MGT3SMG - Thales Group: Strategic Analysis and Research Portfolio

This research portfolio provides a comprehensive analysis of the Thales Group, a multinational company operating in aerospace, defense, security, and transportation. It explores the company's origins, tracing its roots back to the merger of Thomson Brandt and CSF Company, and examines its global presence with operations in 56 countries. The report includes a PESTEL analysis, identifying political, economic, social, technological, legal, and environmental factors influencing Thales Group's business. It also conducts a competitive analysis, highlighting Boeing and BAE Systems as key competitors and applying Porter's Five Forces to assess industry dynamics. Furthermore, the portfolio delves into business-level strategies of Thales' protected vehicles division (Bendigo, Australia) and cybersecurity division (Canada), showcasing their approaches to defense capabilities and critical infrastructure security. This assignment is available on Desklib, where students can find a wealth of academic resources, including solved assignments and past papers.

Research Portfolio 1
BUSINESS: A RESEARCH PORTFOLIO OF THALES GROUP
Name
Course
Tutor
University
City/State
Date

Research Portfolio 2
Introduction
Digital transformation has become a significant shift in not only the social landscape but also in
the modern corporate world. It has brought significant changes in how most companies or
business work and deliver services and solutions to their customers. It has impacted on the way
companies develop their strategic plans in a bid to achieve their strategic goals. The modern
corporate world has been faced with increased competitiveness which requires most companies
to strategically position themselves in developing effective business plans which will give them a
competitive edge in the market or industry they are operating (Fernandez et al. 2014, p. 228).
Most companies or organizations have been focused on understanding and developing their
internal environments by focusing on their inner strengths and weaknesses which include the
company resources and competencies. The success of any organizations is therefore dependent
on its ability to develop and implement effective strategies. This report seeks to provide an
understanding of the Thales Group with the aim of understanding its origin, its business structure
as well as the developed business strategies helping the company achieve their strategic goals
and remain competitive in the industry they operate.
Thales Group Background Information
Thales Group is a multinational company having operations in 56 countries however it is a
French-based company with most of the activities in France. The company is engaged in the
design, manufacture, and provision of electrical systems for markets such as the aerospace,
defense, and security as well as the transportation markets with the aim of making the world a
safer place. The company was founded in the year 1968 through a business merger of the
Thomson Brandt with the CSF Company (Compagnie Generale de Telegraphie San Fil (Botelho

Research Portfolio 3
de Sousa et al. 2014, p. 14). However, these companies were operational before the year 1968
with the Thomson Brandt Company having been founded in the year 1893 while the CSF
Company was established in the year 1918. Both companies boasted of success in different fields
with the Thomson Brandt Company leading in the power generation and transport while the CSF
Company is leading in broadcasting services.
The company is a leading player in French high technology industry with over 70 operational
sites in 7 different regions where it has been able to employ 34 000 employees. Globally it has
operations running in 56 countries where it has operated 64, 000 employees. With such data, it is
evident that over 50 percent of the activities are based in France (Allal-Chérif & Bidan, 2017, p.
34). Over the years the company has been able to develop excellent relationships with their local
customers making the group a significant player in its local counties such as France, Australia,
United Kingdom, Canada, United States and the Netherlands. The company has been able to
expand its operations and business in Asia, South America, and the Middle East for company
strategic purposes of growth and taping to emerging markets.
The principal company activities are based on aerospace, space activities, transport, defense, and
security as well as market-specific solutions. Through their team of experts comprising of over
5000 IT engineers and over 200 exerts in cyber protection the company has gained significant
recognition for its capacity to develop dual civil and military technologies (Gerow et al. 2014, p.
1024). The global company sales are estimated to be $ 12.7 billion according to the company
2016 sustainability report with the defense and security activities recording $ 6.4 billion,
transport 1.5 billion while the aerospace activities marked sales return of $ 4.7 billion. France
recorded sales returns of 28%, UK 11% while the rest of Europe recorded sales return of 21%.

Research Portfolio 4
The company has been built with careful strategic planning that has enabled it achieves most of
the company strategy and growth objectives.
A PESTEL Analysis of Thales Group Describing the Landscape it operates
PESTEL also was known as PESTLE is a strategic analytical tool used by most businesses for
strategic planning and plays an essential role in helping most organizations understanding the
factors influencing their firms from the external environments. Such knowledge puts the
companies or businesses in a strategic position to maximize the available opportunities and
minimize the threats to the organization resulting from the external environments they operate in
(Foreman & Gurugubelli, 2015, p. 97). The acronym stands for political, economic, social,
technological, legal and environmental influences for business operations.
POLITICA
L
ECONOMI
C
SOCIAL TECHNOLOGIC
AL
ENVIRONMENT
AL
LEGAL
1.The
growing
populist
sediments
2. Political
tensions
1. Dynamic
defense
budgets
2. currency
volatility
and Brexit
effect
1.
increasing
aviation
demands
2. growing
urbanizatio
n
1. development of
cross over
technologies
2. differentiation
of innovations as a
competitive
advantage
1. call for
innovative
solutions to curb
climate change
2. global shift
towards the use of
renewable energy
1.intellectu
al property
rights
2. the new
quality
manageme
nt
regulations

