Thales Group Research Portfolio: Strategies for Competitive Advantage

This research portfolio provides a detailed analysis of Thales Group's origin, structure, and strategies for remaining competitive in the industry. It includes a PESTEL analysis, a five force analysis, and strategic analyses of the company's vehicle and cyber-security divisions.

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BUSINESS: RESEARCH PORTFOLIO OF THALES GROUP
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Introduction
Most businesses and organizations have faced tremendous changes in their strategic operations
due to the increased pace of change evident in the modern global and competitive environments.
Such rapid changes, therefore, require most organizations to reposition themselves strategically
to remain competitive in the industry. To achieve a competitive advantage, organizations or
corporate businesses need to develop and implement an effective business strategy. Developing
an efficient business strategy will require the efforts of every member of the organization and
entails looking into various business aspects both internal and external and understanding what
the business is dong excellently and what needs to be changed (Victor, 2017, p. 6). This essay
seeks to provide a detailed research portfolio of the Thales Group in a bid to understand the
corporation origin, the structure and the various strategies employed by the organization to
remain competitive in the industry and attain its desired growth rates.
Background information about Thales Group
The Thales Group is a French Multinational company that was founded in the year 1968 through
a business merger of top leading professional electronic business companies of Thomson Brandt
and Compagnie Generale de Telegraphie San Fil (CSF). However, these two electric companies
have a long history in their operations with Thomson Brandt having been established in the year
1893 to specialize in power generation and transmissions while CSF is having being found in the
year 1918 to become a pioneer in the broadcasting industry (Layton 2014, p. 7). The company
has therefore been built progressively through careful planning which strategically has to enable
it to achieve a remarkable cohesion and strength and has also contributed significantly to the
company abilities to adapt to its structures in the current markets and business conditions.

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Over the years it has been in operation the company has been able to gain significant insights and
knowledge in the markets they operate which play an essential role in their service provision.
The company has operations in 56 countries globally with considerable activity in France where
it has been able to employ 34 000 employs in different states or provinces in the country
(Fernandez et al. 2014, p. 230). The company policy guides the employees in their service
delivery which seeks to achieve corporate responsibility which is critical in managing risks and
driving excellent performance. The company is therefore involved in the design and manufacture
of electrical systems and provides such services for different industries globally including; the
aerospace industry, defense industry, the space industry, the transport industry as well as security
and other specific market solutions for other industries. Throughout the years, the company has
achieved significant milestones regarding innovations having developed significant changes.
These innovative changes include the Thomson Houston Electric tram in 1893 for enhancing
efficiency in public transport, the Magnetic radar in 1936 for the aerospace and defence
industries, X-ray image intensifier (IRR) in 1948 for the medical industry as well as the Vapor
on and palmer radar systems for defence (Zanin et al. 2014. P. 47). The company is, therefore,
one of the leading aerospace companies globally.
A PESTEL Analysis of Thales Company
PESTLE or PESTEL is an analytical tool used by many companies or businesses for strategic
planning and plays a significant role in understanding the external influences on a business or
company operations. The acronym stands for Political, economic, social, technological, legal and
environmental impacts or factors influencing business operations (Barba et al. 2016, p. 981). The
understanding of these external environmental factors play an essential role in helping a

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company to maximize the available opportunities in the business landscape they operate in as
well as minimize the existing threats to the organization.
Political influences Growing geo political tensions
The current growing populist sentiments
Economical influences The changing defense budgets by most states
The impact of Brexit and Currency volatility
globally
Social influences The demands from new work force
New aviation demands from arising markets
The rapid growth of urban centers and growth
of smarter cities
Technological influences The emergence of new technologies
Use of innovation differentiation as a
competitive advantage
Legal influences Intellectual property rights in regard to
innovations
The new revised international management
regulations
Environmental influences The growing need for innovative solution to
fight climate change
Global shift towards the use of renewable
energy

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Political influences: political tensions globally act as an opportunity for Thales Company to
develop strategic mechanisms of venturing into new, markets through the provision of defense
and security systems to various states (Babb 2016, p. 15). The increasing global terrorism and
insecurity have challenged most countries to look for external defense and security systems to
enhance their security capabilities. Uncertainties and increased terrorism cases in Africa as well
as in the Middle East has provided an excellent opportunity for the company to develop effective
strategies for venturing into these markets (Crouch et al. 2017, p. 86). The increased populist
sediments experienced in the past through Brexit and also through the US elections which led to
the election of President Donald Trump have been seen as a strategy aimed at increasing
protectionism in trade and even the development of anti-globalization movements. Such
influences force governments to foster the development of their local companies to meet the
demands of their population. Such a move, therefore, affects the company growth aspects of
other markets.
Economic influences: the change in various economic policies such as a change in defense
budgets also influences the strategic planning of Thales Company. For countries such as the US
and Western Europe, the budgets have become tight forcing most companies providing defense
and security systems to venture into new markets such as the India Market as well as the Middle
East countries which budgets have increased for defense and security. Thales Company,
therefore, can strategize on developing their operation in these markets. Secondly, Brexit led to a
decrease of a depreciating effect in the value of UK currency and therefore exposing the Europe

