Concept of Strategic Management - Case Study Example

Strategic Management Assignment Strategy is defined as the long term ball game on which an organization sees it making through, no matter how troubled the times are or even when the competition is tough to ascertain in the future era. Strategy is the ball game of the organization when it sets foot to compete within the relevant industrial domains so that the end result is one of success for its own sake as well as the standing that it has attained over a period of time within the industrial thresholds. It builds advantage over its competitors so that it could meet the expectations of the stakeholders, customers and employees alike. (Barr, 2000) This is so done because the advantage is much needed in such a scenario and it will help the organization to grow beyond the anticipated proportions. Building and indeed sustaining this advantage is a very significant exercise when one speaks of competitive advantage in the first place. Competitive advantage is something that is build over time and requires synchronization between the tactics, activities and the overall strategy of the company which is producing the product(s). Competitive advantage is developed when there is a differential undertaking on the part of the customer. This could be in the form of lower prices than the competitors, better quality, efficient sales services and support and a number of other features. Thus customer satisfaction is something which cannot be measured by a standard set of parameters. It has to be experienced always with different set of offerings that are made available. These offerings could be in the form of better quality products, higher and more efficient services or a bundle of both high class product and state of the art service, in which case it would not be categorized under either of them rather as a mixture of both. It is pretty true that the market dynamics suggest that the competitive advantage can only be achieved when the customer is given what he or she wants but then again is there any limit to his or her wants? The answer would be no and quite rightly so. The customers expect value for money and thus the best possible product at the most effective rate, thus it would be correct to understand his point of view and then go about changing the product offerings, prices and the value thus provided. However in this whole equation, we cannot forget the stakeholders’ role since these are the people who have invested in the equities of the company and they are there for quick returns. Therefore the benefit point for the stakeholders is one that has to be understood in the proper contexts before we move any further. (Fox, 2004) Strategy has three distinctive key elements within its folds – strategy process, the strategy context and lastly the strategy content. Strategy process and strategy context work hand in hand to discern the basis of strategy content, i.e. what actually lies within the rationale and philosophy of strategy in the first place. The strategy process decides the manner in which strategy will be discussed, manipulated and articulated for the sake of the organization under questions. Strategy context however looks at the avenues in which this strategy will be implemented and made use of. On the whole, strategy content is significant since it discusses what exactly would go in essence whilst formulating a strategy. Delving further into the manner in which strategy process works, one must understand that it needs to be formulated first in order to work for the sake of the organization and its pertinent business processes and activities. Strategy process can only come into the fray if proper measures related with its development and formulation are completed in a manner that could only be remarked as one having success within its ranks. Within the strategy process, the top management and the specialists are involved since they have a lot of say in devising the strategy quintessential for the organizational basis. (Sawai, 1999) These decision making individuals formulate the strategy process in such a way that their organizational value hierarchies and objectives are kept in check. This is significant to comprehend because strategy indeed is the basis of the organization’s long term commitment towards its stakeholders, employees and more importantly – the customers, for whom it is undertaking the operations in essence. The analysis process within the strategy is undertaken when the strategy has financial implications for the smooth running of the business or when there are certain issues which pose as a lingering threat on the working domains of the organization’s goals and objectives. These are essential to take note of because a potential danger as far as the organization’s existence is concerned could be looming in its face. Strategy must be chalked out in such a manner that the organization’s mission and vision objectives are kept in extreme checks and there must not be any straying moments as far as this matter is concerned. The different kinds of analyses usually undertaken involve looking at the strategic basis of the actions that have been devised, the financial and economic aspects as to whether the proposed budgets are in line with the spending levels of the organization for the campaign in strategic retrospective and lastly the manner in which the organizational workforce will be employed for the sake of performing managerial as well as specialist level duties. All these aspects need to be covered in detail before an organization could think of deriving competitive advantage courtesy its strategic process’ tilt and the actions taken under the same heading. In the world of present times, strategic planning is not appropriate for a company which has to meet tactical moves as well as go in line with its strategic tilt and direction that has been set ages ago. This owes its basis to the fact that the company’s mission and vision statements are chalked up when it is in the early stage and thus the whole concept of finding out what it wants from its different processes and activities, whether or not to go for the short term incentives or substitute the same for the long term gains and a host of other things that come in line with these points as well. Organizations