Berkshire Hathaway

Final Strategic Plan

Team Members:
Loryn Autrey, John Baggs, Jonathan Limon,
Moryssa Lopez, Kourtney Sherman,
Sarah Aboul-Nasr
Agenda
1. Introduction
2. Mission & Vision Statements (Moryssa)
3. SWOT (Loryn)
4. Porter (Jonathan)
5. Pestle (Jay)
6. Grand Strategy (Sarah)
7. Functional Strategy (Kourtney)
8. Conclusion
9. References
 Introduction: What is Berkshire Hathaway?

Berkshire Hathaway is a multinational conglomerate

company covering a vast market of subsidiaries. Since 1965,
CEO and owner, Warren Buffett, has entered every area of
the market with ownership of over 65 subsidiaries. These
include Geico, Heinz, Homeservices of America, and many
more. Buffett has succeeded at making Berkshire Hathaway
a very profitable and widely diverse company.
 Mission and Vision
Key Elements: Berkshire Hathaway is known as being very diverse, consistent, and makes smart investments.
The owner, Warren Buffet values quality employees, finding your passion in life, and taking care of
Berkshire Hathaway’s customers (2021). Based on these traits, the following Vision and Mission Statements
are recommended.

Vision statement: To become the most diverse and largest publicly traded company worldwide.

Mission Statement: Seize every smart opportunity to offer our customers valuable products and delightful
service, uphold our exceptional reputation, and continue to grow our company to keep up current
technological advances.

Takeaways: Based off of the values of Berkshire Hathaway and Warren Buffet, the provided Vision and Mission
Statements will allow the company to continue providing the services that they have already found success in, but also
allow the company to grow and expand into new markets.
 SWOT Analysis
Key Takeaways:

There is a huge opportunity for

Berkshire Hathaway to gain
brand awareness and recognition
by revitalizing their online
presence. This would require
CEO Warren Buffett to be
willing to adapt to new
technological advances, which
may challenge his traditional
values (Imbert, 2016). Building
an online presence for Berkshire
Hathaway would allow for new
customers, easier marketing, and
increased brand awareness.
 Porter Analysis
Threat of New Entry Threat of Substitution
Buyer Power Supplier Power
Competitive Rivalry ● BH has a diverse range of
● Customers have low buyer power to ● Supplier power is low as ● Since BH has successfully subsidiaries that cover
● BH does not have any direct BH since the subsidiaries combined there are no direct supplies diversified vastly across the many unique markets, the
rivalry. A big chunk of their have a large number of consumers. that can affect their value. If market, the threat of new threat of a new product
money is invested in insurance Losing customers from one subsidiary investments were cut off entry is low since it would entering the market that
companies and the only major will not significantly impact BH as a completely, then it would be challenging for would negatively affect
whole. cost the company a great competitors to expand into BH is very low.
competitor they can face there
● The products that these suppliers fortune. ● Comparatively, firms
would be companies like many markets quickly.
provide are fairly standardized, less ● The suppliers do not ● New entries are low level producing within the
Allstate.
● differentiated and have low switching contend with other products threat because they cannot industry in which BH
In the railroads, there is that urge
costs. within this industry. This directly compete with BH. operates sell at a lower
to go lower for price to beat
● There’s so many different markets for makes the bargaining power Their years of experience in price than substitutes,
competitor pricing.
● the company, there are some instances of suppliers a stronger force the investment industry with adequate quality.
Competitors who invest in new
in which the buyer power is high, but within the industry. ● While the threat of
unknown products or technology gives them a huge head
where others are low due to the loyalty ● The supplier power is low start, and can only be substitution is relatively
might gain a leg up on BH.
● of the customers. due to competition. If the affected into one small low, there is some in the
There are not too many
instance of potential new
competitors, however; the only ● The buyer has the power to avoid the economy is bad, all the industry.
brands and companies. There are so suppliers may increase ● As technology continues to technology that could be
thing that could be an issue is
many “dupes” that people could lean costs, which will hurt BH. advance, new breakthroughs produced.
another company doing the same
thing and putting in bigger towards. may cause BH to be
investments. financially at risk because
they are not up to speed with
today's technology.
The porter analysis exhibits potential threats and opportunities for BH. Identifying
direct rivalry and situations that can come up from competition. This analysis allows
us to see where we stand in this competing market, identify areas we can improve
in, and identify areas we are succeeding in.

