Strategic Thinking and Strategic Leadership - Assignment Example

Strategic Thinking and Strategic Leadership Table of Contents Question 1 2 Key Theories of How Strategy is Developed and Implemented and the Relationship between Strategy, Innovation and Change 2 Question 2 11 A Critical Analysis of Strategic Processes within Tesco 11 Question 3 13 An Assessment of the Extent towards People Involvement within Tesco 13 References 16 Question 1 Key Theories of How Strategy is Developed and Implemented and the Relationship between Strategy, Innovation and Change According to Johnson & et. al. (2001), strategy is fundamentally described as a long-term action or plan that is adopted as well as implemented by different organisations with the intention of accomplishing their predetermined business goals. Contextually, the goals of a particular organisation may include enhancing productivity as well as profitability, mounting market share and most importantly accomplishing superior competitive positioning over its chief market competitors. The development and successful implementation of effective business strategies are often regarded to be one of the most vital functions of organisational management as it supports them to accomplish the determined goals and obtained the desired outcomes. As stated by Johnson & et. al. (2001), different strategic levels can be witnessed as existing within a particular organisation. For instance, corporate level, operational level and business level can be identified as three broad categories which are often used in theoretical contexts to segregate strategic levels. The concept of corporate-level strategy has been viewed to be primarily concerned with determining the overall scope of a firm and evaluating its business as well as operational performances. Similarly, the business-level strategy signifies the competencies possessed by an organisation and thus plays a vital role in assisting the business to defeat its major rivalries in its targeted business markets. Correspondingly, the notion of operational-level strategy represents the efficiency of an organisation to use its valuable operational resources quite effectively with the purpose of attaining the desired business targets in the most convenient way. As affirmed by Johnson & et. al. (2001), the conception of corporate strategy is typically described as a procedure that supports an organisation’s growth in effectively combining the processes performed within the different functional areas of business through which the attainment of the expected business outcomes are likely to become easier. According to Capon (2008), organisations can obtain numerous benefits by adopting as well as implementing effectual business strategies. The common benefits obtained through strategic effectiveness include sustainable growth opportunities through facilitated stakeholder relationship, better community involvement through enhanced communication, augmented contribution from organisational members to upraise operational performances and consequently, successful accomplishment of superior competitive positioning. As noted by Alkhafaji (2003), strategies are generally developed by an organisation on the basis of certain defined aspects. These aspects comprise performing a detailed analysis of both external as well as internal business environments, identifying along with evaluating the organisational objectives, its missions, its values and its social responsibilities. Moreover, the other aspects include formulating an effective organisational structure, strategic plans or programmes, proper allocation of valuable resources and almost accurate assessment of the organisational performances. From a theoretical perception it has often been argued that due consideration to these factors can enhance the efficiency of an organisation in formulating highly effective business strategies which shall further contribute to its long-run as well as short-run performances (Alkhafaji, 2003). Capon (2008) further identified that even though at the initial stage, strategic development process may seem to be a complex phenomenon, assessing the aforementioned factors through a systematic procedure can render a well-defined framework for the purpose and thus reduce complexities as well as chances of error by a substantial extent. In accordance with the report published by Center for Applied Research (2001), the conception of strategic thinking is principally described as a process that emphasises upon implementing as well as incessantly developing unique opportunities in order to mitigate any sort of critical issue. This particular notion of strategic thinking supports the business managers in different organisational contexts towards periodically reviewing different policy issues, performing long-term effective planning, setting business goals along with determining priorities and recognising potential opportunities as well as risks. It has been apparently observed that the notion of strategic thinking considers certain valuable aspects which further tend to assist modern day business organisations to attain the predetermined goals. In this connection, the aspects encompass the identification of the skills as well as the capabilities possessed by the organisation itself, business environmental elements, target market conditions, competitors’ performances, availability of substitute products and the buyers’ as well as suppliers’ bargaining powers (Center for Applied Research, 2001). It is in this context that theorists have often been arguing that the concept of strategic thinking encompasses two major facets i.e. logical as well as creative thinking which play a decisive role in making the procedure more rational and practical. As stated by Wit & Meyer (2010), the concept of creative thinking aids in making the procedure