Nature of the Thai Gems & Jewelry Business Activity: Micro-Analysis for Competitive Capability Development

Abstract

            Gems and jewelry have always been on the top of the Thai export list while 73% of its GDP derived from this source of income. There has been 5 pieces of researches over the last 13 years studying on recommending strategies for the industry capability development. All of them had employed macro-analysis, then reported the total situation and the general atmosphere of the industry and recommended strategies as antidotes to what the industry lacked or to resolve threats. The macro analysis approach can mislead the readers. This research offers a new perspective by combining micro-analysis of the industry business activities explaining why various phenomena have occurred to offer a new set of strategies more precisely for the industry. This research paradigm is constructivist with qualitative research design using phenomenological research strategy by in-depth interviews and document study for data enquiry. Seven industry experts who are from 4 main industry segments were selected to participate in the study. The 5 research papers were thoroughly analyzed either in the form of the SWOT analysis on the local industry or the world industry settings. Findings from this research can update the industry database. This study uncovered that the majority of the industry members are SMEs and their business activities are Operating Exclusive Manufacturing (OEM) and are a subcontractor. Upon the strategic formulation, the TOWS matrix,(a reverse abbreviation of SWOT, the term stands for Threat, Opportunity, Weakness and Strength) revealed strategic direction suggesting Thailand to a become free-port trading nation for gems, the centralized government should be an organ to supervise the industry. Secondly, positioning analysis from the world market structure is suggesting that the world industry is a fragmented market. The study recommends a set of 5 strategies basing on Thomson and Strickland(2001). These strategies were triangulated with the participants’ recommendations. In retrospect, the government is always a main player in the industry and its role is to enhance the industry competitive capability development at the same time as managing the economy.