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Business models
Section B
B.1: Business models
Jaguar Land Rover Automotive PLC (JLR) designs and manufactures automobile in two distinct brands: jaguar, which includes jaguar, jaguar classic, and jaguar special vehicles, and land rover brands, which includes land rover, land rover classic, and land rover special vehicles. Other products include powertrains and turbocharged engines. JLR target market is the luxury segment. This segment targets the upper-class consumers globally. As a luxury automobile manufacturer, JLR's major critical market is North America. The firm has positioned itself by providing sports and premium vehicles. The key drivers to JLR’s success include a strong customer relationship network and adaptation of the value proposition to the changing operating environment through innovation. Design and engineering are critical elements to the success of the business. This is through developing and manufacturing next-generation electrical architecture. Besides, JLR engages in strategic sourcing, where it partners with suppliers that allow for an optimal value chain. This is coupled by integrating a sustainability model in its operations that allows for the responsible production of eco-friendly products. Finally, JLR champions a corporate culture rooted in shared responsibility with employees, allowing for the pursuit of a similar vision.
BAE Systems leverages technology to provide electronic defence systems, cybersecurity solutions, electro-optical sensors, flight controls and digital defence and commercial engines. It also engages in manufacturing munitions and weapons, combat aircraft, electronics equipment combat aircraft, avionics equipment, combat vehicles, applied intelligence and security services, and defence contracting for managing government munition centres. For maritime products, they include designing and manufacturing submarines, complex warships, ship repair, munitions, and training. BAE Systems offers these products and services to governments, security agencies, prime contractors, and commercial firms. BAE Systems operates in the aerospace and defence industry. This is to provide security solutions in land, sea, and air, where, besides selling of products and services in this sector, the business offers training. The key drivers that inform the firm's success include strategic alliances with governments, developing and diversifying its human capital, and focusing a bulk of its sales and marketing activities on major governments that include the UK, the U.S., and Saudi Arabia. To achieve optimal product and services distribution, BAE Systems engages third-party marketing firms. The business also engages in constant innovation through next-generation research and development investment to solve complex technology-related and engineering project, helping create customer intimacy and a competitive edge.
B.2: Professional and ethical issues
A firm that adheres to best practices positions itself for continuous positive relationships with people in the value chain. Both JLR and BAE Systems can achieve best practices in their respective operations by engaging in several activities. First, the management needs to develop a clear strategic focus in line with its mission and vision. This is followed by communicating the strategy with clarity, which allows for the teams in each firm to develop demanding and realistic objectives. Also, establishing cultural cohesion and pursuing a management style in line with the culture is another critical best practice.
Outcomes from achieving best practices for JLR and BAE Systems include increased competitiveness, optimization of the value chain, improved relations between different stakeholders, and achievement of the target bottom line. The firms will become more flexible to adapt to new changes. Waste minimization, quality improvement, and customer satisfaction are possible results of adherence to best practices. Finally, the firms will achieve the triple bottom line elements of sustainable performance. Through capitalizing on tools such as benchmarking, performance monitoring, and financial forecasting, and strategic planning, the businesses can achieve best practices.
JLR’s strategy has founded on four sustainability pillars. They include corporates social responsibility, the focus on its employees, sustainable operations, and sustainable products. Strategy in the firm focuses on offering a pure electric experience, where the cars will contribute to zero carbon footprint. With ethical concerns over the emissions make by vehicles, the importance of the issue cannot be overlooked. JLR is a champion of reuse and recycle, and has ensured that it monitors the use of its materials as electric cars batteries, plastic items monitoring, and aluminium reforming. The firm has achieved great strides in environmental sustainability, where it has reduced the use of virgin aluminium in automobile production. JLR has achieved a reduction of energy consumption by 90% through the sustainable production approach.
On achieving best practices in JLR, the first ethical consideration is supply chain optimization to ensure a carbon emission-free value chain by 2039. This is by investing £2.5 billion annually on clean energy, including the engagement in electrification technologies through strategic alliances with partners. The pressure from environmentalists, governments, and society has seen a shift in the strategic focus of JLR.
