SWOT and TOWS Matrix of Karnawarna Visual Production
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SWOT is an acronym for strengths, weaknesses, opportunities and threats from the external environment. According to Jogiyanto (2005: 46), SWOT are used to assess the strengths and weaknesses of the resources that the company possesses and external opportunities and challenges faced.
According to David (Fred R. David, 2008: 8), all organizations have strengths and weaknesses in the functional areas of business. No company is as strong or weak in all business areas. Internal strengths and weaknesses combined with external opportunities and threats and a clear mission statement, became the basis for determining the strategy and goal. Objectives and strategies set by leveraging internal strength and overcome weaknesses. The following is an explanation of SWOT analysis (David, Fred R, 2005: 47):
Strength is the resources, skills, or other advantages relating to the company's competitors and the market needs that can be served by companies that are expected to be served. Strength is a special competition which gives the company a competitive advantage in the marketplace.
Weakness is limitations or shortcomings in resources, skills and capabilities that effectively inhibit the performance of the company. These limitations may include facilities, resources, finance, management skills and marketing skills can be a source of company weakness.
Opportunities are important favorable situation in the corporate environment. Important trends are one source of opportunities, such as changes in technology and the growing relationship between the company and the buyer or supplier is an example of opportunities for the company.
Threat is an important unfavorable situation in the corporate environment. Threat is a major nuisance for the current or desired position of the company. The existence of government regulations that are new or revised constitutes a threat to the company's success.
Factors that affect the four basic components included in the SWOT Analysis:
Internal Factors (Strength and Weakness)
- Resources owned
- Excess or lack of internal organization
- The experiences of the previous organization
External Factors (Opportunities and Threats)
- Cultural, Social Politics, Ideology, Economy
- Capital resources
- Government regulations
- Technological development
- Current events
The following SWOT analysis performed by Karnawarna Visual Production to determine the internal conditions within the company are shown in Table 3.1:
Tabel 3.1 Analisis SWOT Karnawarna Visual Production
Strength is the first element contained in the SWOT analysis. Strength is an advantage that is owned by a company or organization as a differentiator with other companies. Strength is a driving factor of success in achieving a superior position from an organization or company. The uniqueness of a company is also considered as a strength.
Karnawarna Visual Production as a company engaged in the creative industries, especially the realm of photography, became one of the company that promote the concept of "one stop service in photography need" namely all sorts of services or products in the field of photography are available. Visual Production Karnawarna are Karnawarna Photography, certified professional photography services and focus on the photo shoot of Advertising, Corporate & Industrial, Event, Food & Restaurant, Hotel & Resort, and NGO.
Karnawarna Visual Production has the human resources that are scattered across the country consisting from many professional photographers from different backgrounds and extensive experience in commercial photography. Karnawarna Visual Production has a mission of developing the related services not only in the field of professional photography services alone but as a facilitator and fulfilling the needs in the field of photography.
Companies like this are still rare in Indonesia. Therefore, it is a strength and uniqueness compared to other companies. Our hope is than Karnawarna Visual Production became the first company to consistently develop various businesses in the photographic industry.
Weakness makes a company or organization has disadvantages compared with other competitors. Weakness or flaws is related to anything that could be improved in the company, what should be avoided, the factors that lead to lost sales, things are perceived by consumers to the weaknesses of the company and what competitors are doing so that it can be better.
Weakness perceived by Karnawarna Visual Production among others are, many categories of businesses offered so it is feared a decline in consumer confidence in the professionalism of work-related specialties. Besides, in the selection of human resources is still considered less reliable because human resources are always based on the considerations of skill, knowledge and attitude that became fundamental to the determination of professional workers held by Karnawarna Visual Production.
Until present, Karnawarna Visual Production are still needed to improve in the promotion to prospective customers. This relates to the preparation of Karnawarna Visual Production as a provider of services, products and facilitator in the field of photography are still in the stage of preparation and research periodically. The research in this case is also related to many competitors who already a superior in eyes of the consumer.
Opportunities are positive factors that emerged from the environment and provide an opportunity for companies to be able to exploit. Opportunity is not just a policy to raise capital in the form of cash, but it can also be a response to the public or issue being discussed trends or run.
