Company Background
4 Orbital ATK Management Analysis
There are five directors, five directions, and six requirements for directors.
6 Duties of a Director Code of Ethics and Business Conduct
6 Director Evaluation
6 Director Orientation Seven obligations
7 Business Conduct
7 Customer Engagement
7 Supply Chain Management
7 Risk Factors
8 Modifications to NASA & Military Budgets
8 Enhanced Competition
8 Contract Nature
9 Termination
9 Security
9 Orbital ATK's SWOT analysis
9 Assets
10 Weaknesses
10 Possibilities
10 Dangers Analysis of the Five Forces by Porter Power of Customers 11 Industry Competition 11
Power of Suppliers 13
Potential of New Entrants into the Industry 14
Threat of Substitutes 14
PESTEL Analysis 14
Political Factors 14
Economic Factors 15
Social Factors 15
Technological Factors 15
Ecological/Environmental Factors 16
Legal Factors 16
Conclusion 16
References
As a global leader in aerospace and defense technology, Orbital ATK engages in conniving, constructing and distributing space, security, and aviation-related structures to different clients in the international context. In this context, Operations Management-Orbital ATK has been able to act as a major supplier. Some of the major products by Operations Management-Orbital ATK include launch vehicles and related propulsion systems; satellites and associated components and services; composite aerospace structures; tactical missiles; subsystems and defense electronics and precision weapons, armament systems and ammunition. As a global employer, Orbital ATK plays a critical role in the creation of employment opportunities for about 12,500 individuals in 18 states across the U.S., as well as worldwide settings.
Company History
Orbital became an entity in 1982 after the important role of three friends who attended Harvard Business School: David Thompson, Scott Webster, and Bruce Ferguson. These three individuals had the opportunity to engage in the development of a plan for what would become their first product in the form of the Transfer Orbit Stage (TOS) for NASA (Orbital ATK, 2015). In the following three decades, Orbital sought to grow into becoming a premier supplier of the space-related systems while pioneering innovative and commercially driven products and services with the objective of enhancing the accessibility of the space to millions of people. In 1990, ATK had the platform to launch as an independent corporation following the approach by Honeywell to spin off its defense businesses to many shareholders. It is essential to highlight that the former Honeywell business supplied defense products, as well as systems to the United States and its allies for half a century (Orbital ATK, 2015). Based on this, ATK had the platform to expand its operations into the aerospace market with acquisitions of Hercules Aerospace Company in 1995, as well as Thiokol Propulsion in 2001. Evidently, various distinguished agreements and attainments did upsurge ATK’s presence in military, space, and profitable markets.
In April 2014, Orbital ATK came into existence following the combination of Orbital and aerospace and defense businesses of ATK in a valuable business merger. In the current context, Orbital ATK tends to integrate three major segments in its operations. These segments include the flight systems group, the space system group, and the defense systems group (Orbital ATK, 2015). Firstly, the Flight Systems Group focuses on the development of rockets applicable for small-and-medium-class space launch vehicles to place satellites into Earth orbit, as well as escape trajectories.
These products also act as interceptors and target vehicles for missile defense systems or suborbital launch vehicles placing the payload into high altitude trajectories. Alternatively, The Defense System Group focuses on the development and production of the small, medium, and large-caliber ammunition, precision weapons, and munitions, as well as the high-performance gun systems, propellant, and valuable energetic materials. In the third aspect, there is the Space Systems Group, which engages in the development and production of small and medium-class satellites applicable in enabling global and regional communications and broadcasting (Meurer & Seah, 2014). The group also engages in the execution of the space-related scientific research while other activities concerning national security.
Management Analysis: Orbital ATK
Number of Directors
Orbital ATK has substantive governance guidelines, which are ideal for the valuable management of the organization. For instance, the governance guidelines highlight the role of the board in the determination of the number of directors, which must not be less than three for effective and efficient running of the organization (Orbital ATK, 2015).
Direction Selection
Similarly, the governance approach is ideal in the determination of the practices for the selection of the director. The firm engages in the election of directors at the annual meeting of the stockholders.