Human rights, more so when dealing with employees, has seen the firm establish principles in its code of conduct to ensure ethical practice and professionalism. The working condition is such that the firm has set policies to ensure the safety, health, and security of the employees, besides providing equal opportunities for all. Also, the organization does not employ minors, nor does it use forced labour. These are measures presented in the code of conduct that guides how professional the employees should be in the firm. Presented in this policy is the statement against corruption and bribery. The success of the code of conduct can be seen in the firm’s lack of reports on corporate unethical reporting.
Guiding the profession and ethical conduct is the JLR corporate governance framework. The firms have several committees that ensure the governance of the firm’ is in line with local and international regulations. These committees include product, security, and health and safety. Using the Wates principles, the firm audits the board based on the skills, knowledge, independence, and experience to ascertain the ability to practice professionalizing in auditing the activities of the firm. Data security is becoming an Achilles heel to businesses globally. JLR has established a framework that sees the governance of its security systems, besides training employees, suppliers, and vendors on using cloud-based tools for establishing cybersecurity threats. The focus on data security, given the firm's reliance on next-generation technology, cannot be overlooked.
BAE Systems achieve the obligations set in best practices through its governance framework. One measure is the utilization of FRC’s Guide on Board effectiveness to measure how the firm's board of directors leads the firm towards achieving best practices. This is by issuing the board a questionnaire at the end of each financial year. However, the challenges that BAE System includes criticism for data security. This is further complicated by backlash for manufacturing weapons of mass destruction.
The strategic management in BAE systems has established measures across its value chain to ensure that the firm achieves its set best practices. Among the approaches taken is the implementation of the ISO1 50001 by purchasing 173,502 MWh of renewable energy in 2020, focused on energy management to ensure environmental protection and the welfare of the communities it operates around.
Corruption is a vice that corporations globally are under pressure to fight. For BAE Systems, the firm has established an anti-corruption programme. The programme is tailored to ensure that employees adhere to the regulatory and legal requirements, including acknowledging and fighting corruption and bribery risk. The firm achieves this by communicating clear anti-corruption policies and principles. Through continuous training of employees on corruption and providing them with a code of conduct provides possible solutions and how they can face and professionally, ethically, and legally overcome them.
BAE Systems has established supplier principles to ensure the firm’s supply chain provides sustainable raw materials for the production process. Through the supplier principles, BAE Systems requires the suppliers to comply with national and international laws and the firm’s best practice on environmental issues, conduct and behaviour regarding corruption, employee treatment, and responsible payment. To measure the success of the adherence to the supplier principles, the firm evaluates supplier compliance using a supply chain assurance activity. An example is the 2020 assessment, where BAE Systems identified 14 low-level risks, which it resolved through collaboration with the suppliers.
To achieve the global pressure from different stakeholders to achieve environmental sustainability, BAE Systems has established measures to reduce its net greenhouse gas emission to zero by 2030. The firm measures this through the carbon footprint in its products, the supplier evaluation, and the extensive use of renewable energy. Further, business travel is reduced, besides the shift towards using facilities and buildings that are energy efficient.
Another ethical issue that BAE Systems considers is the Safety, health and wellbeing of the employees. To achieve this best practice, the firm provides its workforce with a health and safety policy and a security policy. These policies provide the employees with adequate information on how to deal with the prevailing risks to health and safety, besides regular training on the same. To evaluate the success of these engagements, the BAE Systems evaluates the success of the existing policies regarding adherence to the policies and information security audit.
B.3. Conclusion
This report has analysed JLR and BAE Systems to capture the engineering firms in action. Both are publicly listed firms in the UK and with global operations, making them multinationals. Yet, these firms operate in different industries, with JLR operating in the automotive manufacturing industry, while BAE Systems operates in the defence and aerospace industry manufacturing industries. Their business models are in line with offering value to customers through designing, developing, and manufacturing products. With engineering at the centre of the key process, and with major resources directed to engineering, both firms have emerged with innovative cultures in their respective industries, creating, delivering, and promising to engage in next-generation technology production.