Karnawarna Visual Production had noted that an opportunity is a chance that looks and are in an environment and development trend of what is in line with the company. Karnawarna Visual Production see opportunities that is happening at the moment are the opening of the ASEAN free market system towards AEC and AFTA. This resulted in the freedom of doing business circulation among countries in ASEAN that affect the variability of market demand and market reach to various countries in the ASEAN in gaining new market share. In that regard, the high potential in the Digital Agency is currently in the spotlight which is considered to be one of potential business. The business development at Digital Agency is growing rapidly because they are influenced by developments in technology and the development of marketing patterns in the business world is very diverse, especially the use of digital media such as television advertising, online media and etc.
Photographic industry today, exists a diversity of demand related to production needs and education in the world of photography. It is also influenced by the development of today's technology that facilitates the art of photography could be done by anyone with the process becomes easier and faster. Thus, the business developments in the field of photography is considered very diverse and are a necessity.
Karnawarna Visual Production so far in getting jobs and opportunities are based on the stage a vigorous campaign. Through the creation of quality artwork, Karnawarna Visual Production is always trusted by the consumer in working on many projects in the field of photography and videography.
Visual Production Karnawarna felt that today there are many opportunities as well as the varying demand of new services in the field of photographic services such as the photo shoot of, product development photography and various supporting facilities related to photography, such as rental studio, photography equipment rental and sales of accessories and souvenir photography.
Threat are about what will be faced by the company, which may hinder the development or the rate of the standard enterprise. Threat also included about what is being done by competitors when establish its business activities to appear superior. Changes in government regulations also pose a threat to the company if it became a constraints and barriers for companies.
Karnawarna Visual Production today considered to have some threats in conducting future business activities. Unfair price competition in the photographic industry are frequent. This is caused by a number of similar businesses that excels in terms of quality and presentation to customers. The emergence of freelance photographer which sometimes spoil the market price without any responsibility. This is a result from the ease of today's technology where many camera manufacturers worldwide rapidly growing in making sophisticated cameras which have a variety of interesting features that facilitate in creating a good picture. Eventually this results in the emergence of new photographers which only able to photograph the "good" without constituted with full insight in the packaging its business side.
The apparent low level of awareness and appreciation for photo services in Indonesia makes things that had an impact on the creation of commercial photography work. The impact of this made art of photography is often considered as easy and trivial. Though the art of photography is a visual masterpiece which strongly influenced by the aesthetic and artistic elements in it as well as the production process that takes time and knowledge.
With the new agencies in photography which come from overseas began to enter Indonesia. This affect the competition in the competition to produce work of quality photos and presentation to the consumer. But this competition for Karnawarna Visual Production will be responded as a threat positively in order to think and try to be more creative in the business world of photography to be able to develop or diversify their products or other services in order to make the variation of the type of photography business in Karnawarna Visual Production which Karnawarna Visual Production will promote the concept of "one stop services in photography need".
Besides, as an opportunity, the implementation of the AEC and AFTA also can be a threat for companies in the creative industries in Indonesia, including photography. Enactment of these policies such as AEC (ASEAN Economic Community) and AFTA (Asean Free Trade Area) will result in the arrival of various foreign competitors and competent human resources that are free to build their business in the country. This challenge became a serious matter to optimize resources, performance management systems and information technology in the face of competition. If some of these things are not taken seriously internally, then this may be considered a threat.
- TOWS Matrix
TOWS Matrix is an advanced tool that is used to develop four types of options strategies: SO, WO, ST and WT. Key to the successful use of TOWS Matrix is to bring together the key factors internally and externally to form a strategy. The explanation of the SO, WO, ST and WT are:
- SO strategy is a strategy which is created by using the company's internal strength to take advantage of external chance.
- WO strategy is a strategy developed to improve the weaknesses internally and external opportunities. WO also shows the opportunities that exist within the range that can be achieved by Integration if it managed to improve internal weaknesses.
- ST strategies created to anticipate external threats by using internal strengths possessed.
- WT strategy happens when companies deal with factors weaknesses and threats that cannot be dealt with using the strengths and opportunities that exist.
