Anglo American Plc Corporate Strategy: An In-depth Analysis

This report provides a comprehensive analysis of Anglo American Plc's corporate strategy, a British multinational mining company. It includes an overview of the company, followed by external analysis using the PESTLE framework, examining political, economic, social, technological, legal, and environmental factors impacting the mining industry in the UK. The report then applies Porter's Five Forces to assess the competitive intensity of the industry, considering competitive rivalry, the threat of new substitutes and entrants, and the bargaining power of customers and suppliers. Internal analysis focuses on Anglo American's resources, including its research and development department, extraction equipment, human resource department, and technological aspects. A value chain analysis identifies primary activities such as inbound logistics, operations, outbound logistics, marketing and sales, and after-sales services, as well as secondary activities like procurement, technological development, and human resource management. Finally, the report touches upon the company's competencies using the VRIO framework to determine its competitive advantage.

Corporate Strategy

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................1
Overview of the Anglo American Plc..........................................................................................1
External Analysis.........................................................................................................................1
Application of Porter Five forces.................................................................................................3
Internal Analysis..........................................................................................................................4
Analysing the corporate strategy of the chosen organisation......................................................7
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Corporate strategy helps the organisation to take various important decisions. It helps the
company to achieve great results in the future. It also helps the organisation to achieve the
growth and direction by broadening the structure of the workplace. This report aims to analyse
about the position of two companies which is Anglo American (Hernandez, and Menon, 2021). It
is a British listed mining company which is headquartered in London. It is one of the world
largest company it is the major producer of different components which includes diamonds, coal,
nickel and copper etc. the organisation has diversified their business operations in different
regions. They has managed to achieve an effective performance in the market. In this report there
will be discussion about the Pestle analysis of the of the industries in which the organisation
regulate their business. There is evaluation about the porter five forces strategy which helps to
understand about the competitiveness of the industry. Along with that, there are multiple forces
in the industry which is been affecting the performance of the company in the market.
MAIN BODY
Overview of the Anglo American Plc
This is the organisation which is chosen for this project. Anglo American is the British
multinational mining company. It is headquartered in London England. The organisation has
diversified their business operations in different regions (Maranesi, and De Giovanni, 2020). The
organisation is the major producer of the diamond, copper, nickel and thermal coal. It was ranked
one of the largest company and the rank is 274. It was founded by the Corporation which
regulates their operations in different regions.
External Analysis
Pestle Framework – It is the tool which is used to understand different forces in the
desired industry. This is the important framework which also helps the company to carry out the
business operation effectively in the market. There are multiple components in this framework
which is mentioned below:
 Political factor – In the UK there are multiple variations in the economy. There are
different factors which will affect the performance of the company. In relation to Anglo
American is commencing their operations by utilising the resources in an effective
manner. There are different types of political risks which is affecting the stability of the
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company. In the miming industry there is uncertainty which makes this industry more
dangerous for the company which are regulating their operations in the market. Anglo
American is survive with different policies which is regulating their performance in the
market.
 Economic factor – UK is considered one of the largest economy there are various
industries which has seen an effective growth in the market. After the impact of the
Covid pandemic there are multiple competitive norms in the mining industry. There is
not an stability in the industry(Brønn, and Brønn, 2018). Due to the negligence of
different factors the company needs to perform in effective manner. Anglo American is
able to capitalise on different opportunities by taking the advantages of the exchange
rates, they need to develop their infrastructure in order to utilise the resources in a
significant manner.
 Social Factor – In the UK there are different society culture which is affecting the
mining industry. There is negative flow in the industry after the Covid 19 pandemic.
There is a violence situation which is enhancing in the mining. It includes the child
labour, and gender inequalities. In relevance to Angle American they needs to fulfil
different laws which can benefit the society. They need to grow the industry by following
the ethical practices in the market.
