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Task 1 

Research what strategies has been deployed by the comp any, and explain How? Why?

  • Research areas
  • Mission, vision, core competences
  • Successful Strategies deployed in the past
  • Current strategies

There have been many criticisms of the business practices that company h as pursued in recent years. Describe TWO of these controversies and outli ne the outcomes.

  • Focus on the past strategies / tactics which were criticised

The criticisms may comes from various stake holders, such as competitors, employees, customers, suppliers, communi ties and others, media journalist, industry experts, academi c professionals etc. 

Perform an environmental analysis for the involvement of the organisatio n in the context of the industry, it operates in – what are the main opport unities & threats?

  • Analysis Tools
  • General Environments (PESTEL) analysis
  • Specific Environments analysis
  • Porter’s five force analysis
  • Resource Based Model analysis
  • SWOT

Describe the organisational culture or leadership style wi thin the organisation.

  • Research areas
  • Core values/ competencies of the company
  • CEOs who inspired the employees, developed / implem ented the strategies successfully and created the compan y’s unique culture.

BHP's Strategies for Sustainable Value

BHP is one of the multinational metals, mining along with petroleum dual listed public organization which is headquartered in Melbourne, Victoria situated in Australia (Bhp.com, 2018). The revenue which has been earned by the company was US$38.285 billion till the year 2017 and the number of employees working in the organization are 65000 till the year 2017 and the areas served by the company is the entire worldwide.

Mission, vision, core competences

The main mission of the company BHP is to the organization of the choice of the different customers. The main aim is to create sustainable value for the different shareholders, employees, business partners along with the host communities. Furthermore, the main vision of the respective company BHP is to aspire for causing zero harm to the different individuals along with the host communities along with the environment as this will help them in striving to achieve leading industry kind of practice in the entire market. Moreover, the different kinds of core competencies of the firm are to outlining the different strategies to grow value and this will help the company in gaining competitive advantage in the market as well. The operating model will allow leveraging the expertise in the long-term development of the firm and this is allowing the firm to make better practices which will help in sustainable development of the firm effectively.

The different kinds of strategies which have been adopted by BHP in the past is by maintaining in the position in the entire market is relative to the dedication as to create long term value to shareholders, corporate governance along with the main focus is on the communities and environment wherein they have their operations and this is the innovative approaches in gaining strong customer base in the entire market as this will attract more customers in the competitive market (Banumathi and Nadarajan, 2016, p.995).

There are various current strategies which have been adopted by BHP Billiton in order to become more effective in nature and gain more profits in the future as well. Recently, this has been announced by BHP there has been enhancement of strategy which has enhanced the shareholders returns and value in the near term as well (Bratton and Gold, 2017). The main aim of the company is to increase the copper and shale asset as this will create surge in the revenues once the price of the commodity improves. Furthermore, there will be innovation technique which will be applied by the company in an efficient manner with proper innovative usage of technologies. Lastly, in the present scenario, the company is investing in high return growth opportunities to generate the capital will be deployed as this will help in providing huge returns to the company in a positive manner which will improve the overall growth and efficiency of the firm in comparison to the other competitors in the market (Leiber, Stensaker and Harvey, 2018, p.12).

Controversies and Outcomes

There are various kinds of strategies which are being used by the BHP Billiton which has helped them in being more successful in the different approaches which are being adopted by them efficiently. The two kinds of growth strategies which have been adopted by them are as follows:

This is one of the growth strategies which has been adopted by BHP wherein the cost leadership strategy was adopted by them. This was seen and analysed that the cost leadership strategy as this is critical in nature as there are various external environmental threats that can negatively impact the company and this will have huge negative impact on profit margins of BHP despite of the huge demand of the customers in the market. In order to implement the respective strategy, the organization needs to minimize the costs across the entire value chain and this will be done by them through proper diversification of the products and services which were being sold by them (McDONALD, 2015).

The other strategy which was being adopted by the BHP Billiton was the growth strategy in which this has been seen that the growth of the company is essential which helps in the overall growth of the firm. With proper innovative strategies, BHP tried to enhance the returns of the shareholders and value in the near term as well. Furthermore, the main motive and aim of BHP is to improve the productivity level along with maintaining the level of momentum as well. Moreover, this has been seen and analysed that quality portfolio of the company is being based on assets which will help the company in receiving medium level of the growth-related options and techniques as well (Sen and Rajagopal, 2017).