The purpose of TOWS Matrix are to show all the alternatives based on the key internal and external factors not to determine the best strategy. Not all strategy that are resulted should be selected and executed. Choose a strategy determined by other relevant considerations.
TOWS Matrix of Karnawarna Visual Production today as follows:
(S1) Have a certified professional photography services
(S2)Have a competent human resource scattered throughout Indonesia
(S3) Have a mission to develop related services not only in professional photography services, but as a facilitator and fulfilling the needs in the field of photography
(S4) Being a pioneer company that consistently develop the different areas of business in the photographic industry in one parent company
(S5)Become a developer in various aspects of business in the photographic industry
(W1)The number of categories offered feared a decline in consumer confidence in the professionalism of the work-related specialties
(W2) Lack of manpower in each photo category offered
(W3)Lack of promotion conducted on the target market
(W4)Lack of research on the diversification of products or services that will be developed
(W5)The number of competitors who already excel
(O1) The openness of the ASEAN free market system, ahead of the AEC and AFTA
(O2)High potential in the Digital Agency
(O3)The diversity of demand for production and education in the world of photography
(O4) The existence of a variety of jobs that come without any big promotion
(O5) The number of new requests is a good variety of services, products or facilities related to photography
(T1) Unhealthy price competition in professional photography services
(T2) The emergence of new photographers with the price of destructive without accountability
(T3) Low level of awareness and appreciation for photo services in Indonesia
(T4) Foreign photography agency began to enter to Indonesia
(T5) The influx of foreign competitors as the implementation of the AEC and AFTA
Tabel 3.2: TOWS Matrix in Karnawarna Visual Production
TOWS Matrix Analysis makes sure to take into account and make the best use of every opportunity to improve business. At the same time, TOWS Matrix can also find out and take advantage of the internal potential. By analyzing the external TOWS Matrix is able to anticipate the challenges of any external change, even change it (the challenge) into new opportunities.
- Strengths and Opportunities (SO)
Creating new products related to travel, education and tourism promotion through photography (S1, S2, S3, S4, S5, O1, O3, O5)
As a step and product development efforts, Karnawarna Visual Productions have an idea which has high potential to create a travel agent to bridge photography beginners and intermediate photographers to work through the medium of photography to exotic locations all over the country.
Karnawarna Photography Trip and Workshop or travel photography is a photographic tour package of services aimed at taking pictures, traveling, learning and networking to reach various places of interest throughout the country which are full of beauty, history and culture. It is a dream from many photographers to be able to capture the beauty and the momentum into a framed photo work. It is not only for commercial purposes, with breakthroughs in the photographic industry as this allows helped introduce Indonesia to the world through the work of photography that will record the Indonesian natural resources and cultural diversity.
The positive value from this ideas and concepts are not just merely about the potential value of the business, but also full of usefulness such as helping introduce Indonesian tourism through photography work, advancing the photographic industry in Indonesia without restrictions and aspects of barriers to any principals to work in various locations, provide lessons regarding social values that will be encountered in the field, learning or training that will be given in the field of photography and adds to the good networking among participants and with mentors that are are already successful in the photographic industry.
Consistently form a social community (S2, S3, O1, O3, O5)
Basically, Social Community that will be established by Karnawarna Visual Productions is a form of corporate concern to the perpetrators of photography, both hobbyist, the workers, to the community in creating a space education about the world of photography. The added value is expected in the formation of a social community is also aims to establish networking and new market that can mutually benefit in many ways good for the perpetrators of photography as well as for companies.
If Social Community has been established, then the impact that will be felt by the company is a network of increasingly powerful and broad. This network may also be a new solution in getting the human resources needed by companies and markets when Karnawarna Visual Production will develop a variety of products or facilities photography needs.
Optimizing sale through Digital Marketing (S2, O4)
Promotions will be done using Digital Marketing aims to introduce and market using the internet and of course there are various types such as websites and social media. Marketing and promotion through social media websites and will put forward the good and intensive communication with consumers. With a personal relationship communication to make consumers more comfortable and flexible when asked about what we offer.
