Business Strategy and Decision Making - Term Paper Example

Business Strategy and Decision Making Table of Contents Introduction 3 2. Critical Evaluation of the ment 4 2 Mintzbergs 5 Ps of Strategy 5Strategy as Plan 5 Strategy as Ploy 5 Strategy as Pattern 6 Strategy as Position 7 Strategy as Perspective 7 2.2 Intended and Emergent Approaches to Strategic Management 8 3. Real World Examples 9 3.1 Ford Motor Company 9 3.2 Wal-Mart Store Inc. 10 4. Conclusion 12 References 13 1. Introduction The modern pace of globalisation has been witnessed to significantly influence the marketers to make continuous decisions regarding their practice of strategic management approaches. In relation to the present business environment, organisations seek to adopt various competitive approaches with regard to their strategic measures in order to gain sustainability along with achieving competitive position over the growing number of rivals (Ansoff, 1991). The traditional concept of strategic management is one of the critical aspects to achieve continuous development as the process tends to represent the science of crafting effective guidelines to achieve the predetermined organisational goals. The practice of an effective strategic management approach helps to conserve continuous refurbishment and expansion of the organisations to proactively deal with a number of potential challenges. Moreover, it also provides adequate support to the leaders to enhance their potentials in decision making process and improve organisations’ credibility within a competitive business market (Hill & Jones, 2011). Emphasising the emerging trend of strategic management processes, the study intends to focus on critically discussing different competitive strategic approaches that enable the organisations to maintain long-term sustainability. In this regard, the discussion of this study represents widely accepted strategic approaches of the modern organisations along with their roles and significance towards helping the leaders to improve their decision making processes. Moreover, the discussion would also incorporate real-world examples of major organisations from different business industry perspectives. 2. Critical Evaluation of the Statement In relation to the unconventional trends currently witnessed in the business environment, it has been observed that modern organisations commonly seek to develop advanced strategies and focus on the effective adoption of rational and integrated business steps with the intention to remain sustainable in their respective field of operations for a long-term period. With regard to the changing scenario along with fierce competitive trend currently witnessed in today’s global business environment, the notion of intended and emergent business strategies has evolved as a commonly debated issue (Mintzberg & Waters, 1985). According to the modern phenomenon of the global business environment, there are a number of strategic management approaches that are highly practiced by the organisations to gain competitive advantage over their rivals. In this context, the study would aim to analyse few strategy development approaches that are highly implemented by the organisations to achieve long-term goals. 2.1 Mintzbergs 5 Ps of Strategy According to the conventional concept, the strategy development approach of Henry Mintzberg has been widely accepted in terms of helping practitioners and business entrepreneurs to effectively deal with various difficult circumstances. The strategy development approach of Mintzberg incorporates five crucial definitions wherein the strategy is regarded as plan, ploy, pattern, position and prospective that are highly correlated with each other (Mintzberg, 2001). Strategy as Plan According to the strategic approach of Mintzberg, planning has been regarded as one of the crucial elements in strategy formulation practices of the organisations. In accordance with the statement of the author, it has been recognised that the planning for any strategy development approach is generally adopted by the leaders through incorporating various other techniques. In this context, critical assessment of macro environmental factors along with justifying strengths, weaknesses, opportunities and threats are likely to play an essential role for the organisation to build a successful business strategy (Mintzberg, 2001). Strategy as Ploy According to the strategy development approach of Mintzberg, strategy can also be regarded as a ploy due to the nature of specificity intended to outwit the other competitors within a similar business industry or market. Moreover, the management experts have also stated that critically analysing competitors can also be a part of an effective strategy. In this context, the practice of analysing industry and competitors can be few of the major aspects for the marketers to gain a decisive advantage in building successful business strategy. Besides, the process of impact analysis and scenario analysis also helps the organisations to develop effective business strategies and determine potential opportunities as well as threats in a particular market or industry (Mintzberg, 2001). Strategy as Pattern According to