SWOT Analysis / TOWS Matrix for Pudjiadi Prestige (Indonesia)
Based on various researches at Oak Spring University , Pudjiadi Prestige is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies,
talent flight as more people leaving formal jobs, technology disruption, etc
Introduction to SWOT Analysis of Pudjiadi Prestige
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Pudjiadi Prestige can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pudjiadi Prestige, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pudjiadi Prestige 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 Pudjiadi Prestige can be done for the following purposes –
1. Strategic planning of Pudjiadi Prestige
2. Improving business portfolio management of Pudjiadi Prestige
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 Pudjiadi Prestige
Strengths of Pudjiadi Prestige | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Pudjiadi Prestige are -
Highly skilled collaborators
– Pudjiadi Prestige has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Construction Services industry. Secondly the value chain collaborators of Pudjiadi Prestige have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Pudjiadi Prestige 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 Pudjiadi Prestige is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Pudjiadi Prestige emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Pudjiadi Prestige
– The covid-19 pandemic has put organizational resilience at the centre of everthing Pudjiadi Prestige does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Pudjiadi Prestige 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.
High brand equity
– Pudjiadi Prestige has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Pudjiadi Prestige to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Pudjiadi Prestige in Construction Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Pudjiadi Prestige in the Capital Goods sector have low bargaining power. Pudjiadi Prestige has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Pudjiadi Prestige to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Construction Services
– Pudjiadi Prestige 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 Pudjiadi Prestige in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Construction Services industry
- digital transformation varies from industry to industry. For Pudjiadi Prestige digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Pudjiadi Prestige 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
– Pudjiadi Prestige has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Pudjiadi Prestige 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
– Pudjiadi Prestige has one of the best training and development program in Capital Goods 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.
Cross disciplinary teams
– Horizontal connected teams at the Pudjiadi Prestige 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 Pudjiadi Prestige | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Pudjiadi Prestige are -
No frontier risks strategy
– From the 10K / annual statement of Pudjiadi Prestige, it seems that company is thinking out the frontier risks that can impact Construction Services industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Increasing silos among functional specialists
– The organizational structure of Pudjiadi Prestige is dominated by functional specialists. It is not different from other players in the Construction Services industry, but Pudjiadi Prestige needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Pudjiadi Prestige to focus more on services in the Construction Services industry rather than just following the product oriented approach.
Need for greater diversity
– Pudjiadi Prestige 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 bargaining power of channel partners in Construction Services industry
– because of the regulatory requirements in Indonesia, Pudjiadi Prestige 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.
Products dominated business model
– Even though Pudjiadi Prestige 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. Pudjiadi Prestige should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the Construction Services industry, Pudjiadi Prestige 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.
Skills based hiring in Construction Services industry
– The stress on hiring functional specialists at Pudjiadi Prestige 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.
Employees’ less understanding of Pudjiadi Prestige strategy
– From the outside it seems that the employees of Pudjiadi Prestige 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.
Interest costs
– Compare to the competition, Pudjiadi Prestige 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.
Aligning sales with marketing
– From the outside it seems that Pudjiadi Prestige needs to have more collaboration between its sales team and marketing team. Sales professionals in the Construction Services industry have deep experience in developing customer relationships. Marketing department at Pudjiadi Prestige can leverage the sales team experience to cultivate customer relationships as Pudjiadi Prestige is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee of Pudjiadi Prestige is just above the Construction Services industry average. It needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Pudjiadi Prestige Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Pudjiadi Prestige are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Pudjiadi Prestige can use these opportunities to build new business models that can help the communities that Pudjiadi Prestige operates in. Secondly it can use opportunities from government spending in Construction Services sector.
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 Pudjiadi Prestige 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.
Manufacturing automation
– Pudjiadi Prestige 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.
Buying journey improvements
– Pudjiadi Prestige can improve the customer journey of consumers in the Construction Services industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
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. Pudjiadi Prestige 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
– Pudjiadi Prestige 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Pudjiadi Prestige in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Construction Services industry, and it will provide faster access to the consumers.
Loyalty marketing
– Pudjiadi Prestige 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.
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. Pudjiadi Prestige 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. Pudjiadi Prestige 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.
Use of Bitcoin and other crypto currencies for transactions in Construction Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Pudjiadi Prestige in the Construction Services industry. Now Pudjiadi Prestige can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Pudjiadi Prestige 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 Pudjiadi Prestige to build a competitive advantage using analytics. The analytics driven competitive advantage can help Pudjiadi Prestige to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Pudjiadi Prestige is facing challenges because of the dominance of functional experts in the organization. Pudjiadi Prestige 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Pudjiadi Prestige 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.
Threats Pudjiadi Prestige External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Pudjiadi Prestige are -
Environmental challenges
– Pudjiadi Prestige 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. Pudjiadi Prestige can take advantage of this fund but it will also bring new competitors in the Construction Services industry.
Increasing wage structure of Pudjiadi Prestige
– 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 Pudjiadi Prestige.
Consumer confidence and its impact on Pudjiadi Prestige 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.
Easy access to finance
– Easy access to finance in Construction Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Pudjiadi Prestige can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Pudjiadi Prestige in Construction Services industry. The Construction Services industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Technology acceleration in Forth Industrial Revolution
– Pudjiadi Prestige has witnessed rapid integration of technology during Covid-19 in the Construction Services industry. As one of the leading players in the industry, Pudjiadi Prestige 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.
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. Pudjiadi Prestige 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.
Shortening product life cycle
– it is one of the major threat that Pudjiadi Prestige is facing in Construction Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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, Pudjiadi Prestige 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Construction Services industry are lowering. It can presents Pudjiadi Prestige with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Construction Services sector.
Stagnating economy with rate increase
– Pudjiadi Prestige 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.
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.
Weighted SWOT Analysis of Pudjiadi Prestige Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Pudjiadi Prestige 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 Pudjiadi Prestige 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 Pudjiadi Prestige 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 Pudjiadi Prestige 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 Pudjiadi Prestige needs to make to build a sustainable competitive advantage.