 Technological Factor – In relation to UK there are various technologies which has been
implemented by most of the organisation. The mining Industry use the technological
aspects to carry out the operations effectively. They focus on prodding better services to
the customers. In the mining sector most of the organisation use the automated drones,
and drilling and use multiple boring systems to improve the working operations.
 Legal Factor – In the UK the legal factors are affecting the performance of the company.
There are different uncertainties which is faced by the firm. They need to analyse
different aspects in order to perform better in the market. In UK the mining laws includes
the Environmental permitting Regulations 2016 (Graham, 2019). There are different
other laws which needs to followed briefly by the firms which is regulating their business
operations. In relation to Anglo American the company is fulfilling all the legal rules an
regulations to carry out the operations effectively. The mining industry is revolving with
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the best laws and the company has to follow that in order to achieve great success in the
future.
 Environmental Factor – The organisation needs to maintain the standards to become
more effective in carrying out different operations. In the UK there are different changes
in the environment which cannot be controlled by the individual. In the mining industry
the industry there are different rules and regulations which is followed by the firm to
carry out different operations in the market. In relation to Anglo American they focus in
different aspects to preserve the environment. They are able to achieve an greater
performance by evaluating different strategies and approaches.
Application of Porter Five forces
Porter five forces can be described as the framework which helps the firm to evaluate
different strategies in order to perform better in the market. They can focus on achieving great
results in the future. Porter five forces in relation to Anglo American is mentioned below:
 Competitive rivalry – In the mining industry the competitive rivalry is certainly high
there are different organisation which is implementing new technology in order to expand
their business in different regions (Glushakova, Chernikova, and Strekalova, 2020). In
order to perform best in the industry Anglo American is using the technology to achieve
great results in the market. They are focusing on developing new an certifies methods
which helps them to achieve na effective growth in the future.
 Threat of new substitutes – In the mining industry there is an intermediate threat of the
new entrants. They can focus on implementing new methods which helps them to achieve
greater productivity. The manager of the organisation Anglo American needs to develop
their services in a continuos manner. This will help them to dominate the industry and
minimise the threat of substitutes.
 Threat of new entrants – In relation to Mining industry they can bring the new
technology to gain a competitive advantage in the market. The management of Anglo
American needs to formulate new methods this helps them to enhance the capabilities
and skills in an effective manner.
 Bargaining power of customers – In the mining industry the barging power of
customers is certainly low. There are different customers which buy the products at the
rate which company is offering. In relevance to Anglo American they can focus on
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different aspects by provide excellent services to the customers. There are multiple great
results which can be achieved by them in the market.
 Bargaining power of suppliers – In relevance to the Mining industry there are different
dominant position which helps the firm to achieve a greater performance in the market. In
relation to Anglo American they have build and effective supply chain management in
which they generally get the necessary raw materials to make different finished products.
They are supplying this to the consumers at an effective prices in the market.
Internal Analysis
This is the analysis which helps to evaluate different aspects for the organisation in an
effective manner. They can achieve greater performance in the market by capitalising on
different opportunities (Mendes, 2018). Moreover the main focus is to helps the organisation
gain a competitive advantage in the market. They can optimise the resources efficiently in order
to achieve greater performance. There are multiple strengths which is mentioned below:
Resources given by the Anglo American company
 Research and development department – The management of Anglo American is
doing continuos development. It helps the organisation to provide better services in the
market in significant manner. The main focus of the firm is to expand their business in
different regions by capitalising on different opportunities. In the mining industry there
are multiple variations which could affect the performance of the firm in a negative
manner.
 Extraction Equipments – There are different technological equipments which is
necessary for the mining company to extract the raw materials. The management of
Anglo American is using different tools which includes the Blasthole drills, Dozers,
Dragline excavators etc. This also helps the company to gain a competitive advantage
over different competitors. These tools also make the extraction process easy for the
workers. Anglo American is able to finish the work in a timely and accurate manner.