Director Qualification Standards
These governance standards are critical in the determination of the director qualification. It is the duty of the board to seek valuable candidates based on diverse talent and experience in agreement with the strategies and activities of the organization (Orbital ATK, 2015).
Director’s Responsibilities
Furthermore, the board plays a critical role in overseeing effective and efficient handling and management of the corporation. The practices of the organization need to represent the interests of the stakeholders.
Director Orientation
Another critical HRM practice in the organization is the adoption and integration of the formal orientation program for the directors as they join their positions. The orientation program incorporates the strategic plans of the company, significant financial, as well as accounting issues (Orbital ATK, 2015). Other elements of the orientation program include the principal officers, risk management process, compliance policies, and internal or independent auditors for the well-being of the organization in the achievement of the goals and targets.
Director Evaluation
In the evaluation of the director, it is the duty of the board, as well as each of the committees to engage in the execution of annual self-evaluation before the Governance Committee’s recommendation to the board of nominees for critical election as directors. These practices tend to occur during the annual meeting of the stockholders (Orbital ATK, 2015). The board and committees then engage in the presentation of the results to the board for effective decision-making.
Code of Ethics and Business Conduct
Responsibilities
The code of conduct highlights the responsibilities of the firm concerning production of quality products at low costs in comparison to other operators in the industry. Orbital ATK aims at improvement of the well-being of the humanity, thus, the platform for the generation of quality products and services.
How to act in the Workplace
The code of conduct documents expectations of the employees at the workplace. For instance, the firm expects employees to promote its values while working towards the achievement of competitive advantage, mission, and vision statements. Alternatively, it is obligator for Orbital ATK’s employees to demonstrate honesty, ethics, hard work, and loyalty among appropriate values in the achievement of the goals and targets (Orbital ATK, 2015).
Customer Interaction
The firm trains and orients its workers to practice professionalism in the interactions with consumers within physical and virtual platforms. These practices are ideal in retaining the existing consumers while enabling attraction of the new consumers in the achievement of the goals and targets.
Supply Chain Management
According to Patrick Russel, Vice President of Operation and SCM, “No company stands alone…we rely on our customers, our suppliers, and the education sector/academic to help us in the improvement of our supply chain (Harris, 2017).” It is essential to note that the ASD (aerospace structure division) of the company operates in seven manufacturing facilities within the contexts of Utah, Mississippi, Ohio, California, and Massachusetts. These facilities have been critical in the production of highly engineered, lightweight structures for the commercial, as well as military aircraft inclusive of the Airbus A350, Boeing 787, and Lockheed Martin F-35.
The facilities have also been able to produce the United Launch Alliance’s Delta and Atlas launch vehicles. Orbital ATK’s supply chains, as well as manufacturing teams, liaise closely to facilitate coordination of the organizational efforts for the growth and development of the company (Harris, 2017). These practices are ideal in the harmonization of the operational groups. In the midst of globalization, Orbital ATK has focused on the expansion of its operations based on the significant growth in the demand for its products spurring ASD to look outside its operations for more than raw materials. In the global context, the company has focused on the generation of highly complex, as well as automated composite structure. Notably, a simple composite is essential and effective for the subcontracts. Orbital ATK has been able to work on the utilization of various advanced composite manufacturing techniques in its operations inclusive of 3-D addictive technology in the global context.
Risk Factors
Changes in NASA & Military Spending
It is essential to note that the company depends on the government, as well as NASA projects in the course of maximizing the revenues and profit levels at the each operational year. From this perspective, changes or reductions in the NASA and military spending have enormous implications on the profit levels and practices of Orbital ATK.
Increased Competition
Orbital ATK has the tendency to experience intense competition from other operators for the United States’ government contracts, as well as programs. This calls for the adoption and implementation of valuable strategies to oversee effective and efficient competition by the firm for such contracts and programs. Nonetheless, ineffective competitive aspects of the company might affect the achievement of these contracts or programs leading to minimization of the level of profit and revenue levels at the end of each fiscal period.