in the present times are doing their utmost in order to know more and more about their valued customers. For this, they have devised certain strategies which are in line with the values that their business has set for itself. These values are thus deeply intrinsic within the mission and vision statements of the company. In order to gain further knowledge about the customers, research is being given proper emphasis which would eventually discern the exact basis for the customers to come and make that vital purchase. Even when the same has been done, the need is to find out how the same customers can be retained and in what manner they will come back for the repeat purchase of the product. Organizations do their best to conduct research which will harness their business outcomes as well as help them achieve positive results in the light of unbroken grounds, at least in the marketing and business circles. They want to reach out to the customers in whatever capacity they can and for that they aim to find out the best and most efficient means possible. (Wells, 1998) In order to gain this deeper understanding, they are seeking in depth research from third party research affiliates like A C Nielsen, Dunn & Bradstreet and others. These research companies find the exact basis for the company to reach out to the potential customers as well as hit upon the ones who are actually buying the competitor products and are simply unaware of their product or do not want to use theirs due to certain malice, prejudice, immoral or disliked advertising campaigns and a host of other reasons as well. Now it is up to the companies themselves whether they choose the long term (strategic) incentives mechanism or go the short term (tactical) gains’ way. The option here is to suggest that strategic gains might be fruitful for the company in a broader perspective but this might leave the business processes behind when a comparison is drawn up between it and the other competitors at some realistic point in time. This also fathoms the fact that short term gains are denied their due right since the company’s long term vision just does not allow the freedom and space for the company to grow in a slow yet steady manner. All emphasis is based on the end result, which might be quite far off but then the need is to understand that future is not everything within the business. A company has to be financially sound today to make it even better in the coming times. Organizational performance is dependent a great deal on the manner in which this strategy is coined and indeed implemented in the longer scheme of things. The changing market structure might call for changing strategies and lines of action that would all target the people for whom the product is actually designed as well as the competitors with whom the clutter is being broken in the environs of the marketplace. Thus competition brings in more and more quality at the end of the company with regards to its products as well as more sales in the form of its varied and changed stance on focusing towards the customers rather than the product itself. Apart from that, emphasis on need must be the order of the day rather than bringing out more and more varied stock key units just for the sake of it. (Boeker, 1997) The different products should satisfy each and every user rather than satisfy the people sitting in the innovation labs and those who invent just to take the company one step further. This trap should thus be avoided under all circumstances. Thus profits could come out in the middle when a company is the sole and dominant player in the whole market structure. It has to be kept in mind that the profits have to outnumber the losses in the longer scheme of the whole equation of carrying out a marketing activity. If this is not the case, then the business might not survive for long and the losses will lead it to simply nowhere at all. It is imperative to pinpoint the weak and grey areas and thus set out on a journey on the part of the marketer to tackle the very same and thus bring to light the positives out of the whole equation. Consequently the significance lies on the shoulders of the main person who has set the ball rolling as far as the business is concerned and it is up to him solely as to what he has in mind, with respect to the vision and mission of the business and the company for that matter. Every big business or multinational that is existent in present times credits itself on to the vision of an exemplary personality which started it all when the going was tough and when there was a huge competition in the related market. (Foss, 2005) Thus to withstand pressure and competition is the hallmark of any successful and long lasting business, company or enterprise, whichever term we might quote it as. Organizational performance and strategic implementation regimes thus work hand in hand to produce solid results and look to harness the strengths which exist within the domains of the organization. The benefits and limitations of strategies are only within the minds of the strategic actors – the ones who devise the strategies for the business concerns and/or organizations in the first place. Now if these strategies are not properly framed up, there is a huge possibility that ambiguities would exist and that the strategy could come down quickly. This could mar the growth basis of the organization in the long run and could look to thwart the existence regimes of the organization on all counts. For that strategic planning must be the buzzword. Strategic or long range planning can help a particular company gain so much in accordance with its goals and objectives that had been planned and drafted but in the current times more and more attention and emphasis is making the rounds of the discussion as to whether these plans can actually deliver what was expected of them in the first place. (Elkin, 1998) Planning is not appropriate for a company which has to meet tactical moves as well as go in line with its strategic tilt and direction that has been set ages ago. This owes its basis to the fact that the company’s mission and vision statements are chalked up when it is in the early stage and thus the whole concept of finding out what it wants from its different processes and activities, whether or