KGHM Polska Miedz (0O8D) SWOT Analysis / TOWS Matrix / MBA Resources
Metal Mining
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for KGHM Polska Miedz (United Kingdom)
Based on various researches at Oak Spring University , KGHM Polska Miedz is operating in a macro-environment that has been destablized by – competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, increasing energy prices, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization,
increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, etc
Introduction to SWOT Analysis of KGHM Polska Miedz
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that KGHM Polska Miedz can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the KGHM Polska Miedz, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which KGHM Polska Miedz 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 KGHM Polska Miedz can be done for the following purposes –
1. Strategic planning of KGHM Polska Miedz
2. Improving business portfolio management of KGHM Polska Miedz
3. Assessing feasibility of the new initiative in United Kingdom
4. Making a Metal Mining sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of KGHM Polska Miedz
Strengths of KGHM Polska Miedz | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of KGHM Polska Miedz are -
Innovation driven organization
– KGHM Polska Miedz is one of the most innovative firm in Metal Mining sector.
Training and development
– KGHM Polska Miedz 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.
Sustainable margins compare to other players in Metal Mining industry
– KGHM Polska Miedz has clearly differentiated products in the market place. This has enabled KGHM Polska Miedz to fetch slight price premium compare to the competitors in the Metal Mining industry. The sustainable margins have also helped KGHM Polska Miedz to invest into research and development (R&D) and innovation.
Digital Transformation in Metal Mining industry
- digital transformation varies from industry to industry. For KGHM Polska Miedz digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. KGHM Polska Miedz 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.
Low bargaining power of suppliers
– Suppliers of KGHM Polska Miedz in the Basic Materials sector have low bargaining power. KGHM Polska Miedz has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps KGHM Polska Miedz to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– KGHM Polska Miedz has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled KGHM Polska Miedz to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Metal Mining
– KGHM Polska Miedz is one of the leading players in the Metal Mining industry in United Kingdom. Over the years it has not only transformed the business landscape in the Metal Mining industry in United Kingdom but also across the existing markets. The ability to lead change has enabled KGHM Polska Miedz in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– KGHM Polska Miedz 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 KGHM Polska Miedz have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- KGHM Polska Miedz 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 KGHM Polska Miedz is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at KGHM Polska Miedz emphasize – knowledge, initiative, and innovation.
Organizational Resilience of KGHM Polska Miedz
– The covid-19 pandemic has put organizational resilience at the centre of everthing KGHM Polska Miedz does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– KGHM Polska Miedz is one of the leading players in the Metal Mining industry in United Kingdom. It is in a position to attract the best talent available in United Kingdom. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management in the Metal Mining industry
– KGHM Polska Miedz is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses of KGHM Polska Miedz | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of KGHM Polska Miedz are -
No frontier risks strategy
– From the 10K / annual statement of KGHM Polska Miedz, 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.
Slow to strategic competitive environment developments
– As KGHM Polska Miedz 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.
Interest costs
– Compare to the competition, KGHM Polska Miedz 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.
Products dominated business model
– Even though KGHM Polska Miedz has some of the most successful models in the Metal Mining industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. KGHM Polska Miedz should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
KGHM Polska Miedz has a high cash cycle compare to other players in the Metal Mining industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High operating costs
– Compare to the competitors, KGHM Polska Miedz has high operating costs in the Metal Mining industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract KGHM Polska Miedz lucrative customers.
Low market penetration in new markets
– Outside its home market of United Kingdom, KGHM Polska Miedz needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– KGHM Polska Miedz 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.
High bargaining power of channel partners in Metal Mining industry
– because of the regulatory requirements in United Kingdom, KGHM Polska Miedz 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.
Compensation and incentives
– The revenue per employee of KGHM Polska Miedz 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.
Capital Spending Reduction
– Even during the low interest decade, KGHM Polska Miedz 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.
KGHM Polska Miedz Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of KGHM Polska Miedz are -
Leveraging digital technologies
– KGHM Polska Miedz 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
– KGHM Polska Miedz 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.
Using analytics as competitive advantage
– KGHM Polska Miedz 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 KGHM Polska Miedz to build a competitive advantage using analytics. The analytics driven competitive advantage can help KGHM Polska Miedz to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 KGHM Polska Miedz 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, KGHM Polska Miedz is facing challenges because of the dominance of functional experts in the organization. KGHM Polska Miedz can utilize new technology in the field of Metal Mining industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
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. KGHM Polska Miedz can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Use of Bitcoin and other crypto currencies for transactions in Metal Mining industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for KGHM Polska Miedz in the Metal Mining industry. Now KGHM Polska Miedz can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at KGHM Polska Miedz 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.
Creating value in data economy
– The success of analytics program of KGHM Polska Miedz has opened avenues for new revenue streams for the organization in Metal Mining industry. This can help KGHM Polska Miedz to build a more holistic ecosystem for KGHM Polska Miedz products in the Metal Mining industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– KGHM Polska Miedz 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 KGHM Polska Miedz to increase its market reach. KGHM Polska Miedz 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for KGHM Polska Miedz 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.
Developing new processes and practices
– KGHM Polska Miedz 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.
Threats KGHM Polska Miedz External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of KGHM Polska Miedz 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.
Regulatory challenges
– KGHM Polska Miedz 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.
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
– KGHM Polska Miedz 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.
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 KGHM Polska Miedz business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that KGHM Polska Miedz is facing in Metal Mining sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– KGHM Polska Miedz has witnessed rapid integration of technology during Covid-19 in the Metal Mining industry. As one of the leading players in the industry, KGHM Polska Miedz needs to keep up with the evolution of technology in the Metal Mining 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, KGHM Polska Miedz 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 KGHM Polska Miedz prominent markets.
Environmental challenges
– KGHM Polska Miedz 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. KGHM Polska Miedz can take advantage of this fund but it will also bring new competitors in the Metal Mining 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 KGHM Polska Miedz in the Metal Mining sector and impact the bottomline of the organization.
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. KGHM Polska Miedz needs to understand the core reasons impacting the Metal Mining industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for KGHM Polska Miedz 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.
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. KGHM Polska Miedz can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of KGHM Polska Miedz Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at KGHM Polska Miedz 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 KGHM Polska Miedz 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 KGHM Polska Miedz 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 KGHM Polska Miedz 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 KGHM Polska Miedz needs to make to build a sustainable competitive advantage.