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markets to increased competition from Russia and the growing superpower China regarding
military equipment.
Social Influences: the French economy is overgrowing characterized by the growth of
urbanization and new smarter cities. These developments have led to increased demand for
security and transportation systems to provide specific market solutions (Gerow et al. 2015, p.
472). There are growing demands for aviation services in existing and new markets such as in
Australia where competition in Aerospace has significantly increased. Such demand creates the
need for new workforce in the industry and development of significant innovative solutions
which will enhance the company competitiveness in the aerospace and space industry.
Technological influences: the company has continued to increase their innovative capabilities
with the increased technical advancements. It has been able to use technology to produce or
manufacture differentiated products which give them a competitive edge in the market. The
development of crossover technologies has led to increased competition in the industry from
other aerospace and defense as well as security systems companies (Gerow et al. 2014, p. 1075).
However, Thales Company has been able to adopt new technologies and increase their
competitiveness through increased innovations over the decades across the various sectors it
operates.
Legal Influences: the most influences in these industries include the increased intellectual
property rights governing the innovations in the market. Most companies globally have used
differentiation technology for their advantage which has raised the issues of intellectual property
rights (Fleisher & Bensoussan 2015, p. 16). The Europe market and also globally regarding
security, defense and aerospace equipment’s has embraced the revised quality management

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regulations. Such regulations may be a distraction to penetration into new markets but can also
be used as an opportunity to increase competitiveness through quality services.
Environmental influences: with increased innovations and business operations, most
governments have shifted towards the use of renewable energy and increased call for innovative
solutions aimed at fighting climate change. The company operates under the use high energy
consumptions in manufacturing their products and this may be a threat to the company and may
be required to develop new energy strategies in their bid to achieve corporate sustainability.
Thales Company Two Main Competitors and a Five Force Analysis
The porters five forces analysis has been developed to help many companies assess the nature of
the industrial competitiveness and provide them with an opportunity to develop corporate
strategies. The five forces include the supplier power, buyer power, and competitive rivalry,
threat of substitution and danger of new entry. These forces are therefore used to determine the
company competitiveness in the industry (Mathooko & Ogutu 2015, p. 342). Thales Group has
continued to experience competition from various competitors in the industry including some
competition from their main competitors such as the Boeing Company and the Lock heed Martin
Company or group. The Boeing Company is one of the largest aerospace companies with
estimated revenue of $94.6 billion and has been able to employ over 140000 employees globally
and has its headquarters in Chicago in the US. The principal company activities are Aerospace
services, manufacturing, airplanes, and manufacturing. On the other hand, the company also
experiences first competition from the Lock Heed Martin which has estimated revenue of $ 47.2
billion and has been able to employ over 97000 employees and is also based in Bethesda, MD.

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Regarding the supplier power, the company seeks to have fewer suppliers to avoid being
exploited and comparing them with their primary competitors the company has not been able to
achieve this. The company still has increasing supplier’s percentages over the years which have
led to increased competition from their competitors regarding revenue generation (Mayer et al.
2017, p. 12). Secondly, the company seeks to diversify their services to avoid relying on specific
high purchasers who end up controlling the company operations. To improve its competitiveness
from her rivals the company needs to emphasize on the development of high-quality products
and services. With increased technological advancements in the aerospace industry, the company
faces the threat of substitution of company products by the new emerging companies as well as
from the existing companies who are embracing modern technology.
Thales strategic analysis of Vehicles Division in Bendigo
The Australia Thales vehicle protected division has been used in the manufacture of massive
military transportation machines. With the support of Oshkosh truck, the Thales Australia
production line in Bendigo has been able to manufacture or produce the Bushmaster protected
mobility vehicle for security and defense. The manufacture of these vehicles was strategic as it
has been sold to most countries and governments for defense and security purposes (Cassidy
2016. P. 35). The production line is also aiming to manufacture the Hawkei Vehicles which will
be able to provide more security or protection to soldiers and allow them to operate in more risky
areas and enhance efficiency. This strategy for the company will, therefore, help the company
penetrate into new markets where insecurity has become a significant challenge by assisting the
governments to solve specific security demands.

