PT Bank Mandiri Persero TBK (PPERY) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for PT Bank Mandiri Persero TBK (United States)
Based on various researches at Oak Spring University , PT Bank Mandiri Persero TBK is operating in a macro-environment that has been destablized by – there is increasing trade war between United States & China, increasing commodity prices, central banks are concerned over increasing inflation, supply chains are disrupted by pandemic , increasing transportation and logistics costs, increasing household debt because of falling income levels, technology disruption,
customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of PT Bank Mandiri Persero TBK
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that PT Bank Mandiri Persero TBK can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the PT Bank Mandiri Persero TBK, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which PT Bank Mandiri Persero TBK 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 PT Bank Mandiri Persero TBK can be done for the following purposes –
1. Strategic planning of PT Bank Mandiri Persero TBK
2. Improving business portfolio management of PT Bank Mandiri Persero TBK
3. Assessing feasibility of the new initiative in United States
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of PT Bank Mandiri Persero TBK
Strengths of PT Bank Mandiri Persero TBK | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of PT Bank Mandiri Persero TBK are -
Ability to lead change in
– PT Bank Mandiri Persero TBK is one of the leading players in the industry in United States. Over the years it has not only transformed the business landscape in the industry in United States but also across the existing markets. The ability to lead change has enabled PT Bank Mandiri Persero TBK in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– PT Bank Mandiri Persero TBK has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled PT Bank Mandiri Persero TBK to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– PT Bank Mandiri Persero TBK is present in almost all the verticals within the industry. This has provided PT Bank Mandiri Persero TBK 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.
Ability to recruit top talent
– PT Bank Mandiri Persero TBK is one of the leading players in the industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– PT Bank Mandiri Persero TBK has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – PT Bank Mandiri Persero TBK staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in industry
– PT Bank Mandiri Persero TBK has clearly differentiated products in the market place. This has enabled PT Bank Mandiri Persero TBK to fetch slight price premium compare to the competitors in the industry. The sustainable margins have also helped PT Bank Mandiri Persero TBK to invest into research and development (R&D) and innovation.
Strong track record of project management in the industry
– PT Bank Mandiri Persero TBK is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– PT Bank Mandiri Persero TBK 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 industry. The technology infrastructure of United States 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
– PT Bank Mandiri Persero TBK has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive industry. Secondly the value chain collaborators of PT Bank Mandiri Persero TBK have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the PT Bank Mandiri Persero TBK 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.
Low bargaining power of suppliers
– Suppliers of PT Bank Mandiri Persero TBK in the sector have low bargaining power. PT Bank Mandiri Persero TBK has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps PT Bank Mandiri Persero TBK to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– PT Bank Mandiri Persero TBK has one of the best training and development program in 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.
Weaknesses of PT Bank Mandiri Persero TBK | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of PT Bank Mandiri Persero TBK are -
Compensation and incentives
– The revenue per employee of PT Bank Mandiri Persero TBK is just above the 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.
Workers concerns about automation
– As automation is fast increasing in the industry, PT Bank Mandiri Persero TBK 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 PT Bank Mandiri Persero TBK supply chain. Even after few cautionary changes, PT Bank Mandiri Persero TBK is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left PT Bank Mandiri Persero TBK vulnerable to further global disruptions in South East Asia.
Slow decision making process
– As mentioned earlier in the report, PT Bank Mandiri Persero TBK has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. PT Bank Mandiri Persero TBK 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 dependence on PT Bank Mandiri Persero TBK ‘s star products
– The top 2 products and services of PT Bank Mandiri Persero TBK still accounts for major business revenue. This dependence on star products in industry has resulted into insufficient focus on developing new products, even though PT Bank Mandiri Persero TBK has relatively successful track record of launching new products.
High cash cycle compare to competitors
PT Bank Mandiri Persero TBK has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Increasing silos among functional specialists
– The organizational structure of PT Bank Mandiri Persero TBK is dominated by functional specialists. It is not different from other players in the industry, but PT Bank Mandiri Persero TBK needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help PT Bank Mandiri Persero TBK to focus more on services in the industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of United States, PT Bank Mandiri Persero TBK needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, PT Bank Mandiri Persero TBK 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.
Skills based hiring in industry
– The stress on hiring functional specialists at PT Bank Mandiri Persero TBK 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, PT Bank Mandiri Persero TBK is slow explore the new channels of communication. These new channels of communication can help PT Bank Mandiri Persero TBK to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
PT Bank Mandiri Persero TBK Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of PT Bank Mandiri Persero TBK are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in industry, but it has also influenced the consumer preferences. PT Bank Mandiri Persero TBK can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– PT Bank Mandiri Persero TBK can improve the customer journey of consumers in the 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, PT Bank Mandiri Persero TBK is facing challenges because of the dominance of functional experts in the organization. PT Bank Mandiri Persero TBK can utilize new technology in the field of industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Loyalty marketing
– PT Bank Mandiri Persero TBK 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. PT Bank Mandiri Persero TBK 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. PT Bank Mandiri Persero TBK 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.
Learning at scale
– Online learning technologies has now opened space for PT Bank Mandiri Persero TBK 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.
Manufacturing automation
– PT Bank Mandiri Persero TBK can use the latest technology developments to improve its manufacturing and designing process in 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.
Creating value in data economy
– The success of analytics program of PT Bank Mandiri Persero TBK has opened avenues for new revenue streams for the organization in industry. This can help PT Bank Mandiri Persero TBK to build a more holistic ecosystem for PT Bank Mandiri Persero TBK products in the 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 PT Bank Mandiri Persero TBK to increase its market reach. PT Bank Mandiri Persero TBK 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.
Leveraging digital technologies
– PT Bank Mandiri Persero TBK 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.
Use of Bitcoin and other crypto currencies for transactions in industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for PT Bank Mandiri Persero TBK in the industry. Now PT Bank Mandiri Persero TBK can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, PT Bank Mandiri Persero TBK 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
– PT Bank Mandiri Persero TBK has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled PT Bank Mandiri Persero TBK to build a competitive advantage using analytics. The analytics driven competitive advantage can help PT Bank Mandiri Persero TBK to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats PT Bank Mandiri Persero TBK External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of PT Bank Mandiri Persero TBK are -
Stagnating economy with rate increase
– PT Bank Mandiri Persero TBK 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 industry.
Easy access to finance
– Easy access to finance in industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. PT Bank Mandiri Persero TBK can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– PT Bank Mandiri Persero TBK 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.
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. PT Bank Mandiri Persero TBK 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.
Regulatory challenges
– PT Bank Mandiri Persero TBK 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 industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, PT Bank Mandiri Persero TBK 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 PT Bank Mandiri Persero TBK prominent markets.
Technology acceleration in Forth Industrial Revolution
– PT Bank Mandiri Persero TBK has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, PT Bank Mandiri Persero TBK needs to keep up with the evolution of technology in the 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents PT Bank Mandiri Persero TBK with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of PT Bank Mandiri Persero TBK
– 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 PT Bank Mandiri Persero TBK.
Consumer confidence and its impact on PT Bank Mandiri Persero TBK 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 industry and other sectors.
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.
Shortening product life cycle
– it is one of the major threat that PT Bank Mandiri Persero TBK is facing in 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, PT Bank Mandiri Persero TBK may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of sector.
Weighted SWOT Analysis of PT Bank Mandiri Persero TBK Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at PT Bank Mandiri Persero TBK 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 PT Bank Mandiri Persero TBK 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 PT Bank Mandiri Persero TBK 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 PT Bank Mandiri Persero TBK 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 PT Bank Mandiri Persero TBK needs to make to build a sustainable competitive advantage.