of strategic thinking more comprehensive, consistent as well as rigorous rather than fragmentary and haphazard. Similarly, logical thinking attempts to deliver pioneering solutions, inventive ideas and unconventional insights to the management when focusing on strategic thinking which mitigates the possible constraints of the process in terms of conservative and conformist outputs (Wit & Meyer, 2010). Hence, it can be affirmed that these concepts of logical and creative thinking supports the business managers to perform different operational functions that comprise leading, organising, planning and controlling strategies. When assessing the operational functions of strategic planning, both creative as well as logical thinking supports the organisations in defining its performance objectives and most significantly determining the necessary actions needed to be executed in order to establish those objectives. In relation to the operational functions of organising strategies, creative and logical thinking tends to assist the organisations in arranging valuable resources and assigning different management related tasks after synchronising the activities of every organisational member. With regard to the operational function of leading, both logical as well as critical thinking helps the organisations in conducting various tasks which include establishing effective communication, stimulating and encouraging the working staffs to generate superior operational results. Creative as well as logical thinking also helps different organisations in the form of measuring work performances effectually, evaluating operational results to business goals and adopting as well as implementing corrective actions when practicing its controlling functions (Schermerhorn, 2011). According to Hoskisson & et. al. (2008), the notion of strategic leadership has been identified to be normally performed by the strategic leaders of different organisations with the aim to generate a well-structured as well as organised organisational culture by establishing effectual communication along with coordinating the personnel from various organisational dimensions. Strategic leaders, in today’s context also pay due consideration towards the proper allocation of valuable resources which in turn is believed to enhance the competencies of the organisation by a large extent. Elenkov & et. al. (2005) also noted that the prime intention of strategic leadership is to encourage the working staffs by offering attractive reward systems and compensation packages so that the business and the operational performances of the organisations can be raised over the long-run in a sustainable as well as highly competitive manner. Furthermore, as stated by Appelbaum & Paese (n.d.), there are various functions of strategic leadership through which organisations can attain the expected business goals. For instance, the strategic leadership function comprise identifying critical issues or problems, formulating long-range action courses in order to resolve the issues, exploiting opportunities for business growth, establishing effective communication with the employees as well as key stakeholders and attracting along with retaining new talents. Moreover, strategic leaders are also learnt to be focused on building high degree of commitment towards fulfilling common organisational goals, optimising organisational performances by incorporating information from different sources of business environment to embrace operational changes more enthusiastically. These functions can effectively contribute towards strategy development as well as implementation by effective guidance and direction to the strategic leaders (Appelbaum & Paese, n.d.). According to Adair (2011), the other general functions of strategic leadership comprise building as well as preserving the working team and most importantly stimulating along with advancing the performances of every organisational member. These aspects can also be considered as the other imperative functions of strategic leadership that accumulatively contribute towards strategy development along with implementation by helping the strategic leaders in critically evaluating the existing business elements. As per the observation made by Amos & et. al. (2009), suitably utilising the policies or the strategies and mounting the corporate spirit are the key functions of strategic leadership. These functions can also be recognised to effectively contribute towards strategy development as well as implementation by assisting the strategic leaders to think synergistically while performing different operational functions. In this regard, it can be stated that the synergistic efforts of the strategic leaders might enhance external effectiveness as well as internal efficiencies, especially in the field of organisational structural arrangements. Analoui & Karami (2003) identified that the process of strategic management is generally commenced with analysing the internal strengths as well as weaknesses and external threats along with opportunities that is theoretically acknowledged as SWOT analysis. As stated by Christensen & Donovan (n.d.), a strategy is developed as well as implemented on the basis of two theoretical processes. The first theoretical process linked with strategic development and implementation is ‘analytical and conscious’. This particular theoretical process generally involves the evaluation of the structure of the business markets, market-growth drivers, nature of the customers’ requirements and its competitive strengths along with weaknesses. The consequence of this procedure is regarded as an intended or deliberate strategy. Christensen & Donovan (n.d.) termed the second theoretical process linked with strategic advancement and execution as ‘emergent strategy’. This theoretical process engages