Change or Die

159

Chapter 17

Strengths and Weaknesses

e preparation of a ve- year strategic plan for URHere’s micro credit

agency began by comparing the agency’s services to that of its competitors.

Results highlighted activities that its credit union performed better or worse

than its competitors. Table17.1 compiles input from the analysis.

e team identied internal factors that caused the credit union to excel

(strengths) and the factors that caused their ratings to be lower than competi-

tors (weaknesses). e external environment that provides opportunities and

threats was also reviewed to provide input for the SWOT (strengths, weak-

nesses, opportunities, threats) matrix shown in Table17.2.

Process SWOT

A SWOT analysis for the selected process serves to validate the feasibility of the

goals and objectives set for the process. With SWOT, the process and its results

are compared with those of other organizations. e lack of information does

not limit the validity or cheapen the veracity of the SWOT.

e SWOT analysis shown in Table17.3 for the accounts payable process

was completed by following the ve steps that are discussed below:

1. Identify the internal strengths and weaknesses

2. Scan the external environment

3. Prepare the SWOT matrix

4. Develop strategies

5. Validate goals and objectives

160  ◾  Change or Die: The Business Process Improvement Manual

Table17.1  Analysis of Competitors

Issue Competitor A Competitor B Competitor C Credit Union

Years in

existence

Less than 5 12 15 20

Number of

members

100,000 75,000 (estimated) 75,000 to 100,000 >100,000

Management

experience

5*

Former bank

executives run

the company.

3

Mix of professional

and nonprofessionals

run the company.

1

Nonprofessionals

are the executives.

3

Many years in the business. Few

executives are professionals.

Delinquency

ratio

1

Uses bank ratings

to issue loans

and banking

collection

methods.

3

Gives unsecured

loans.

1

More on a savings

drive and for

purchase of tangible

items for

repossession.

5

Invests in the members’

businesses. During start- up of

business, the delinquency ratio is

high. Because of family relations,

there was leniency with members.

Strengths and Weaknesses  ◾  161

Client care 5

The customer

care models from

the banking

system are used.

3 to 5

Seen as customer-

friendly.

3

Unsecured loans are

discouraged without

explanations.

5

Members feel like family (and

often are). Long- standing

relationships with members for

generations.

Risk taking 1

Not perceived as

an option. Seen

as cold and too

businesslike.

3

Will give secured

loans.

1

Not risk takers.

5

Will give unsecured loans for

start- ups.

Branding 5

Logo, branded

products, Web

presence.

3

No logo or branding.

Low name recognition.

Web presence.

1

Logo. Now branding.

Now getting Web

presence.

3

Logo established. Low name

recognition. Web presence.

*

Ratings are on a scale of 1 (low) to 5 (high), as follows: 5 (high) means, “Pay any price”; 1 (low) means, “Want it for free; not

willing to pay extra for it”; 3 (moderate) is all the stuff in between, meaning we are “willing to pay a reasonable price” with-

out being forced to define “reasonable.”

162  ◾  Change or Die: The Business Process Improvement Manual

Step 1: Identify Internal Strengths and Weaknesses

e credit union worked the questionnaire below to identify its strengths and

weaknesses.

◾ Identify three things in your process that you cannot live without.

− e sta’s willingness to work

− e long- term relationships with vendors, especially when things go wrong

Table17.3  SWOT Matrix for Accounts Payable Process

Strengths Weaknesses Opportunities Threats

Long- term

relationships

with vendors

Committed

staff and

management

Internal controls

are weak

Invoices received

do not comply with

the process

requirements

Increasing vendor

complaints

Internal customers

do not always

comply with our

needs

Higher levels of

technology

within the

banking sector

Increased

security in using

the Internet

Vendors are

willing to work

with us for

solutions

Hackers update

the Internet with

viruses on a

regular basis

Vendors hold up

services or want

payment up front

New government

regulations that

may result in

litigation for late

payments

Table17.2  SWOT Matrix for Credit Union

Strengths Weaknesses Opportunities Threats

High

customer

satisfaction

Committed

management

and staff

Ready access

to funding

from

URHere’s

main office

Limited

managerial

experience

Customers and

staff are related—

conflicts of

interest

Not all process

and systems work

well

High delinquency

rates on loan

portfolios

Government

initiative to

increase the

number of micro

businesses

Government

training programs

for entrepreneurs

and small-

business owners

Links to external

markets for

customers

Increased

regulatory

framework for

operations

Global credit

crunch—may

affect URHere’s

overall business

Social conditions

in the villages

within which the

micro credit

operates