Balfour Beatty is a construction company in the United Kingdom, delivering projects across commercial and social buildings, power utility systems, transport, and the leading infrastructure company compared to other construction companies in the United Kingdom (Balfour Beatty, 2019).
The internal analysis of Balfour Beatty is essential for strategic planning of the company. However, we will first look at the SWOT analysis of the company before discussing the internal analysis. The Strength, Weakness, Opportunity and Threat analysis of the company helps in analysing the required strategic policies for diversification of the company and to boost profitability (Valentin, 2001). Belfour Beatty is a real estate and construction company which provide assets to the societies that need to function, thrive and develop. As a leading company in the construction sector, Balfour Beatty has many strengths that have helped in the market. The company has a successful track record of integrating complimentary firms by acquiring or merging. It successfully integrated with many technology companies, therefore streamlining their operations. Besides, the automation of activities of the company has helped in bringing consistency in the quality of its services. This has made it scale down or scale up depending on the condition of the market (Valentin, 2001).
The culture of cooperation between the company and the dealers where dealers promote the company by training of the teams that make sales hence helping the company to sell its products, therefore, financial flow. Another strength of the company is a strong brand portfolio which is extremely useful in strategising and planning especially when diversification of different geographical location is required (Valentin, 2001). The latest analysis of the company financial status shows good returns on expenditure. The execution of new projects helps generate good performance as compared to spending by building different revenue streams over time. Besides, the company boasts of a workforce which is highly skilled through successful training programs. Balfour Beatty invests hugely in training of its employees. Highly motivated employees drive the production and profitability of the company. Lastly, the availability of reliable suppliers and a high level of customer satisfaction are other strengths of the company. The raw materials are essential for the company to overcome any supply chain bottleneck that may arise. Customer satisfaction boosts the customer-company relationship due to brand quality.
However, Balfour Beatty company has much weakness which can be improved when competitive advantage and strategic planning is taking place. The marketing of its products is a major weakness of the company. Lack of success in merging and integrating firms with a different culture is another shortcoming of the company. The companies which merge have different work cultures, and this is a challenge. Furthermore, the limitation of success in the outside core businesses shows a point of weakness of the construction company. Poor financial planning is a major weakness in the company that internally, the company is supposed to look into for better profitability (Porter, 1980).
The Balfour Beatty has a lot of opportunities for their development and expansion. Government agreements have opened new markets for the company around the globe. The new emerging markets are essential for the exploration by the company to help in diversifying geographically. The stable flow of cash flow provides opportunities for investments in other segments which are adjacent (Valentin, 2001). The technological advancement which is taking place in the construction industry offers an opportunity for Balfour Beatty to expand and reach customers as well as deliver the best services to the clients. The decrease globalisation and creation of new market frontiers is an excellent opportunity for the company. Strategic planning is vital in exploring other markets around the globe not only delivering services to the UK and the US markets.
However, the company faces some threats, especially from external factors. To diversify, an internal analysis of how to deal with the risks is necessary. The threats include; lack of regular innovative products, imitation and counterfeiting of Balfour Beatty products, demand of highly profitable products, environmental regulations, competition from other companies and changes in consumer behaviour (Chandler, 1998).
The organisational resources include information, human, finance and physical resources (Frery and Warnier, 2015). Balfour Beatty competes effectively both in the United Kingdom and Internationally because of adequate resources, the company has. With a total of 15, 000 employees throughout the United Kingdom, the company has extensively invested in its human fund, which reflects on its productivity (Balfour Beatty, 2019). The company’s Chief Executive Officer, Leo Quinn is one of the members of the Department for Business, Energy and Industrial Strategy’s Construction Council charged with the responsibilities of leading work stream on skills (Balfour Beatty, 2019). This contributes to the information resource the company has, besides economic growth connected to in-depth knowledge about infrastructure, investment and degeneration. On the financial support, the company’s stock stands at UK£1.8b, with a focus on both short and long term investments. The company is also shrunken its debt from UK£1.1b to UK£1.0b in 2018 accounting for operational efficiency. The cut in total debt and the adoption of long-term debt imply that the company utilises more of its finances in productivity (Balfour Beatty, 2019).
Strategies used by the company.
Balfour Beatty’ industrial strategy is based on a vision for growth. The company combine the investment competence with the engineering skills with a focus on financing, developing, constructing as well as maintaining complex structures (Hartmann, 2006). The company’s strategy is based on four aspects, which include lean, expert, trusted and safe. The company leads in safety matters by ensuring zero harm to communities, customers and the people in general (Mohamed, 2003). Balfour Beatty ensures trust by exhibiting discipline during the process of contracting, as well as delivering value to the customers. The company as well execute their services with expertise, whereby the investment is to attract, retain and develop skilled employees in addition to subcontracting talents (Roberts, 2005). The company pioneers new technologies, and transform the field of construction. The company put in place appropriate measures to compete effectively. The measures include engineering expertise in the delivery of large- scale and complex infrastructure facilities. The company’s presence at the local level and the strong networks with suppliers and customers enhance its competitiveness. Besides, the company’s safety ethics and sustainability make it compete with other global construction organisations.