This model represents the Political, Economic, Social, Technological, and Environmental factors of Berkshire Hathaway Inc. The analysis identifies the
external factors that may negatively impact business operations, and of Berkshire hathaway and its subsidiaries.
P E
Political factors exert a BH can have big economic
strong influence on the factors affecting it. If
long-term sustainability economic factors were to
and profitability of BH. In change with transportation,
a political context, the for example with rising gas
key to success in a prices, many of their
dynamic international insurance companies would
business environment is have a direct impact on the
to diversify the number of drivers who would
systematic risks. The need insurance. Although not
political environment of a a direct factor to BH as a
country comprises parenting company, many of
multifaceted factors. BH its economic factors would
is present in different not be highly affected by
countries, each having such needs. Unless a
its own political tensions, catastrophe happens with
thus allowing the the investments of BH will
company to enter low they begin to suffer. If there
taxation markets and was a sudden loss of value
benefit from high profits of BH stock, the value can
that can be invested in quickly decrease in a matter
research and of hours, but with so many
development activities. entities that they own in so
many different industries, it is
safe to say they secured
their economic impact to low
risk.
PESTLE Analysis:
S T L E
As BH is such a BH has a lot to gain Since BH is such a diverse BH does not have too
diverse corporation from technological corporation there are many environmental
in almost all forms of advancements in the potentially a lot of different dependencies on its
its unique business external environment. legal factors that may impact own. However, the
model, there are Innovations in the corporation. The companies that work
many different technology will allow insurance sector alone had with them do. For
aspects to its social faster production of numerous laws. For one example, Apple
analysis as a products by improving there are data protection cannot work without
business. Ensuring manufacturing. Being laws and property rights certain environmental
that BH keeps up able to produce more laws. I also think BH would dependencies. You
with the changing products for a lower have to consider the criminal cannot make an
demands in the cost will improve and civil justice system in iPhone without metals
social aspects of profits greatly. order to better cover their and glass. You cannot
many of its fields is Consumers having insured customers. Other run an apple store or
something the access to newer legal factors that affect BH apple factory without
company needs to technologies also could be patent laws or light, power, and
put at the forefront expands BH's copyright laws to protect the water. These are all
of its advancement marketing abilities products and companies that elements that can be
efforts. Since there through the potential they invest in. They may made or broken by
is such a diverse for advertisements also have to consider the environment. It is
range of businesses and commercials. international laws before important that BH
within the This is dependent on investing in international accounts for this as
corporation, the BH’s willingness to markets. I also think BH the companies they
social parts of the adapt to new would be smart to consider invest in have a lot
company will always technological different protection laws in riding on the
be something that changes, which may order to protect their environment.
needs to be focused be a challenge for investments.
on, as well as CEO Warren Buffett.
improved on.
 GRAND STRATEGY: Overall Goals: Market Growth & Stability

Rapid Market Growth + Strong Competitive Position

-

Quadrant 2
Market Growth and Development with new
Rapid Market Growth + Weak Competitive Position
Quadrant 1

potential companies/ investments

- Market Growth within companies already
- Product development within companies with
under BH
BH & outside BH
- Product development within companies
- Market penetration
already under BH
- Differentiation of branding and working with
- Integration of technology
brands that have products other companies
do not carry or create

Quadrant 4
Slow Market Growth +Strong Competitive Position
Slow Market Growth + Weak Competitive Position
Quadrant 3

- Creating relationships with companies

- Not expanding with up & coming companies
already invested in by BH
and brands
- Maintaining the values of BH with every client
- Neglecting already flourishing companies
- Maintaining strong bonds and relationships
- Neglecting/ straying away from values of BH
with individuals that would aid in networking
- Loss of employees or staff including investors
with new clientele
 Functional Strategy
The deal breakers and dealmakers within a company that are the key focus points for success.
Financial:
Also looking back at our original mission and vision statement for
Berkshire Hathaway, one that was stressed was the importance of
Berkshire Hathaway staying current with technological advancements.
If we take a look at the current businesses that Berkshire Hathaway
owns, we can see a lack of businesses that represent the technology
field. From the Berkshire Hathaway website we see that there is a
heavy presence of insurance subsidiaries, and also presence from the
customer service industry, things like retail and food service. (2022).
It would be smart for Berkshire Hathaway to invest more in
technological companies, especially as technology continues to
advance. Berkshire Hathaway seems to start seeing the importance of
expanding into the technology market, as “Berkshire purchased nearly
121 million shares of HP, according to securities filings. That stake was
worth roughly $4.2 billion based on Wednesday’s closing price for the
stock, amounting to a holding of about 11%” (Pound,2022). This is a
small start for Berkshire Hathaway in the technology industry, and
continuing to do so could greatly benefit the company in the future.
Marketing:
The mission and vision statement we originally came up
with for Berkshire Hathaway highlights the importance
of diversity to this business. Warren Buffet’s company
owns 65 unique businesses, with its subsidiaries totaling
over 260 (Moore, 2022). The functional strategy of
marketing must support this goal of diversification by
adapting and innovating new marketing strategies to
reach opposite ends of the market. This diversity means
that there is no one way to reach Berkshire Hathaway’s
entire market so creativity is a must to keep consumers
engaged and wanting more. To be successful in this
endeavor it is important that Berkshire Hathaway put
resources and time into a marketing strategy and team
that recognizes this importance of diversification.