- Strengths and Threats (ST)
Always produce works of high quality and attractive (S1, S2, T1, T2)
As professionals, both in services or a variety of other products being developed, Karnawarna Visual Production always optimize in an effort to produce the best work as expected by the consumer. Consistency in delivering a great work became the motivation and company value to be superior to other competitors. Besides the good work, the presentation of that is given must be somewhat attractive and unique which has always been a differentiator with competitors.
Educate the public and the perpetrators of photography to appreciate each other in every process creating works (S3, T3)
Understanding the Indonesian people on how to see and appreciate the process of creating visual artworks sometimes still considered to be easy and inexpensive. Similarly, some perpetrators of photography is still low in comprehension to appreciate the process creating works. These two things are the cause of photography services in Indonesia are still not appreciated expensive. Yet behind the creation of photographic works are a series of complicated and expensive process. Two of these are Karnawarna about Visual Production will gradually educate to the community and photography itself.
Education that will be done is extremely diverse, ranging from the creation of work until the approach to the consumer to determine prices and packed into a seminar, workshop or free and open sharing periodically. This does impact education as it is expected to improve the pattern of appreciation for the work both the perpetrators and consumers and business development of photography in Indonesia will be more advanced.
Always selective in getting the team (S2, T4, T5)
Team in a work process is a very important pillar. The success of a work is determined by the production process of a good team. Building a good team takes things as basic as skill, knowledge and attitude that should be owned by every team. An individual's expertise in executing a shoot reliably and professionally based on the scientific held. It is indispensable in the process creating works. Knowledge is the insight that one has which covers facts or information obtained through experience or education to a job. This is the next stage which is to be owned by the perpetrators of photography when going on a job or create ideas and concepts to be a masterpiece photos so these works can weigh both the content, presentation and visual end result. Attitude is the most important thing for Karnawarna Visual Production as an initial foundation in recruiting a team or workers. This greatly affects the rate of future work well in coordination among teams and companies. Because comfort is built among fellow are extremely influential in a job.
Always follow the latest strategies of competitors for better packaging (S1, S2, S3, S4, S5, T4, T5)
Competition in the photographic industry are stringent. It takes a variety of effective ways in determining competitive strategies. Karnawarna Visual Production is currently required to always know a lot of information on developments and changes in the strategies made by competitors. On an ongoing basis, the company should always compare services, presentation, pricing and promotions with the nearest competitor in particular. In this way companies, can measure and find things anything that could potentially have advantages and weaknesses from competitors. And the company can evaluate weaknesses of competitors into corporate excellence.
- Weakneesses and Opportunities (WO)
Consistently maintain the quality of the work offered in many categories (W1, O2, O4)
Karnawarna Visual Production - Karnawarna Photography has services in several categories namely photo Advertising, Corporate & Industrial, Event, Food & Restaurant, Hotel & Resort and NGO. Of the six categories, Karnawarna Visual Production expected to be always consistent in presenting the works of quality. The biggest challenge that must be faced is that in selecting the team. In selecting the team sometimes there are several styles of the photographers from the team that has style photographing different. It is always a challenge for Karnawarna Photographyto be always selectively choose the top teams in the underlying skill, knowledge and a good attitude so that it can always make it easier to provide direction and input in creating the characters in the photo work from Karnawarna Photography.
Provide regular training to the whole team (W1, W2, W5, O1, O2)
Karnawarna Visual Production - Karnawarna Photography apply a rule to the entire team so that every three months there will be trainings or free discussion by practitioners of professional photography to give a short lecture about photography from each category owned by Karnawarna Photography. The hope is with focus and routinely provided training or discussion like this, work patterns, skills and knowledge of the team are always evolving. This will affect the results of the work created in the face of competition, so that consumers served by the more satisfied Karnawarna Photography.
Make new developments every year on matters the market needs in the realm of photography (W3, W4, O1, O2, O3, O5)
Karnawarna Visual Production will always be consistent in developing a variety of businesses in the photographic industry, given the photography business is now considered very potential and full of competition, Karnawarna Visual Production as a company that carries a "one stop service in photography need" at the beginning of the year 2012 - 2017 Karnawarna Visual Production will first focus on developing services for photography and videography. 2018 and 2020 will develop Photography Business Trip & Workshop, School of Photography and Photography Merchandise Store. In the year 2021-2023 will focus on developing Photography Equipment Rent and Sale, Photo Studio Photo Property Rent and Rent. By carrying out the "one stop service in photography need" Karnawarna Visual Production is expected to get around the tough competition in the field of photography and videography with various competitors and are also expected to have its own value in the eyes of consumers.