Nature of the Contracts
Based on this risk, it is ideal to highlight the ineffectiveness of the company to affect or control government contracts. In certain instances, it is impossible for the company to react towards increases in its costs because of the nature of the government contracts. Inability to react might be risky in the provision of quality products and services in agreement with the expectations of the target audiences.
Termination
Since the corporation deals with government contracts, it is subject to termination of the contracts, thus, enormous implications on the profit levels.
Security
Security threats such as cyber security, industrial insider, and physical security threats, as well as other disruptions, have the tendency to generate negative implications on the operations of the company. These threats inclusive of terrorism continue to affect the operations of the company, thus, the need for the adoption and implementation of appropriate mechanisms to overcome or prevent such challenges.
SWOT Analysis of Orbital ATK
In the course of exploring internal and external environment concerning the operations of an institution, researchers and management teams have focused on the utilization of the SWOT analysis tool. The objective of the tool is to explore the internal factors such as strengths and weaknesses affecting the operations of the company in questions. Besides, the model evaluates the opportunities and threats, thus, the external environment on the operations of the company.
Strengths
One of the major strengths of Orbital ATK in the achievement of its goals relates to the effectiveness, efficiency, and innovative nature of its operations concerning research and development programs. Based on this strength, the firm continues to address the growing and transforming demands of the consumers, thus, the opportunity for the maximization of the revenues and profit levels at the end of each fiscal period. Secondly, the company has focused on the maximization of its ability to provide quality program performance in comparison to its competitors, especially at a lower cost.
This strength highlights the sensitivity of the consumers to cost and quality, thus, the objective of Orbital ATK to merge these two elements effectively and efficiently in the achievement of the desired goals and targets. Furthermore, Orbital ATK focuses on the exploration of its readiness to execute programs for which it competes concerning the available equipment, facilities, and personnel. Orbital ATK has been able to maximize its image and reputation based on the valuable past performance, as well as demonstrated capabilities in the industry (Nosella & Petroni, 2007). These attributes are valuable in the maximization of the revenues and minimization of the costs of operation at the end of each fiscal period.
Weaknesses
One of the major weaknesses of the corporation relates to future profitability in the midst of various operators in the industry. Secondly, there are various small business units, which limit the ability of the firm to exploit its edge in the optimization of the revenues at the end of each fiscal period.
Opportunities
One of the major opportunities for Orbital ATK is the platform for the maximization of the income level, which is a constant increase. Moreover, the firm might use its valuable resources for further expansion based on new acquisitions. The approach would be ideal in the minimization of the costs of operation while increasing coverage in the global context. The institution will have the opportunity to facilitate maximization of the revenues based on the consistent rates and profitability following its valuable reputation. Utilization of these opportunities will enable the firm to achieve its goals and targets while reducing negative implications in the revenues within the highly competitive industry.
Threats
One of the critical threats affecting the operations of Orbital ATK in this industry is the tendency of prices to change. The firm targets NASA and the military aspects as the major consumers. These targets tend to associate with price changes aimed at the acquisition of contracts, which might limit the ability of the firm to achieve its goals and targets. Similarly, the firm might suffer from changes in the taxation systems and volumes. Alternatively, the firm might also suffer from issues such as financial capacities compared to other competitors in the industry. Inclusive of the increasing rates of interest, these threats have negative implications on the revenues and profit levels at the end of each fiscal period.
Porter’s Five Forces Analysis
One of the critical management tools is Porter’s five forces model named after Michael E. Porter. The objective of the model is to facilitate identification and analysis of the five competitive forces with the ability and potentiality to shape every industry. Evidently, the approach plays a critical role in the identification of the weaknesses and strengths of the industry. The purpose of this section is to oversee assessment and exploration of these forces concerning the case of Orbital ATK.
Competition in the Industry
It is essential to note that Orbital ATK competes against other the United States and foreign prime contractors, as well as subcontractors. Most of these competitors tend to have substantially more resources to deploy in the achievement or accomplishment, as well as the pursuit of the industrial and government contracts. Nonetheless, the ability of Orbital ATK to compete successfully and effectively in this environment relates to different factors. Some of these factors include effectiveness and innovative nature of the firm regarding research and development activities, provision of better program performance compared to competitors at a lower cost, and readiness to undertake the programs of competition. Moreover, the firm has been able to achieve competitive advantage based on its past performance, as well as demonstrated capabilities (Autry & Davidian, 2014). From a general perspective, Orbital ATK tends to face competition from various competitors in each business area or segment. In spite of this, no single competitor is competing along all the organizational segments.
