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 – digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic ,
central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto 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 -
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.
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.
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.
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.
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.
Organizational Resilience of PT Bank Mandiri Persero TBK
– The covid-19 pandemic has put organizational resilience at the centre of everthing PT Bank Mandiri Persero TBK does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
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.
Digital Transformation in industry
- digital transformation varies from industry to industry. For PT Bank Mandiri Persero TBK digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. PT Bank Mandiri Persero TBK 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
– 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.
Innovation driven organization
– PT Bank Mandiri Persero TBK is one of the most innovative firm in sector.
Successful track record of launching new products
– PT Bank Mandiri Persero TBK has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. PT Bank Mandiri Persero TBK 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.
Learning organization
- PT Bank Mandiri Persero TBK 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 PT Bank Mandiri Persero TBK is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at PT Bank Mandiri Persero TBK emphasize – knowledge, initiative, and innovation.
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 -
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.
High bargaining power of channel partners in industry
– because of the regulatory requirements in United States, PT Bank Mandiri Persero TBK is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
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.
Need for greater diversity
– PT Bank Mandiri Persero TBK 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, PT Bank Mandiri Persero TBK has high operating costs in the industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract PT Bank Mandiri Persero TBK lucrative customers.
Slow to strategic competitive environment developments
– As PT Bank Mandiri Persero TBK is one of the leading players in the industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Products dominated business model
– Even though PT Bank Mandiri Persero TBK has some of the most successful models in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. PT Bank Mandiri Persero TBK should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of PT Bank Mandiri Persero TBK products
– To increase the profitability and margins on the products, PT Bank Mandiri Persero TBK needs to provide more differentiated products than what it is currently offering in the marketplace.
No frontier risks strategy
– From the 10K / annual statement of PT Bank Mandiri Persero TBK, it seems that company is thinking out the frontier risks that can impact industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
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.
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 -
Developing new processes and practices
– PT Bank Mandiri Persero TBK can develop new processes and procedures in 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.
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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, PT Bank Mandiri Persero TBK can use these opportunities to build new business models that can help the communities that PT Bank Mandiri Persero TBK operates in. Secondly it can use opportunities from government spending in sector.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help PT Bank Mandiri Persero TBK to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, PT Bank Mandiri Persero TBK 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 PT Bank Mandiri Persero TBK to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– 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.
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.
Building a culture of innovation
– managers at PT Bank Mandiri Persero TBK 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 industry.
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.
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.
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.
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.
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 -
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 PT Bank Mandiri Persero TBK business can come under increasing regulations regarding data privacy, data security, etc.
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.
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.
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.
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 PT Bank Mandiri Persero TBK.
Environmental challenges
– PT Bank Mandiri Persero TBK 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. PT Bank Mandiri Persero TBK can take advantage of this fund but it will also bring new competitors in the 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. PT Bank Mandiri Persero TBK needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
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.
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.
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.
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.
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.
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.
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.