Scan the media to identify an enterprise of interest and then summarise the major strategic issues that it currently faces. Consider how and why the enterprise might misdiagnose these issues. What it could it do to avoid such mistakes?

Question

What will be an ideal response?

Answer 1

The lecturer may care to channel attention to enterprise(s) of topical interest, followed with
subsequent class discussion. For example, BAE Systems’ strategic decision to focus on
defence/military equipment served it well. Presumably it was influenced in large part by the ‘war on
terror’, more specifically aggressive interventions by the US, Britain and other major defence
spenders to engage in Iraq and Afghanistan as well as lucrative contracts from Saudi and other
middle eastern countries. More recently, it has become vulnerable to cuts in defence spending by the
UK and other governments. Evidently, it gambled on overestimates of the capacity and willingness
of these governments to continue spending after the global financial crisis of 2008 onwards.
Unfortunately for BAE, defence contracts are often very ‘chunky’, especially warships and aircraft.
Cutbacks impact dramatically on existing production facilities; minor adjustments to output are not
an adequate response.