Future for the Creation of Strategies and Appropriate Business Processes - Assignment Example

Importance of Competing For the Future Name: Course: Institution: Tutor: Question 1: Importance of Competing For the Future The future of any business is changing rapidly and requires strategic planning and ability to take advantage of emerging opportunities. Competing for the future refers to the creation of strategies and appropriate business processes that can enable an organization stay in business for a long time while maintaining strategic, competitive advantages. Treacy (2005) explains that strategy and organization are vital tools that provide a safe avenue for a business’ future. Without proper strategies, an organization cannot develop a concrete plan for achieving any goals in the future. Essentially, competing for the future enables companies to stay in tune with its competitors and the market. To effectively compete for the future, organizations should develop new and improved business ideas and change the rules of engagement. This will have the positive effect of transforming the organization and hence create a proactive agenda for achieving strategic business objectives. In His book, Moreton (2003) notes that competing for the future creates valuable opportunities for stabilizing the market share, which in turn strengthens an organization’s core business values and ability to grow. It is, therefore, important for companies to look at outside sources, threats and opportunities in order to stay alive in the competitive market. Although the process of creating a sustainable business future is more challenging like creating a successful business, it helps place a business in a strategically comfortable position. For instance, companies that have successfully competed for the future can easily take advantage of new technologies and business processes. This not only increases the companies’ ability to compete with its rivals but also increases the company’s production efficiency, which influences market share and profitability. According to Moreton (2003) the main reason why companies compete for the future is to create strategic business positions that will enable them meet their long time goals. This requires an understanding of how competition in the future will be different from today’s competition. Understanding an organization’s position in the industry and the market can be crucial in making decisions regarding a business’ strategic plan. The dangers that are involved in not understanding an organization’s position, goals and challenges are manifested in the inability to compete effectively for the future. This may cause a business organization to decrease profit margin. Treacy (2005) has underscored the importance of competing for the future by asserting that companies can easily become old and die out if they fail to change their strategies and adapt to popular trends in their industries. One of the companies which have successfully competed for the future is Verizon Inc. This is a telecommunication giant based in the United Kingdom. The company has active operations in more than 40 countries where it offers telephone and internet services. Having realized the changing nature of competition in the telecommunication industry, Verizon has diversified its services by incorporating new technologies, multiple channel video program system and broadband services. This strategy has made the company the largest telecommunication service provider in the world and has given it competitive edge over future competition. Question 2: Framework for Developing an External Marketing Strategy An external marketing strategy focuses on the way in which business differentiates itself effectively from its rival businesses by offering unique products and services. This requires a business to capitalize on its distinctive strengths and deliver high-quality products to its customers. According to Moreton (2003), an effective external marketing strategy should be characterized by: a clear market definition; superior performance in relation to the market competition and a good match between corporate strategic objectives and market expectations. Essentially, this means matching the business needs with those of its customers and competitors. The process of developing a viable external business strategy is a multi-step process. The main steps are: i. Vision formulation: The foremost step in developing any business strategy is to develop a vision for the intended strategy. The vision should be presented as a realistic image of the business’ position in three or more years’ time after the implementation of the external strategy. According to Kang (2007) the nature of an organization is expressed in terms of its vision. Vision indicates not only the aim and objectives of the business, but also the purpose and intended activities of the business. ii. Analysis and Assessment of Current Situation: The most important step in developing any business strategy is data analysis. This process is divided into two sections, namely external analysis and internal analysis. External analysis is the evaluation of the market and competitive landscape while internal analysis is the evaluation of the company’s strategic competencies and resources. In internal analysis, a company’s existing vision, mission and objectives are assessed and judged against the expected performance. The assessment is essential in describing the actual strategies that should be followed in implementing the intended external strategy. Analysis is also important in that it helps a company to gauge its position relative to the market needs and competition requirements. iii. Strategy formulation: Once valuable information has been obtained, the strategy can be developed. Companies have limited resources and imperfect information and as such, tough decisions should be taken when deciding on what to do. A number of tools and resources are available to help business managers make strategic decisions. These include Porter’s cost leadership and differentiation analysis, SWOT analysis, trend analysis and resource-based view. iv. Strategy Execution: Once the intended strategy has been developed and all options weighed, the strategy is executed. Execution of strategy can be deliberate or emergent. In emergent execution, a strategy is formulated and executed at the same time. The execution process is characterised by constant learning and use of opportunities to shape the executed strategy. In deliberate execution, resources are allocated to an intended strategy, which is then executed. In this method, formulation and execution of the strategy are done separately. The above framework was used by Vodafone as an important strategy to expand its business scope. Although the company was founded just 30 years ago in the United Kingdom, it has grown steadily over the years to become a leading telecommunications company worldwide. The company’s well-informed external strategies have enabled it to outdo competitors in more than forty countries and acquire impressive market capitalization. Question 3: How Stakeholder Expectations Influence Business Operations Stakeholders can be defined as the various entities which are impacted by a business’s activities. The impact can be direct as in the case of a business’ customers and suppliers or indirect as in the case of communities in which a business chooses to be located. In general, a business’ most important stakeholders include owners, investors, customers, creditors, personnel, the government and the host community. Each of these stakeholders has different expectations and needs which the business must consider. It is, however, the case that certain stakeholders such as owners and investors are more important than other stakeholders. The stakeholders are important to a business in that they influence a business’ plans for its operations. According to Kang (2007) the influence of stakeholders on a business is ubiquitous and inescapable. All businesses exist to meet the needs and expectations of at least one stakeholder in the sense that businesses are established with the view of producing profit for their owners or investors. In essence, stakeholders have the ability to facilitate or hinder the operations of a business. For instance, a host community can improve a business’s reputation and strengthen its market presence. Therefore, a business has to be responsive to the expectations of its host community. According to Moreton (2003) stakeholders’ expectations are in most cases related to how the business objectives should be realized. Therefore, these expectations aid as a production benchmark tool and can be used as a success gauge in any business process. As an example of how stakeholder expectations influence business operations, we consider the case of General Motors and its Corporate Social Responsibility program in China. General Motors is a multinational automotive manufacturing company with headquarters in the United States. The company has active manufacturing and distribution centers in several countries around the world. In 2009, the company decided to extend its CSR commitment to China. The commitment mainly focused on promoting road safety, introducing sustainable, green technologies and supporting public health as part of its general strategy of working in China, for China and with China. In essence, the decision by General Motors to extend CSR to China was in response to the interests of China as a stakeholder to create and promote a safe, greener and healthier community. In conclusion, the influence of stakeholders is an important factor to consider when planning for new business strategies (Kang, 2007). In this context of business strategies, the power and influence that stakeholders have over a business process is very important. The stakeholder’s ability to exert power and influence over a business process derives from their ability to be directly impacted on by the business. Therefore, their expectations reflect the extent to which they can disrupt a business plans or cause uncertainties in the plans. References Kang, K. N. 2007, Strategic Business Management, Boston, Deep & Deep Publications. Moreton, K. M. 2003, Strategic management and business analysis, Elsevier, Butterworth- Heineman. Treacy, T. 2005, The Discipline of Market Leaders, Cambridge, MA: Perseus Read More