At the fore of both firm’s operations is the adherence to ethical practices. Both firms are led by governance bodies that ensure they achieve the triple bottom line approach to sustainable business practices. Production involves the consumption of a mix of raw material, which emits waste to the environment. Automobiles are known to emit fumes that contribute to environmental degradation. Both firms, facing pressure from global and local stakeholders, have developed policies to align the strategic focus with these expectations and priorities. Both firms believe in human capital as the source of current and future value for all stakeholders. Thus, provided in the code of conducts on both firms is the commitment to ethical practices.
One reason for such a high level of similarity is the focus on evidence-based practices, as proven by the commitment to research and development investment. Also, as a manufacturing firm that depends on its value chain to procure raw materials, transform them, and deliver as finished products to customers, ethics remain a crucial strategic focus. Another reason for the similarities, despite different business model capitalization of innovation and engineering in the delivery of value to both firms.
JLR and BAE Systems exploit mechanical engineering aspects that include manufacturing, environment and combustion, and systems. Also, both firms focus on energy management, where this is a key element in informing the production decisions, mechanical designing, evident from the consistent innovation and focus on technology.
The long-term outlook for JLR and BAE Systems informs the strategic alignment of the resources and efforts. One such focus is having a long-term strategy for the elimination of greenhouse gas emission. To achieve this, both firms have set aside research and development resources, with JLR focusing on producing electric automobiles. Clean energy is the ultimate goal for both firms. This is with the focus on reducing the overall value chain emission by 2035 for JLR and 2030 for BAE Systems. Also, the focus is on engineering systems to develop autonomous transport products, such as luxury vehicles that are self-driven for JLR while applying sustainable practices. Data and security development leadership will be critical to the future of BAE Systems, with the firm's constant ethical dilemma based on its business model a major concern. By observing ethical principles, both firms can minimize the environmental and social concerns that currently affect their businesses.
Business models
Section B
B.1: Business models
Jaguar Land Rover Automotive PLC (JLR) designs and manufactures automobile in two distinct brands: jaguar, which includes jaguar, jaguar classic, and jaguar special vehicles, and land rover brands, which includes land rover, land rover classic, and land rover special vehicles. Other products include powertrains and turbocharged engines. JLR target market is the luxury segment. This segment targets the upper-class consumers globally. As a luxury automobile manufacturer, JLR's major critical market is North America. The firm has positioned itself by providing sports and premium vehicles. The key drivers to JLR’s success include a strong customer relationship network and adaptation of the value proposition to the changing operating environment through innovation. Design and engineering are critical elements to the success of the business. This is through developing and manufacturing next-generation electrical architecture. Besides, JLR engages in strategic sourcing, where it partners with suppliers that allow for an optimal value chain. This is coupled by integrating a sustainability model in its operations that allows for the responsible production of eco-friendly products. Finally, JLR champions a corporate culture rooted in shared responsibility with employees, allowing for the pursuit of a similar vision.
BAE Systems leverages technology to provide electronic defence systems, cybersecurity solutions, electro-optical sensors, flight controls and digital defence and commercial engines. It also engages in manufacturing munitions and weapons, combat aircraft, electronics equipment combat aircraft, avionics equipment, combat vehicles, applied intelligence and security services, and defence contracting for managing government munition centres. For maritime products, they include designing and manufacturing submarines, complex warships, ship repair, munitions, and training. BAE Systems offers these products and services to governments, security agencies, prime contractors, and commercial firms. BAE Systems operates in the aerospace and defence industry. This is to provide security solutions in land, sea, and air, where, besides selling of products and services in this sector, the business offers training. The key drivers that inform the firm's success include strategic alliances with governments, developing and diversifying its human capital, and focusing a bulk of its sales and marketing activities on major governments that include the UK, the U.S., and Saudi Arabia. To achieve optimal product and services distribution, BAE Systems engages third-party marketing firms. The business also engages in constant innovation through next-generation research and development investment to solve complex technology-related and engineering project, helping create customer intimacy and a competitive edge.
