Barrick Gold: Peter Munk's Leadership and Legacy SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Barrick Gold: Peter Munk's Leadership and Legacy
Under the guidance and vision of founder Peter Munk, Barrick Gold Corporation had risen to become an industry leader and the world's largest gold producer. The company had grown, mostly through mergers and acquisitions, from one single mine in Northern Ontario to 26 operating mines on five continents, with more than 20,000 employees worldwide. By 2013, however, weak gold prices, asset value writedowns and operational cost overruns have negatively affected the company's stock price. Many attribute the company's problems to Munk's personality and his control over the board of directors. Munk has announced that he will retire in 2014 and will be replaced as chairman by his current co-chairman, John L. Thornton. How can Thornton effectively chair Barrick's board in the wake of Munk's legacy? Will his vision for the company conflict with Munk's dream of turning it into an international diversified mining company? How much of a role will Munk play in the future given his level of informal power? Finally, what can Barrick do to lift itself out of an industry mired in volatility and financial uncertainty?
Swot Analysis of "Barrick Gold: Peter Munk's Leadership and Legacy" written by Cara C. Maurer, Graeme Kreindler includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Munk's Munk facing as an external strategic factors. Some of the topics covered in Barrick Gold: Peter Munk's Leadership and Legacy case study are - Strategic Management Strategies, Leadership transitions and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Barrick Gold: Peter Munk's Leadership and Legacy casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models, wage bills are increasing,
increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Barrick Gold: Peter Munk's Leadership and Legacy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Barrick Gold: Peter Munk's Leadership and Legacy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Munk's Munk, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Munk's Munk 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 Barrick Gold: Peter Munk's Leadership and Legacy can be done for the following purposes –
1. Strategic planning using facts provided in Barrick Gold: Peter Munk's Leadership and Legacy case study
2. Improving business portfolio management of Munk's Munk
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Munk's Munk
Strengths Barrick Gold: Peter Munk's Leadership and Legacy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Munk's Munk in Barrick Gold: Peter Munk's Leadership and Legacy Harvard Business Review case study are -
Sustainable margins compare to other players in Strategy & Execution industry
– Barrick Gold: Peter Munk's Leadership and Legacy firm has clearly differentiated products in the market place. This has enabled Munk's Munk to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Munk's Munk to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Munk's Munk in the sector have low bargaining power. Barrick Gold: Peter Munk's Leadership and Legacy has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Munk's Munk to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Strategy & Execution field
– Munk's Munk is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Munk's Munk in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Munk's Munk is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Munk's Munk digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Munk's Munk 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.
Successful track record of launching new products
– Munk's Munk has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Munk's Munk 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.
Superior customer experience
– The customer experience strategy of Munk's Munk in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the Barrick Gold: Peter Munk's Leadership and Legacy Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Effective Research and Development (R&D)
– Munk's Munk has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Barrick Gold: Peter Munk's Leadership and Legacy - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Munk's Munk has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Analytics focus
– Munk's Munk 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 suggested by Cara C. Maurer, Graeme Kreindler can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Organizational Resilience of Munk's Munk
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Munk's Munk does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Barrick Gold: Peter Munk's Leadership and Legacy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Barrick Gold: Peter Munk's Leadership and Legacy are -
Increasing silos among functional specialists
– The organizational structure of Munk's Munk is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Munk's Munk needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Munk's Munk to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Barrick Gold: Peter Munk's Leadership and Legacy, in the dynamic environment Munk's Munk has struggled to respond to the nimble upstart competition. Munk's Munk has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study Barrick Gold: Peter Munk's Leadership and Legacy, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. 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.
Products dominated business model
– Even though Munk's Munk has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Barrick Gold: Peter Munk's Leadership and Legacy should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Munk's Munk 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Barrick Gold: Peter Munk's Leadership and Legacy, is just above the industry average. Munk's Munk 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.
Aligning sales with marketing
– It come across in the case study Barrick Gold: Peter Munk's Leadership and Legacy that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Barrick Gold: Peter Munk's Leadership and Legacy can leverage the sales team experience to cultivate customer relationships as Munk's Munk is planning to shift buying processes online.
Lack of clear differentiation of Munk's Munk products
– To increase the profitability and margins on the products, Munk's Munk needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Munk's Munk 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.
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 Munk's Munk supply chain. Even after few cautionary changes mentioned in the HBR case study - Barrick Gold: Peter Munk's Leadership and Legacy, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Munk's Munk vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Munk's Munk, firm in the HBR case study Barrick Gold: Peter Munk's Leadership and Legacy needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Barrick Gold: Peter Munk's Leadership and Legacy | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Barrick Gold: Peter Munk's Leadership and Legacy are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Munk's Munk in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Munk's Munk 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, as suggested in case study, Barrick Gold: Peter Munk's Leadership and Legacy, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Munk's Munk can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Barrick Gold: Peter Munk's Leadership and Legacy suggest that firm 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.
Creating value in data economy
– The success of analytics program of Munk's Munk has opened avenues for new revenue streams for the organization in the industry. This can help Munk's Munk to build a more holistic ecosystem as suggested in the Barrick Gold: Peter Munk's Leadership and Legacy case study. Munk's Munk can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Munk's Munk can develop new processes and procedures in Strategy & Execution 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Munk's Munk can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Munk's Munk 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.
Better consumer reach
– The expansion of the 5G network will help Munk's Munk to increase its market reach. Munk's Munk 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
– Munk's Munk 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.
Manufacturing automation
– Munk's Munk can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution segment. 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Munk's Munk is facing challenges because of the dominance of functional experts in the organization. Barrick Gold: Peter Munk's Leadership and Legacy case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Munk's Munk can use these opportunities to build new business models that can help the communities that Munk's Munk operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Munk's Munk 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.
Threats Barrick Gold: Peter Munk's Leadership and Legacy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Barrick Gold: Peter Munk's Leadership and Legacy are -
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Munk's Munk in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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 Munk's Munk business can come under increasing regulations regarding data privacy, data security, etc.
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. Munk's Munk 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.
Environmental challenges
– Munk's Munk 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. Munk's Munk can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Munk's Munk in the Strategy & Execution sector and impact the bottomline of the organization.
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.
High dependence on third party suppliers
– Munk's Munk 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.
Technology acceleration in Forth Industrial Revolution
– Munk's Munk has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Munk's Munk needs to keep up with the evolution of technology in the Strategy & Execution 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 in the industry are lowering. It can presents Munk's Munk with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Munk's Munk 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 the industry and other sectors.
Regulatory challenges
– Munk's Munk 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 Strategy & Execution industry regulations.
Increasing wage structure of Munk's Munk
– 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 Munk's Munk.
Weighted SWOT Analysis of Barrick Gold: Peter Munk's Leadership and Legacy Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Barrick Gold: Peter Munk's Leadership and Legacy 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 the case study Barrick Gold: Peter Munk's Leadership and Legacy 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 the Harvard case study Barrick Gold: Peter Munk's Leadership and Legacy 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 Barrick Gold: Peter Munk's Leadership and Legacy is 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 Munk's Munk needs to make to build a sustainable competitive advantage.