Business Environment Strategic Decision - Assignment Example

Sur Corporate Governance for Westpac Sources have revealed that in the current business environment strategic decision-making has become increasingly complex due to emerging trends. For instance, there are multiple pressures from diverse stakeholders as well as the dynamic trends of competitive advantage make the situation more complex. This document explores on environmental analysis as a critical tool for rational planning. Significantly, the document highlights that environmental analysis provides conceptual as well as practical understanding. Consequently, the document emphasizes that environmental analysis play a critical role to manager’s decision making. In addition, it has profound implications at all the levels of an organization (Hill and Jones 27). Significantly, the document reveals that numerous scholars argue that strategic planning provides a mere and perhaps less relevant understanding of strategic decision making, thus, the increasing adaptive strategy. In response, this document provides a comprehensive critique to the existing literature against the perception of emerging trends as well as the pressures in the contemporary business world. Therefore, it has referred numerous sustainability competencies that suggest the need of capable consideration of holistic and systemic pressures predicting future scenarios and considering how numerous stakeholders would perceive normative business practices. The sources have revealed that the Westpac group ranks among the top listed financial companies on the Australian Securities Exchange (ASE): in September 2010 Westpac’s market capitalization realized &69.5 billion (AUD). Additionally, it has five key diverse customers; significantly, it serves approximately, 12.8 million customers ranging from institutional, business and retail banking, wealth management, and insurance. For instance, there is the Westpac Institutional Bank (WIB), Westpac Retail and Business Banking (WRBB), and BT Financial Group (BTFG). The sources have further identified that sustainability plays a central position in Westpac’s vision. The vision states that the Westpac has become one of the largest firms in assisting consumers, communities and prosperous people. Significantly, the company recognizes the links between healthy societies and sustainable businesses. Accordingly, Westpac has managed its direct as well as indirect environmental impacts. It has put appropriate strategies of dealing with the critical issue, such as climate change. Significantly, the company has recognized that climatic change influences profoundly on economic, social, and environmental aspects in their operating regions. Consequently, the Westpac has considered such issues before embarking on their investments, lending, and operational decisions. Additionally, the company has realized that it has to expect to drive shareholder value through their response. Sources have revealed that the Westpac is among the Australian companies that have taken action on climate change. For instance, they have publicly reported their emissions since late in the twentieth century. Additionally, the company has continually responded to the CDP each year since its birth. Moreover, the company is credited for its strong history of calling for immediate action on climate change from both the government and the community at large. Moreover, the company launched a five-year climate change strategy building on its existing activities together with its position statement, hence, transitioning to a low carbon economy (Hill and Jones 55). Significantly, the Westpac Company takes a value chain approach, focusing on five critical areas. Firstly, they have managed their environmental foot front by building on the forty percent emissions reduction achieved between 1996 and 2008. Similarly, the company has targeted a further thirty percent reduction by 2013 as well as accounting the more of their direct impacts. Additionally, the company has intensified on employee engagement by raising awareness of climatic trends and supporting the employees that develop local and personal responses. Moreover, the company has raised knowledge and tools in order to incorporate climatic trends explicitly into its decision-making, hence, modifying their credit, underwriting, and related standards to reflect climatic risks. Additionally, the company’s has developed numerous commodities in support of positive environmental outcomes and engaging the consumers to help them mitigate climatic impacts. Lastly, the company has sought to drive awareness as well as action in the community and businesses and policy makers, thus, assisting in the transition to a low carbon economy. Concisely, the Westpac Company has emphasized that the entire economy must collaborate in order to address climatic trends effectively (Hill and Jones 80). The sources have revealed that the Westpac Company has provided numerous incentives for the management of climatic trend issues, as well as, attainment of targets. For example, it has given monetary rewards to the corporate executive team. Therefore, the company has included the emission reduction target in the performance objectives of its corporate team, hence, influencing directly at risk remuneration. Additionally, the company has set monetary rewards to the Chief Operating Officer (COO); it has included its emissions reductions in the performance objectives for the COO directly influencing at risk remuneration. Moreover, the company has extended numerous incentives to the business unit managers, the energy managers, risk managers, and employees. Significantly, the company’s employees have an element of their performance linked to sustainability objectives. Thus, the company gives annual rewards to individuals as well as teams working alongside their mandated responsibilities on environmental issues. Lastly, all the company’s employees can get free interest loans – hence, enabling them to take advantage of the seasonal travel pass discounts for public. Concisely, climatic trend risks and opportunities are identified and prioritized by the relevant board committee and management. Additionally, the strategic planning group manages the development of organizational strategy. It also conducts environmental scanning from all aspects. The company has also developed numerous initiatives, such as regulatory risk framework, business continuity planning (BCP), sustainable Supply Chain Management (SSCM), and the Reputation Risk Framework (RRF). In conclusion, this document highlights that the Westpac Company hardly enjoys a competitive advantage over its rivals. For instance, the company’s profitability does not supersede the average profitability for its industry. Consequently, due to this insignificant competitive advantage, the company lacks sustained competitive advantage. Additionally, the company has not been able to maintain an above average profitability for a number of years. Moreover, the company has employed inappropriate strategies in dealing with the current GCF outfall in the banking industry. Therefore, this document recommends that the company must understand the numerous market conditions in the industry. Accordingly, on the top of its internal as well as external incentives, the company must recognize the varied competitive conditions in the industry. Work Cited Hill, Charles and Jones, Gareth. Essentials of strategic management. Chicago, IL: Cengage learning, 2011. Print. Read More