Research Portfolio 5
Environmental factors or influences: the global markets and many governments have engaged
in strategies aimed at improving and conserving the environment. Therefore most innovations by
the company are required to offer solutions which will help in curbing climate change. The
French economy has shifted its strategic economic goals to meet international environmental
conservation regulations by moving into the use of renewable energy. Thales Company has been
committed to reducing carbon emissions, limiting discharge and reducing wastes as well as
reducing the consumption of natural resources.
Political influences: globally there have been reported cases of increased political tensions as
well terrorist activities have increased cost governments concerns about keeping their people
safer. Most governments have therefore focused on the acquisition of privatized security services
instead of developing their existing capabilities. This has provided the company with an
opportunity to venture into these markets and provide security and defense systems to such
markets (Wheelen et al. 2017, p. 26). The organic populist sediments have also impacted the
operations of the company negatively in various landscapes since they have promoted anti-
globalization ideas as well regional divisions. The company needs therefore to develop effective
strategies to deal with these ideas since they act as a threat to the business growth.
Economic influences: Most governments such as the United States, UK, and Australia
governments have had tight budgets whereas other countries such as the Middle East countries
and India have increased their defense and security budgets. The company, therefore, has to
develop effective strategies aimed at venturing into these markets with high budgets for military
and defense systems. Currency volatility has affected most Europe and United Kingdom
countries due to the impact of Brexit and therefore or making the pound and dollar appreciate

Research Portfolio 6
(Goztepe et al. 2014, p. 16). This has exposed the country into a significant rivalry regarding
their exports from countries such as China in offering military and defense equipment.
Legal influences: There have been increased concerns over regulations of quality information
technology services and innovations. Globally the international markets have embraced the use
of the revised quality management regulations. There are also increased concerns over increased
intellectual property rights protecting innovations. Such standards and regulations require the
company to invest more in the production of quality products and services.
Technological influences: with the rapid growth in technological advancements there is a need
for the company to keep up with the current technologies. There has been increased development
of crossover technologies and innovations which have been differentiated are now considered to
present a competitive advantage in the Thales markets. There is a need therefore for Thales
Company to adopt technologies which will give the company a competitive advantage in the
industry.
Thales Two Main Competitors and Five Forces Analysis showing the position of the
competitors
The Aerospace, transport, defense and security markets or industries are intensely competitive
globally as the world seeks to intensify various mechanisms of making the world safer. With
increased technology and different resource, endowment competition has increased, and
competitive advantage is achieved by companies which offer quality services to solve various
market problems (Fleisher & Bensoussan, 2015, p. 68). The porters five forces analysis provides
an assessment of the competitiveness of industry in developing corporate strategies. The five

Research Portfolio 7
forces used in the evaluation include; the supplier power, the buyer's power, competitive rivalry,
threat of substitution and the risk of new entry. Thales main competitors include the Boeing
Company as well as the BAE Systems Company.
The Boeing Company is the most significant aerospace company globally with revenue of $ 94.6
billion and therefore regarding supplier’s power the company has few suppliers and hence has
been able to control their power in the market giving the company an advantage. It has employed
over 140 000 employees globally and does not relies on specific high purchasers of their
products however their services are diversified enabling the company to control the buyer's
power. Regarding competition the company is very competitive regarding quality service
provision and increased innovative solutions primarily in the transport market (Foreman, J.C.,
and Gurugubelli, D., 2015, p. 367). It does not face the substantial threat of substitution however
different airlines such as the Canadian airlines, Australia airlines; Lock Heed Martin company
has increased competition to the company by offering short distance aerospace services. But
regarding new entry into the market, the company is more competitive and does not face a
significant threat from new or emerging companies.
The BAE systems Company has a higher revenue compared to the Thales Company of $ 22.3
billion and has been able to employ over 83 000 employees. The company also operates in the
same markets as Thales Company and has an average supplier power with most of the company
suppliers influencing the company decisions. The buyer power has been controlled since the
company serves most of the medium and small-scale purchasers and has few high purchasers.
The company is competitive in the industry and has been able to rival Thales Company regarding

