Standard Bank Grp (SBKJ) SWOT Analysis / TOWS Matrix / MBA Resources
Money Center Banks
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Standard Bank Grp (South Africa)
Based on various researches at Oak Spring University , Standard Bank Grp is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, increasing transportation and logistics costs, geopolitical disruptions, increasing commodity prices, talent flight as more people leaving formal jobs, technology disruption, cloud computing is disrupting traditional business models,
supply chains are disrupted by pandemic , increasing energy prices, etc
Introduction to SWOT Analysis of Standard Bank Grp
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Standard Bank Grp can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Standard Bank Grp, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Standard Bank Grp 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 Standard Bank Grp can be done for the following purposes –
1. Strategic planning of Standard Bank Grp
2. Improving business portfolio management of Standard Bank Grp
3. Assessing feasibility of the new initiative in South Africa
4. Making a Money Center Banks sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Standard Bank Grp
Strengths of Standard Bank Grp | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Standard Bank Grp are -
Digital Transformation in Money Center Banks industry
- digital transformation varies from industry to industry. For Standard Bank Grp digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Standard Bank Grp 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
– Standard Bank Grp has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Standard Bank Grp 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.
Cross disciplinary teams
– Horizontal connected teams at the Standard Bank Grp 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.
Highly skilled collaborators
– Standard Bank Grp has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Money Center Banks industry. Secondly the value chain collaborators of Standard Bank Grp have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Money Center Banks
– Standard Bank Grp is one of the leading players in the Money Center Banks industry in South Africa. Over the years it has not only transformed the business landscape in the Money Center Banks industry in South Africa but also across the existing markets. The ability to lead change has enabled Standard Bank Grp in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Standard Bank Grp has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Standard Bank Grp staying ahead in the Money Center Banks industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management in the Money Center Banks industry
– Standard Bank Grp is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Standard Bank Grp 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.
Innovation driven organization
– Standard Bank Grp is one of the most innovative firm in Money Center Banks sector.
Sustainable margins compare to other players in Money Center Banks industry
– Standard Bank Grp has clearly differentiated products in the market place. This has enabled Standard Bank Grp to fetch slight price premium compare to the competitors in the Money Center Banks industry. The sustainable margins have also helped Standard Bank Grp to invest into research and development (R&D) and innovation.
Training and development
– Standard Bank Grp 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.
Superior customer experience
– The customer experience strategy of Standard Bank Grp in Money Center Banks industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses of Standard Bank Grp | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Standard Bank Grp are -
Aligning sales with marketing
– From the outside it seems that Standard Bank Grp needs to have more collaboration between its sales team and marketing team. Sales professionals in the Money Center Banks industry have deep experience in developing customer relationships. Marketing department at Standard Bank Grp can leverage the sales team experience to cultivate customer relationships as Standard Bank Grp is planning to shift buying processes online.
Skills based hiring in Money Center Banks industry
– The stress on hiring functional specialists at Standard Bank Grp 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.
Compensation and incentives
– The revenue per employee of Standard Bank Grp is just above the Money Center Banks 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 Standard Bank Grp ‘s star products
– The top 2 products and services of Standard Bank Grp still accounts for major business revenue. This dependence on star products in Money Center Banks industry has resulted into insufficient focus on developing new products, even though Standard Bank Grp has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the Money Center Banks industry, Standard Bank Grp 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.
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 Standard Bank Grp supply chain. Even after few cautionary changes, Standard Bank Grp is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Standard Bank Grp vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Standard Bank Grp has some of the most successful models in the Money Center Banks industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Standard Bank Grp should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Standard Bank Grp is one of the leading players in the Money Center Banks industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Money Center Banks industry in last five years.
Lack of clear differentiation of Standard Bank Grp products
– To increase the profitability and margins on the products, Standard Bank Grp needs to provide more differentiated products than what it is currently offering in the marketplace.
Low market penetration in new markets
– Outside its home market of South Africa, Standard Bank Grp needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Standard Bank Grp has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Money Center Banks industry over the last five years. Standard Bank Grp 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.
Standard Bank Grp Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Standard Bank Grp are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Standard Bank Grp is facing challenges because of the dominance of functional experts in the organization. Standard Bank Grp can utilize new technology in the field of Money Center Banks industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Building a culture of innovation
– managers at Standard Bank Grp 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 Money Center Banks industry.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Standard Bank Grp can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Standard Bank Grp 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Money Center Banks industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Standard Bank Grp 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. Standard Bank Grp 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.
Creating value in data economy
– The success of analytics program of Standard Bank Grp has opened avenues for new revenue streams for the organization in Money Center Banks industry. This can help Standard Bank Grp to build a more holistic ecosystem for Standard Bank Grp products in the Money Center Banks industry by providing – data insight services, data privacy related products, data based consulting services, 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, Standard Bank Grp can use these opportunities to build new business models that can help the communities that Standard Bank Grp operates in. Secondly it can use opportunities from government spending in Money Center Banks sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Standard Bank Grp 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 Standard Bank Grp to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Standard Bank Grp 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.
Use of Bitcoin and other crypto currencies for transactions in Money Center Banks industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Standard Bank Grp in the Money Center Banks industry. Now Standard Bank Grp can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Standard Bank Grp 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.
Buying journey improvements
– Standard Bank Grp can improve the customer journey of consumers in the Money Center Banks 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.
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. Standard Bank Grp can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Standard Bank Grp External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Standard Bank Grp are -
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 Standard Bank Grp business can come under increasing regulations regarding data privacy, data security, etc.
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 Standard Bank Grp.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Standard Bank Grp 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 Standard Bank Grp prominent markets.
Technology acceleration in Forth Industrial Revolution
– Standard Bank Grp has witnessed rapid integration of technology during Covid-19 in the Money Center Banks industry. As one of the leading players in the industry, Standard Bank Grp needs to keep up with the evolution of technology in the Money Center Banks 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.
Regulatory challenges
– Standard Bank Grp 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 Money Center Banks industry regulations.
Environmental challenges
– Standard Bank Grp 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. Standard Bank Grp can take advantage of this fund but it will also bring new competitors in the Money Center Banks industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Money Center Banks industry are lowering. It can presents Standard Bank Grp with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Money Center Banks sector.
Increasing wage structure of Standard Bank Grp
– 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 Standard Bank Grp.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Standard Bank Grp in Money Center Banks industry. The Money Center Banks 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.
Consumer confidence and its impact on Standard Bank Grp 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 Money Center Banks industry and other sectors.
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. Standard Bank Grp needs to understand the core reasons impacting the Money Center Banks industry. This will help it in building a better workplace.
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, Standard Bank Grp may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Money Center Banks sector.
Weighted SWOT Analysis of Standard Bank Grp Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Standard Bank Grp 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 Standard Bank Grp 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 Standard Bank Grp 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 Standard Bank Grp 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 Standard Bank Grp needs to make to build a sustainable competitive advantage.