Based on various researches at Oak Spring University , AngloGold Ashanti ADR is operating in a macro-environment that has been destablized by – geopolitical disruptions, wage bills are increasing, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices,
technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of AngloGold Ashanti ADR
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that AngloGold Ashanti ADR can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the AngloGold Ashanti ADR, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which AngloGold Ashanti ADR 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 AngloGold Ashanti ADR can be done for the following purposes –
1. Strategic planning of AngloGold Ashanti ADR
2. Improving business portfolio management of AngloGold Ashanti ADR
3. Assessing feasibility of the new initiative in United States
4. Making a Gold & Silver sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of AngloGold Ashanti ADR
Strengths of AngloGold Ashanti ADR | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of AngloGold Ashanti ADR are -
Strong track record of project management in the Gold & Silver industry
– AngloGold Ashanti ADR is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– AngloGold Ashanti ADR is one of the leading players in the Gold & Silver industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Gold & Silver
– AngloGold Ashanti ADR is one of the leading players in the Gold & Silver industry in United States. Over the years it has not only transformed the business landscape in the Gold & Silver industry in United States but also across the existing markets. The ability to lead change has enabled AngloGold Ashanti ADR in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– AngloGold Ashanti ADR 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 Gold & Silver industry. The technology infrastructure of United States is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
High switching costs
– The high switching costs that AngloGold Ashanti ADR 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.
Training and development
– AngloGold Ashanti ADR 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.
Effective Research and Development (R&D)
– AngloGold Ashanti ADR has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – AngloGold Ashanti ADR staying ahead in the Gold & Silver industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– AngloGold Ashanti ADR is present in almost all the verticals within the Gold & Silver industry. This has provided AngloGold Ashanti ADR 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.
High brand equity
– AngloGold Ashanti ADR has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled AngloGold Ashanti ADR to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy of AngloGold Ashanti ADR comprises – understanding the underlying the factors in the Gold & Silver 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.
Successful track record of launching new products
– AngloGold Ashanti ADR has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. AngloGold Ashanti ADR 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.
Digital Transformation in Gold & Silver industry
- digital transformation varies from industry to industry. For AngloGold Ashanti ADR digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. AngloGold Ashanti ADR 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.
Weaknesses of AngloGold Ashanti ADR | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of AngloGold Ashanti ADR are -
Compensation and incentives
– The revenue per employee of AngloGold Ashanti ADR is just above the Gold & Silver 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.
Need for greater diversity
– AngloGold Ashanti ADR 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.
Increasing silos among functional specialists
– The organizational structure of AngloGold Ashanti ADR is dominated by functional specialists. It is not different from other players in the Gold & Silver industry, but AngloGold Ashanti ADR needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help AngloGold Ashanti ADR to focus more on services in the Gold & Silver industry rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of United States, AngloGold Ashanti ADR needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– From the outside it seems that AngloGold Ashanti ADR needs to have more collaboration between its sales team and marketing team. Sales professionals in the Gold & Silver industry have deep experience in developing customer relationships. Marketing department at AngloGold Ashanti ADR can leverage the sales team experience to cultivate customer relationships as AngloGold Ashanti ADR is planning to shift buying processes online.
High bargaining power of channel partners in Gold & Silver industry
– because of the regulatory requirements in United States, AngloGold Ashanti ADR 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 Gold & Silver industry.
Ability to respond to the competition
– As the decision making is very deliberative at AngloGold Ashanti ADR, in the dynamic environment of Gold & Silver industry it has struggled to respond to the nimble upstart competition. AngloGold Ashanti ADR has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on AngloGold Ashanti ADR ‘s star products
– The top 2 products and services of AngloGold Ashanti ADR still accounts for major business revenue. This dependence on star products in Gold & Silver industry has resulted into insufficient focus on developing new products, even though AngloGold Ashanti ADR has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, AngloGold Ashanti ADR has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Gold & Silver industry over the last five years. AngloGold Ashanti ADR 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 operating costs
– Compare to the competitors, AngloGold Ashanti ADR has high operating costs in the Gold & Silver industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract AngloGold Ashanti ADR lucrative customers.
Products dominated business model
– Even though AngloGold Ashanti ADR has some of the most successful models in the Gold & Silver industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. AngloGold Ashanti ADR should strive to include more intangible value offerings along with its core products and services.
AngloGold Ashanti ADR Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of AngloGold Ashanti ADR are -
Developing new processes and practices
– AngloGold Ashanti ADR can develop new processes and procedures in Gold & Silver 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, AngloGold Ashanti ADR 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.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Gold & Silver industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. AngloGold Ashanti ADR 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. AngloGold Ashanti ADR 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, AngloGold Ashanti ADR can use these opportunities to build new business models that can help the communities that AngloGold Ashanti ADR operates in. Secondly it can use opportunities from government spending in Gold & Silver sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects AngloGold Ashanti ADR can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions in Gold & Silver industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for AngloGold Ashanti ADR in the Gold & Silver industry. Now AngloGold Ashanti ADR can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– AngloGold Ashanti ADR can use the latest technology developments to improve its manufacturing and designing process in Gold & Silver 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.
Better consumer reach
– The expansion of the 5G network will help AngloGold Ashanti ADR to increase its market reach. AngloGold Ashanti ADR 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for AngloGold Ashanti ADR to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for AngloGold Ashanti ADR to hire the very best people irrespective of their geographical location.
Buying journey improvements
– AngloGold Ashanti ADR can improve the customer journey of consumers in the Gold & Silver 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.
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 AngloGold Ashanti ADR 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.
Loyalty marketing
– AngloGold Ashanti ADR 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.
Building a culture of innovation
– managers at AngloGold Ashanti ADR 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 Gold & Silver industry.
Threats AngloGold Ashanti ADR External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of AngloGold Ashanti ADR are -
Easy access to finance
– Easy access to finance in Gold & Silver industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. AngloGold Ashanti ADR can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, AngloGold Ashanti ADR may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Gold & Silver sector.
Increasing wage structure of AngloGold Ashanti ADR
– 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 AngloGold Ashanti ADR.
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.
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 AngloGold Ashanti ADR.
High dependence on third party suppliers
– AngloGold Ashanti ADR 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.
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. AngloGold Ashanti ADR 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.
Consumer confidence and its impact on AngloGold Ashanti ADR 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 Gold & Silver industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Gold & Silver industry are lowering. It can presents AngloGold Ashanti ADR with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Gold & Silver sector.
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.
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. AngloGold Ashanti ADR needs to understand the core reasons impacting the Gold & Silver industry. This will help it in building a better workplace.
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 AngloGold Ashanti ADR business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– AngloGold Ashanti ADR 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. AngloGold Ashanti ADR can take advantage of this fund but it will also bring new competitors in the Gold & Silver industry.
Weighted SWOT Analysis of AngloGold Ashanti ADR Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at AngloGold Ashanti ADR 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 AngloGold Ashanti ADR 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 AngloGold Ashanti ADR 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 AngloGold Ashanti ADR 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 AngloGold Ashanti ADR needs to make to build a sustainable competitive advantage.