Human Resources:
Berkshire Hathaway has a unique business
model in many different ways, however
especially so in the way that Warren Buffett,
head of Berkshire Hathaway, is responsible for
making all of the decisions within the company.
This is uncommon among many businesses
today, and in the case of 88-year-old Buffett, not
necessarily the best idea. Opening up decision
making within the company will be something
that benefits the corporation greatly.
Functional Strategy Cont.
Production:
Berkshire Hathaway is a holding company. All its
subsidiaries offer a wide range of products. By
utilizing a wide range of products in its marketing
mix strategy, they are able to understand what the
customer wants. Berkshire Hathaway owns
business in insurance, rail transportation, energy
generation/distribution, and manufacturing.
Insurance generates the most revenue for
Berkshire Hathaway, however all of the
manufacturing products generate more earnings
before taxes than any other product.
Research and
Development:
Berkshire Hathaway themselves do not do any
public marketing. They keep their development
high, also with real estate, and all their major
companies they have a piece in. Although he is
holding on to all these companies, he is still selling
and buying on a quarterly basis. Recently investing
in pharmaceutical companies, health care industry,
oil, and tech companies, he has taken a turn to
invest into more current companies changing the
world (Duggan, 2022). The development he has
established is phenomenal, acquiring and holding
into companies that are both starting up and
investing into companies that are making
comebacks. With a vast investment portfolio, and
fund managers publicly disclosing their stock
holdings to the U.S. Securities and Exchange
Commission, we all get to publicly see what new
companies they are investing in and selling.
Conclusions
1. Berkshire Hathaway is a very successful company and Warren Buffet knows what he's doing. The
goal for the future of the company should be to continue practicing what they are good at, but also
finding new markets to expand to in order to keep up with technological advancements.
2. Find a balance between Buffet’s traditional values and modern technological advances.
3. BH can be able to thrive as it invests into powerhouse company, being a backbone for many
successful companies.
4. Considering all external factors; BH can be affected in a number of ways and they must prepare
every aspect of their business in order to strategically manage potential threats
5. With the Grand Strategy in mind, the best ways to accomplish the goals set in place is by utilizing
the Rapid Growth plans of action as well as the Slow Growth and Strong Competitive Position plan
of action.
6. Put importance in diversifying the marketing strategies to reach more markets.
 References

Berkshire Hathaway Inc. . (2022). Berkshire Hathaway Inc.. BERKSHIRE HATHAWAY INC.
Retrieved April 16, 2022, from https://www.berkshirehathaway.com/
Berkshire Hathaway Sustainability Leadership Council.
2022.https://www.berkshirehathaway.com/sustainability/brksustainabilityleadershipcouncilmay2021.pdf
Duggan, Wayne. 10 Stocks Warren Buffet Just Bough and Sold, 2022.
https://money.usnews.com/investing/stock-market-news/slideshows/stocks-warren-buffett-just-bought?slide=7

Free Investing. (2021, December 24). Warren Buffett: You only need to know these 7 rules - youtube. Youtube. Retrieved April 27, 2022, from
https://www.youtube.com/watch?v=63oF8BOMMB8

Imbert, Fred. “Buffett: We're Figuring out How to Deal with Internet Growth.” CNBC, CNBC, 30 Apr. 2016,
https://www.cnbc.com/2016/04/30/buffett-were-figuring-out-how-to-deal-with-internet-growth.html.

Moore, Barry. What Companies Does Warren Buffett Own? Liberated Stock Trader, 2022,

https://www.liberatedstocktrader.com/what-companies-does-warren-buffett-own/
Pound, J. (2022, April 7).
Warren Buffett's Berkshire Hathaway reveals major stake in HP, Tech Stock soars. CNBC. Retrieved April 16, 2022, from
https://www.cnbc.com/2022/04/07/warren-buffett-berkshire-hathaway-reveals-stake-in-hp-inc-tech-stock.html
Salzar, Jessica. Berkshire Hathaway Inc. Strategic Audit, 2019,
https://digitalcommons.unl.edu/cgi/viewcontent.cgi?article=1129&context=honorstheses.