the decisions that are adopted as well as implemented by the business managers with the motive of mounting the business or operational performances in the long-run as well as in the short-run (Christensen & Donovan, n.d.). According to Christensen & Donovan (n.d.), one of the imperative factors i.e. the procedure of resource allocation, imposes extensive impact upon the development as well as the implementation of a strategy. This might be owing to the reason that the process of resource allocation is viewed to be a diffused procedure which takes place at every level in almost every organisation. This particular system of resource allocation typically acts as a filter through which different organisations can enlarge and employ effective strategies effectively with the intention of accomplishing their respective business objectives by a greater degree. As per the study conducted by Christensen & Donovan (n.d.), the different strategic ideas or initiatives which are undertaken by various organisations are usually filtered through the process of resource allocation. As noted by Karami (2007), various decisive factors prevail within the internal and the external business environment which tend to largely influence the development and the implementation of a strategy. In this similar context, the factors the macro as well as the micro-environmental factors which can be evaluated critically through developed frameworks such as PESTEL, Porter’s Five Forces and SWOT(Karami, 2007). The theoretical processes involved in the development as well as the implementation of a strategy can be better understood with the help of the following pictorial representation. Source: (Christensen & Donovan, n.d.) With regard to determine the interrelation between strategy, change and innovation, Chenhall & et. al. (n.d.) identified that the organisations in this present day context can attain superior competitive position over their chief contenders only if they are able to adopt effective business strategies, preserve higher innovation level and make periodic organisational changes. As stated by Chenhall & et. al. (n.d.), certain factors play a vital role in upraising the market competition and have consequently made the modern day organisations to devise effective strategies with the intention of accomplishing their predetermined goals. In this regard, the critical factors comprise increased level of globalisation, introduction as well as implementation of pioneering technological advancements and the prevalence of higher degree of internationalisation among others. According to Chenhall & et. al. (n.d.), innovation within the work culture and the consequent organisational changes are typically driven by the strategies employed by different organisations. Thus, it can be stated that there exist a direct association between innovation, strategy and change. After acquiring a brief idea about the conception of strategy, Chenhall & et. al. (n.d.) defined innovation as the adoption and the utilisation of a particular managerial notion or behaviour that is quite new to a specific organisation. In this similar concern, innovation can also be regarded as one of the significant strategies for organisations as it enables them to present new thoughts and thus attain their desired goals with greater efficiency (Chenhall & et. al. n.d.). However, Dobni (2010) stated that strategy and innovation are not related to one another. There are certain differences that exist between strategy and innovation. One of the major dissimilarities between strategy and innovation has been viewed to be in their nature. In this similar context, Dobni (2010) noted that the innovation nature is quite unpredictable as well as exploitative. On the other hand, a strategy mainly emphasises upon control along with planning and seems to be quite predictable. Nonetheless, Dobni (2010) also realised that both, strategy and innovation, can support an organisation towards making significant organisational changes and attaining its desired goals successfully as per planned. Dobni (2010) also observed that there are certain organisations which tend to maintain a proper balance between strategy and innovation in order to make significant organisational changes. According to this viewpoint, it can broadly be stated that both, strategy as well as innovation, co-exists in organisations which accumulatively creates a significant impact on the strategic development and implementation and its relationship. Question 2 A Critical Analysis of Strategic Processes within Tesco Tesco PLC is regarded as one of the leading retail chains throughout the globe which performs its different business functions as well as operational responsibilities in 14 nations with a workforce of more than 500,000 (Tesco, 2013). The vision of the company is to become one of the most valued retail chains and corporate entities in the entire world. The company desires to become highly valued not only on behalf of the customers, but also by the communities, working staffs and key stakeholders as well. The company further tends to accomplish its desired business goals remaining loyal as well as committed towards integrity when applying the skills worldwide to devise and implement effective strategies (Tesco, 2013). When assessing the strategic processes within Tesco, it has been apparently observed that the company intends to make certain organisational changes through extensive capital investments. In this regard, the company strongly believes that it can improve the performances of the shareholders and can also comply with the requirements of the customers (Tesco, 2013). There are several strategic processes that are implemented by the company while performing its different operational functions with the motive of satisfying the expected goals. In this regard, the