One of the strategic options available to BAE is to engage senior executives in back-office functions. It would help the team transform the existing operations and take a different approach to human resource management and accounting. The key challenge when picking this option is the lack of instant and simultaneous control over service improvements and cost reduction. Based on the information presented in the case study, BAE does not see a lot of sustainability in terms of its operations, which is an important idea to mention. This concept becomes especially crucial when innovation has to be sustained but the organization cannot allocate enough resources to share costs and promote outsourcing. The inability to appeal to additional suppliers should also become central to BAE if the management expects to protect its international contracts and design services that would be perceived identically across the globe. Yet, the fact remains that fee-for-service outsourcing is a complex task to complete, and BAE could be exposed to additional challenges with this strategic option.
Another concept that should be investigated by the company’s management is the transformation of supplier margins. The latter could encourage specific decentralization and help the team benefit from baseline services (Wheelen et al., 2017). Regardless of the company’s future strategic direction, the management should not engage in fee-for-service outsourcing in order not to allow any power shifts that would make the supplier superior to BAE. Reasonable contract alterations would give the company an opportunity to sign adequate contracts and integrate services and technologies in a way that would underline the benefits of BAE’s approach to human resources. The concept of ‘premier’ mentioned in the case should not be seen as the only available option for BAE that should be exploited to an extent where the market would get oversaturated owing to the company’s efforts. One of the possible ways to resolve this issue could be to investigate the benefits of enterprise partnership and give up on fee-for-service outsourcing when it comes to international conglomerates.
Business Level Strategies
One of the possible business strategies for BAE could be to broaden exposure to innovative HR initiatives. The rationale behind this would be the fact that the company yet has to strengthen its international presence and review the possibilities related to how the management could resolve the lack of skilled individuals on the team’s roster. On the business level, such strategy could help BAE improve its worldwide image and start paying more attention to how its HR unit finds the most skilled workforce (Sullivan, Thomas and Rosano, 2018). With no exceptions, this business level strategy would become one of the most important stages on the company’s way to improved hiring procedures and an extensive roster consisting of experienced employees ready to maintain the organization’s vision. On the other hand, broadening exposure to HR initiatives could be a reasonable option in the case where BAE chooses to re-evaluate its budget expenditures.
Therefore, the second business level strategy comes into play, which is an attempt to increase the company’s marketing budget. Knowing that the organization dominates the UK and Saudi Arabia in terms of its employment agenda and majorly overlooks other first-world countries such as the United States, it may be proposed to spend more resources on establishing a powerful workforce network across the globe. This effort is long-term by nature but BAE should expect its business units to acknowledge the need for improved marketing. A better brand name would drive more potential employees to the organization, allowing the administration to increase possible returns on investment and develop a sophisticated operative grid. The fact of increasing the amount of money spent on BAE marketing might be a crucial step on the way to developing a stronger team. Without a reasonable marketing budget, the organization will not have the opportunity to expand its operations.
The third business level strategy that should be considered when discussing the operations characteristic of BAE is quality improvement. This update should touch upon the HR unit, as the process of recruiting should be reviewed to respond to the needs and aspirations of the existing market. HR experts cannot overlook the benefits of professional development because it would aid them in finding the best labor force even during the times when employees cannot physically visit the workplace. The impact of HR unit on business operations of BAE is irreplaceable due to the influence of the human factor on the organization (Ritter and Lettl, 2018). HR quality improvement is an essential procedure that should be promoted and maintained at BAE if the company expects to conquer more international markets. The current development vector shows that the organization’s management acknowledges the need for changes and imminently reinforces the value of professional knowledge and market relationships.
The latter is also important due to the team’s willingness to tap new and emerging markets and increase the organization’s influence on the marketplace in general. The high pace of technological and social development forces many organizations similar to BAE to restructure their budget and put a strain on the existing resources with the intention of merely keeping the company afloat. Accordingly, the rationale behind tapping new markets would be to spread the corporation’s influence worldwide and involve more countries than UK, US, Saudi Arabia, and Australia. It may be unclear now if the team could be investigating new products as well but the general idea of allowing BAE to spend more monetary resources on a reasonable business expansion is evident. The need for updates in the area of market investigation is an important asset that could drive the company out of its comfort zone and establish additional development opportunities.
Corporate Level Strategy
The first element of BAE’s corporate level strategy should be the reorganization of the HR unit that would turn the latter into shared service streams. Each of those service streams would quickly become a mini-business in itself, allowing the organization to spread its efforts and share responsibilities related to recruitment among numerous groups consisting of the members of the HR team. Local recruitment sessions across the globe could protect the organization from unreasonable hiring procedures forcing BAE to invest more resources in employee salary cap instead of possible rewards. The existence of cross-business services at BAE shows that shared service streams could represent the future of organizational decision-making when it comes to human resource management (Peppard and Ward, 2016). Further standardization and centralization of the processes would make the company much more successful due to the fact that it would establish a business connection between hiring experts and current employees.