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Business Level Strategic analysis of Thales cyber-security division
The company has been able to offer solutions for too many companies who have been faced with
any disruptive technologies and cyber threats. The company provides optimal performance
solutions for any company critical information systems. The company is a world leader in
cryptographic security products and cutting-edge strategies. The company has invested in having
a team of experts in cyber protection who work closely with the company clients globally to
harbor company data and their businesses. The company has over 5000 critical IT engineers as
well as over 200 experts in cybersecurity with more than four decades of experience (Barcellos
2017, p. 269). The division has therefore been able to develop itself in meeting the challenges of
cyber threats strategically. However, there is a need to ensure that these experts and resourceful
company that the company has been able to attract is innovative by creating a competitive
innovation environment in the company. In the end, it will not only improve the company
innovative capability but also increase the company competitiveness in the industry and enhance
service provision.
The company has significantly benefited from its strategic relationships with other companies.
One of the vital connections was the merger with the CSF Company which gave them a more
significant competitive advantage in the communications and broadcasting industry in France
and Europe at large. The company was also able to acquire the Guavas Company which is a
leading pioneer in real-time big data analytics which has helped the company in developing
effective strategies to solve any data or cyber-related threats.

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Conclusion
The Aerospace Company is increasingly becoming more competitive with increased
technological advancements. However, the development of effective strategies is essential for the
growth of any company by helping the company achieve her set performance goals and improve
her competitiveness in the market or industry. The Thales Group can, therefore, be said to have
an active growth strategy. However, there is a great need for the company to improve their
general growth strategies and innovations to help them increase their competitiveness with their
main competitors in the industry.

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List of references
Babb, J., 2016. Australia's once and future car industry. News Weekly, (2983), p.15.
Barba, F.C., Sánchez, G.M.D., Seguí, B.S., Darabkhani, H.G. and Anthony, E.J., 2016. A
technical evaluation, performance analysis and risk assessment of multiple novel oxy-turbine
power cycles with complete CO2 capture. Journal of cleaner production, 133, pp.971-985.
Barcellos, F., 2017. The Brazilian Space Industry: Geostationary Satellite of Defense and
Strategic Communication Program. Astropolitics, 15(3), pp.264-276.
Cassidy, A., 2016. A practical guide to information systems strategic planning. CRC press.pp.
35.
Crouch, I.G., Cimpoeru, S.J., Li, H. and Shanmugam, D., 2017. Armour steels. In The Science of
Armour Materials (pp. 55-115).
Fernandez, A.S., Le Roy, F. and Gnyawali, D.R., 2014. Sources and management of tension in
co-opetition case evidence from telecommunications satellites manufacturing in Europe.
Industrial Marketing Management, 43(2), pp.222-235.
Fleisher, C.S. and Bensoussan, B.E., 2015. Business and competitive analysis: effective
application of new and classic methods. FT Press.pp. 14-18.
Gerow, J.E., Grover, V., Thatcher, J.B. and Roth, P.L., 2014. Looking toward the future of IT-
business strategic alignment through the past: A meta-analysis. Mis Quarterly, 38(4), pp.1059-
1085.

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Gerow, J.E., Thatcher, J.B. and Grover, V., 2015. Six types of IT-business strategic alignment:
an investigation of the constructs and their measurement. European Journal of Information
Systems, 24(5), pp.465-491.
Layton, P., 2014. Future Land Warfare and the Australian Army. Defence Today, 11(1), pp.6-9.
Mathooko, F.M. and Ogutu, M., 2015. Porter’s five competitive forces framework and other
factors that influence the choice of response strategies adopted by public universities in Kenya.
International Journal of Educational Management, 29(3), pp.334-354.
Mayer, M., Hautz, J., Stadler, C. and Whittington, R., 2017. While corporate UK was for
Remain, their business strategies tell a different story. British Politics and Policy Blog. pp. 12.
Victor, M.D.S.P., 2017. Influence of Institutional actors on the strategy and performance of
Indian Space Companies (Doctoral dissertation, Toulouse Business School). pp. 4-7.
Zanin, M., Perez, D., Chatterjee, K., Kolovos, D.S., Paige, R.F., Horst, A. and Rumpe, B., 2014.
On demand data analysis and filtering for inaccurate flight trajectories. arXiv preprint
arXiv:1409.2304.pp. 47.