SWOT Analysis / TOWS Matrix for Kertas Basuki Rachmat (Indonesia)
Based on various researches at Oak Spring University , Kertas Basuki Rachmat is operating in a macro-environment that has been destablized by – technology disruption, wage bills are increasing, increasing transportation and logistics costs, there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%,
competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, etc
Introduction to SWOT Analysis of Kertas Basuki Rachmat
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Kertas Basuki Rachmat can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kertas Basuki Rachmat, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kertas Basuki Rachmat 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 Kertas Basuki Rachmat can be done for the following purposes –
1. Strategic planning of Kertas Basuki Rachmat
2. Improving business portfolio management of Kertas Basuki Rachmat
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Retail (Specialty) sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kertas Basuki Rachmat
Strengths of Kertas Basuki Rachmat | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kertas Basuki Rachmat are -
Low bargaining power of suppliers
– Suppliers of Kertas Basuki Rachmat in the Services sector have low bargaining power. Kertas Basuki Rachmat has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kertas Basuki Rachmat to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Retail (Specialty) industry
- digital transformation varies from industry to industry. For Kertas Basuki Rachmat digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Kertas Basuki Rachmat 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.
Successful track record of launching new products
– Kertas Basuki Rachmat has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kertas Basuki Rachmat 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.
Training and development
– Kertas Basuki Rachmat has one of the best training and development program in Services industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Ability to lead change in Retail (Specialty)
– Kertas Basuki Rachmat is one of the leading players in the Retail (Specialty) industry in Indonesia. Over the years it has not only transformed the business landscape in the Retail (Specialty) industry in Indonesia but also across the existing markets. The ability to lead change has enabled Kertas Basuki Rachmat in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Kertas Basuki Rachmat is present in almost all the verticals within the Retail (Specialty) industry. This has provided Kertas Basuki Rachmat a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
High brand equity
– Kertas Basuki Rachmat has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Kertas Basuki Rachmat to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Kertas Basuki Rachmat is one of the leading players in the Retail (Specialty) 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.
Effective Research and Development (R&D)
– Kertas Basuki Rachmat has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Kertas Basuki Rachmat staying ahead in the Retail (Specialty) industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Kertas Basuki Rachmat is one of the most innovative firm in Retail (Specialty) sector.
Superior customer experience
– The customer experience strategy of Kertas Basuki Rachmat in Retail (Specialty) industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Kertas Basuki Rachmat has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Retail (Specialty) industry. Secondly the value chain collaborators of Kertas Basuki Rachmat have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Kertas Basuki Rachmat | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Kertas Basuki Rachmat are -
Ability to respond to the competition
– As the decision making is very deliberative at Kertas Basuki Rachmat, in the dynamic environment of Retail (Specialty) industry it has struggled to respond to the nimble upstart competition. Kertas Basuki Rachmat has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Kertas Basuki Rachmat has some of the most successful models in the Retail (Specialty) industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Kertas Basuki Rachmat should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, Kertas Basuki Rachmat has high operating costs in the Retail (Specialty) industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Kertas Basuki Rachmat lucrative customers.
Slow to strategic competitive environment developments
– As Kertas Basuki Rachmat is one of the leading players in the Retail (Specialty) industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Retail (Specialty) industry in last five years.
High cash cycle compare to competitors
Kertas Basuki Rachmat has a high cash cycle compare to other players in the Retail (Specialty) 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 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 Kertas Basuki Rachmat supply chain. Even after few cautionary changes, Kertas Basuki Rachmat is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Kertas Basuki Rachmat vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Kertas Basuki Rachmat has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High dependence on Kertas Basuki Rachmat ‘s star products
– The top 2 products and services of Kertas Basuki Rachmat still accounts for major business revenue. This dependence on star products in Retail (Specialty) industry has resulted into insufficient focus on developing new products, even though Kertas Basuki Rachmat has relatively successful track record of launching new products.
