Strategy

2008 Annual Report Strategy (30th March 2009)

Performing against our strategy

Our Group strategy is ‘To deliver sustainable growth in shareholder value by being the premier global defence, security and aerospace company’. We deliver our strategy through our Group Strategic Objectives, Business Portfolio Actions and Integrated Business Plans. The Group Strategic Objectives are championed by the Executive Committee and apply across all our businesses. The Business Portfolio Actions are championed by the relevant Executive Committee member and are delivered by the businesses either separately or jointly. Both are underpinned by our Integrated Business Plans.

Strategy

Our consistent strategy
The Group's strategy has been successful in laying the foundation for our long-term sustainable growth and has provided the framework for the continued development of the business. The strategy has evolved as the Group has progressed and, for 2009, there are again further developments within that consistent framework.

Evolution of our strategy
This year, we continued the evolution of our Group Strategic Framework through our strategy review process. With the acquisition of Detica, the Group Strategy statement has been updated to read ‘…premier global defence, security and aerospace company', reflecting the importance of this growing market opportunity. As part of our commitment to be recognised as a leader in responsible business worldwide, we expanded the first Group Strategic Objective to include ‘delivery of our Corporate Responsibility agenda’.

Building on past progress, new and revised actions to support the strategy in 2009 have been developed. A new Business Portfolio Action – ‘Implement our global initiatives in Security, Readiness & Sustainment (R&S) and Unmanned Aircraft Systems (UAS)’ – has been added to highlight the importance of these global initiatives. We also added the Business Portfolio Action ‘Continue to develop our global markets' as we continue to develop our existing home markets, broaden our home market base and seek to export to selected markets.

Our Operational Framework
The Operational Framework defines the mandated policies and core business processes that provide a common framework for how we do business. These mandated policies and core business processes, together with our key resources, help us to achieve the Group's strategic objectives.

Our Key Performance Indicators (KPIs)
The Group delivers its strategy through the Group Strategic Objectives, Business Portfolio Actions and Integrated Business Plans. The strategy is also supported by ten short-term objectives agreed annually by the Executive Committee and the Board (see page 9) which address the key challenges in delivering the strategy in the year ahead. The objectives are directly underpinned by a set of financial and non-financial performance indicators that are regularly reported to the Board. Certain of these are linked to executive remuneration. These KPIs are detailed on pages 24 to 27, and provide a succinct and meaningful measurement system to assess enterprise performance and continuous improvement in line with our strategy.

Our risks
Effective management of risk and opportunity is essential to the delivery of the Group's objectives and achievement of sustainable shareholder value. The Group's approach to risk management is aimed at the early identification of key risks and then removing or reducing the likelihood and effect of risks before they occur, and dealing effectively with them if they do.

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Related information

See also

• Corporate Governance
• Financial Calendar
• 2008 Annual Report
• Executive Biographies
• Media Contacts