Optimizing promotions regularly about new opportunities (W3, O4, O3, O5)
Opportunities and trends in the photography world is very diverse in line with current technological developments. Karnawarna Visual Production will always be observant in seeing every opportunity when their trends or new opportunities. Karnawarna Visual Production will always follow whatever the market demand and will package them with attractive promotions such as affordable prices, diverse packages and other benefits that will certainly be felt consumers.
- Weaknesses and Threats (WT)
While providing an appropriate and flexible pricing, but does not reduce the quality of the work or the presentation (W5, T1, T2)
The advantages and differences from Karnawarna Visual Production with other competitors are always flexible in negotiating with the needs and abilities of consumers. According to experience so far by negotiating and discussing with consumers on the value or pricing the project, Karnawarna Visual Production always follow what is needed and the ability of the consumer. Especially when getting new customers which has never used the services from Karnawarna Visual Production. It is considered very effective in binding the consumer to continue cooperating with Karnawarna Visual Production. Besides the work and satisfactory price, consumers are sometimes reluctant to switch service to another party (competitor). This is a good strategy to the continuity of the relationship with the consumer. Regarding prices given to consumers or Karnawarna Visual Production, gradually getting up and appreciated as customer satisfaction with the services which is we provide to consumers.
Doing collaboration with competitors (W2, W5, T4, T5)
The existence of competitors is a threat to every company including Karnawarna Visual Production. But currently, Karnawarna Visual Production has a new solution to anticipate and address these issues namely by bringing competitors to collaborate in working on various projects from the consumer. This is becoming a trend among the photography business today.
- Business Strategy Formulation
According to Wheelen and hunger (2012), strategy formulation is the development of long-range plans for the effective management of environmental opportunities and threats, in light of corporate strengths and weaknesses (SWOT). It includes defining the corporate mission, specifying, achievable objectives, developing strategies and setting policy guidelines.
Formulation of business strategy will focus on marketing strategy Karnawarna Visual Production more clearly. The formulation of business strategy is to formulate a marketing strategy based on SWOT analysis. It starts from the top hierarchy of the strategy up to the bottom like a figure 3.3:
Figure 3.3: Hierarchical Levels of Strategy
Corporate strategy is one the top hierarchy which strategy related to the selection of the company's overall direction and management of product and business portfolio. Corporate strategy defines the business which company should be in. After defining it, the business strategy explains about the tactics to beat the competition. Finally, functional strategy will be the operational methods to implement the tactic as marketing strategy.
- Corporate Strategy
This strategy is the company's overall orientation growth, stability or retrenchment. Those 3 orientations are usually known as the grand strategy. Growth strategies expand the company's activities. Stability strategies make no change to the company's current activities. Retrenchment strategies reduce the company's level of activities. It is figured as below.
Figure 3.4: Corporate Directional Strategy (Whelen and Hunger, 2012)
Karnawarna Visual Production currently requires a growth strategy to develop its business as well as add a new division to develop. Based on the analysis of SWOT which have been made, Karnawarna Visual Production currently has several threats that must be anticipated such as competitive price which is not healthy in the field of professional photography services, the emergence of new photographers which is destructive without their continued accountability, the low level of awareness and appreciation for the services photograph in Indonesia, photography agencies from overseas which began to enter Indonesia and the influx of foreign competitors in line with implementation of the AEC and AFTA imposed by the government, so Karnawarna Visual Production requires a new strategy by diversifying concentric growth strategies in order to face the threat.
Concentric diversification should occur when adding new products related to existing products either related within the common technology, the use of shared facilities or marketing of the same network. Karnawarna Visual Production will develop new service products to anticipate the current competition. This new service products will be designed in a way to attract and meet the new demand in the photographic industry. The new service products which will be developed by Karnawarna Visual Production in 2018 and 2020 will develop Photography Business Trip & Workshop, School of Photography and Photography Merchandise Store. In 2021 - 2023 will focus on developing Photography Equipment Rent and Sale, Rent Photo Studio and Photo Property Rent.