 Human resource department – Anglo American has the workforce which maximize
their efforts in order to achieve the company goals and objectives in the market. The
Human resource department provide right training to the candidates which helps the
workers to grow their overall skills and capabilities in an effective manner (Wen, and
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Tikoo, 2022). The company is also moving further in order to achieve better results in the
industry.
 Technological aspects – In this new era there are different companies which is heavily
investing in the technological aspect. The organisations has established a digital
infrastructure to carry out the operations smoothly in the workplace. In relation to Anglo
American the main focus of the company is to use the technological advancements to
manage the working operations in a strategic manner. There are better results which can
be achieved by them in the market.
Value Chain Analysis
It is the process which helps the individual in evaluating different opportunities. It could
help the firm to achieve great results in the future. Value chain analysis in relation to Anglo
American is mentioned below:
Primary activities of Anglo American is mentioned below:
 Inbound logistics – In relation to the Anglo American the extraction of different
resources is the inbound logistics for the company.
 Operations – This is the stage which is concerned with the raw materials. In relation to
Anglo American the company focuses on providing services to the customers by using
raw materials effectively.
 Outbound Logistics – This is the stage which is considered which helps the company to
deliver the products to the consumers (Glushakova, Chernikova, and Strekalova, 2020).
In accordance to Anglo American they utilise the resources in an effective manner to
supply different services to the customer.
 Marketing and Sales – This is the main strength for the Anglo American they use
different channels of communication to attract different customers in the market.
 After sales services – Anglo American is concern with providing the best services to the
customers.
Secondary activities
 Procurement – The main activity of Anglo American is that they use the additional
equipments to provide best services to the customer.
 Technological development – Anglo American is technology driven they use the
technological tools to achieve great results in the market.
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 Human resource management – The organisation human resource management works
in an effective manner. They recruit the talented and skilled workforce. This help Anglo
American to gain out maximum productivity in the workplace.
Different Competencies in relation to the Anglo American
Competencies is the process which helps the organisation to gain a competitive advantage
in the market. VRIO is the framework which can be used by the firm to understand the true
potential of the industry(Wadström, 2018). They can take certain benefits with the help of this
framework. The main focus is to gain a competitive advantage in the market. VRIO analysis in
relation to the Anglo American is mentioned below:
Competencies Valuable Rare Inimitable
Brand position in market 
Human resource  
Utilisation of resources   
Innovative strategies   
Technology usage   
The main competency of the firm is that they use the technology in an effective namer to
become more profitable in the market. The main perspective of the firm Anglo American is to
utilise the resources fully in with the help of technology.
This is also considered one of the most valuable aspect for the company. Anglo American
utilise the resources to preserve the environment in an effective manner. The technology which
they use is also rare in the mining industry (Byun, and Lim, 2022). This also help them while
extracting the resources. They are heavily investing in the technology to achieve great success in
the market and could gain a competitive advantage over different brands.
Tows Analysis a process it helps the organisation to evaluate different forces which is
affecting the working operations of the organisation. Tows analysis in relation to Anglo
American is mentioned below:
Threats Opportunities
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 Social factors is the major threat for the
Anglo American company. The
organisation needs to protect the
employees while extracting the
resources.
 Anglo American also needs to comply
the legal rules and regulations which
helps them to achieve greater results in
the market.
Anglo American can seamlessly invest in the
technology to improve their infrastructure in an
effective manner.
The company needs to follow all the rules an
regulations in order to work effectively in the
market. There are different environmental risks
which needs to be followed by the Anglo
American in order to gain a competitive
advantage in market.
Weaknesses
 The main weakness for Anglo
American is the use of resources. The
organisation needs to preserve the
natural resources to maintain a positive
brand image in the market.
Strengths
 Anglo American main strength is that
they heavily invest in technology in
order to perform better in the market
(Benlemlih, Jaballah, and Kermiche,
2022). There are multiple strategies
which they are making in order to
improve different aspects.
