Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past

Over the past several decades, rapid growth in Chinese investment and trade has created for Africa a new development partner. China represents an alternative to U.S. and European nations whose past imperialism, resource avarice, and economic dictates-through the conditionality of IMF and World Bank lending-remain a negative legacy. This case uses the story of Zambia's Chambishi copper mine, which was purchased in 1998 by the state-owned China Non-Ferrous Metals Mining Corporation, to illustrate China's growing interest and involvement in the African continent. While many in Africa welcome the substantial Chinese investment, resentment over labor abuses, low pay, and substandard working conditions at some Chinese-owned enterprises fuels anti-China sentiment. At Chambishi copper mine, a 2005 explosion, caused by management's shoddy adherence to safety standards, killed nearly 50 miners and sparked outrage among Zambians. The explosion marked the first in a long series of protests and safety violations that would unfold at Chambishi over the next ten years.

Authors :: Rafael Di Tella, Vincent Pons, Sarah Mehta, David Lane

Topics :: Global Business

Tags :: Corporate governance, Economics, Emerging markets, Labor, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past" written by Rafael Di Tella, Vincent Pons, Sarah Mehta, David Lane includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Chambishi Zambia's facing as an external strategic factors. Some of the topics covered in Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past case study are - Strategic Management Strategies, Corporate governance, Economics, Emerging markets, Labor and Global Business.

Some of the macro environment factors that can be used to understand the Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past casestudy better are - – technology disruption, cloud computing is disrupting traditional business models, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, there is backlash against globalization, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, etc

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Introduction to SWOT Analysis of Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Chambishi Zambia's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Chambishi Zambia's 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past can be done for the following purposes –
1. Strategic planning using facts provided in Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past case study
2. Improving business portfolio management of Chambishi Zambia's
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Chambishi Zambia's

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Strengths Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Chambishi Zambia's in Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past Harvard Business Review case study are -

Organizational Resilience of Chambishi Zambia's

– The covid-19 pandemic has put organizational resilience at the centre of everthing that Chambishi Zambia's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Cross disciplinary teams

– Horizontal connected teams at the Chambishi Zambia's 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.

High brand equity

– Chambishi Zambia's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Chambishi Zambia's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Analytics focus

– Chambishi Zambia's 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 Rafael Di Tella, Vincent Pons, Sarah Mehta, David Lane 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.

Diverse revenue streams

– Chambishi Zambia's is present in almost all the verticals within the industry. This has provided firm in Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.

Sustainable margins compare to other players in Global Business industry

– Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past firm has clearly differentiated products in the market place. This has enabled Chambishi Zambia's to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Chambishi Zambia's to invest into research and development (R&D) and innovation.

Highly skilled collaborators

– Chambishi Zambia's has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

Learning organization

- Chambishi Zambia's 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 Chambishi Zambia's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Superior customer experience

– The customer experience strategy of Chambishi Zambia's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Innovation driven organization

– Chambishi Zambia's is one of the most innovative firm in sector. Manager in Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

Training and development

– Chambishi Zambia's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.

High switching costs

– The high switching costs that Chambishi Zambia's 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.

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Weaknesses Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past are -

No frontier risks strategy

– After analyzing the HBR case study Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past, it seems that company is thinking about the frontier risks that can impact Global Business 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.

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 Chambishi Zambia's supply chain. Even after few cautionary changes mentioned in the HBR case study - Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Chambishi Zambia's vulnerable to further global disruptions in South East Asia.

Low market penetration in new markets

– Outside its home market of Chambishi Zambia's, firm in the HBR case study Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past, it seems that the employees of Chambishi Zambia's don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.

Need for greater diversity

– Chambishi Zambia's 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.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past, in the dynamic environment Chambishi Zambia's has struggled to respond to the nimble upstart competition. Chambishi Zambia's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Slow decision making process

– As mentioned earlier in the report, Chambishi Zambia's has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Chambishi Zambia's even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.

High cash cycle compare to competitors

Chambishi Zambia's 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.

Increasing silos among functional specialists

– The organizational structure of Chambishi Zambia's is dominated by functional specialists. It is not different from other players in the Global Business segment. Chambishi Zambia's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Chambishi Zambia's to focus more on services rather than just following the product oriented approach.

Compensation and incentives

– The revenue per employee as mentioned in the HBR case study Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past, is just above the industry average. Chambishi Zambia's 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.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Chambishi Zambia's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

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Opportunities Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past | 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 Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past are -

Low interest rates

– Even though inflation is raising its head in most developed economies, Chambishi Zambia's 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Chambishi Zambia's can use these opportunities to build new business models that can help the communities that Chambishi Zambia's operates in. Secondly it can use opportunities from government spending in Global Business sector.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Chambishi Zambia's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Manufacturing automation

– Chambishi Zambia's can use the latest technology developments to improve its manufacturing and designing process in Global Business 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.

Developing new processes and practices

– Chambishi Zambia's can develop new processes and procedures in Global Business 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Chambishi Zambia's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.

Changes in consumer behavior post Covid-19

– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Chambishi Zambia's 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. Chambishi Zambia's 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.

Identify volunteer opportunities

– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Chambishi Zambia's can explore opportunities that can attract volunteers and are consistent with its mission and vision.

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 Chambishi Zambia's in the consumer business. Now Chambishi Zambia's can target international markets with far fewer capital restrictions requirements than the existing system.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Chambishi Zambia's 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, Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Creating value in data economy

– The success of analytics program of Chambishi Zambia's has opened avenues for new revenue streams for the organization in the industry. This can help Chambishi Zambia's to build a more holistic ecosystem as suggested in the Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past case study. Chambishi Zambia's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Chambishi Zambia's is facing challenges because of the dominance of functional experts in the organization. Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past 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.

Learning at scale

– Online learning technologies has now opened space for Chambishi Zambia's to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.

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Threats Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past are -

Technology acceleration in Forth Industrial Revolution

– Chambishi Zambia's has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Chambishi Zambia's needs to keep up with the evolution of technology in the Global Business 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.

Increasing wage structure of Chambishi Zambia's

– 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 Chambishi Zambia's.

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. Chambishi Zambia's 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.

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 Chambishi Zambia's business can come under increasing regulations regarding data privacy, data security, etc.

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.

Easy access to finance

– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Chambishi Zambia's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Chambishi Zambia's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

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 Chambishi Zambia's.

Regulatory challenges

– Chambishi Zambia's 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 Global Business industry regulations.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Chambishi Zambia's in the Global Business industry. The Global Business 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.

High dependence on third party suppliers

– Chambishi Zambia's 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.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past, Chambishi Zambia's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .

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.

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Weighted SWOT Analysis of Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past 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 Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past 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 Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past 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 Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past 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 Goodbye IMF Conditions, Hello Chinese Capital: Zambia's Copper Industry and Africa's Break with Its Colonial Past 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 Chambishi Zambia's needs to make to build a sustainable competitive advantage.

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