Building the Sustainable Organization-Free-Samples for Students

Question: Discuss about the Business Model Innvation at BHP Billition and Business Model Innovation at Wesfarmers. Answer: Key Strategic Idea BHP Billiton is one of the market leaders in their field of metal, mining and petroleum. The company has followed a unique structure and strategy in the last decade to gain competitive advantage in the market. BHP Billiton is largest mining company in the world and this has been possible only because of the usage of innovation in the business model (Grant et al. 2014). The company has kept its core value intact and it has produced positive results for them. BHP Billitons Strategy is based on diversification where the organization tries to operate on low cost, long life, expandable assets. Wesfarmers have invested in retail, coal mining, chemicals, industrial products for safety and fertilizers. This shows that the organization has a diversified portfolio and the organization is able to gain large amount share in market due to the innovation they sue in their business model. Wesfarmers is one of the largest companies in Australia and has been able to hold on the market share due to their use of innovation in the business model. Wesfarmers have a strong management capability, which helps them to formulate and execute strategies (Biddle 2016). The company monitors day to day activities to ensure maximum productivity in all their diversified portfolios. Business model innovation at BHP Billiton The business model that has been established by the company helps in the development of the core competencies and the at the same time expertises in the development, evaluation, selling and extraction of natural resources. The business of the organization is asset intensive and the success of the organization is dependent on the safety, reliability and productivity of the operations (Perrott 2015). The improvements in the productivity of the organization with the help of unique features are the reason for their huge share in the market. The scale of operation of the company is large which will minimize the production cost of the company. The operations of the company is diversified which consists of commodities of various types which helps to hedge the risks involved in the market. The company also uses innovative ways to reduce the cost of the supply chain of the organization. the company uses simple integrated metrics in a structured way to make improvement in the productivity. The company continuously measure the performance to make further improvements (Klettner, Clarke and Boersma 2014). The continuous enhancement in the culture and the technology in the organization has helped the organization to lay the foundation for the growth and production. There are lot of complexities associated with the mining industry but the company has made usage of the simple design to monitor the performance. The business model is designed in such way that it will help the organization in all the elements. Therefore, all the essential activities in the organization is monitored on a regular basis to ensure effective use of resources. The supply chain of the organization is very effective and it acts a backbone for the operating model of the organization. The supply chain of the organization helps to streamline of the business model. The organization uses a integrated system for management which helps the organization track, measure and benchmark the performances in to a singl e component. The company sues standard process and common system to step up duplication of the best practices (Chaston 2017). The company spends a lot of capital on the research and development of technology. The continuous improvement in the technology acts as a major catalyst in the growth in the productivity of the organization. The organization in still searching for autonomous ways to reduce the cost and time involved in the operations. The company is focusing on improvement in the technology through innovation, which will help the organization to improve safety, increase the output and minimize the cost of production. Business model innovation at Wesfarmers Wesfarmers has a diversified portfolio, which helps the organization to hedge the risk involved in the market. The use of big data is one of the key to success of the organization and they have huge amount of data on customer information, which provides valuable insights. The big data analysis of the data helps the organization to pick best location for their stores and provides guidance in the marketing campaign of the company. This has helped the organization to gain competitive advantage in the market. Coles insurance is one of the divisions which is not known by the organization and it plays a very important role in the growth of the organization (Sokolov Mladenovi? and ?uzovi? 2015). The company uses competitive marketing strategy to increase the growth and productivity of the organization. Wesfarmers have made a lot of acquisitions which has created value for the organization. The main reason of the success of the organization is due to the diversified portfolio of the company as it able to hedge the risk in the market. The company tries to make usage of innovation to analyze the needs and wants of the consumers. The company uses big data to identify the trends in the market, which will help the organization to identify the most popular products in the retail sector. The company has been able to gain a majority of share in the market and keeps on using long term planning as the basis of their strategy. However, the business model of the organization has been criticized severely because of the decrease in the growth of the organization. However, the company is using the same strategy and business model as it has full confidence that they will be able to bounce and regain the loss share in the market (Nwogugu 2016). The organization uses innovative structure to sustain the leaseback and sale of property so that they can drive the return on capital. The growth of the mining division is less but the deficit is being covered by the growth in the retail. This s hows that diversification of the portfolio is one of the strong suits for the organization. There are lot of experts who feel that the organization needs to change their business model but the CEO of the company has defended their business model and will be using the same business model which has proved to be successful for the organization for so many decades (Beech et al. 2017). References Beech, N., MacIntosh, R., Krust, P., Kannan, S. and Dadich, A., 2017.Managing change. Cambridge University Press. Biddle, I., 2016. The Wesfarmers/Woolworths duopoly war: The Bunnings vs. Masters battle.Busidate,24(3), p.3. Chaston, I., 2017. Entrepreneurship. InTechnological Entrepreneurship(pp. 1-24). Springer International Publishing. Grant, R., Butler, B., Orr, S. and Murray, P.A., 2014.Contemporary strategic management: An Australasian perspective. John Wiley Sons Australia, Ltd.. Klettner, A., Clarke, T. and Boersma, M., 2014. The governance of corporate sustainability: Empirical insights into the development, leadership and implementation of responsible business strategy.Journal of Business Ethics,122(1), pp.145-165. Nwogugu, M.C., 2016. Corporate Governance, Financial Stability and Evolving Insurtech: The Case of Insurance Australia Group (2011-2016). Perrott, B.E., 2015. Building the sustainable organization: an integrated approach.Journal of Business Strategy,36(1), pp.41-51. Sokolov Mladenovi?, S. and ?uzovi?, ?., 2015. FRANCHISING AS THE MODEL OF INTERNATIONALISATION OF RETAILING.TEME: Casopis za Drutvene Nauke,39(1).