 The management of Anglo American
company is optimising the performance
by utilising the resources in a positive
manner. They also focus on incurring
more profits in the industry.
Analysing the corporate strategy of the chosen organisation
The organisation has the corporate strategy in order to survive with the new marketing
conditions. Anglo American has the portfolio of becoming better in the market by utilising the
resources in an effective manner. This will help them to provide the better return to the
shareholders. There are different criteria which is mentioned below:
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 Suitability – In this particular stage the company checks whether they are suitable to
perform the necessary business operations in an effective manner (Yamazaki, 2019).
Anglo American corporate strategy is to focus in utilising the resources by fulfilling
various factors. They can focus on different aspects in order to achieve greater results in
the industry. The organisation approach is to achieve different targets in the mining
industry. The suitability of the organisation can be evaluated with the help of Tows
matrix which is described below:
Factors Strengths
 Innovation strategies and
approaches
 Heavily investing in the
new technology to
achieve better results
 Investing huge amount
in research and
development department
to offer better services to
customers.
Weaknesses
 Creating pollution
which is affecting the
environment
Opportunities
 Anglo American can
use the competitive
pricing strategy to get
better deals in the
market.
 Complying with all
different values which
is prepared in order to
preserve the
environment to
S-O strategy
Corporate strategy of utilising
the resources in a significant
manner is driving Anglo
American to achieve success in
the future
W-O strategy
Acquiring strategy of Anglo
American is to reduce the use
of carbon emissions in the
environment.
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enhance the services of
their operations (Szőcs,
and Schlegelmilch,
2020). Adopting to the new
technology to enhance
the productivity of the
workplace in an
effective manner
Threats
 Anglo American needs
to follow the new rules
and regulation in order
to expand their
business in the new
region.
 The company needs to
follow the suitable
practices to provide the
incentives to the
workers in an effective
manner.
S-T strategy
Acquiring strategy of Anglo
American is to fulfil all the laws
which is established by the
government.
W-T strategy
Acquisition strategy of Anglo
American can impact the
company in a negative
manner.
 Acceptability- There are different acceptances which includes the shareholder funds in
order to evaluate different risks in the market. The organisation can take certain
advantages by assessing the cost benefit analysis and shareholder value analysis. Anglo
American is able to achieve great results in the industry. They need to focus on
performing better in different aspects. There is adaptability in the workplace which can
be implemented by the firm in order to enhance the overall productivity in a significant
manner (Derqui, 2020). There are multiple investors in the company which has invested a
huge amount. They had the significant influence in the workplace. There are different
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strategies which the company form in order to achieve better results to the market and
provide the revenues to the significant amount to the investors. The employees of Anglo
American is considered in Low power and high interest. There are different decisions
which is taken by the top authorities in an effective manner. The company also closely
monitors the performance of the employees and helps them in improving different areas.
 Feasibility- The organisation needs to improve their feasibility by adapting towards new
challenges in an effective manner. The revenue for Anglo American is 30.9 Billion in the
year of 2020. The organisation corporate strategy is to expand their business in different
regions to incur more profits in the market (Dragomir, 2019). The company has
acquired CHL holdings they are also interested in different other companies. The
organisation is also enhancing their sales operations by offering new valuable resources
at a faster pace in the market.
CONCLUSION
From the above report, it has been analysed by the firm there are different aspects which
can be improved in order to achieve greater performance in the market. The management can
formulate different strategies and approaches to achieve a potential growth in the desired
industry. On the other hand, in this report there is discussion about the pestle analysis which is a
tool it helps the firm to analyse different forces which is affecting their performance in the
market. There are newer areas in which the company can perform better and are able to capitalise
on different opportunities. Along with that, there is evaluation of different areas which helps the
form to improve different aspects. They are also able to improve the critical areas in which they
are lacking. For further instance, in this report there is analysation of the VRIO analysis it helps
the company to gain a competitive advantage in the market. They can also utilise the resources in
an effective manner.
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REFERENCES
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