Africa Strategy of China Nonferrous Metal Mining Group SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Africa Strategy of China Nonferrous Metal Mining Group
Founded in 1983, China Nonferrous Metal Mining (Group) Co., Ltd. ("CNMC") is one of the earliest and largest global Chinese nonferrous metal industrial enterprises. It has investments and projects in 27 countries and trade networks in nearly 100 countries with a particular focus in Africa. CNMC has been exploiting mineral resources in Zambia since 1998, becoming one of the most important copper industry enterprises in the country. In 2013, CNMC was included in the Fortune Global 500 for the first time, ranking 482nd with operating revenues of 24 billion USD. In 2015, CNMC ranked 390th among the Fortune Global 500. CNMC has been actively committed to becoming a bellwether of "going global" among Chinese enterprises, making great contribution to Africa by promoting mutually beneficial cooperation. Confronted with intensifying competition in China and overseas, CNMC leaders look to the future and endeavor to further develop African businesses, to strengthen CNMC's overall competitiveness, and to fulfill sustainable development, on the basis of its international expansion strategy.
Authors :: F. Warren McFarlan, Jie Jiao, Dayong Yang, Shanshan Cao
Swot Analysis of "Africa Strategy of China Nonferrous Metal Mining Group" written by F. Warren McFarlan, Jie Jiao, Dayong Yang, Shanshan Cao includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cnmc Nonferrous facing as an external strategic factors. Some of the topics covered in Africa Strategy of China Nonferrous Metal Mining Group case study are - Strategic Management Strategies, Globalization and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Africa Strategy of China Nonferrous Metal Mining Group casestudy better are - – technology disruption, digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%, central banks are concerned over increasing inflation, there is backlash against globalization, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion,
challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Africa Strategy of China Nonferrous Metal Mining Group
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Africa Strategy of China Nonferrous Metal Mining Group case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cnmc Nonferrous, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cnmc Nonferrous 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 Africa Strategy of China Nonferrous Metal Mining Group can be done for the following purposes –
1. Strategic planning using facts provided in Africa Strategy of China Nonferrous Metal Mining Group case study
2. Improving business portfolio management of Cnmc Nonferrous
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 Cnmc Nonferrous
Strengths Africa Strategy of China Nonferrous Metal Mining Group | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cnmc Nonferrous in Africa Strategy of China Nonferrous Metal Mining Group Harvard Business Review case study are -
Effective Research and Development (R&D)
– Cnmc Nonferrous 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 Africa Strategy of China Nonferrous Metal Mining Group - 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
– Cnmc Nonferrous is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Strategy & Execution industry
– Africa Strategy of China Nonferrous Metal Mining Group firm has clearly differentiated products in the market place. This has enabled Cnmc Nonferrous to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Cnmc Nonferrous to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Cnmc Nonferrous 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Cnmc Nonferrous digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cnmc Nonferrous 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.
Learning organization
- Cnmc Nonferrous 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 Cnmc Nonferrous is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Africa Strategy of China Nonferrous Metal Mining Group Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Cnmc Nonferrous in the sector have low bargaining power. Africa Strategy of China Nonferrous Metal Mining Group has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cnmc Nonferrous to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Cnmc Nonferrous in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Cnmc Nonferrous
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cnmc Nonferrous does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the Africa Strategy of China Nonferrous Metal Mining Group 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.
Cross disciplinary teams
– Horizontal connected teams at the Cnmc Nonferrous 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.
Innovation driven organization
– Cnmc Nonferrous is one of the most innovative firm in sector. Manager in Africa Strategy of China Nonferrous Metal Mining Group Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Africa Strategy of China Nonferrous Metal Mining Group | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Africa Strategy of China Nonferrous Metal Mining Group are -
Interest costs
– Compare to the competition, Cnmc Nonferrous 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.
Aligning sales with marketing
– It come across in the case study Africa Strategy of China Nonferrous Metal Mining Group 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 Africa Strategy of China Nonferrous Metal Mining Group can leverage the sales team experience to cultivate customer relationships as Cnmc Nonferrous is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Cnmc Nonferrous is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Cnmc Nonferrous needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cnmc Nonferrous to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Cnmc Nonferrous has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
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 Cnmc Nonferrous supply chain. Even after few cautionary changes mentioned in the HBR case study - Africa Strategy of China Nonferrous Metal Mining Group, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cnmc Nonferrous vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Cnmc Nonferrous, firm in the HBR case study Africa Strategy of China Nonferrous Metal Mining Group needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cnmc Nonferrous is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Africa Strategy of China Nonferrous Metal Mining Group can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Cnmc Nonferrous needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Lack of clear differentiation of Cnmc Nonferrous products
– To increase the profitability and margins on the products, Cnmc Nonferrous needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Cnmc Nonferrous has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Products dominated business model
– Even though Cnmc Nonferrous 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 - Africa Strategy of China Nonferrous Metal Mining Group should strive to include more intangible value offerings along with its core products and services.
Opportunities Africa Strategy of China Nonferrous Metal Mining Group | 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 Africa Strategy of China Nonferrous Metal Mining Group are -
Better consumer reach
– The expansion of the 5G network will help Cnmc Nonferrous to increase its market reach. Cnmc Nonferrous 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.
Loyalty marketing
– Cnmc Nonferrous 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Cnmc Nonferrous can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Cnmc Nonferrous can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Africa Strategy of China Nonferrous Metal Mining Group 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cnmc Nonferrous 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cnmc Nonferrous 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, Africa Strategy of China Nonferrous Metal Mining Group, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Cnmc Nonferrous 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Cnmc Nonferrous 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. Cnmc Nonferrous 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.
Building a culture of innovation
– managers at Cnmc Nonferrous 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 Strategy & Execution segment.
Using analytics as competitive advantage
– Cnmc Nonferrous has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Africa Strategy of China Nonferrous Metal Mining Group - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cnmc Nonferrous to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Cnmc Nonferrous 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Cnmc Nonferrous in the consumer business. Now Cnmc Nonferrous can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cnmc Nonferrous can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Africa Strategy of China Nonferrous Metal Mining Group External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Africa Strategy of China Nonferrous Metal Mining Group are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cnmc Nonferrous 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.
Regulatory challenges
– Cnmc Nonferrous 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.
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 Cnmc Nonferrous.
Environmental challenges
– Cnmc Nonferrous 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. Cnmc Nonferrous can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Increasing wage structure of Cnmc Nonferrous
– 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 Cnmc Nonferrous.
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 Cnmc Nonferrous business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cnmc Nonferrous with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Cnmc Nonferrous 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.
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. Cnmc Nonferrous needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Cnmc Nonferrous 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.
Shortening product life cycle
– it is one of the major threat that Cnmc Nonferrous is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Cnmc Nonferrous 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.
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.
Weighted SWOT Analysis of Africa Strategy of China Nonferrous Metal Mining Group 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 Africa Strategy of China Nonferrous Metal Mining Group 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 Africa Strategy of China Nonferrous Metal Mining Group 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 Africa Strategy of China Nonferrous Metal Mining Group 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 Africa Strategy of China Nonferrous Metal Mining Group 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 Cnmc Nonferrous needs to make to build a sustainable competitive advantage.