There were different criticisms or failure which was being faced by BHP Billiton and the company suffered huge loss in the past as well. Firstly, this was seen that BHP faced a major issue in the year 2015. In 2015, this was being noticed that there were different unreported documents which showed that mining company was aware of the different threats from the worst environmental damage, however there was no such action which was taken by them. Six months before dam which was containing millions of mining waste in liters in which more than 19 people were killed and the company BHP which was dealing in mine did not take any such action for reducing the risk in an effective manner (Waring, 2016).

Environmental Analysis

The main allegation which was being faced by BHP Billiton was that the company was aware of the worst damage that could have been taken place, however they were not at all successful in reducing the same and this affected the overall image of the company in an ineffective manner as well (Theguardian.com, 2018). The main issue which was being criticized for BHP was that the company did not focus on the safety of the individuals and they only prioritized the profit-making approach and this was creation of criminal case against the joint venture along with the parent companies (Hill, Jones and Schilling,2014).

The other incident which occurred in BHP Billiton was regarding the dispute within the management of the organization faced with the trade unions regarding the benefits and payment provided. The workers who were working with BHP Billiton protested and there was a strike of more than few weeks in Chile and the strike helped the employees in benefitting themselves from the lowering the cost and this helped the employees in performing well as well (Dalal and Malik, 2015, p.12).

With the help of the PESTEL analysis, this will assist in understanding the various kinds of factors which will have huge negative or positive impact on the operations of the respective company.

Political Factors is one of the major aspects in which it has been identified that BHP tries to remain neutral in the different countries in which the company is having their operations. This helps in focusing that they choose not to contribute towards any kinds of funds of the political party or elected kind of officials in the country (Yadav and Kumar, 2015, p.685).

Economic Factors is the other aspect in which this has been noticed that in case of BHP, as it is in oil market, the company will be facing various kinds of disputes in the market when this is related to the prices of oil barrels. The main reason is the instability in the market and there is huge uncertainty in the entire market as well (Shafritz, Ott and Jang, 2015).

Social Factors is the third aspect in which BHP is well aware of the different kinds of social issues which can affect the stability of the firm during construction along with operation of the different firms. This means that the company needs to have remedial measures in order to reduce the different threats and maximising their benefits efficiently (Shafiq, 2017,p. 730).

Organizational Culture and Leadership Style

Technological Factors is the aspect in which innovation is essential when it is oil business and competing in the entire market place. BHP has technology related park which is based in Australia in order to focus more on technology and this helped the company in staying ahead in comparison to the other competitors in the market as well (Santos and Laczniak, 2015).

Legal Factors is the aspect wherein BHP has different resources along with stakes in different countries and the company must keep in track the various regulations and laws when they are considering the different other countries. The health and safety laws which are being adopted by BHP are up to the standard and this helps the company in becoming successful (McDonald and Wilson, 2016).

Environmental Factors is the other aspect in which BHP aims in delivering long lasting benefits to the environment along communities for improvement of the different natural resources. The respective program has helped the company in becoming successful in their approaches (Yadav and Kumar, 2015, p.685).

With the help of the SWOT analysis, the different kinds of strengths, weaknesses, opportunities and threats are being identified which will help the company in understanding their position and try to make the weaknesses and threats as their opportunities and strengths.

 

Figure 1: SWOT Analysis

(Source: Created by Author)

Rivalry among the various competitors is high between BHP and other competitors as there are two major kind of rivals in the market which is ALOCA INC. and VALE S/A. The position of BHP is highest among competitors as the company has invested in various resources in the world.

Threats from new entrants is the other aspect which is low as the advancement of the technology which is being used by the firm is huge and the innovation in gas and oil market is exceptionally excellent.

Threat of substitutes is medium in nature as BHP lies in somewhat small because the company has more than one resource and this makes the organization sustainable in nature as well. there is diversification of the different resources and this helps the company in becoming successful as well (Yadav and Kumar, 2015, p.685). 