B.2: Professional and ethical issues
A firm that adheres to best practices positions itself for continuous positive relationships with people in the value chain. Both JLR and BAE Systems can achieve best practices in their respective operations by engaging in several activities. First, the management needs to develop a clear strategic focus in line with its mission and vision. This is followed by communicating the strategy with clarity, which allows for the teams in each firm to develop demanding and realistic objectives. Also, establishing cultural cohesion and pursuing a management style in line with the culture is another critical best practice.
Outcomes from achieving best practices for JLR and BAE Systems include increased competitiveness, optimization of the value chain, improved relations between different stakeholders, and achievement of the target bottom line. The firms will become more flexible to adapt to new changes. Waste minimization, quality improvement, and customer satisfaction are possible results of adherence to best practices. Finally, the firms will achieve the triple bottom line elements of sustainable performance. Through capitalizing on tools such as benchmarking, performance monitoring, and financial forecasting, and strategic planning, the businesses can achieve best practices.
JLR’s strategy has founded on four sustainability pillars. They include corporates social responsibility, the focus on its employees, sustainable operations, and sustainable products. Strategy in the firm focuses on offering a pure electric experience, where the cars will contribute to zero carbon footprint. With ethical concerns over the emissions make by vehicles, the importance of the issue cannot be overlooked. JLR is a champion of reuse and recycle, and has ensured that it monitors the use of its materials as electric cars batteries, plastic items monitoring, and aluminium reforming. The firm has achieved great strides in environmental sustainability, where it has reduced the use of virgin aluminium in automobile production. JLR has achieved a reduction of energy consumption by 90% through the sustainable production approach.
On achieving best practices in JLR, the first ethical consideration is supply chain optimization to ensure a carbon emission-free value chain by 2039. This is by investing £2.5 billion annually on clean energy, including the engagement in electrification technologies through strategic alliances with partners. The pressure from environmentalists, governments, and society has seen a shift in the strategic focus of JLR.
Human rights, more so when dealing with employees, has seen the firm establish principles in its code of conduct to ensure ethical practice and professionalism. The working condition is such that the firm has set policies to ensure the safety, health, and security of the employees, besides providing equal opportunities for all. Also, the organization does not employ minors, nor does it use forced labour. These are measures presented in the code of conduct that guides how professional the employees should be in the firm. Presented in this policy is the statement against corruption and bribery. The success of the code of conduct can be seen in the firm’s lack of reports on corporate unethical reporting.
Guiding the profession and ethical conduct is the JLR corporate governance framework. The firms have several committees that ensure the governance of the firm’ is in line with local and international regulations. These committees include product, security, and health and safety. Using the Wates principles, the firm audits the board based on the skills, knowledge, independence, and experience to ascertain the ability to practice professionalizing in auditing the activities of the firm. Data security is becoming an Achilles heel to businesses globally. JLR has established a framework that sees the governance of its security systems, besides training employees, suppliers, and vendors on using cloud-based tools for establishing cybersecurity threats. The focus on data security, given the firm's reliance on next-generation technology, cannot be overlooked.
BAE Systems achieve the obligations set in best practices through its governance framework. One measure is the utilization of FRC’s Guide on Board effectiveness to measure how the firm's board of directors leads the firm towards achieving best practices. This is by issuing the board a questionnaire at the end of each financial year. However, the challenges that BAE System includes criticism for data security. This is further complicated by backlash for manufacturing weapons of mass destruction.
The strategic management in BAE systems has established measures across its value chain to ensure that the firm achieves its set best practices. Among the approaches taken is the implementation of the ISO1 50001 by purchasing 173,502 MWh of renewable energy in 2020, focused on energy management to ensure environmental protection and the welfare of the communities it operates around.