For instance, in the Flight Systems Group, the institution tends to face competition from Aerojet-Rocketdyne, Lockheed Martin Corp, United Launch Alliance, Space Exploration Technologies Corporation (SpaceX), Coleman Aerospace, Kratos Defense & Security Solutions, and Arianespace SA. Other competitors in this segment include Kilgore Flares Company, Northrop Grumman Corp, GKN Aerospace Company, Vought Aircraft, Daher Group, Spirit Aero-Systems, and HITCO Aerostructures.
Alternatively, the Defense Systems Group tends to face substantive competition from General Dynamics, Lockheed Martin Corp, Aerojet-Rocketdyne, Raytheon Company, The Boeing Company, BAE Systems, Chemring Group, Northrop Grumman Corp, and other international producers of ammunition, as well as guns.
In the third segment, Space Systems Group, Orbital ATK tends to experience substantial competition from operators such as The Boeing Company, Airbus Defense and Space, Space Systems/Loral, Reshetnev Company-Information Satellite Systems, Dettwiler and Associates Ltd, Thales Alenia Space, Mitsubishi Electric Corp, and Surrey Satellite Technology Limited. From the above illustrations, Orbital ATK tends to operate in an industrial environment, which is highly competitive.
This is evident in the saturated number of operators across the three segments of operation, thus, the need for adoption and implementation of appropriate strategies and mechanisms in the achievement of the goals and targets (Gatens, 2016). Another element of this intensive competition in the industry relates to the lack of differentiation in the industry. Most of the major players in the industry have the tendency to generate similar products, thus, the need to engage in competition based on quality and costs.
Power of Customers
NASA comes out as the largest customer for the Orbital ATK products, thus, the platform to generate about 25 percent of its revenues or sales. Other significant consumers include the US Air Force and the US Navy. The plan for the organization relates to the integration of strategies for further expansion into emerging and adjacent markets. In the accomplishment of these elements, the organization tends to have diverse strategies to focus on the quality and cost. Consumers in this industry are sensitive to quality and costs, thus, the tendency of the organizations to coin their operations along these elements. Based on the saturation of the companies or corporations in the industry, it is essential to note that the consumers have relatively high power in the industry. Consumers have the opportunity to experience zero costs upon transition from one provider to another.
Power of Suppliers
Orbital ATK focuses on the provision of reliable and affordable products and systems, thus, the enormous implication of the suppliers in the value chain. Like Orbital ATK, corporations in this industry have focused on the adoption and implementation of strategies to liaise with suppliers with proven commitment, as well as capabilities on quality, cost, contractual requirements, and schedule. There is a need for the selection of suppliers offering mutual benefit for products and technologies. There are diverse suppliers in the industry, which reduces their powers. From this perspective, the industry tends to have limited suppliers power based on the opportunity for the organizations to move from one supplier to another depending on their costs and expectations.
Potential of New Entrants into the Industry
The industry experiences the low threat of new entrants because of various barriers. For instance, the industry associates with high economies of scale among the practitioner limiting the ability of the new entrants to make it in the highly competitive environment. Moreover, the operations demand more capital, which is beyond various entrepreneurs. Other factors might include contractual issues and inadequate resources.
Threat of Substitutes
Based on the specific consumers in the industry, the firms in this industry experiences relatively low threat of substitutes. From this perspective, the firm tends to have the opportunity to facilitate maximization of the profit levels while focusing on the issue of quality, as well as cost.
PESTEL Analysis
One of the valuable tools in the evaluation of the external environment is PESTEL. The purpose of the model is to evaluate external factors, which affect the operations and activities of the business entities, especially in the globalized economy.