- Business Strategy
According to Wheelen and Hunger (2012), business strategy usually occurs at the business unit or product level, and it emphasizes improvement of the competitive position of a corporation's product or services in the specific industry or market served by that business unit. Business strategies may fit within the two overall categories, competitive and coorperative strategies.
Karnawarna Visual Production in facing today's business challenges associated with the threat and the competition will focus on choosing a strategy to concentric diversification, which means Karnawarna Visual Production will add new products. The products that will be developed in the market are expected to able to compete and to compete with other similar competitors. In this section Karnawarna Visual Production also will choose a strategy of differentiation in products that will developed based on competitive strategies. Therefore, Karnawarna Visual Production in terms of the development of its products emphasize more on uniqueness and special attraction for consumers (uniqueness) and setting aside the price issue (high cost) that will be faced by consumers when choosing Karnawarna Visual Production as a service or product sales. Therefore, Karnawarna Visual Production selecting focused differentiation strategy and differentiation to development of services and products. Figure 3.5 shows the five competitive strategies to do.
Figure 3.5: Business Level Strategies (Hitt, 2011)
Related to the above strategy, the Integrated Cost Leadership / Differentiation is one of the strategies from five competitive strategies. According to Hitt, (2011) the majority of consumers have high expectations when purchasing goods or services. In general, most consumers want to pay lower pricing to products with distinct features. The expectations of consumers, a number of companies can be involved simultaneously in the pursuit of low cost and differentiation. Karnawarna Visual Production in this case will make a differentiation strategy and focused pursuit of differences from other competitors and slightly override considerations regarding the costs to be incurred by consumers.
- Functional Strategy
According Wheelen and Hunger (2012), functional strategies is the approach to functional areas necessary for the purpose unit of the company, the business and the strategy to maximize resource productivity. This relates to develop and maintain distinctive competence to provide a company or business unit with a competitive advantage. This is the same as which multidivisional company has several business units, each of which has its own business strategy, a business unit from each department and each functional strategy itself.
Functional strategy focuses on the development and maintenance of a distinctive competency to produce advantages for a company or business unit. Functional strategy on Karnawarna Visual Production will focus on marketing strategy. Marketing strategy with regard to pricing, sales and distribution of products. Some of the marketing strategies that will be used by Visual Production Karnawarna including market development strategy, product development strategy, push and pull strategy and pricing strategy. Of the four marketing strategies, will be adapted to the TOWS analysis from Karnawarna Visual Production.
- Market Development Strategy
Karnawarna Visual Production in creating current market development strategy by way of grabbing market share greater from the current market share through market uptake and market penetration. Based on the analysis TOWS Matrix which have been made, then the resulting market development strategy as follows:
- Establish a consistently Social Community
- Product Development Strategy
In making the product development strategy, Karnawarna Visual Production will develop new products to existing markets in the photography industry. Based on the analysis TOWS matrix which have been made, then the resulting product development strategy as follows:
- Make new products related to travel, education and tourism promotion through photography)
- Make new developments in each year related things the market needs in the realm of photography.
- Push and Pull Strategy
Push and Pull Strategy are needed in doing promotional stages. Karnawarna Visual Production is currently doing promotion by using a pull strategy. Pull Strategy is a strategy where an advertising medium as a means to pull the product through the distribution channel. In Push and Pull Strategy, Karnawarna Visual Production will spend more money on advertising designed to build brand awareness so that buyers are expected will looking for these products. Based on the analysis TOWS Matrix that has been created, then produced the following strategies:
- Optimizing sale through Digital Marketing
- Optimizing promotions regularly for any new opportunities
- Pricing Strategy
In determining the pricing strategy, there are three types of pricing strategy which is skimming pricing, penetration pricing and dynamic pricing. Of the three pricing strategy, Karnawarna Visual Production chose skimming pricing because according to the current condition of the company. Skimming pricing is a strategy which is implemented by setting a high price for a new or innovative products during the introductory stage, then lowering the price when the competition gets tight.
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