observations, the strategic plans and ploys have been identified to deliberately provide adequate opportunities to the organisations in developing their business strategies. Correspondingly, the consideration of strategy as plan also ensures to offer significant support to the organisations. In this context, it is also essential for an organisation to develop effective tools to gain competitive position. According to the concept of considering strategy as pattern, the practice of Unique Selling Proposition (USP) can enable the organisations to develop their decision making process and uphold effective strategies to achieve competitive advantage within a particular market (Mintzberg, 2001). Strategy as Position Position can also be considered as another essential part in strategy development process of the organisations. It significantly enables the marketers to determine the current position of the organisation and helps to build long-term sustainability within a particular marketplace. The concept of considering strategy as position tends to define the organisational competency to differentiate its products/services in order to effectively deal with the competitive environment. It further facilitates to critically understand the strategic position concerning the external influencing factors of an organisation in a particular business market. In order to successfully understand the strategic position, the critical assessment of the industry and other macro environmental factors help organisations to build strong strategic decision (Mintzberg, 2001). Strategy as Perspective According to Mintzberg, the strategy development choice of an organisation is strongly reliant upon the cultural aspects of a particular organisation. The way of thinking pattern and behavioural quality of a leader highly influence the organisation to gain competitive edge as strategy developing techniques tend to shape the organisation’s perspective. In this context, the process of encouraging continuous innovation and risk taking measures are the major strategic attributes of the organisation in order to build competitive business goals and directions (Mintzberg, 2001). 2.2 Intended and Emergent Approaches to Strategic Management The concept of intended and emergent strategic management approaches indicates dissimilar processes of strategic decision making adopted by marketers to efficiently achieve their predetermined business goals. With regard to the theoretical perspective, the intended strategic management approach is considered as a set of planned strategies, followed by the organisations to satisfy the determined goals. It is a long-term process through which an organisation manages and operates its business functions, irrespective of any uncertain events including opportunities, threats or challenges. Hence, it is arguable that the intended strategic management approach focuses principally on developing strategic plans on the basis of organisational values, aims and goals, taking reference from the external environmental elements to predict future strategic performance of the business on the whole (Hill & Jones, 2011). On the other hand, the concept of emergent strategic approach signifies a set of short-term plans that are executed by the organisations in accordance with the changing trends identified within the business environment including rising opportunities or any threat from the influencing factors (Hill & Jones, 2011). The implementation of emergent strategic measures in the organisation tends to formulate a centralised structure, which can control the organisational competences to obtain expected success in the competitive market. Moreover, the concept of emerging strategic approach also signifies adequate flexibility regarding the functions of the organisation. In this regard, significant differences among these two strategic approaches in line with the degree of taking risks as well as comfort with steadiness and expectedness of the organisation has also been taken into consideration (Hill & Jones, 2011). Furthermore, the strategy making approach of the organisations is arguably, often moderated by certain other factors including the size of the firm, influence of the executive director(s) and environmental uncertainties, which in turn tend to determine the effectiveness of the companies in framing their intended or emergent strategic management approach (Pretorius & Maritz, 2010). 3. Real World Examples The notion of practicing strategy development approach has long been witnessed to be widely accepted by the organisations from various industrial backgrounds to uphold their sustainable position. Moreover, the organisations have also been recognised to gain competitive position through conserving continuous practice of strategy development process. According to the present day context, a number of global organisations can be observed to be making continuous practice of strategy development approaches (Thompson, 2005). 