BHP is a top producer in the global mining industry with sales of $44 billion and operating in 25 countries. The current influences that may affect BHP’s profit and how it is run are globalisation, technology, cost-based competition, and government policies as priorities. BHP needs to focus on technology and globalisation, as they are key factors and influences that may affect the business greatly as they are directly linked with BHP and its operations processes.
Description and Legal structure
BHP Billiton is one of the top producers of iron ore, metallurgical coal, copper and uranium, while also interested in oil, gas and energy coal. Extraction and processing of the minerals, oil and gas operations are located primarily in Australia and the Americas. BHP runs under a Duel Listed Company structure with 2 parent companies; which are BHP Billiton Ltd and BHP Billiton Plc. These are operated as a single entity and are run by a board and management. The global headquarters for BHP is Melbourne, Australia. BHP’s revenue was over $44 billion in 2015 with over 65,000 employees in 2016 and operating in 25 countries.
Influences
Globalisation
Globalisation is the high degree transfer of capital, labour, intellectual capital and ideas, financial resources and technology. It includes the removal of trade barriers and increased integration between countries and companies around the globe, which means BHP can operate in more countries, transfer goods between the countries and in
2 Globalisation is the process by which the world is becoming increasingly interconnected as a result of massively increased trade and cultural exchange. Globalisation has increased the production of goods and services. The biggest companies are no longer national firms but multinational corporations with
Globalisation refers to the process of interaction and integration among the people, companies as well as governments of countries around the world, particularly in terms of trade, investment and technology. The process of globalisation, has profound impacts on the environment, culture, political systems, economic developments, prosperity and human physical well-being in the societies around the world.
Globalisation- Globalisation is a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology. This process has effects on the environment, on culture, on political systems, on economic development and prosperity, and on human physical well-being in
BHP Billiton Limited was founded in the year 2001 as a merger between Australian Broken Hill Proprietary Company and the Anglo-Dutch Billiton Plc. BHP Billiton is a dual listed company and well known as the leading global resources and the largest mining company in the world measured from its revenue. The headquarters is in Melbourne, Australia and a major management office in London, UK. They have more than 100,000 employees and contractors across the 25 nations. BHP Billiton is the major producers of commodities namely energy coal, aluminum, iron ore, minerals, copper, manganese, uranium, nickel, and mining in oil, gas, and diamond. They have more than 100 mining and
Many Australian businesses are now outsourcing, or shifting their production or services offshore where there is cheap
Globalisation is the process by which the world is becoming increasingly interconnected as a result of massively increased trade and cultural exchange. Globalisation over the past hundred years has undoubtedly made the world more interconnected including closer societies, politics, economies, cultures and the environment. Globalisation has increased the production of goods and services. There are those who argue that globalisation creates "winners" and "losers," as some countries prosper, mainly European countries and America, whilst other countries fail to do well. For example, USA and Europe fund their own agricultural industries heavily so less economically developed
South Australia economic performance has vastly improved in recent decades. The Mining Industry, is undoubtedly the most valuable resource that South Australia has. (Australian Mining. This is our Story. 2015). Besides this, South Australia is commonly known for to have a flexible and skilled workforce,
Globalization is difficult to simply define due to the variety of changing definitions that have been established over previous decades. Hamilton and Webster (2012) suggest that globalization is the connection between nations, defining globalization as a process in which barriers are reduced in order to encourage exchanges between countries. This view proposes that globalization refers very much so to the trade barriers and the improved communications between countries in order to ensure the world is unified. Globalization increases economic activity across the world and opens up markets for foreign investment.
Risk recognition and management are vital to the operation of this company (BHP Billiton 2015, p.20). According to the previous financial activities, there several significant risks influence BHP Billiton, which are commodity risk, foreign exchange risk, interest risk, transportation risk and sustainability risk.
Globalisation is the growth and integration between the economies in different countries for movement of goods and services. Globalisation
The report consists of three major parts, which are firstly divided into providing background information of Rio Tinto and its biggest competitors BHP and Vale in the mining industry. A SWOT-analysis takes into consideration the external factors of the market as well as the internal factors which may have an impact on the financial statements of Rio Tinto.
Globalisation is a broad term that is often defined in economic factors alone. The Dictionary at merriam-webster.com describes globalisation as “the process of enabling financial markets to operate internationally, largely as a result of deregulation and improved communication.” Also due to deregulation on the financial market, multi-national companies are free to trade and move their businesses to areas where a higher return or profit can be achieved. New technology also enables companies to relocate to areas where labour costs are lower, for instance movement of call centre jobs from the UK to India.
BHP Billion, a merging cooperation of BHP and Billion in 2010 (BHP Billiton, 2011), is a world leading company in mining and resource exploiting. According to ASX data, BHP Billion has the largest business scales in the Australian market, AU$166 billion of market capital and AU$71 billion of annual operating revenue in FY13 (Australian Securities Exchange, 2014). Over 128,800 employees and contractors work in 26 countries worldwide to create value for their shareholders (BHPB Annual Report, 2013). The core business has been classified into five units: petroleum, copper, iron ore, coal and aluminum, making 20%, 18%, 17%, 31% and 14% respectively in the revenue of FY13. It can be seen from Graph 1 that although iron ore was not the segment with the largest assets, it still returned with the largest revenue and highest ROA rate in 2013. The following paragraphs will focus on the strategy analysis on the segment of iron ore and how it can conquer possible threats
Globalisation can be defined as the movement toward economic, financial, trade, and communications integration by countries and their populations globally. It is a constant process and it has resulted in the intertwining and generalisation of the needs and wants of people
People around the world are more connected to each other than ever before. Information and money flow quicker than ever. Products produced in one part of a country are available to the rest of the world. It is much easier for people to travel, communicate and do business internationally. This whole phenomenon has been called globalization. Spurred on in the past by merchants, explorers, colonialists and internationalists, globalization has in more recent times been increasing rapidly due to improvements in communications, information and transport technology. It has also been encouraged by trade liberalization and financial market deregulation.