The paper 'BHP Billiton and Strategic Choices" is a good example of a management case study. This paper discusses the evaluation and business strategies adopted by BHP Billiton in order to maintain steady strategic growth in a competitive market environment. The report aims at assisting in creating the understanding and importance of Mergers, Acquisitions as well as Joint Ventures as critical tools to achieve a competitive position. It will also analyze and explain key threats to the company as well as the emerging markets (Barnes et al, 2012). The report concludes by explaining the strategies that BHP Billiton implemented in order to ensure steady growth.
Finally, the recommendations are drawn from the analysis and the inferences made regarding the various types of strategies adopted by the company. External Analysis (Identification and analysis of main issues in general, industry and competitor) The aim of the exterior analysis is to evaluate the various variables from the external surroundings, competitive forces and industry. BHP Billiton’ s context of the external environment is better understood by reviewing the effects of environmental and key drivers for change (Bastida et al, 2005).
The significance and meaning of external analysis impact directly on the strategic choices of BHP Billiton. It is important to assess the market so as to obtain multiple scenarios to be expected in the future, hence facilitating timely adjustments to the proposed strategy. Porter’ s five forces analysis The deliberate view of the BHP Billiton concerning its external environment due to global competition is best analyzed by the review of its porter five forces. This gives an opportunity to evaluate the sources of the company’ s strengths and weakness that may enable the company to achieve its goals and objectives (Du Plessis et al, 2005). Bargaining power of the buyer Research indicates that the bargaining power of the buyers is moderate to low.
The main products that BHP Billiton markets globally enable it to increase shipping prices or reduce labor and production cost at any time (Correia, 2007). This is because of the higher demand of the natural resources that include coal, diamonds, metals, petroleum and uranium and the low global supply of these products (Geological Survey, 2011). Bargaining power of suppliers The overall costs of BHP Billiton from suppliers have increased due to due to the increase in the firm activity with the aim of reducing the capacity (Mackenzie et al, 2013).
There are only a few substitutes of the materials supplied by this company and hence high bargaining power of supplies (Du Plessis et al, 2005). There is little pressure from the competition from other companies in that mining demands the high cost of exploration. The threat of new entrants This is temperate to small. There is little supply of natural resources to the markets globally including oil.
It is such factors that led to a significant barrier to the new entrants. Though there are some Chinese companies that have formed joint ventures with western Australian firms, the impact will be felt in the long term (Thompson & Macklin, 2010). Introduction of new companies to the market will take time in that mining requires a lot of resources and employees that is difficult to be brought up by small companies compared to BHP Billiton assets (Tatnall, 2007).
Barnes, T. J., Peck, J., & Sheppard, E. (2012). The Wiley-Blackwell Companion to Economic Geography. New York, NY, John Wiley & Sons. http://nbn- resolving.de/urn:nbn:de:101:1-201411176658.
Bastida, E., Waelde, T. W., & Warden-Fernández, J. (2005). International and comparative mineral law and policy: trends and prospects. The Hague, Kluwer Law International.
Correia, C. (2007). Financial management. Cape Town, Juta.
Du Plessis, J. J., Mcconvill, J., & Bagaric, M. (2005). Principles of contemporary corporate governance. Cambridge [England], Cambridge University Press.
Geological Survey. (2011). Minerals Yearbook 2008 Metals and Minerals. U S Geological Survey.
Good, K. (2003). Bushmen and diamonds: (un)civil society in Botswana. Uppsala, Nordiska Afrikainst.
Hunter, W. (2007)"Dependency Theory." Microsoft® Student 2008 [DVD]. Redmond, WA: Microsoft Corporation.
Joint United Nations Programme On Hiv/Aids. (2005). Access to treatment in the private-sector workplace. Geneva, UNAIDS.
Kelton, M. (2008). More than an ally?": contemporary Australia-US relations. Aldershot, Hampshire, England, Ashgate.
Mackenzie, B., Coetsee, D., Njikizana, T., Selbst, E., Chamboko, R., Colyvas, B., & Hanekom, B. (2013). Wiley IFRS 2013: interpretation and application of international financial reporting standards. http://search.ebscohost.com/login.aspx?direct=true&scope=site&db=nlebk&db=nlabk&A N=518 372.
Mirza, A. A. (2012). Wiley international financial reporting trends. Hoboken, NJ, Wiley.
Murray, P., Murray, P., Poole, D., & Jones, G. (2006). Contemporary issues in management and organisational behaviour. South Melbourne, Vic, Thomson Learning.
Ramamurti, R., & Singh, J. V. (2009). Emerging multinationals in emerging markets. Cambridge, UK, Cambridge University Press.
Tatnall, A. (2007). Encyclopedia of portal technologies and applications. Hershey, PA, Information Science Reference. http://www.books24x7.com/marc.asp?bookid=20782.
Thompson, P. A., & Macklin, R. (2010). The big fella: the rise and rise of BHP Billiton. North Sydney, N.S.W., Random House Australia.
United States, & Geological Survey (U.S.). (2014). Minerals Yearbook Asia and the Pacific. Volume III, Volume III. Washington [D.C.], U.S. Dept. of the Interior; U.S. Geological Survey.
Vulkan, N., Roth, A. E., & Neeman, Z. (2013). The handbook of market design