Essay on Internal Analysis of Rolls Royce

1951 Words Jun 26th, 2011 8 Pages
ROLLS-ROYCE: INTERNAL ANALYSIS
For the purpose of internal analysis, I have selected civil aerospace SBU of Rolls-Royce. This analysis has been done considering the fact that the case study was published in year 2005.
Financial Analysis:
Rolls-Royce has been generating higher margins in past few years. In last four years i.e. from 2002 to 2006 the operating profit has grown from £168 million to £692 million with the annual growth rate of 42.5%. The net profit has also increased at compound annual growth rate of 71.3% from £53 million to £998 million in these four years. These figures are the indicators of a strong financial performance. It is evident from the figures that the high levels of margin in their field of operation are very
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* Operations: Strong
They are the producers of world class engines and 42 out of 50 top airlines use their engines. In addition they always look for betterment of their processes to gain competitive advantage.

* Outbound logistics: Not Clear
There is no clear information about the outbound logistics but from the progress the company has made so far it seems that they must be strong in this area as well.

* Marketing & Sales: Strong
Initially Rolls-Royce was focusing only on the technical advancement but after Sir John Rose’s introduction to the firm, he not only continued on focusing on R&D but also emphasized on market oriented business approach. This resulted in company reaching in top 3 positions. Now the Marketing and Sales is a strong point of Rolls-Royce

* Service: Strong In case of services Rolls-Royce has strong support and service which includes 24/7 assistance to support in-service, co-ordinate fleet management providing a seamless link between on-wing and shop management, technical publications, maintenance training programs etc.

Limitations of value chain analysis: * Too generic * Lack detailing * May not be applicable to all industries

Alternative framework: * Resource based view

Resource Based View:

Literature Review:
The resource based view emphasizes the internal capabilities of the organization in formulating strategy to achieve a sustainable

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