Corruption is a vice that corporations globally are under pressure to fight. For BAE Systems, the firm has established an anti-corruption programme. The programme is tailored to ensure that employees adhere to the regulatory and legal requirements, including acknowledging and fighting corruption and bribery risk. The firm achieves this by communicating clear anti-corruption policies and principles. Through continuous training of employees on corruption and providing them with a code of conduct provides possible solutions and how they can face and professionally, ethically, and legally overcome them.
BAE Systems has established supplier principles to ensure the firm’s supply chain provides sustainable raw materials for the production process. Through the supplier principles, BAE Systems requires the suppliers to comply with national and international laws and the firm’s best practice on environmental issues, conduct and behaviour regarding corruption, employee treatment, and responsible payment. To measure the success of the adherence to the supplier principles, the firm evaluates supplier compliance using a supply chain assurance activity. An example is the 2020 assessment, where BAE Systems identified 14 low-level risks, which it resolved through collaboration with the suppliers.
To achieve the global pressure from different stakeholders to achieve environmental sustainability, BAE Systems has established measures to reduce its net greenhouse gas emission to zero by 2030. The firm measures this through the carbon footprint in its products, the supplier evaluation, and the extensive use of renewable energy. Further, business travel is reduced, besides the shift towards using facilities and buildings that are energy efficient.
Another ethical issue that BAE Systems considers is the Safety, health and wellbeing of the employees. To achieve this best practice, the firm provides its workforce with a health and safety policy and a security policy. These policies provide the employees with adequate information on how to deal with the prevailing risks to health and safety, besides regular training on the same. To evaluate the success of these engagements, the BAE Systems evaluates the success of the existing policies regarding adherence to the policies and information security audit.
B.3. Conclusion
This report has analysed JLR and BAE Systems to capture the engineering firms in action. Both are publicly listed firms in the UK and with global operations, making them multinationals. Yet, these firms operate in different industries, with JLR operating in the automotive manufacturing industry, while BAE Systems operates in the defence and aerospace industry manufacturing industries. Their business models are in line with offering value to customers through designing, developing, and manufacturing products. With engineering at the centre of the key process, and with major resources directed to engineering, both firms have emerged with innovative cultures in their respective industries, creating, delivering, and promising to engage in next-generation technology production.
At the fore of both firm’s operations is the adherence to ethical practices. Both firms are led by governance bodies that ensure they achieve the triple bottom line approach to sustainable business practices. Production involves the consumption of a mix of raw material, which emits waste to the environment. Automobiles are known to emit fumes that contribute to environmental degradation. Both firms, facing pressure from global and local stakeholders, have developed policies to align the strategic focus with these expectations and priorities. Both firms believe in human capital as the source of current and future value for all stakeholders. Thus, provided in the code of conducts on both firms is the commitment to ethical practices.
One reason for such a high level of similarity is the focus on evidence-based practices, as proven by the commitment to research and development investment. Also, as a manufacturing firm that depends on its value chain to procure raw materials, transform them, and deliver as finished products to customers, ethics remain a crucial strategic focus. Another reason for the similarities, despite different business model capitalization of innovation and engineering in the delivery of value to both firms.
JLR and BAE Systems exploit mechanical engineering aspects that include manufacturing, environment and combustion, and systems. Also, both firms focus on energy management, where this is a key element in informing the production decisions, mechanical designing, evident from the consistent innovation and focus on technology.
The long-term outlook for JLR and BAE Systems informs the strategic alignment of the resources and efforts. One such focus is having a long-term strategy for the elimination of greenhouse gas emission. To achieve this, both firms have set aside research and development resources, with JLR focusing on producing electric automobiles. Clean energy is the ultimate goal for both firms. This is with the focus on reducing the overall value chain emission by 2035 for JLR and 2030 for BAE Systems. Also, the focus is on engineering systems to develop autonomous transport products, such as luxury vehicles that are self-driven for JLR while applying sustainable practices. Data and security development leadership will be critical to the future of BAE Systems, with the firm's constant ethical dilemma based on its business model a major concern. By observing ethical principles, both firms can minimize the environmental and social concerns that currently affect their businesses.