advantage of this fund but it will also bring new competitors in the Construction Services industry.
Stagnating economy with rate increase
– Indonesia Pondasi Raya Tbk PT 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.
Regulatory challenges
– Indonesia Pondasi Raya Tbk PT 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 Construction Services industry regulations.
Technology acceleration in Forth Industrial Revolution
– Indonesia Pondasi Raya Tbk PT has witnessed rapid integration of technology during Covid-19 in the Construction Services industry. As one of the leading players in the industry, Indonesia Pondasi Raya Tbk PT needs to keep up with the evolution of technology in the Construction 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 wage structure of Indonesia Pondasi Raya Tbk PT
– 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 Indonesia Pondasi Raya Tbk PT.
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 Indonesia Pondasi Raya Tbk PT.
Shortening product life cycle
– it is one of the major threat that Indonesia Pondasi Raya Tbk PT is facing in Construction Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Indonesia Pondasi Raya Tbk PT 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 Indonesia Pondasi Raya Tbk PT prominent markets.
High dependence on third party suppliers
– Indonesia Pondasi Raya Tbk PT 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Indonesia Pondasi Raya Tbk PT 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.
Consumer confidence and its impact on Indonesia Pondasi Raya Tbk PT 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 Construction Services industry and other sectors.
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.
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. Indonesia Pondasi Raya Tbk PT will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Weighted SWOT Analysis of Indonesia Pondasi Raya Tbk PT Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Indonesia Pondasi Raya Tbk PT 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 Indonesia Pondasi Raya Tbk PT 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 Indonesia Pondasi Raya Tbk PT 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 Indonesia Pondasi Raya Tbk PT 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 Indonesia Pondasi Raya Tbk PT needs to make to build a sustainable competitive advantage.