de beers

DE BEERS

De Beers

Strategic situational analysis

For De Beers, the strategic analysis comprise of PEST analysis. They comprise of a complete environmental scan for external forces acting upon De Beers, they are discussed as under,

Political

The political forces comprise of changes endorsed by the regulations imposed by the government, as well as, their effects upon the business. The political forces acting in case, are discussed as under;

The formation of new countries due to the breaking of Soviet Union led De Beers to termination of the contracts with the suppliers in the former Soviet Union.

Countries forcing local polishers to work for the diamond producers inside the country hindering De Beers

The shift of political focus to capitalize upon their diamond resources while giving stakes to their local people, rather than, De Beers.

The business was accused of being a part of Blood Diamonds', thereby, damaging it public relationing with the legal authorities in the African continent.

Economic

The economic forces comprise of the environment of the business, they are discussed as under;

The changes that are induced in the economic dynamics of the countries where De Beers works.

The acquisition of the Global diamond went down, since there were local polishers and the miners that had to get into a business partnership due to the laws being induced

The supply side strategy looked way complex, since the local polishers were capable of supplying the same quality diamond in a larger quantity at a lower price

Greater number of synthetic diamonds being produced, and therefore, a large number falling beyond the supply control and demand control of De Beers.

Social

The changes occurring in the society, as well as, people when it comes to consuming diamonds comprise of social parameter that are discussed below;

There was a large demand for synthetic diamonds

The changes taking place in the preferences of people using synthetic diamonds including wide acceptance

Technological

The changes and forces that concern the production and use of diamond in terms of scientific advancements, they are discussed as under;

New processes for production of lab-grown diamonds

Processing faculties being installed and managed by the local people (Reavis, & McAdams, 2008).

The De Beers Strategy

Due to the situation discussed in the section above, De Beers was undergoing a colossal deal of problems that are discussed as under;

The tendency of the largest diamond producing countries to build local diamond industries hindered the production of De Beers by cutting the demand for its diamond, as well as, the supply of its diamond.

The termination of contracts due to the formation of independent states and territories in the second half of nineteenth century, such as, the termination of the contracts made with the Russian Government were terminated

The Australian diamond mines, deciding to sell diamonds for polishing and processing to their local polishers, thereby, cutting the supply to De Beers, as well as, the demand for the diamond produced under De Beers Tag

The emergence of Canada as a colossal diamond industry, whereas, focusing the local diamond manufacturers since De Beers had ...