UOB Kay Hian Holdings Ltd (UOKH) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for UOB Kay Hian Holdings Ltd (Singapore)

Based on various researches at Oak Spring University , UOB Kay Hian Holdings Ltd is operating in a macro-environment that has been destablized by – increasing energy prices, challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation, technology disruption, there is backlash against globalization, etc

---

---

---

---

Introduction to SWOT Analysis of UOB Kay Hian Holdings Ltd

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that UOB Kay Hian Holdings Ltd can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the UOB Kay Hian Holdings Ltd, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which UOB Kay Hian Holdings Ltd 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 UOB Kay Hian Holdings Ltd can be done for the following purposes –
1. Strategic planning of UOB Kay Hian Holdings Ltd
2. Improving business portfolio management of UOB Kay Hian Holdings Ltd
3. Assessing feasibility of the new initiative in Singapore
4. Making a Investment Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of UOB Kay Hian Holdings Ltd

---

Strengths of UOB Kay Hian Holdings Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of UOB Kay Hian Holdings Ltd are -

Innovation driven organization

– UOB Kay Hian Holdings Ltd is one of the most innovative firm in Investment Services sector.

Effective Research and Development (R&D)

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

Analytics focus

– UOB Kay Hian Holdings Ltd 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 Investment Services industry. The technology infrastructure of Singapore 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.

Highly skilled collaborators

– UOB Kay Hian Holdings Ltd has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Investment Services industry. Secondly the value chain collaborators of UOB Kay Hian Holdings Ltd have helped the firm to develop new products and bring them quickly to the marketplace.

Superior customer experience

– The customer experience strategy of UOB Kay Hian Holdings Ltd in Investment 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 UOB Kay Hian Holdings Ltd in the Financial sector have low bargaining power. UOB Kay Hian Holdings Ltd has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps UOB Kay Hian Holdings Ltd to manage not only supply disruptions but also source products at highly competitive prices.

Digital Transformation in Investment Services industry

- digital transformation varies from industry to industry. For UOB Kay Hian Holdings Ltd digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. UOB Kay Hian Holdings Ltd 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.

Ability to lead change in Investment Services

– UOB Kay Hian Holdings Ltd is one of the leading players in the Investment Services industry in Singapore. Over the years it has not only transformed the business landscape in the Investment Services industry in Singapore but also across the existing markets. The ability to lead change has enabled UOB Kay Hian Holdings Ltd in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Sustainable margins compare to other players in Investment Services industry

– UOB Kay Hian Holdings Ltd has clearly differentiated products in the market place. This has enabled UOB Kay Hian Holdings Ltd to fetch slight price premium compare to the competitors in the Investment Services industry. The sustainable margins have also helped UOB Kay Hian Holdings Ltd to invest into research and development (R&D) and innovation.

Training and development

– UOB Kay Hian Holdings Ltd has one of the best training and development program in Financial 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.

Successful track record of launching new products

– UOB Kay Hian Holdings Ltd has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. UOB Kay Hian Holdings Ltd 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.

High switching costs

– The high switching costs that UOB Kay Hian Holdings Ltd 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 UOB Kay Hian Holdings Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of UOB Kay Hian Holdings Ltd are -

Aligning sales with marketing

– From the outside it seems that UOB Kay Hian Holdings Ltd needs to have more collaboration between its sales team and marketing team. Sales professionals in the Investment Services industry have deep experience in developing customer relationships. Marketing department at UOB Kay Hian Holdings Ltd can leverage the sales team experience to cultivate customer relationships as UOB Kay Hian Holdings Ltd is planning to shift buying processes online.

Employees’ less understanding of UOB Kay Hian Holdings Ltd strategy

– From the outside it seems that the employees of UOB Kay Hian Holdings Ltd 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.

Lack of clear differentiation of UOB Kay Hian Holdings Ltd products

– To increase the profitability and margins on the products, UOB Kay Hian Holdings Ltd needs to provide more differentiated products than what it is currently offering in the marketplace.

Need for greater diversity

– UOB Kay Hian Holdings Ltd 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 operating costs

– Compare to the competitors, UOB Kay Hian Holdings Ltd has high operating costs in the Investment Services industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract UOB Kay Hian Holdings Ltd lucrative customers.

High dependence on UOB Kay Hian Holdings Ltd ‘s star products

– The top 2 products and services of UOB Kay Hian Holdings Ltd still accounts for major business revenue. This dependence on star products in Investment Services industry has resulted into insufficient focus on developing new products, even though UOB Kay Hian Holdings Ltd has relatively successful track record of launching new products.

