Swot Analysis in Strategic Planning

Strategic planning is dependent on an understanding of an organization’s resources and

capabilities, as well as crucial capacity constraints. In deciding a new company strategy, the use

of the SWOT Analysis to assess the current position is valuable if not indispensable. Sammut-

Bonnici & Galea, D (2015) state that in the SWOT analysis, strengths and weaknesses refer to

the internal organizational environment whereas the opportunities and threat are external. The

SWOT Analysis can be utilized to make the most of what is already there, to the advantage of

the business. Chances of failure can be eliminated or reduced by understanding what is lacking,

and removing hazards that would otherwise be detrimental to the organization. Better still, a

strategy can be crafted that distinguishes the entity from competitors, and so compete

successfully the market.

The Infrastructure Development Bank of Zimbabwe (IDBZ)

The IDBZ is an infrastructural development finance institution (DFI) in Zimbabwe that started

operating in 2005. It is majority share-owned by the Government of Zimbabwe, with less than

10% ownership either in the local private sector of like international development finance

institutions. Its corporate objectives are long term financing of large-scale infrastructure projects,

particularly in energy, transportation, water etc. To do so, the bank endeavors to harness private

sector financing and internal resources and focus them towards projects that have a long-term

national impact.

Strengths

The IDBZ has a national brand and outreach that is complemented well by government

departments that focus on infrastructure. brand visibility and outreach. This positions the Bank
favorably to capitalize upon institutional stature, regional and existing global partnerships. The

Bank possesses internal human resources capability to include legal, finance, engineering, human

resources etc. coupled with collaborative opportunities to procure experts, deliver support,

channels to build knowledge, disseminate information and deliver on infrastructure. Proximity to

clients through field and regional offices serves as a source of country knowledge and

relationship management. Availability of potential project partners at regional, bi-lateral and

multi-lateral levels is a valuable resource. It’s history on delivery is profound and attract local

institutional investors to projects that the Bank endorses as bankable. Over the years IDBZ has

developed strong internal processes and controls which has led to strong financial management

of the project. This has resulted in efficient, cost effective and transparent implementation of the

project that would in turn provide attraction to would be investors

Weaknesses

Weaknesses like threats are harmful to achieving the organizational objectives and are

unfavorable for organizations (. Macro-economic problems at a national level has resulted in the

Bank being grossly underfunded, undermining efforts to co finance projects of national

importance. This has largely been due to the massive devaluation of the local currency, that the

Bank previously held as well as the non-maturity of treasury bills in the Banks possession.

Critically, private and foreign investors demand co-funding on projects, that the IDBZ is failing

to follow through upon. The Bank has been failing to retain key or critical staff due to migration

weakening the systems that had been painstakingly developed. There is a need for a clear value

proposition to differentiate the Bank as many other government departments (especially at

local/municipal level) claim to offer similar solutions on infrastructure issues. In some form or

other, these organizations address similar issues to those identified in the Strategy albeit through
direct government funding creating an over-lap that is hardly filled. The level and variety of

expertise needed to deliver on projects is significant. To be impactful, many of the interventions

require comprehensive hands-on support and mentoring. Together, these conditions translate into

significant resources requirement and is therefore challenging for the Bank in light of the

challenges earlier pointed out. There is a definite to manage potential internal overlaps as many

other departments in the Bank address issues best suited to other departments. Harmonizing and

differentiating the Bank’s work with the departments will take time although collaboration has

minimized the negative impact on the core mandate and focus of the IDBZ.

Opportunities

The present infrastructure deficit in the country present an present and on-going necessity for the

Bank, albeit, if adequately resourced. Energy shortages, water supply problems, dilapidated road

networks, capacity deficiency necessitate the Bank’s intervention in harnessing private sector

and foreign resources. There is a demonstrated interest in the Banks projects and programmes,

particularly at national Government level and international institutions, because of the

recognition that infrastructure development can potentially reduce poverty and inequality, and

because of the IBDZ’s strategic positioning with its clients. The Bank has the opportunity to

leverage both the Bank’s public and private sector portfolios, creating an integrated package of

solutions and facilitating private-public sector participation particularly in key areas like energy.

Being the lead Zimbabwean infrastructure focused DFI, the IDBZ is well positioned to champion

the governance of financial resources focused on infrastructure and to be a trusted broker

between the government and institutional/foreign investors.

Threats
Resource mobilization has and is particularly difficult from external partners because of real or

perceived currency stability and the ability to estimate accurate future costs of individual

projects. Economic sanctions placed on the country has resulted in the small, if at all, uptake of

investment opportunities the Bank offers. Most infrastructure the Bank is involved in require an

extensive foreign currency component that the country as a whole is in short supply. This has

resulted in poor project delivery in recent times and presents an on-going challenge.

Capitalization of the institution as a whole remains a challenge, taking cognizance of the afore-

mentioned issues and various country associated perceptions.

Conclusion

Whereas the Bank stands in good light, there are serious macro-economic fundamentals that need

sorting out for the IDBZ to be fully utilized for economic growth purposes particularly in the

infrastructure sectors. Retaining appropriate skills and attracting them remain a challenge and

shall have an impact on the Banks strategic planning. All other issues noted in the SWOT

analysis for the Bank, though not complete, need to be taken into consideration when planning

for the short, medium and long term.

It is thus suffice to say that in short, the SWOT analysis is a vital precondition for good strategic

planning in that it will point the way towards challenges and opportunities that must be

addressed by an organization if it hopes to be competitive, sustainable and successful in the years

ahead.

References

Sammut-Bonnici, T., & Galea, D. (2015). SWOT Analysis. In book: Wiley Encyclopedia of

Management, 1-8. Doi:10.1002/9781118785317.weom120103.