3.1 Ford Motor Company The continuous practice of strategy development process is often observed in the business performance of Ford Motor Company (Ford) in the global automobile industry. According to the strategy development process of the organisation, the company tends to incorporate three major dimensions including effective strategic planning, execution and evaluation related function. The strategic planning stage of Ford incorporates an effective process of defining current business functions and mission statement that enables it to refurbish the overall performance. Moreover, the formulation of new business concepts and mission statement of the company also enables the organisation to gain leverage in the respective business industry. The continuous practice of internal and external audit along with formulating competitive strategies to achieve strategic objectives can also be considered as among the major functions of Ford to conserve its sustainable position in the fiercely growing automobile industry (Harvard Business School Publishing Corporation, 2001). 3.2 Wal-Mart Store Inc. With regard to the business strategy development process, Wal-Mart tends to involve diverse mechanisms for its each overseas subsidiary across the different retail markets in the world. In relation to the fiercely competitive environment in global retail business industry, the strategy development process of Wal-Mart has been widely accepted as one of the major elements to achieve its long-term sustainability. In this context, creating positive brand and name recognition is one of the major strategic aspects of Wal-Mart that facilitates the company to effectively deal with the rising competition. The main goal of the company is to associate the customers with its reputation by selling merchandises in low price as compared to the other retail companies. Wal-Mart achieves the current value of the company through the different ways of advertising such as television advertising campaigning and newspaper adverts. In this regard, the company has gained significant value to build its competitive position in the respective industry (Wal-Mart Stores Inc., 2013). Additionally, formulation of new segment in the retail industry is also a major and competitive aspect of Wal-Mart. Owing to the fact that the expansion of retail branches into grocery sales, pharmacy and automotive repair shop can be considered as a major strategic decision of the company to gain a competitive position (Heyden & et. al, 2002). With reference to the various types of strategy development approaches along with the current practice of the organisations, it has been firmly identified that the notion of strategy development approach plays a crucial role for the organisations to achieve long-term sustainability. According to the real world examples of Ford Motors and Wal-Mart, it has been critically recognised that both the organisations have gained competitive position within their respective business industries through implementing adequate measures of strategy development approaches. 4. Conclusion The aspect of organisational strategy development is considered to be amongst the considerable processes, which focuses on the factor of change and its effects on the entire business operations. In this regard, an effective strategic decision is one of the core and most essential steps for the entrepreneurs to sustain in the competitive business environment. With respect to the observation of strategy development approach of Mintzberg, it has been widely recognised that the factors such as plan, ploy, position, pattern and perspective play a crucial role for the organisations to gain significant benefit in marketplace. According to the concepts of intended and emergent business strategies in line with the recent cases of the global organisations, it has been identified that the incorporation of an effective emergent strategy plays a major role in achieving the intended goals. Due to the stated concern, the emergent strategy can enable the organisations to adopt changes and innovative measures for effectively dealing with the external influencing factors. Moreover, it also may facilitate the organisations to achieve a competitive position by developing organisational activities in line with the opportunities and potential threats persisting in the business environment on the whole. References Ansoff, H. I., 1991. Critique of Henry Mintzbergs the Design School: Reconsidering the Basic Premises of Strategic Management. Strategic Management Journal, Vol. 12, pp. 449-461. Harvard Business School Publishing Corporation, 2001. Strategic Management Process. Pearson Higher Education Ltd., pp. 78-81. Heyden, P. & et. al., 2002. Wal-Mart: Staying on Top of the Fortune 500. A Case Study on Wal-Mart Stores Inc, pp. 1-36. Hill, C. W. L. & Jones, G. R., 2011. Essentials of Strategic Management. Cengage Learning. Mintzberg, H. & Waters, J. A., 1985. Of Strategies, Deliberate and Emergent. Strategic Management Journal, Vol. 6, pp. 257-272. Mintzberg, H., 2001. The Strategy Concept I: Five P’s for Strategy. General Strategic Theory, pp. 11-24. Pretorius, M. & Maritz, R., 2010. Strategy-Making Approach Matters a Great Deal. Journal of Business Strategy, Vol. 32, pp. 25-31. Thompson, J. L., 2005. Strategic Management: Awareness and Change. Cengage Learning EMEA. Wal-Mart Stores Inc., 2013. Wal-Mart 2013 Annual Report. Investors, pp. 1-64. Read More