SWOT Analysis / TOWS Matrix for Indah Prakasa Sentosa (Indonesia)
Based on various researches at Oak Spring University , Indah Prakasa Sentosa is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic ,
increasing energy prices, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Indah Prakasa Sentosa
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Indah Prakasa Sentosa can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Indah Prakasa Sentosa, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Indah Prakasa Sentosa 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 Indah Prakasa Sentosa can be done for the following purposes –
1. Strategic planning of Indah Prakasa Sentosa
2. Improving business portfolio management of Indah Prakasa Sentosa
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Trucking sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Indah Prakasa Sentosa
Strengths of Indah Prakasa Sentosa | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Indah Prakasa Sentosa are -
Innovation driven organization
– Indah Prakasa Sentosa is one of the most innovative firm in Trucking sector.
Digital Transformation in Trucking industry
- digital transformation varies from industry to industry. For Indah Prakasa Sentosa digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Indah Prakasa Sentosa 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.
Organizational Resilience of Indah Prakasa Sentosa
– The covid-19 pandemic has put organizational resilience at the centre of everthing Indah Prakasa Sentosa does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Indah Prakasa Sentosa has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Indah Prakasa Sentosa staying ahead in the Trucking industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Indah Prakasa Sentosa 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 Trucking 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.
Learning organization
- Indah Prakasa Sentosa 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 Indah Prakasa Sentosa is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Indah Prakasa Sentosa emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Indah Prakasa Sentosa 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.
Sustainable margins compare to other players in Trucking industry
– Indah Prakasa Sentosa has clearly differentiated products in the market place. This has enabled Indah Prakasa Sentosa to fetch slight price premium compare to the competitors in the Trucking industry. The sustainable margins have also helped Indah Prakasa Sentosa to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy of Indah Prakasa Sentosa comprises – understanding the underlying the factors in the Trucking 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.
Superior customer experience
– The customer experience strategy of Indah Prakasa Sentosa in Trucking industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Indah Prakasa Sentosa has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Trucking industry. Secondly the value chain collaborators of Indah Prakasa Sentosa have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Indah Prakasa Sentosa is present in almost all the verticals within the Trucking industry. This has provided Indah Prakasa Sentosa 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.
Weaknesses of Indah Prakasa Sentosa | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Indah Prakasa Sentosa are -
Employees’ less understanding of Indah Prakasa Sentosa strategy
– From the outside it seems that the employees of Indah Prakasa Sentosa don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
No frontier risks strategy
– From the 10K / annual statement of Indah Prakasa Sentosa, it seems that company is thinking out the frontier risks that can impact Trucking industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on Indah Prakasa Sentosa ‘s star products
– The top 2 products and services of Indah Prakasa Sentosa still accounts for major business revenue. This dependence on star products in Trucking industry has resulted into insufficient focus on developing new products, even though Indah Prakasa Sentosa has relatively successful track record of launching new products.
Aligning sales with marketing
– From the outside it seems that Indah Prakasa Sentosa needs to have more collaboration between its sales team and marketing team. Sales professionals in the Trucking industry have deep experience in developing customer relationships. Marketing department at Indah Prakasa Sentosa can leverage the sales team experience to cultivate customer relationships as Indah Prakasa Sentosa is planning to shift buying processes online.
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 Indah Prakasa Sentosa supply chain. Even after few cautionary changes, Indah Prakasa Sentosa is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Indah Prakasa Sentosa vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Indah Prakasa Sentosa has a high cash cycle compare to other players in the Trucking industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Capital Spending Reduction
– Even during the low interest decade, Indah Prakasa Sentosa 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 Trucking industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of Indah Prakasa Sentosa is dominated by functional specialists. It is not different from other players in the Trucking industry, but Indah Prakasa Sentosa needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Indah Prakasa Sentosa to focus more on services in the Trucking industry rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, Indah Prakasa Sentosa has high operating costs in the Trucking industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Indah Prakasa Sentosa lucrative customers.
Interest costs
– Compare to the competition, Indah Prakasa Sentosa 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.
Slow to strategic competitive environment developments
– As Indah Prakasa Sentosa is one of the leading players in the Trucking industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Trucking industry in last five years.
Indah Prakasa Sentosa Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Indah Prakasa Sentosa are -
Manufacturing automation
– Indah Prakasa Sentosa can use the latest technology developments to improve its manufacturing and designing process in Trucking 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.
Loyalty marketing
– Indah Prakasa Sentosa 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Indah Prakasa Sentosa in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Trucking industry, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Indah Prakasa Sentosa can use these opportunities to build new business models that can help the communities that Indah Prakasa Sentosa operates in. Secondly it can use opportunities from government spending in Trucking sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Indah Prakasa Sentosa 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 Indah Prakasa Sentosa to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Indah Prakasa Sentosa is facing challenges because of the dominance of functional experts in the organization. Indah Prakasa Sentosa can utilize new technology in the field of Trucking industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– Indah Prakasa Sentosa 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.
Learning at scale
– Online learning technologies has now opened space for Indah Prakasa Sentosa 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Indah Prakasa Sentosa can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Trucking industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Indah Prakasa Sentosa 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. Indah Prakasa Sentosa 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Indah Prakasa Sentosa 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Trucking industry, but it has also influenced the consumer preferences. Indah Prakasa Sentosa can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Indah Prakasa Sentosa to increase its market reach. Indah Prakasa Sentosa 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.
Threats Indah Prakasa Sentosa External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Indah Prakasa Sentosa are -
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 Indah Prakasa Sentosa business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Indah Prakasa Sentosa 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.
Consumer confidence and its impact on Indah Prakasa Sentosa 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 Trucking industry and other sectors.
Regulatory challenges
– Indah Prakasa Sentosa 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 Trucking industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Indah Prakasa Sentosa in Trucking industry. The Trucking 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 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 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. Indah Prakasa Sentosa needs to understand the core reasons impacting the Trucking industry. This will help it in building a better workplace.
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.
Environmental challenges
– Indah Prakasa Sentosa 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. Indah Prakasa Sentosa can take advantage of this fund but it will also bring new competitors in the Trucking industry.
Stagnating economy with rate increase
– Indah Prakasa Sentosa 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 Trucking industry.
Increasing wage structure of Indah Prakasa Sentosa
– 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 Indah Prakasa Sentosa.
Easy access to finance
– Easy access to finance in Trucking industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Indah Prakasa Sentosa 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
– Indah Prakasa Sentosa has witnessed rapid integration of technology during Covid-19 in the Trucking industry. As one of the leading players in the industry, Indah Prakasa Sentosa needs to keep up with the evolution of technology in the Trucking 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.
Weighted SWOT Analysis of Indah Prakasa Sentosa Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Indah Prakasa Sentosa 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 Indah Prakasa Sentosa 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 Indah Prakasa Sentosa 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 Indah Prakasa Sentosa 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 Indah Prakasa Sentosa needs to make to build a sustainable competitive advantage.