Strategic Analysis - Assignment Example

AIR NATIONAL STRATEGIC ANALYSIS---INTRODUCTION Strategic analysis is an inevitable part of every corporate organization’s management plan on whichall its functioning stands. All the organizations either large or small devise methods and apply techniques for the growth and success of their product and merchandise. Such sets of devises are called the organization’s strategic plans to enhance its volume and capacity. Thus, there always exists the need for a comprehensive and transparent methodology of formulating a strategy and revising it according to the changes taking place in corporate sector in a very fast pace. Hence, strategic management not only discusses the decision making regarding main issues of grave concern of an organization, but also it focuses on the implementation of the strategy planned in a proper way in order to obtain the appropriate results. “Simply put, strategic planning determines where an organization is going over the next year or more, how its going to get there and how itll know if it got there or not. The focus of a strategic plan is usually on the entire organization, while the focus of a business plan is usually on a particular product, service or programme.” (McNamara, 2006). Q 1.What factors enabled AN’s senior management to take a strategic approach to its business and to adopt an empowering-developmental approach to HRM? Answer: Almost all the corporate organizations, enterprises and companies undergo various financial fluctuations during the course of time while offering their services either at global or domestic level. These fluctuations are the outcome of many factors including changes in technology, alterations of government policies, political, social and cultural changes, introduction of new inventions, environmental factors and others. The leadership and senior management of the organizations comes forwards to determine the ways to bring considerable alterations in strategic plans. The same is the case with the Air National Airlines, which experienced business setbacks after getting privatised by the British Government in 1986. The Air National was enjoying the status of a well-reputed airline with long range of customers and significant profit every year. The senior management had to adopt the policy of downsizing in respect of both assets and labour, in a result of being declared privatised, which surely influenced its performance. Consequently, the Air National had to work in an environment of perfect competition with other airlines networks under the same environment. The privatisation process took place at the time when Europe and North America were facing economic recession in the field of air travelling. The CEO Mr. Bradley Smith assumed low-cost competitive strategy by providing services at low rate than the rival airline enterprises. Unfortunately, he stressed on austerity measures only, in services and advertising too, which ended in fiasco and the company had to suffer significant losses. All such losses enabled the new management under the dynamic leadership of new CEO Mr. Clive Warren to articulate a comprehensive strategic approach that may lead to the transformation of business operations and HR practises. Mr. Warren applied latest strategic analysis prevailing in the contemporary market to combat the threat of losses in a courageous way. He reorganized management structure and emphasised on enhancement of providing quality service to the customer at discounted rates. He divided the task force into groups and accelerated advertising and marketing performances to capture the attention of the customers. It is fact beyond doubt that if all the departments of an enterprise including marketing, finance, advertising, human resource management and others work in a joint venture and consult one another to revise and review their strategies, the organization can make progress, escape losses, improve services and enhance customer range. Human resource management contains very significant part in the process of growth of a company. Mr. Warren stated the staff of his industry central figure to make things in a proper and organized form. In the same way, he revised HR strategy by laying stress on employee empowerment and commitment. He declared his staff as the precious most asset of the enterprise. Moreover, he banned the demarcation in HR department and led way to multiskilled operations. All these factors contributed in taking strategic approach in business and HRM strategic approach that boosted the morale and efficiency of the employees and the airline was once again on the road of achievements. Q 2: How useful is the concept of ‘strategic choice’ in understanding the linkage between AN’s competitive and HR strategies? Answer: Strategic analysis and strategic choice are essential parts of strategic management. The former discusses the understanding of the strategic situation of a company or organization, while the latter concentrates on the decisions made regarding the future of the organization according to the external and internal alterations within the market scenario. Strategic choice serves as the nucleus in a corporate strategic management and discusses all the inter-departmental operationalization. As both competitive and HR strategies are the part of strategic choice, it is highly beneficial in understanding the linkage between competitive and HR strategies of an organization. Both these strategies are applied to enhance the efficiency of the workforce including management and labour class, and there always exists an association between the competitive and human resource strategies. The same is the case with the Air National airlines. The top management of the Air National implemented new competitive strategy, where it divided its services into two parts. On the one hand, AN’s operations department launched a discounted airline quality customer service in comparison with the rival companies. On the other hand, its advertising department laid stress upon value added elements to display that the company was offering its services at even the discounted rate without making any compromise in its quality or services. Keeping an eye on the future developments, the company sold out some of its aircrafts and buildings. The enterprise successfully suspended its unprofitable routs and promoted quality of service in profitable areas. Similarly, the management took the same steps taken in Competitive Strategy while making strategic choice in HR department, where it implemented downsizing in its extra or inefficient labour. The CEO focused on the empowerment and commitment of the efficient staff. The HR department organized the staff on the multiskilled basis without discrimination of crafts groups and concentration was laid on the performance and dexterity of the staff members under the supervision of a team leader. The motive behind that all was to improve the services in order to enhance business activities and expansion of services for the future years to come. Q 3. What problems, if any, do you envisage with AN’s HR strategy and Gojet’s HR strategy? Answer: Gojet Airline is also a project of Air National, which maintains lower status and serves as parallel to the discounted airlines of Europe. The planes under this project lack business class, but contain 20 additional seats. The HR strategy has suggested lower rate of wages for the employees in comparison with their counterparts or co-workers serving in the Air National. As the Gojet project serves discounted passengers, the employees also get the remunerations on the same foundations. There is difference in strategic plans of both Air National and the Gojet Air. The human resource department has adopted the dichotomous policy by taking advantageous and disadvantageous points of two entirely different business strategies. Dichotomy simply means the categorical division into two mutually exclusive or contradictory entities. The term, applied in business strategies refers to two opposite policies, nearly pole apart, adopted in order to get the best of the both. Here, the CEO emphasised on the employees empowerment and commitment on the one hand by discussing the Air Nationals HR strategy, he seeks wages of the Gojet employees lower enough that equal the discounted airlines employees. This HR strategic plan may create feelings of disappointment in the minds of the Gojet employees shaking their efficiency and commitment to the organization resulting in failure of other departments too. The HR strategists must keep such policies in mind to save the organization from further losses and future failures. Read More