strategic processes includes innovation in product development, Information Technology (IT) integration and supplier management. Notably, in the process of product development, it has been viewed that the product and/or service advancement procedure of the company is considerably re-engineered with the motive of delivering effective products to the valuable customers (Slideshare Inc., 2013). Moreover, the company also made innovation in its operational segment by introducing the loyalty cards system in order to customise the services in accordance with the requirements of the customers. In relation to the other strategic process concerning IT integration, it has also been apparently observed that the company has introduced as well as implemented efficient operational systems in order to record its inventories in a systematic and error-free manner. Additionally, realising the advantages of integrating IT related operational functions to remain competitive, the company applied an extranet system which further enabled it to generate customised along with proprietary information flows within the company and also with its different business partners. This particular strategic process relating to IT integration ultimately supported the company to enhance its distribution channel efficiencies by larger extent. In relation to supplier management, it has been viewed that Tesco intends to work in alliance with different suppliers throughout the globe belonging to diverse cultural backgrounds. This practice has been considered as one of the major approaches for the company in order to maintain a unique interrelation with the suppliers (Slideshare Inc., 2013). After acquiring a brief idea about the selected strategic processes practiced within Tesco, it can be stated that the aforementioned strategic procedures of the company can be related to the theoretical process of intended or deliberate strategy. It is particularly owing to the reason that the strategic procedures followed by the company have been primarily based upon the nature of the customers’ requirements and the structure of the industrial business markets which decipher the qualities of a deliberate strategy (Christensen & Donovan, n.d.). Question 3 An Assessment of the Extent towards People Involvement within Tesco The business model of Tesco comprise the interrelation with the suppliers, broad network of the distribution centres and the development in the performances of the working staffs that accumulatively provides a better idea about the extent towards which people within the organisation are engaged with and contribute to a selected strategy. When assessing Tesco’s association with its suppliers, it can be observed that the company works with a broad assortment of suppliers belonging to diverse ethnic backgrounds and thus, focuses extensively on developing its different brands to comply with the requirements of the customers. Apart from working with diverse suppliers, the company has also been noted to work effectively with various specialist partners with the intention of delivering better product offerings to its valuable customers. For instance, the company has focused on conducting joint ventures with various international companies in order to produce superior quality Tesco products at attractive prices (Tesco, 2013). In relation to one of the constituents of the business model concerning broad network of the distribution centres, it has been apparently observed that the company has been able to preserve a cost-effective system of supply chain with the introduction of pioneering technological advancements along with broad networking facilities connecting its distribution centres. In this similar context, a portion of the people or the workforce of the company supports the company in maintaining an effective distribution system by keeping the ordering systems updated, properly scheduling transport planning methods and appropriately allocating the accessible resources. The company also emphasises upon the aspect of primary distribution as a core function that ultimately assists it towards sustaining a cost-effective system in its supply chain process (Tesco, 2013). Concerning the performance development of the working staffs in Tesco, it has been noted that the company largely considers its personnel as imperative assets facilitating in the presentation of superior services. In this connection, the company has been periodically introducing effective training programs especially for its employees in order to develop their operational performances continuously in offering quality and attractive services to the customers. The company also believes on its notion that working staffs are the most curial constituents in facilitating the company towards accomplishing and preserving a sustainable growth over the long-run. Moreover, the company also believes that its personnel attempts to comply with the changing requirements of the customers incessantly that eventually enhances the degree of satisfaction among the customers. Finally, it can be stated that the company has been able to deliver a broad array of quality products or services by emphasising upon its different constituents of the business model. The aforementioned elements constituting the business model of Tesco ultimately contributes to the selected strategy of being an inventor of highly valued brands throughout the globe (Tesco, 2013). Thus, the above discussed constituents relating to the business model of Tesco ultimately depicts the extent to which people are engaged with the company and effectually contribute to a selected strategy. References Alkhafaji, A. F., 2003. Strategic Management: Formulation, Implementation, and Control in a Dynamic Environment. Routledge. Analoui, F. & Karami, A., 2003. 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