Based on various researches at Oak Spring University , Globe Metals & Mining is operating in a macro-environment that has been destablized by – wage bills are increasing, increasing household debt because of falling income levels, central banks are concerned over increasing inflation, there is backlash against globalization, there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs,
increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Globe Metals & Mining
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Globe Metals & Mining can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Globe Metals & Mining, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Globe Metals & Mining 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 Globe Metals & Mining can be done for the following purposes –
1. Strategic planning of Globe Metals & Mining
2. Improving business portfolio management of Globe Metals & Mining
3. Assessing feasibility of the new initiative in Australia
4. Making a Metal Mining sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Globe Metals & Mining
Strengths of Globe Metals & Mining | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Globe Metals & Mining are -
Strong track record of project management in the Metal Mining industry
– Globe Metals & Mining is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Globe Metals & Mining has one of the best training and development program in Basic Materials industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Digital Transformation in Metal Mining industry
- digital transformation varies from industry to industry. For Globe Metals & Mining digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Globe Metals & Mining 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.
Effective Research and Development (R&D)
– Globe Metals & Mining has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Globe Metals & Mining staying ahead in the Metal Mining industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Globe Metals & Mining is one of the most innovative firm in Metal Mining sector.
Diverse revenue streams
– Globe Metals & Mining is present in almost all the verticals within the Metal Mining industry. This has provided Globe Metals & Mining 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.
Successful track record of launching new products
– Globe Metals & Mining has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Globe Metals & Mining 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.
Operational resilience
– The operational resilience strategy of Globe Metals & Mining comprises – understanding the underlying the factors in the Metal Mining 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.
Ability to lead change in Metal Mining
– Globe Metals & Mining is one of the leading players in the Metal Mining industry in Australia. Over the years it has not only transformed the business landscape in the Metal Mining industry in Australia but also across the existing markets. The ability to lead change has enabled Globe Metals & Mining in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Metal Mining industry
– Globe Metals & Mining has clearly differentiated products in the market place. This has enabled Globe Metals & Mining to fetch slight price premium compare to the competitors in the Metal Mining industry. The sustainable margins have also helped Globe Metals & Mining to invest into research and development (R&D) and innovation.
Organizational Resilience of Globe Metals & Mining
– The covid-19 pandemic has put organizational resilience at the centre of everthing Globe Metals & Mining does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Globe Metals & Mining has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Metal Mining industry. Secondly the value chain collaborators of Globe Metals & Mining have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses of Globe Metals & Mining | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Globe Metals & Mining are -
Slow to strategic competitive environment developments
– As Globe Metals & Mining is one of the leading players in the Metal Mining industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Metal Mining industry in last five years.
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 Globe Metals & Mining supply chain. Even after few cautionary changes, Globe Metals & Mining is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Globe Metals & Mining vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Globe Metals & Mining products
– To increase the profitability and margins on the products, Globe Metals & Mining needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Globe Metals & Mining 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 Metal Mining industry using digital technology.
High bargaining power of channel partners in Metal Mining industry
– because of the regulatory requirements in Australia, Globe Metals & Mining is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the Metal Mining industry.
High dependence on Globe Metals & Mining ‘s star products
– The top 2 products and services of Globe Metals & Mining still accounts for major business revenue. This dependence on star products in Metal Mining industry has resulted into insufficient focus on developing new products, even though Globe Metals & Mining has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee of Globe Metals & Mining is just above the Metal Mining industry average. It 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
– From the outside it seems that Globe Metals & Mining needs to have more collaboration between its sales team and marketing team. Sales professionals in the Metal Mining industry have deep experience in developing customer relationships. Marketing department at Globe Metals & Mining can leverage the sales team experience to cultivate customer relationships as Globe Metals & Mining is planning to shift buying processes online.
Interest costs
– Compare to the competition, Globe Metals & Mining 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.
Increasing silos among functional specialists
– The organizational structure of Globe Metals & Mining is dominated by functional specialists. It is not different from other players in the Metal Mining industry, but Globe Metals & Mining needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Globe Metals & Mining to focus more on services in the Metal Mining industry rather than just following the product oriented approach.
No frontier risks strategy
– From the 10K / annual statement of Globe Metals & Mining, it seems that company is thinking out the frontier risks that can impact Metal Mining industry. 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.
Globe Metals & Mining Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Globe Metals & Mining are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Metal Mining industry, but it has also influenced the consumer preferences. Globe Metals & Mining can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Globe Metals & Mining in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Metal Mining industry, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Globe Metals & Mining 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 Metal Mining industry.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Globe Metals & Mining to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Learning at scale
– Online learning technologies has now opened space for Globe Metals & Mining 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Globe Metals & Mining 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.
Buying journey improvements
– Globe Metals & Mining can improve the customer journey of consumers in the Metal Mining industry by using analytics and artificial intelligence. It 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Globe Metals & Mining can use these opportunities to build new business models that can help the communities that Globe Metals & Mining operates in. Secondly it can use opportunities from government spending in Metal Mining sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Globe Metals & Mining can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Globe Metals & Mining has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Metal Mining sector. This continuous investment in analytics has enabled Globe Metals & Mining to build a competitive advantage using analytics. The analytics driven competitive advantage can help Globe Metals & Mining to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Globe Metals & Mining can develop new processes and procedures in Metal Mining 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.
Leveraging digital technologies
– Globe Metals & Mining 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
– Globe Metals & Mining can use the latest technology developments to improve its manufacturing and designing process in Metal Mining sector. 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.
Threats Globe Metals & Mining External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Globe Metals & Mining are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Globe Metals & Mining may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Metal Mining sector.
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. Globe Metals & Mining needs to understand the core reasons impacting the Metal Mining industry. This will help it in building a better workplace.
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. Globe Metals & Mining 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Globe Metals & Mining in Metal Mining industry. The Metal Mining 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.
Stagnating economy with rate increase
– Globe Metals & Mining can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the Metal Mining industry.
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 Globe Metals & Mining business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Globe Metals & Mining 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 Metal Mining industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Globe Metals & Mining can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate Globe Metals & Mining prominent markets.
High dependence on third party suppliers
– Globe Metals & Mining 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.
Easy access to finance
– Easy access to finance in Metal Mining industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Globe Metals & Mining can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Globe Metals & Mining 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. Globe Metals & Mining can take advantage of this fund but it will also bring new competitors in the Metal Mining industry.
Consumer confidence and its impact on Globe Metals & Mining 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 Metal Mining industry and other sectors.
Shortening product life cycle
– it is one of the major threat that Globe Metals & Mining is facing in Metal Mining sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Globe Metals & Mining Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Globe Metals & Mining 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 Globe Metals & Mining 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 Globe Metals & Mining 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 Globe Metals & Mining 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 Globe Metals & Mining needs to make to build a sustainable competitive advantage.