Bargaining Power of the Suppliers is medium in nature wherein the suppliers of BHP are affected in a large manner by supplies of labour, energy, materials along with cost of energy and this has reduced the overall costs of the suppliers of BHP.

Conclusion

The organizational culture of BHP Billiton is efficient in nature and this helped the company in employing more efficient employees in the organization as well. The leadership style which is being followed by BHP is the transformational leadership which helped the company in being more effective in building proper reputation in the firm. Proper development programs have been taken into consideration by BHP to improve the overall function of the management and employees and gain profitability in the entire market as well which helped the company in becoming more successful in the different kinds of training approaches.  

There is proper inclusion of the diversity in the workplace in which all the employees are being provided with same kind of respect and this helps the company in gaining huge competitive advantage. The diversity along with the talent management are the other aspects which are required to gain more efficiency in their approaches of becoming successful and effective. Lastly, BHP tried to retain the different employees in the organization by creating unique culture of hiring locally and training the employees in an efficient manner.

Conclusion

Therefore, this can be concluded that there are different issues which was faced by BHP in the past and this affected the brand image of the company. However, on the other hand this was noticed that BHP which is in the oil industry has tried in analysing the different issues in an effective manner and this helped the company in gaining huge success and there were no such issues which affected the overall profitability of the firm.

On the other hand, with the environmental analysis, this was noticed that there were different pressures from the external environment which is required to be analysed and identified effectively. The organizational culture along with style of leadership is effective and this helped the company in becoming one of the effective competitors in the entire competitive market.

References

Banumathi, R. and Nadarajan, S., 2016. Swot Analysis on Marketing Strategies Adopted: A Study on Salt Industries in Southern Region of Tamilnadu. Asian Journal of Research in Social Sciences and Humanities, 6(9), pp.995-1015.

Bhp.com 2018. BHP | Our business. [online] BHP. Available at: https://www.bhp.com/our-businesses [Accessed 5 Sep. 2018].

Bratton, J. and Gold, J., 2017. Human resource management: theory and practice. Palgrave.

Dalal, G. and Malik, S., 2015. Online Marketing: A Swot Analysis. The International Journal of Business & Management, 3(7), p.12.

Hill, C.W., Jones, G.R. and Schilling, M.A., 2014. Strategic management: theory: an integrated approach. Cengage Learning.

Leiber, T., Stensaker, B. and Harvey, L.C., 2018. Bridging theory and practice of impact evaluation of quality management in higher education institutions: a SWOT analysis. European Journal of Higher Education, pp.1-15.

McDonald, M. and Wilson, H., 2016. Marketing Plans: How to prepare them, how to profit from them. John Wiley & Sons.

McDONALD, M.A.L.C.O.L.M., 2016. Strategic marketing planning: theory and practice. In The marketing book (pp. 108-142). Routledge.

Santos, N. and Laczniak, G., 2015. Marketing to the poor: A SWOT analysis of the Market Construction Model for engaging impoverished market segments. Social Business, 5(2).

Sen, S. and Rajagopal, K., 2017. SWOT ANALYSIS OF FAST MOVING CONSUMER GOODS COMPANIES–A CASE STUDY ABOUT PATANJALI AYURVED IN INDIA.

Shafiq, K., 2017. SUPPLY CHAIN MANGEMENT, TEXT AND CASES BY: VV SOPLE. Pakistan Business Review, 17(3), pp.725-730.

Shafritz, J.M., Ott, J.S. and Jang, Y.S., 2015. Classics of organization theory. Cengage Learning.

Theguardian.com 2018. BHP faces billions in compensation after mine dam collapse, say protesters. [online] the Guardian. Available at: https://www.theguardian.com/business/2015/nov/19/bhp-faces-billions-in-compensation-after-mine-dam-collapse-say-protesters [Accessed 5 Sep. 2018].

Waring, S.P., 2016. Taylorism transformed: Scientific management theory since 1945. UNC Press Books.

Yadav, T. and Kumar, S., 2015. Mangement Information Systems: Significant Tool for Strategic & Discreet Planning. International Journal of Applied Research, 1(11), pp.685-688.

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