Employees’ less understanding of Kertas Basuki Rachmat strategy
– From the outside it seems that the employees of Kertas Basuki Rachmat 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.
High bargaining power of channel partners in Retail (Specialty) industry
– because of the regulatory requirements in Indonesia, Kertas Basuki Rachmat 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 Retail (Specialty) industry.
Aligning sales with marketing
– From the outside it seems that Kertas Basuki Rachmat needs to have more collaboration between its sales team and marketing team. Sales professionals in the Retail (Specialty) industry have deep experience in developing customer relationships. Marketing department at Kertas Basuki Rachmat can leverage the sales team experience to cultivate customer relationships as Kertas Basuki Rachmat is planning to shift buying processes online.
Kertas Basuki Rachmat Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Kertas Basuki Rachmat are -
Using analytics as competitive advantage
– Kertas Basuki Rachmat has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Retail (Specialty) sector. This continuous investment in analytics has enabled Kertas Basuki Rachmat to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kertas Basuki Rachmat to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Kertas Basuki Rachmat can improve the customer journey of consumers in the Retail (Specialty) 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Retail (Specialty) industry, but it has also influenced the consumer preferences. Kertas Basuki Rachmat can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Kertas Basuki Rachmat 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 Retail (Specialty) 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, Kertas Basuki Rachmat can use these opportunities to build new business models that can help the communities that Kertas Basuki Rachmat operates in. Secondly it can use opportunities from government spending in Retail (Specialty) sector.
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. Kertas Basuki Rachmat can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Kertas Basuki Rachmat 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.
Creating value in data economy
– The success of analytics program of Kertas Basuki Rachmat has opened avenues for new revenue streams for the organization in Retail (Specialty) industry. This can help Kertas Basuki Rachmat to build a more holistic ecosystem for Kertas Basuki Rachmat products in the Retail (Specialty) industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Kertas Basuki Rachmat 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Kertas Basuki Rachmat 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 Kertas Basuki Rachmat to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Kertas Basuki Rachmat can develop new processes and procedures in Retail (Specialty) 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Kertas Basuki Rachmat in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Retail (Specialty) industry, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Kertas Basuki Rachmat is facing challenges because of the dominance of functional experts in the organization. Kertas Basuki Rachmat can utilize new technology in the field of Retail (Specialty) industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Threats Kertas Basuki Rachmat External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Kertas Basuki Rachmat are -
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Kertas Basuki Rachmat in the Retail (Specialty) sector and impact the bottomline 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 Kertas Basuki Rachmat business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Kertas Basuki Rachmat 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. Kertas Basuki Rachmat can take advantage of this fund but it will also bring new competitors in the Retail (Specialty) industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Retail (Specialty) industry are lowering. It can presents Kertas Basuki Rachmat with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Retail (Specialty) sector.
High dependence on third party suppliers
– Kertas Basuki Rachmat 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Kertas Basuki Rachmat in Retail (Specialty) industry. The Retail (Specialty) 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.
Stagnating economy with rate increase
– Kertas Basuki Rachmat 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 Retail (Specialty) industry.
Consumer confidence and its impact on Kertas Basuki Rachmat 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 Retail (Specialty) industry and other sectors.
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. Kertas Basuki Rachmat will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Technology acceleration in Forth Industrial Revolution
– Kertas Basuki Rachmat has witnessed rapid integration of technology during Covid-19 in the Retail (Specialty) industry. As one of the leading players in the industry, Kertas Basuki Rachmat needs to keep up with the evolution of technology in the Retail (Specialty) 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Kertas Basuki Rachmat may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Retail (Specialty) sector.
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. Kertas Basuki Rachmat needs to understand the core reasons impacting the Retail (Specialty) industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Kertas Basuki Rachmat Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Kertas Basuki Rachmat 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 Kertas Basuki Rachmat 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 Kertas Basuki Rachmat 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 Kertas Basuki Rachmat 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 Kertas Basuki Rachmat needs to make to build a sustainable competitive advantage.