Another corporate level strategy is the process of redesigning the business processes present within the organization. In order to achieve its objectives related to corporate level strategies, BAE utilizes a custom Six Sigma methodology. A reasonable way to improve the current state of affairs could be redesigning the peer-review process completed by senior leaders of the organization. The modern inefficiency of the review process could be explained with the help of an extensive amount of bureaucratic paperwork that slows down the HR management process by a notch. An increase in the prevalence of self-service could become a possible solution for BAE, as the company would move into the area of saving HR-related assets and delivering improved services within shorter periods. The concept of electronic HR management should be explored further in order to allow BAE retain its workforce without maintaining a physical contact.
The most appropriate internationalization strategy for the current case study is to apply enterprise partnership. Even though it could affect the organization in a negative way at first, the ultimate outcomes would relate to proper outsourcing and absence of compatibility issues. The idea of developing a culture that would appeal to the company’s customers is going to become a beneficial asset in the long run. A probable increase in transformation-related costs could be mitigated with the help of hiring an additional HR manager who would focus on partnership opportunities and international relationships (Trigeorgis and Reuer, 2017). The staff should support the proposed changes to challenge the conventional problem of cultural obstacles that affect intercontinental companies. This way, BAE would protect itself from negative social backlash and gain more insight into how the organization could maintain its image of a risk averse and cautious corporation. The back-office function, nevertheless, should be transformed with the help of innovative HR management and cultural variations.
Proposed Organizational Structure
The proposed organizational structure should also rely on the potential of third-party transformations established by BAE. The rationale behind this idea is that it could decrease expenditures linked to decentralization and help the corporation save more resources via smarter HR decision-making. In this case, the probable cost escalation would be met with required knowledge and experience. The team will not be required to face fee-for-service outsourcing and force the organization to switch to unit-cost reductions. BAE’s customers would be most likely to stick with the organization in a situation where the management is going to protect their baseline and predict the possible overall costs of the unwanted transformations and alterations (Ethiraj, Gambardella and Helfat, 2016). An increased level of corporate transparency would improve the company’s image and turn BAE into one of the most responsible corporations in the market. Not only this would improve BAE’s international image but it would also attract transcontinental specialists to the organization. Third-party HR management should become an accurate depiction of how people should be hired at BAE, as otherwise, hidden costs and the lack of transparency would turn away the majority of applicants from the organization.
Recommendations and Implementation
Approach to Strategic Control
The company would have to pay stricter attention to strategic control because enterprise partnership is not a perfect solution for every task that arises in front of BAE. The former joint governance established in order to create a link between suppliers and customers gave managers a hard time, forcing them to switch between goals that were mutually excluding. Therefore, in order to maximize profits and protect the company’s HR initiatives, the management should try implementing cost-efficient service delivery first and then build the remainder of the corporate strategy around what worked for BAE the best. When it comes to strategic control, the role of executives should not be underestimated as well because their decisions could be another way for the organization to find the perfect balance between outsourcing, cost reduction, and service quality (Deephouse, Gardberg and Newburry, 2019). The potential outcomes of business process outsourcing should be addressed by BAE in a preventive fashion in order to help the team externalize its objectives and sustain cost-effectiveness irrespective of the condition of the market.
Recommendations to the Firm
The key recommendation for BAE is to strengthen its back-office initiatives and ensure that the quality of services the team provides remains at an exceptionally high level. Even though it is rather unlikely that the team is going to achieve lower costs within a short period, the idea for the organization should be to support international partnerships and outsource human resources where possible to establish an enthusiastic corporate image of BAE and its employees. The current decentralization of back-office operations should be removed in order to speed up the cost reduction process and help the management focus on the benefits of standardization. The transformation of the back-office operations would become a challenge for BAE management at first due to the lack evidence proving the value of this strategy. Nevertheless, the main outcome of the current case study is that BAE should avert any fee-for-service interactions and turn to prospective outsourcing. This means that the team would improve its capabilities and develop culturally apt strategies in order to highlight its domain knowledge and experience without any sign of discrimination or inattentiveness. The fast pace of technology development should also be considered when reviewing HR management strategies and their impact on the organization.
Deephouse, D., Gardberg, N. and Newburry, W. (2019). Global aspects of reputation and strategic management. New York: Emerald Group Publishing.
Ethiraj, S. K., Gambardella, A. and Helfat, C. E. (2016) ‘Replication in strategic management’, Strategic Management Journal, 37(11), pp. 2191-2192.
Peppard, J. and Ward, J. (2016) Strategic management of information systems: building a digital strategy. New York: John Wiley & Sons.
Ritter, T. and Lettl, C. (2018) ‘The wider implications of business-model research’, Long Range Planning, 51(1), pp. 1-8.
Sullivan, K., Thomas, S. and Rosano, M. (2018) ‘Using industrial ecology and strategic management concepts to pursue the sustainable development goals’, Journal of Cleaner Production, 174, pp. 237-246.
Trigeorgis, L. and Reuer, J. J. (2017) ‘Real options theory in strategic management’, Strategic Management Journal, 38(1), pp. 42-63.
Wheelen, T. L. et al. (2017) Strategic management and business policy. Boston: Pearson.