LBS Bina Pref (LBSBq) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for LBS Bina Pref (Malaysia)

Based on various researches at Oak Spring University , LBS Bina Pref is operating in a macro-environment that has been destablized by – increasing transportation and logistics costs, increasing commodity prices, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, etc

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Introduction to SWOT Analysis of LBS Bina Pref

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that LBS Bina Pref can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the LBS Bina Pref, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which LBS Bina Pref 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of LBS Bina Pref can be done for the following purposes –
1. Strategic planning of LBS Bina Pref
2. Improving business portfolio management of LBS Bina Pref
3. Assessing feasibility of the new initiative in Malaysia
4. Making a Construction Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of LBS Bina Pref

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Strengths of LBS Bina Pref | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of LBS Bina Pref are -

Ability to lead change in Construction Services

– LBS Bina Pref is one of the leading players in the Construction Services industry in Malaysia. Over the years it has not only transformed the business landscape in the Construction Services industry in Malaysia but also across the existing markets. The ability to lead change has enabled LBS Bina Pref in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Innovation driven organization

– LBS Bina Pref is one of the most innovative firm in Construction Services sector.

Learning organization

- LBS Bina Pref 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 LBS Bina Pref is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at LBS Bina Pref emphasize – knowledge, initiative, and innovation.

Operational resilience

– The operational resilience strategy of LBS Bina Pref comprises – understanding the underlying the factors in the Construction Services industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.

Cross disciplinary teams

– Horizontal connected teams at the LBS Bina Pref 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.

High brand equity

– LBS Bina Pref has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled LBS Bina Pref to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Effective Research and Development (R&D)

– LBS Bina Pref has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – LBS Bina Pref staying ahead in the Construction Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Successful track record of launching new products

– LBS Bina Pref has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. LBS Bina Pref 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.

Superior customer experience

– The customer experience strategy of LBS Bina Pref in Construction Services industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Digital Transformation in Construction Services industry

- digital transformation varies from industry to industry. For LBS Bina Pref digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. LBS Bina Pref 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.

Strong track record of project management in the Construction Services industry

– LBS Bina Pref is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Sustainable margins compare to other players in Construction Services industry

– LBS Bina Pref has clearly differentiated products in the market place. This has enabled LBS Bina Pref to fetch slight price premium compare to the competitors in the Construction Services industry. The sustainable margins have also helped LBS Bina Pref to invest into research and development (R&D) and innovation.

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Weaknesses of LBS Bina Pref | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of LBS Bina Pref are -

Interest costs

– Compare to the competition, LBS Bina Pref 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.

Employees’ less understanding of LBS Bina Pref strategy

– From the outside it seems that the employees of LBS Bina Pref 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.

Slow decision making process

– As mentioned earlier in the report, LBS Bina Pref has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Construction Services industry over the last five years. LBS Bina Pref 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.

High operating costs

– Compare to the competitors, LBS Bina Pref has high operating costs in the Construction Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract LBS Bina Pref lucrative customers.

Aligning sales with marketing

– From the outside it seems that LBS Bina Pref 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 LBS Bina Pref can leverage the sales team experience to cultivate customer relationships as LBS Bina Pref is planning to shift buying processes online.

Slow to strategic competitive environment developments

– As LBS Bina Pref is one of the leading players in the Construction Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Construction Services industry in last five years.

Products dominated business model

– Even though LBS Bina Pref 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. LBS Bina Pref should strive to include more intangible value offerings along with its core products and services.

Compensation and incentives

– The revenue per employee of LBS Bina Pref 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.

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 LBS Bina Pref supply chain. Even after few cautionary changes, LBS Bina Pref is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left LBS Bina Pref vulnerable to further global disruptions in South East Asia.

Low market penetration in new markets

– Outside its home market of Malaysia, LBS Bina Pref needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

High cash cycle compare to competitors

LBS Bina Pref has a high cash cycle compare to other players in the Construction Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

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LBS Bina Pref Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of LBS Bina Pref are -

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. LBS Bina Pref 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. LBS Bina Pref 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, LBS Bina Pref is facing challenges because of the dominance of functional experts in the organization. LBS Bina Pref 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.

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 LBS Bina Pref in the Construction Services industry. Now LBS Bina Pref can target international markets with far fewer capital restrictions requirements than the existing system.

Better consumer reach

– The expansion of the 5G network will help LBS Bina Pref to increase its market reach. LBS Bina Pref 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.

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. LBS Bina Pref 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 LBS Bina Pref can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Construction Services industry.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, LBS Bina Pref can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help LBS Bina Pref to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Loyalty marketing

– LBS Bina Pref 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, LBS Bina Pref 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.

Learning at scale

– Online learning technologies has now opened space for LBS Bina Pref 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 LBS Bina Pref can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Manufacturing automation

– LBS Bina Pref 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.

Using analytics as competitive advantage

– LBS Bina Pref 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 LBS Bina Pref to build a competitive advantage using analytics. The analytics driven competitive advantage can help LBS Bina Pref to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

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Threats LBS Bina Pref External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of LBS Bina Pref 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 LBS Bina Pref in the Construction Services 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 LBS Bina Pref business can come under increasing regulations regarding data privacy, data security, etc.

Shortening product life cycle

– it is one of the major threat that LBS Bina Pref 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, LBS Bina Pref can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate LBS Bina Pref prominent markets.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for LBS Bina Pref 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.

Stagnating economy with rate increase

– LBS Bina Pref 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.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry to Construction Services industry are lowering. It can presents LBS Bina Pref with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Construction Services sector.

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. LBS Bina Pref 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.

High dependence on third party suppliers

– LBS Bina Pref 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.

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. LBS Bina Pref needs to understand the core reasons impacting the Construction Services industry. This will help it in building a better workplace.

Environmental challenges

– LBS Bina Pref 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. LBS Bina Pref can take advantage of this fund but it will also bring new competitors in the Construction Services industry.

Regulatory challenges

– LBS Bina Pref needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Construction Services industry regulations.

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Weighted SWOT Analysis of LBS Bina Pref Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at LBS Bina Pref 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 LBS Bina Pref 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 LBS Bina Pref 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 LBS Bina Pref 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 LBS Bina Pref needs to make to build a sustainable competitive advantage.

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