SWOT Analysis / TOWS Matrix for Duta Pertiwi Nusantara (Indonesia)
Based on various researches at Oak Spring University , Duta Pertiwi Nusantara is operating in a macro-environment that has been destablized by – increasing commodity prices, challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models, increasing energy prices, technology disruption,
central banks are concerned over increasing inflation, geopolitical disruptions, etc
Introduction to SWOT Analysis of Duta Pertiwi Nusantara
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Duta Pertiwi Nusantara can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Duta Pertiwi Nusantara, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Duta Pertiwi Nusantara 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 Duta Pertiwi Nusantara can be done for the following purposes –
1. Strategic planning of Duta Pertiwi Nusantara
2. Improving business portfolio management of Duta Pertiwi Nusantara
3. Assessing feasibility of the new initiative in Indonesia
4. Making a Chemical Manufacturing sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Duta Pertiwi Nusantara
Strengths of Duta Pertiwi Nusantara | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Duta Pertiwi Nusantara are -
Training and development
– Duta Pertiwi Nusantara has one of the best training and development program in Basic Materials 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.
High switching costs
– The high switching costs that Duta Pertiwi Nusantara 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.
Effective Research and Development (R&D)
– Duta Pertiwi Nusantara has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Duta Pertiwi Nusantara staying ahead in the Chemical Manufacturing industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Duta Pertiwi Nusantara in the Basic Materials sector have low bargaining power. Duta Pertiwi Nusantara has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Duta Pertiwi Nusantara to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Duta Pertiwi Nusantara has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Chemical Manufacturing industry. Secondly the value chain collaborators of Duta Pertiwi Nusantara have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Duta Pertiwi Nusantara is one of the most innovative firm in Chemical Manufacturing sector.
Diverse revenue streams
– Duta Pertiwi Nusantara is present in almost all the verticals within the Chemical Manufacturing industry. This has provided Duta Pertiwi Nusantara 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.
Organizational Resilience of Duta Pertiwi Nusantara
– The covid-19 pandemic has put organizational resilience at the centre of everthing Duta Pertiwi Nusantara does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy of Duta Pertiwi Nusantara comprises – understanding the underlying the factors in the Chemical Manufacturing 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.
High brand equity
– Duta Pertiwi Nusantara has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Duta Pertiwi Nusantara to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Duta Pertiwi Nusantara is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the Chemical Manufacturing industry. The technology infrastructure of Indonesia is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Strong track record of project management in the Chemical Manufacturing industry
– Duta Pertiwi Nusantara is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of Duta Pertiwi Nusantara | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Duta Pertiwi Nusantara are -
Low market penetration in new markets
– Outside its home market of Indonesia, Duta Pertiwi Nusantara needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Duta Pertiwi Nusantara 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 cash cycle compare to competitors
Duta Pertiwi Nusantara has a high cash cycle compare to other players in the Chemical Manufacturing industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Duta Pertiwi Nusantara is slow explore the new channels of communication. These new channels of communication can help Duta Pertiwi Nusantara to provide better information regarding Chemical Manufacturing products and services. It can also build an online community to further reach out to potential customers.
Skills based hiring in Chemical Manufacturing industry
– The stress on hiring functional specialists at Duta Pertiwi Nusantara 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 Duta Pertiwi Nusantara strategy
– From the outside it seems that the employees of Duta Pertiwi Nusantara 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.
Increasing silos among functional specialists
– The organizational structure of Duta Pertiwi Nusantara is dominated by functional specialists. It is not different from other players in the Chemical Manufacturing industry, but Duta Pertiwi Nusantara needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Duta Pertiwi Nusantara to focus more on services in the Chemical Manufacturing industry rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Duta Pertiwi Nusantara 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 Chemical Manufacturing industry using digital technology.
Lack of clear differentiation of Duta Pertiwi Nusantara products
– To increase the profitability and margins on the products, Duta Pertiwi Nusantara needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Duta Pertiwi Nusantara has some of the most successful models in the Chemical Manufacturing industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Duta Pertiwi Nusantara should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Duta Pertiwi Nusantara has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Chemical Manufacturing industry over the last five years. Duta Pertiwi Nusantara 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.
Duta Pertiwi Nusantara Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Duta Pertiwi Nusantara are -
Creating value in data economy
– The success of analytics program of Duta Pertiwi Nusantara has opened avenues for new revenue streams for the organization in Chemical Manufacturing industry. This can help Duta Pertiwi Nusantara to build a more holistic ecosystem for Duta Pertiwi Nusantara products in the Chemical Manufacturing industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Duta Pertiwi Nusantara to increase its market reach. Duta Pertiwi Nusantara 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Duta Pertiwi Nusantara in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Chemical Manufacturing industry, and it will provide faster access to the consumers.
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 Duta Pertiwi Nusantara 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Duta Pertiwi Nusantara 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.
Using analytics as competitive advantage
– Duta Pertiwi Nusantara has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Chemical Manufacturing sector. This continuous investment in analytics has enabled Duta Pertiwi Nusantara to build a competitive advantage using analytics. The analytics driven competitive advantage can help Duta Pertiwi Nusantara to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Duta Pertiwi Nusantara can develop new processes and procedures in Chemical Manufacturing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Duta Pertiwi Nusantara 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 Duta Pertiwi Nusantara to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Duta Pertiwi Nusantara 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.
Loyalty marketing
– Duta Pertiwi Nusantara 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Duta Pertiwi Nusantara is facing challenges because of the dominance of functional experts in the organization. Duta Pertiwi Nusantara can utilize new technology in the field of Chemical Manufacturing industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Duta Pertiwi Nusantara can use these opportunities to build new business models that can help the communities that Duta Pertiwi Nusantara operates in. Secondly it can use opportunities from government spending in Chemical Manufacturing sector.
Leveraging digital technologies
– Duta Pertiwi Nusantara 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.
Threats Duta Pertiwi Nusantara External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Duta Pertiwi Nusantara are -
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.
Regulatory challenges
– Duta Pertiwi Nusantara needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Chemical Manufacturing industry regulations.
Environmental challenges
– Duta Pertiwi Nusantara 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. Duta Pertiwi Nusantara can take advantage of this fund but it will also bring new competitors in the Chemical Manufacturing industry.
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. Duta Pertiwi Nusantara needs to understand the core reasons impacting the Chemical Manufacturing industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Chemical Manufacturing industry are lowering. It can presents Duta Pertiwi Nusantara with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Chemical Manufacturing sector.
High dependence on third party suppliers
– Duta Pertiwi Nusantara 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.
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 Duta Pertiwi Nusantara in the Chemical Manufacturing sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Duta Pertiwi Nusantara has witnessed rapid integration of technology during Covid-19 in the Chemical Manufacturing industry. As one of the leading players in the industry, Duta Pertiwi Nusantara needs to keep up with the evolution of technology in the Chemical Manufacturing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Duta Pertiwi Nusantara may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Chemical Manufacturing sector.
Increasing wage structure of Duta Pertiwi Nusantara
– 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 Duta Pertiwi Nusantara.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Duta Pertiwi Nusantara in Chemical Manufacturing industry. The Chemical Manufacturing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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 Duta Pertiwi Nusantara.
Weighted SWOT Analysis of Duta Pertiwi Nusantara Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Duta Pertiwi Nusantara 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 Duta Pertiwi Nusantara 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 Duta Pertiwi Nusantara 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 Duta Pertiwi Nusantara 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 Duta Pertiwi Nusantara needs to make to build a sustainable competitive advantage.