Strategy Experience: Stock Market Performance - Assignment Example

1. How did assessment of the strategic position and strategic choices evolve over the two year period? What key changes occurred, or new information emerge, that changed the opinion of the original summary? Initially, upon analyzing the situation and the strategic position as well as the strategic choices that must be made, my original position was more fabricated upon the need for slow development and solid decision making as a means of building a resilient and effective firm. However, the fast paced environment and the incessant decision making effected a situation in which stakeholders had to sacrifice this desire for a more immediate level of snap decisions. Although these “snap decisions” created a situation in which the firm was able to react to the sudden changes and unique dynamics of the business environment, they necessarily left me a bit disquieted with regards to the overall quality of the inputs and the data that were being levered as a means of making these decisions. Further, the perennial concern that developed within my mind was whether or not these choices could ultimately have a very strong level of impact upon the longevity and success of the firm; due to the fact that some of the changes and pursuits that were engaged negated ones that had been made previously. Yet, as the process wore on, it became clear and apparent that even though the snap changes that were engaged took place at a dizzying speed, this rate of change was absolutely integral if the firm was indeed to survive in the climate of global business competition. By utilizing up to date information and tracking core levels of data, the meetings were able to present relevant needs that could encourage new levels of efficiency and productivity. Furthermore, a clear and unique distinction was able to be drawn between a long term strategy and short term goals. Further, in the beginning of the process, most stakeholders were unaware of how to incorporate the many different inputs that they received on each and every issue at hand. However, as the process wore on, individuals, myself included, felt more confident and comfortable engaging with the complexities that each decision necessarily portended. This should not be understood to mean that the decisions came to be easier over time; instead, the stakeholders became more familiar with the ways in which individual choices had complex outcomes that would affect other aspects of the company and lead to previously unforeseen consequences for the future. 2. Consider a specific decision, or cluster of decisions. Why were you pursuing these specific objectives rather than other objectives at this time? Considering the operating environment of WRSX, what was your basis for the decision? What was your expectation for the outcome and was this fulfilled? With regard to the consideration of a specific decision, or cluster of decisions, the decision to outsource, and how, was one that took a degree of precedence over other objectives that were discussed within the meetings. A primary consideration it had to be made was with regards to the operating environment that the firm found itself within. Rather than merely choosing to outsource as a means of reducing costs, a more relevant and salient consideration was with respect to the means by which synergy could be created and costs reduced at the same time. In such a way, culture and the ease through which outsourcing could maximize the productivity as well as minimize costs was a contingent concern that necessarily from many of the other issues that were considered at the same time. The expectation of the outcome that I initially held was that outsourcing would prove to be a decision that could drastically reduce the overall amount of money that was being spent on salaries at the current point in time. However, in tandem with this approach, I also believed that the loss of efficiency that would be noted would be severe; at least in the early weeks and months of implementation. Yet, this was not noted and I was pleasantly surprised to see the outsourcing taking place at a surprising rate and with good overall results. Further, it should be understood that these steps were fundamental in realizing a situation in which the firm could become profitable once again. Whereas partial success in terms of reorganization or outsourcing could have made an effect, the effect that would have been made would likely not have been enough to place the firm on positive footing within the highly competitive global markets it competed. Ultimately, successive, rapid, and definitive actions were necessitated in order to change the path the firm was taking. Accordingly, it is the interpretation of this stakeholder that these were done in an informed and thoughtful manner. 3. Present a brief discussion of the underpinning theoretical frameworks for the decision(s); did the theory support the decision, or mislead you, and why? To what extent did the use of theory help resolve any conflict of objectives? Although a number of decisions could be related, the case of choosing to sell Promoco was one of vital importance and went against theory. Ultimately, theory stipulates that the overall potential of an existing business entity is necessarily higher than one that only exists in theory and will be tasked with performing the same goals/functions. Yet, this was specifically the case with regard to selling Promoco and attempting to use the revenue from the sale as a means of engaging a new operation within Shanghai. Theory would have one to believe that the potential of Promoco within India could be salvaged. However, the argument that was eventually accepted was that the cost of creating further profitability with this business at the current juncture would outweigh the benefits that could be realized by its sale. A seemingly rational approach would have been to seek to promote rapid changes to Promoco as a means of making it effective within the environment it operated. However, judging that the time to conquer these issues was too long and required too much investment, it was determined that cutting losses and moving a focus to the Chinese market was a far superior move. Within this conflict, theory was still utilized as a cost and benefit analysis of keeping Promoco was determined to represent a situation in which it would best suit the needs of the firm to release it for sale. However, the conflict that has been described was not concentric upon whether or not theory triumphed over business acumen; instead, theory was placed against theory and ultimately resulted in a situation in which a SWOT analysis determined that the best way forward was by selling Promoco and developing resources for marketing within the People’s Republic of China. Choosing to engage the SWOT analysis was a difficult choice; especially considering the overall amount of inputs and variables that had to be considered. Yet, from an overview of the case and a look into the decisions that were made, it is effectively obvious that the right path was chosen as the development within the Asian market proved to be highly beneficial to the overall outlook that the firm could enjoy within this previously untapped market. Stock market performance In terms of overall stock market performance, meeting four indicated that periods 1, 2, 3, and 4 saw a gradual and steady increase with regard to the overall profitability of the stock in question; denoting the fact that effective decision making was taking place and lending the observer to conclude that profitability was resulting from the difficult choices that had been made. Table 1.0 illustrates the growth in overall stock performance over the time period discussed. Although there was a slight drop in overll stock prices that was noted in period 3, this is partially expected as a result of the major shifts and changes in direction that the firm was experiencing during this time. Further, it must be counselled that stock performance alone should not be viewed as the only metric through which success can be determined. Indeed, if this were the case, then many plans for change would not take place and the development of future changes would be called into question by a board of directors that demanded immediate results without the possibility of losing any stock value. Whereas the analysis that has been performed has engaged something of a qualitative understanding of the decisions that were made, this representation of stock prices clearly demonstrates that the choices were beneficial in the long-term success and profitability that are represented below. As is indicated, continued profitability on an ever upward trend was not noted; however, taken in total, the observer can readily note that the observable trend is one that demonstrates that effective decision making has been engaged. It would of course be folly to assume that the best choices were taken at each and every juncture. However, from the financial information presented below in terms of period stock prices, it is clearly understandable that the choices which were made were on the whole positive. Table 1.0 Read More