Question

these questions need to be answered in relation to BHP Billiton

1) What are the firm's Sustainable Competitive advantages

2) Perform a SWOT analysis of the firm (min 3 points on each)

3) Does this firm follow sustainable marketing practices

Answer 1

Ans1: ) Sustainable Competitive advantages for BHP Billiton:

Sustainable Competitive advantages implies a firm’s ability to maintain the asset, prcess and business knowledge and technology that is tough for any other firm to imitate in long term.BHP being a mineral and exploration company needs a sound and sustainable business practices that may run the business smoothly without external shocks in todays highly competitive and environmentally conscious world.

BHP very well understands the value of sustainability so they have placed their structure to create a sustainable competitive advantage ecosystem in the organisation. For example;

1. Corporate strategy to achieve the best capabilities, best commodities and best assets to create long-term value and high returns.

2. Nurturing culture and capabilities that enable the execution of business strategy.

3. Exploring and developing commodities with high economic rent potential that match our capabilities.

4. Developing assets that are resilient through the cycle, have embedded growth options and match firm’s capabilities.

Ans 2:) SWOT analysis of BHP:

Strength:

1. Creating value and wealth for the community and long tested trust of shareholders in the firm.

2. Strong financial performance.

3. High quality assets largely located in low-risk locations, with strong development potential.

Weakness:

1. Operating market is environmentally sensitive.

2. Prone to localised conflicts in asset exploration.

3. The operating environment is complex, with uncertainty and volatility expected to be high.

Opportunity:

1. Positive long term overview of market.

2. Emergence of new demand centres where the twin levers of industrialisation and urbanisation are still in nascent stage.

3. Continuous advancement of technology that reduces the overhead of operations.

Threat:

1. Policy uncertainty , along with an increasingly unpredictable policy formation process in some major economies, serve to reduce consumer confidence and business certainty.

2. The marginal cost of producing some commodities is likely to rise.

3. Unsustainable land and water use and biodiversity loss are a danger to long-run living standards.

Ans 3:) Sustainable marketing practices:

By virtue of their operating market, BHP is very well aware that any unsustainable marketing practice may harm the long term business. So firms overall marketing structure is devised on sustainable marketing practices. For example:

1. Active investment in Community wellbeing and human rights.

2. Deep R&D in environment friendly exploration processes.

3. Engaging in regular, open and honest dialogue with stakeholders to understand their expectations, concerns and interests.

4. Applying the mitigation hierarchy (avoid, minimise, rehabilitate, compensate) to minimise environment and community impacts, and achieve target environmental outcomes.

5. Conducting regular impact assessments for each asset to understand the social, environmental and economic context;