High cash cycle compare to competitors

UOB Kay Hian Holdings Ltd has a high cash cycle compare to other players in the Investment 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, UOB Kay Hian Holdings Ltd is slow explore the new channels of communication. These new channels of communication can help UOB Kay Hian Holdings Ltd to provide better information regarding Investment Services products and services. It can also build an online community to further reach out to potential customers.

Interest costs

– Compare to the competition, UOB Kay Hian Holdings Ltd 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.

Slow to strategic competitive environment developments

– As UOB Kay Hian Holdings Ltd is one of the leading players in the Investment Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Investment Services industry in last five years.

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

---

UOB Kay Hian Holdings Ltd Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of UOB Kay Hian Holdings Ltd are -

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects UOB Kay Hian Holdings Ltd can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Using analytics as competitive advantage

– UOB Kay Hian Holdings Ltd has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Investment Services sector. This continuous investment in analytics has enabled UOB Kay Hian Holdings Ltd to build a competitive advantage using analytics. The analytics driven competitive advantage can help UOB Kay Hian Holdings Ltd to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Leveraging digital technologies

– UOB Kay Hian Holdings Ltd 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, UOB Kay Hian Holdings Ltd can use these opportunities to build new business models that can help the communities that UOB Kay Hian Holdings Ltd operates in. Secondly it can use opportunities from government spending in Investment Services sector.

Better consumer reach

– The expansion of the 5G network will help UOB Kay Hian Holdings Ltd to increase its market reach. UOB Kay Hian Holdings Ltd 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, UOB Kay Hian Holdings Ltd 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, UOB Kay Hian Holdings Ltd is facing challenges because of the dominance of functional experts in the organization. UOB Kay Hian Holdings Ltd can utilize new technology in the field of Investment 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 UOB Kay Hian Holdings Ltd has opened avenues for new revenue streams for the organization in Investment Services industry. This can help UOB Kay Hian Holdings Ltd to build a more holistic ecosystem for UOB Kay Hian Holdings Ltd products in the Investment Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Buying journey improvements

– UOB Kay Hian Holdings Ltd can improve the customer journey of consumers in the Investment 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.

Developing new processes and practices

– UOB Kay Hian Holdings Ltd can develop new processes and procedures in Investment 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.

Use of Bitcoin and other crypto currencies for transactions in Investment Services industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for UOB Kay Hian Holdings Ltd in the Investment Services industry. Now UOB Kay Hian Holdings Ltd can target international markets with far fewer capital restrictions requirements than the existing system.

Building a culture of innovation

– managers at UOB Kay Hian Holdings Ltd 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 Investment Services industry.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for UOB Kay Hian Holdings Ltd 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 UOB Kay Hian Holdings Ltd to hire the very best people irrespective of their geographical location.

---

Threats UOB Kay Hian Holdings Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of UOB Kay Hian Holdings Ltd are -

Shortening product life cycle

– it is one of the major threat that UOB Kay Hian Holdings Ltd is facing in Investment 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.

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. UOB Kay Hian Holdings Ltd needs to understand the core reasons impacting the Investment Services industry. This will help it in building a better workplace.

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 UOB Kay Hian Holdings Ltd in the Investment Services sector and impact the bottomline of the organization.

Technology acceleration in Forth Industrial Revolution

– UOB Kay Hian Holdings Ltd has witnessed rapid integration of technology during Covid-19 in the Investment Services industry. As one of the leading players in the industry, UOB Kay Hian Holdings Ltd needs to keep up with the evolution of technology in the Investment 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.

Easy access to finance

– Easy access to finance in Investment Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. UOB Kay Hian Holdings Ltd can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Consumer confidence and its impact on UOB Kay Hian Holdings Ltd 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 Investment Services industry and other sectors.

Environmental challenges

– UOB Kay Hian Holdings Ltd 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. UOB Kay Hian Holdings Ltd can take advantage of this fund but it will also bring new competitors in the Investment Services industry.

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 UOB Kay Hian Holdings Ltd.

Stagnating economy with rate increase

– UOB Kay Hian Holdings Ltd 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 Investment Services industry.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, UOB Kay Hian Holdings Ltd 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 UOB Kay Hian Holdings Ltd prominent markets.

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. UOB Kay Hian Holdings Ltd 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.

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 UOB Kay Hian Holdings Ltd business can come under increasing regulations regarding data privacy, data security, etc.

---

Weighted SWOT Analysis of UOB Kay Hian Holdings Ltd Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at UOB Kay Hian Holdings Ltd 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 UOB Kay Hian Holdings Ltd 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 UOB Kay Hian Holdings Ltd 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 UOB Kay Hian Holdings Ltd 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 UOB Kay Hian Holdings Ltd needs to make to build a sustainable competitive advantage.

--- ---