Research Portfolio 8
sales returns. The company also faces the threat of new entry from small companies offering the
same products to the small and growing markets globally.
A Business Level Strategic analysis of Thales protected vehicles division (Bendigo)
Australia has been in the forefront to address the defense and military systems of the country.
Thales had developed the Bushmaster vehicle which was used for defense and security purposes.
However due to increased security measures the company has sought to create new machines
with the new protected mobility as the new business strategy through the development of the
Hawkei in Thales protected vehicle division in Bendigo (Khan et al. 2015, p. 958). The plan is
aimed at creating a future defense capability for the Australian governments as well as to other
countries. The advantage of having this new protected vehicles include increased mobility of the
car allowing soldiers to penetrate harsh conditions, the vehicle is well protected, increased
lethality and has increased survivability compared to the Bushmaster. The Hawkei provides
unparalleled situational awareness and also incorporates very high levels of ballistic and blast
protection. However, the technology used to develop these military and defense systems is very
expensive for the company but offer quality services. It has enhanced defense and military
facilities in Victoria and ranked the Australian Military and defense systems very high in the
global map.
A Business Level Strategic analysis of Thales cyber-security division
Thales cybersecurity division in Canada has developed a business strategy that seeks to deliver
safety, secure and resilience services to any company or organization critical infrastructure. The
division has developed cutting-edge security strategies through cryptographic security products

Research Portfolio 9
aimed at offering optimal performance for securing critical information systems. The company
has specialized in providing end to end information security for organizations or businesses in
not only preventing and detecting attacks but also in helping the systems react rapidly to the
attacks (Pestle et al. 2014, p. 102). The division has also engaged in the development of entirely
secured information systems throughout their life cycle to help the businesses master critical
data. The company has been able to attract a team of over 5000 essential IT engineers as well as
2000 experts in cybersecurity. Despite having these experts, the division seeks to attract the best
human talents, and this can only be achieved through developing practical, innovative strategies
and reward systems for the division employees.
Benefits of Thales Strategic Relationships
Over the period of operation, the company has been able to develop specific strategic
relationships aimed at improving the performance of the company. One of the benefits resulted
from having the French state become a shareholder in the company by owning individual rights
in the form of golden share. This has enabled the company to enjoy constant support from the
state as it is the only French company by which the state owns shares. Secondly, the company
has benefited from the strategic relationship of a business merger with the CSF Company which
helped the company in improving their broadcasting and communication information systems
(Lawrence & Braddon, 2017, p. 37). Lastly, the company was able to acquire the `Quavers
Company which has helped the company in enhancing their essential data analysis in a bid to
strengthen their cybersecurity services.
Conclusion

Research Portfolio 10
The development of strategic business plans is very vital for business growth. The effectiveness
of a company and its ability to remain competitive in the industry is determined by the company
able to develop effective business strategies. From the above research portfolio, Thales Company
can be said to having an action plan aimed to provide defense and security systems. However,
there is a need to attract best talents in their various divisions to enhance their innovative
capabilities with the aim of improving their competitiveness in the industry and rival their
competitors.

Research Portfolio 11
List of references
Allal-Chérif, O. and Bidan, M., 2017. Collaborative open training with serious games:
Relations, culture, knowledge, innovation, and desire. Journal of Innovation &
Knowledge, 2(1), pp.31-38.
Botelho de Sousa, T., Soares Camparotti, C.E., Müller Guerrini, F., da Silva, A.L. and
Azzolini Júnior, W., 2014. An overview of the advanced planning and scheduling
systems. Independent Journal of Management & Production, 5(4).pp. 14.
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. 68.
Foreman, J.C. and Gurugubelli, D., 2015. Identifying the cyber attack surface of the
advanced metering infrastructure. The Electricity Journal, 28(1), pp.94-103.
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.
Goztepe, K., Kilic, R. and Kayaalp, A., 2014. Cyber Defense In Depth: Designing Cyber
Security Agency Organization For Turkey. Journal of Naval Science and Engineering,
10(1), pp.1-24.

Research Portfolio 12
Khan, U.A., Alam, M.N. and Alam, S., 2015. A critical analysis of internal and external
environment of Apple Inc. International Journal of Economics, Commerce and
Management, 3(6), pp.955-961.
Lawrence, P. and Braddon, D., 2017. Strategic issues in European aerospace. Taylor &
Francis.pp. 37.
Nag, B., Han, C. and Yao, D.Q., 2014. Mapping supply chain strategy: an industry
analysis. Journal of Manufacturing Technology Management, 25(3), pp.351-370.
Pestle, W.J., Crowley, B.E. and Weirauch, M.T., 2014. Quantifying inter-laboratory
variability in stable isotope analysis of ancient skeletal remains. PLoS one, 9(7), p.102.
Wheelen, T.L., Hunger, J.D., Hoffman, A.N. and Bamford, C.E., 2017. Strategic
management and business policy. pearson.pp.24-32.