SWOT Analysis / TOWS Matrix for JCBNext Berhad (Malaysia)
Based on various researches at Oak Spring University , JCBNext Berhad is operating in a macro-environment that has been destablized by – geopolitical disruptions, increasing commodity prices, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion,
there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that JCBNext Berhad can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the JCBNext Berhad, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which JCBNext Berhad 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 JCBNext Berhad can be done for the following purposes –
1. Strategic planning of JCBNext Berhad
2. Improving business portfolio management of JCBNext Berhad
3. Assessing feasibility of the new initiative in Malaysia
4. Making a Business Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of JCBNext Berhad
Strengths of JCBNext Berhad | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of JCBNext Berhad are -
High brand equity
– JCBNext Berhad has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled JCBNext Berhad to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the JCBNext Berhad 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.
Ability to lead change in Business Services
– JCBNext Berhad is one of the leading players in the Business Services industry in Malaysia. Over the years it has not only transformed the business landscape in the Business Services industry in Malaysia but also across the existing markets. The ability to lead change has enabled JCBNext Berhad in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of JCBNext Berhad in the Services sector have low bargaining power. JCBNext Berhad has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps JCBNext Berhad to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– JCBNext Berhad has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. JCBNext Berhad 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.
Organizational Resilience of JCBNext Berhad
– The covid-19 pandemic has put organizational resilience at the centre of everthing JCBNext Berhad does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- JCBNext Berhad 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 JCBNext Berhad is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at JCBNext Berhad emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– JCBNext Berhad is one of the most innovative firm in Business Services sector.
Diverse revenue streams
– JCBNext Berhad is present in almost all the verticals within the Business Services industry. This has provided JCBNext Berhad 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.
Training and development
– JCBNext Berhad 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.
Effective Research and Development (R&D)
– JCBNext Berhad has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – JCBNext Berhad staying ahead in the Business Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that JCBNext Berhad 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.
Weaknesses of JCBNext Berhad | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of JCBNext Berhad are -
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 JCBNext Berhad supply chain. Even after few cautionary changes, JCBNext Berhad is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left JCBNext Berhad vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, JCBNext Berhad 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.
Ability to respond to the competition
– As the decision making is very deliberative at JCBNext Berhad, in the dynamic environment of Business Services industry it has struggled to respond to the nimble upstart competition. JCBNext Berhad has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on JCBNext Berhad ‘s star products
– The top 2 products and services of JCBNext Berhad still accounts for major business revenue. This dependence on star products in Business Services industry has resulted into insufficient focus on developing new products, even though JCBNext Berhad has relatively successful track record of launching new products.
High cash cycle compare to competitors
JCBNext Berhad has a high cash cycle compare to other players in the Business 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, JCBNext Berhad is slow explore the new channels of communication. These new channels of communication can help JCBNext Berhad to provide better information regarding Business Services products and services. It can also build an online community to further reach out to potential customers.
Aligning sales with marketing
– From the outside it seems that JCBNext Berhad needs to have more collaboration between its sales team and marketing team. Sales professionals in the Business Services industry have deep experience in developing customer relationships. Marketing department at JCBNext Berhad can leverage the sales team experience to cultivate customer relationships as JCBNext Berhad is planning to shift buying processes online.
Lack of clear differentiation of JCBNext Berhad products
– To increase the profitability and margins on the products, JCBNext Berhad needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though JCBNext Berhad has some of the most successful models in the Business Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. JCBNext Berhad should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, JCBNext Berhad 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 Business Services industry using digital technology.
High operating costs
– Compare to the competitors, JCBNext Berhad has high operating costs in the Business Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract JCBNext Berhad lucrative customers.
JCBNext Berhad Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of JCBNext Berhad are -
Loyalty marketing
– JCBNext Berhad has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for JCBNext Berhad in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Business Services industry, and it will provide faster access to the consumers.
Buying journey improvements
– JCBNext Berhad can improve the customer journey of consumers in the Business 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, JCBNext Berhad 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 JCBNext Berhad to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Redefining models of collaboration and team work
– As explained in the weaknesses section, JCBNext Berhad is facing challenges because of the dominance of functional experts in the organization. JCBNext Berhad can utilize new technology in the field of Business Services industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Creating value in data economy
– The success of analytics program of JCBNext Berhad has opened avenues for new revenue streams for the organization in Business Services industry. This can help JCBNext Berhad to build a more holistic ecosystem for JCBNext Berhad products in the Business Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at JCBNext Berhad 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 Business Services industry.
Use of Bitcoin and other crypto currencies for transactions in Business Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for JCBNext Berhad in the Business Services industry. Now JCBNext Berhad can target international markets with far fewer capital restrictions requirements than the existing system.
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. JCBNext Berhad can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for JCBNext Berhad 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 JCBNext Berhad to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects JCBNext Berhad can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Business Services industry, but it has also influenced the consumer preferences. JCBNext Berhad can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– JCBNext Berhad 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 JCBNext Berhad External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of JCBNext Berhad are -
Increasing wage structure of JCBNext Berhad
– 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 JCBNext Berhad.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
High dependence on third party suppliers
– JCBNext Berhad 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 JCBNext Berhad in Business Services industry. The Business 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.
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 JCBNext Berhad in the Business Services sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– JCBNext Berhad 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 Business Services 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. JCBNext Berhad needs to understand the core reasons impacting the Business Services industry. This will help it in building a better workplace.
Regulatory challenges
– JCBNext Berhad 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 Business Services industry regulations.
Technology acceleration in Forth Industrial Revolution
– JCBNext Berhad has witnessed rapid integration of technology during Covid-19 in the Business Services industry. As one of the leading players in the industry, JCBNext Berhad needs to keep up with the evolution of technology in the Business 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. JCBNext Berhad 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 JCBNext Berhad is facing in Business Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, JCBNext Berhad may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Business Services sector.
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 JCBNext Berhad.
Weighted SWOT Analysis of JCBNext Berhad Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at JCBNext Berhad 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 JCBNext Berhad 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 JCBNext Berhad 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 JCBNext Berhad 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 JCBNext Berhad needs to make to build a sustainable competitive advantage.