L3 Harris Technologies SWOT and PESTLE Analysis

Strength

1. Strong Research and Development team with continuous focus on innovation: The Company has a very strong research and development team that has always focused on continuous innovation. L3 Harris spent approximately $329 million in first two quarters of the fiscal year 2020 and $331 million in the year 2019. A portion of their R&D expenditure is incurred for commercial products and services, and some portion is allocated among contracts and programs in process under U.S. Government contractual arrangements. Such company-sponsored research is directed to the development of new products and services and to building technological capabilities in various markets leading to competitive advantage for L3 Harris.

2. Huge portfolio of patents and other intellectual property: The culture of innovation that the company has established over the years has led to several patents and other intellectual property which has become one of their most important assets. L3 Harris owns a huge portfolio of patents, trade secrets, know-how, confidential information, trademarks, copyrights and other intellectual property, including reliable, resilient and innovative cyber capabilities. As of year, 2020, L3 Harris held approximately 2460 U.S. patents and 2,070 foreign patents along with approximately 280 U.S. patent applications pending and 280 foreign patent applications pending. They are also engaged in a patent licensing program and cross-license agreements which also generate royalty income. Such intellectual property rights offer huge competitive advantage to them in the market.

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Weakness

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Opportunity

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Threat

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Political

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Economic

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Social

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Technological

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Legal

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Environmental

1. Complying with the environmental regulations: L3 Harris business operations are greatly influenced by the environmental rules and regulations which are designed to protect the environment, particularly with regard to waste and emissions. Their facilities and operations are subject to numerous domestic and international laws and regulations pertaining to environment. Failure to comply with such regulations can cause an adverse impact on the business operations and financials. Also, as they operate in various geographies, they need to comply with the specific regulations applicable in those regions. With regard to this they have installed waste treatment facilities and pollution control equipment in their factories to satisfy legal requirements and to achieve our waste minimization and prevention goals.

2. Increasing focus towards renewable energy and reduction of emission: There is an increasing trend of focusing renewable energy in many geographies and industries in order to safeguard the resources. Moreover, government is making stringent regulations for the manufactures to take initiatives to reduce emissions. Such environmental initiatives involve huge capital investment for L3 Harris and failure to abide by such laws can lead to substantial fines and criminal sanctions as well as shutdowns of facilities. To address this L3 Harris has been committed in reducing green-house emissions as well as reducing energy consumption associated with the manufacturing facilities through energy-efficient lighting, heating and cooling systems. They have also signed a renewable energy agreement in order to reduce their emissions by 30% till 2026.