Strategic Management

This study material provides an in-depth understanding of strategic management. It covers topics such as how organizations establish a track record of success, core value proposition, target market, major threats, and recommendations for addressing threats. It also explores the prospects for the future of strategic management. Suitable for students studying strategic management or related courses.

Running head: STRATEGIC MANAGEMENT
Strategic management
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STRATEGIC MANAGEMENT
Table of Contents
How organization established a track record of success:................................................................2
Core value proposition of BJP Billiton:...........................................................................................2
Target market of BHP Billiton:.......................................................................................................2
Major threats faced by the organization:.........................................................................................3
Recommendation on possible strategies for addressing the identified threats:...............................3
Organizations prospects for future:.................................................................................................4
References:......................................................................................................................................5

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How organization established a track record of success:
BHP Billiton is one of the largest mining companies of Australia that is involved in the
production of copper, steel, silver, iron, gas and oil and has diversified its business in
engineering and transportation. The planning process of corporate is designed to deliver strategic
objectives that helps in levering the competitive resources and capabilities to create sustainable
long-term value and to meet the evolving needs of the market. The success of company is
associated with the sustainable growth of both developed and emerging economies that helps in
production of commodities that is integral in driving the growth of company (Bhp.com, 2019).
Core value proposition of BJP Billiton:
BHP Billiton seeks to leverage the people, capabilities, values, balance sheet, insight
assets, and commodity positions to be the partner of choice for the customers of coal energy. The
core purpose of the organization is to create long-term value through the development,
discovery, and provision of innovative customers, conversion of natural resources and enabling
solutions that is market focused. The organization seeks to leverage its strength to meet the needs
of customers and helps in generating incremental long-term value to the parties concerned
(Bhp.com, 2019).
Target market of BHP Billiton:
The target market of BHP Billiton is geographically diverse and the business has been
structured in such a manner that helps in meeting the changing demands due to the dynamic shift
in the global market. Some of the countries, which forms the target market of the organization,
include Japan, China, United States, and Japan, India, other Asian countries and Eurozone. Sales

STRATEGIC MANAGEMENT
of the organization is made predominantly to the customers in the northern hemisphere from the
operations in the southern hemisphere.
Major threats faced by the organization:
The business model and thereby the solvency, liquidity and future performance of the
BHP Billiton is threatened by some of the principal risks. The assessment of the risks that is
likely to threaten the future performance of the company is a low price environment and a well
blow out in the Gulf of Mexico. In addition to this, the reputation and materially of the business
is affected by operational and information technology services that are subjected to cyber
security risks. Assets of the company can be adversely affected by the natural and unexpected
operational catastrophes and uncertainty is associated with the actions resulting from the
Samarco dam failure and potential liabilities resulting from litigation (Bhp.com, 2019).
Furthermore, the reduced productivity and the pressures of operating cost can negatively affect
the expansion plans and operating margins. There also exist the failure of the non-operating join
ventures to comply with the existing standards which the company is required to adhere by.
Sustainability risk is another area of principal risk under which the markets and assets of BHP
Billiton can be adversely impacted by the some potential physical impact and the efforts taken to
address climatic change (Morschett et al., 2015).
Recommendation on possible strategies for addressing the identified threats:
The threats faced by the business affecting the materially is addressed by the
development of strategy of operating and owning low cost and lifelong assets. In order to
improve safety, unlocking value and lower cost, the business and operational process are heavily

STRATEGIC MANAGEMENT
dependent upon the emerging and traditional technologies. The damage caused by Samarco dam
failure has been addressed by the execution and development of socio economic and
environmental programs that helped in providing compensation and remediating such damages.
In order to deal with the threats faced by the cyber-attacks, it is required by the organization to
develop an appropriate program and implement such framework that helps in verifying all the
records and the information generated through the technological system of the company
(Bhp.com, 2019). In light of constantly changing environment, management of risk and
opportunities, the developed strategies should be reviewed constantly and the same should be
cascaded through the process of planning. The maintenance strategies is intended to make the
company cost efficient and generate higher volume and this is reflected in continued reduction in
the cost of labor.
Organizations prospects for future:
The pipeline of the potential growth projects such as copper, conventional oil and coal
would help in creating significant value to the shareholders over the long term. It is expected
that there would be an incremental production from the Spence growth option and there is
expectation that the demand for steel would continue in the future with increasing development
and growth in population in emerging economies (David & David, 2017). The financial
condition of the company is sought to be favorable because of the ability of BHP to generate
revenues and the success of acquisition and exploration efforts.

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References:
Bhp.com. (2019). Retrieved 4 July 2019, from
https://www.bhp.com/-/media/documents/investors/annual-reports/2018/
bhpannualreport2018.pdf
David, F. R., & David, F. R. (2017). Strategic Management: Concepts: a Competitive Advantage
Approach. Pearson.
Morschett, D., Schramm-Klein, H., & Zentes, J. (2015). Strategic international management (pp.
978-3658078836). Springer.