Graystone Case Study

Jim Beam

WEEK 5 Final

Company Analysis

GRAYSTONE deals in suppling turnkey solutions to the SAUDI defense industry. Its mission is to provide world class services and products tailored to our customer’s needs, supported by highly qualified professionals and commercial best practices, building a robust defense capability base for the SAUDI and its citizens through Emiratization. Its vision is to be a leading organization in contributing to the defense industry of the SAUDI, developing a new generation of national leaders, and building a prosperous future for the people of the SAUDI which will help them become leaders in the field of aviation services.

They accomplish this by hiring subject matter experts from world class organizations to provide advisory and consulting services. They also hire hands on professionals from around the world with unique technical skills that are required to support complex equipment and missions throughout the world in hostile and non-hostile environments. The end state is eventually transferring all the intellectual knowledge, skills and resources to the local or Emirati workforce. This policy is called Emiratization.

Being founded in 2007 the growth that GRAYSTONE has experienced has been nothing short of explosive. With more than 5000 employees and owning all major defense contracts in the SAUDI they are postured for potential future success. One limitation is that they rely heavily on one source of revenue the SAUDI government. If this revenue stream changes then so does the profitability and success of GRAYSTONE. It is important to note that GRAYSTONE is a government owned company. This makes growth strategies complex as it has no capital of its own. In order for it to grow it must be able to provide further value to its parent company and the SAUDI government.

Because of this it is imperative that there are more revenue streams that are established and long term stability can be achieved. The two biggest threats to GRAYSTONE are geopolitical instability and commodity prices. Two things that no one within the company can do anything about. I think it is important to comment that GRAYSTONE does not actually produce anything. They are a consulting company that provides the human capital required to meet the unique and dynamic needs of our customer

Industry Analysis

The aerospace and defense industry is one of the biggest employers in the world. Growth within the industry has been low the past 5 years. The increased economic pressure around the globe slowed growth until recently. Now with an increase in travel demand, many new technologies coming online, and new security threats there has been an increase in defense sales and aircraft production along with defense budgets starting to see an increase again.

With the Global War on Terror being perceived by many people as a negative thing and not one of necessity, encouraging the common taxpayers to get behind colossal defense budgets has been an ever-increasing problem.  The continued support for long term wars such as in Afghanistan has dwindled drastically. This has led to a more competitive landscape. Usually the military is a huge driver in the aerospace industry. With a lack of money for new programs military aerospace growth is at a slight stall. Most of the growth has come from an increased commercial demand.