Political Factors
In the course of addressing its duties and expectations to the consumers, Orbital ATK has been able to exploit the political stability, especially in the case of the United States. In this context, the firm engages in the provision of quality products to the government of the United States, as well as NASA projects. Evidently, the firm has an obligation to adhere to the legal framework for the contract enforcement. In certain instances, the firm has to adhere to the negative implications following the tendency of the government to terminate the contract. Nonetheless, the political factors have been relatively beneficial to the company seeking to maintain its position as a global leader in the development of quality and innovative products at the disposal of the consumers.
Economic Factors
Economic factors have enormous implications on the operations of Orbital ATK. Some of the economic factors affecting the operations of this corporation include changes in the interest rate, taxation rates, income levels, and overall performance of the company. These factors influence the approach by the firm to adopt and implement appropriate strategies for the achievement of the desired goals and targets.
Social Factors
Social factors have the tendency to associate with the human behavior and activities, as well as preferences in the market and industry of operation. Based on this, the recent years continue to highlight the behavior of human beings to innovate and pursue various products. In this aspect, Orbital ATK has focused on the maximization of the opportunities to satisfy the urge of the consumers to achieve their goals and targets while focusing on quality and costs.
Technological Factors
Technology plays a critical role in shaping decision-making and interactions in the modern society. In the midst of technological era, Orbital ATK has focused on the maximization of the revenues through automation of its products. This is through utilization of technology to enhance interaction with suppliers and consumers in the highly globalized economy. The approach enables the firm to maximize and exploit available opportunities in the accomplishment of the revenues and profit levels at the end of each fiscal period.
Ecological/Environmental Factors
In this segment, the institution has focused on the integration of environmentally friendly practices in the achievement of reduced instances or cases of global warming. From this argument, it is ideal to note that the firm adheres to the environmental obligations through monitoring its emissions into the atmosphere. These CSR practices in the manufacturing and distribution of the products and services are ideal in enabling the firm to achieve the desired revenues and reputation in the highly competitive markets.
Legal Factors
While operating in the United States and other foreign environments, Orbital ATK has an obligation to adhere to various legal factors such as standards of production, taxation, and employment regulations. These legal practices are ideal in the determination of the level of revenues and profit.
Conclusion
Conclusively, the paper focused on the exploration of Orbital ATK and its operations management practices. Orbital ATK engages in designing, building and delivering space, defense, and aviation-related systems to different customers across the world. The paper did document valuable internal and external factors, which highlight the strengths and weaknesses of the firm in pursuit of its goals and targets at the end of each operational period. Evidently, Orbital ATK continues to exploit its strengths such as manufacturing quality products at low costs, increased investments in research and development for the production of innovative products and services, and valuable reputation based on past performance, as well as illustrated capabilities. These attributes have been ideal in enabling the firm to compete effectively and efficiently in the midst of intensive competitive industry.
References
Autry, G., & Davidian, K. J. (2014), “A Review of the Competitive Advantage of the United States of America in Commercial Human Orbital Spaceflight Markets,” In AIAA SPACE 2014 Conference and Exposition (p. 4202).
Gatens, R. (2016, March), “Commercializing low-Earth orbit and the role of the International Space Station,” In Aerospace Conference, 2016 IEEE (pp. 1-8), IEEE
Harris, J., (2017) Orbital ATK. Supply Chain World. Retrieved from http://www.scw-mag.com/sections/manufacturing-distribution/818-orbital-atk
Meurer, R., & Seah, P. H. (2014), “Global Commerce in Small Satellites Trends and New Business Models.”
Nosella, A., & Petroni, G. (2007), “Multiple network leadership as a strategic asset: The Carlo Gavazzi Space case,” Long Range Planning, 40(2), 178-201.
Orbital ATK.,(2015) An Introduction to Orbital ATK, Inc. Company Overview Presentation. Retrieved from file:///C:/Users/Adam/Downloads/OA_OverviewPres_Feb2015%20(2).pdf
Orbital ATK.,(2015) Fiscal Year 2015 Annual Report. Retrieved from https://www.orbitalatk.com/news-room/docs/Annual%20Report%20Optimized.pdf
Orbital ATK.,(2016) Orbital ATK Corporate Governance Guidelines.