not to go for the short term incentives or substitute the same for the long term gains and a host of other things that come in line with these points as well. (Orpen, 1985) The usage of long range planning in the business world of today is very imperative as it ensures that the same is not only important to the whole well being and the actual basis of the business but also the manner in which it invites the short term gains and incentives that come along all this while. Management by Objectives (MBO) looks at agreeing upon a certain set of objectives within the working methodology of an organization. The purpose of MBO is to devise the ways and means through which targets could be achieved in a pretty speedy manner. The term was first coined by Peter F Drucker in the year 1954 and has remained constant throughout the passage of time. (Lachman, 1989) The role of scenario building is the analysis of future events by contemplating alternative outcomes which are possible. These are also known as the scenarios which could be shaped up. These scenarios assist in devising different decisions and facilitate in the decision making process as there is more room for completion of outcomes as well as their varied implications. (Soukup, 1992) Some management theories working within different organizations might not be that easy to understand at the very beginning. These can encompass a variety of different aspects, features and traditional mindsets which make up their structures. To start with, we see that an organization can either be formally aligned in its ways and means of doing things and different processes or the same might just be in a way informal in quite a few of its activities and tasks. The manner in which it runs across this paradigm is something that needs to be studied in depth before we reach further consensus on their purposes and the kind of achievements that they have had. The communication within an organization can flow in one of three ways or in all the three directions. This means that these three directions pave the way for the ease of communication and there are as such no barriers to arise from the whole equation. (Dunning, 2001) The mainstream management theory thus relies on the aspect of delegation of work which is a significant aspect if we look at the work regimes within the present day organizations and management hierarchies. Now all this requires a strenuous critical look to come to terms with the weaknesses present within the organization’s management and strategic basis and without having a look at the very same, the room for improvement would indeed never be envisaged let alone the gaps be plugged. Strategic management must bring about certain efforts which are geared up to make it sound, look and eventually feel different from the rest of the lot and in the long run, have a selling proposition in it and in its products that help it in winning the customers time and time again. Similarly, it needs to make sure that its staff members and employees are amongst the best in the industry and that they can relate with the norms and routines of the top corporations working hand in hand with each other but competing on the business level. The managers need to look at several different angles which are related with the business itself. All this easily accumulates under the mainstream management thinking that is present in the times much like today. This means that there is a general sense of negativity attached with the way in which managers perform their tasks. It also gives air to the notion that managers know nothing about what the requirements of the stakeholders are in the whole equation but then again this assumption might just not be correct as well. (Roney, 2004) The managers might just be thinking about the long term scenarios and therefore have to sacrifice the short term interests of the stakeholders for their long term ones. However this is all pretty confusing to understanding and more so within the business circles and the related processes in which managers perform their duties and tasks. In the end, it is quintessential to state here that strategic management regimes cannot be overlooked if the same are planned in a corporate or a business unit way. All of them have similar importance no matter how different they are within their contextual differences. The operational and functional levels present within the domains of the organization are of equal significance as are the long term strategic and corporate level organizational levels. What is needed first and foremost is a vision – what the organization wants in the long run for its own self and then only tactical level details are discerned, discussed and dealt with, in due course of time. A strategy can only be turned into a successful one if there is an effort on the part of the stakeholders to understand its due importance and implementation within the related settings. (Kay, 1995) All said and done, the need of the hour is to comprehend how strategic movements within the lengths and breadths of an organization are carried out and how the same benefit the long range growth levels of any organization. Bibliography BARR, Pamela S. (2000). When Firms Change Direction. Oxford University Press BOEKER, Warren. (1997). Executive Migration and Strategic Change: The Effect of Top Manager Movement on Product-Market Entry. Administrative Science Quarterly, Vol. 42 DUNNING, John H. (2001). Multinational Firms: The Global-Local Dilemma. Routledge ELKIN, Paul. (1998). Mastering Business Planning and Strategy: The Power of Strategic Thinking. Thorogood FOSS, Nicolai J. (2005). Strategy, Economic Organization, and the Knowledge Economy: The Coordination of Firms and Resources. Oxford University Press FOX, John. (2004). Organizational Discourse: A Language-Ideology-Power Perspective. Praeger KAY, John. (1995). Why Firms Succeed. Oxford University Press LACHMAN, Ran. (1989). Power from What? A Reexamination of its Relationships with Structural Conditions. Administrative Science Quarterly, Vol. 34 ORPEN, Christopher. (1985). The Effects of Long Range Planning on Small Business Performance: A Further Examination. Journal of Small Business Management Vol. 23 RONEY, C. W. (2004). Strategic Management Methodology: Generally Accepted Principles for Practitioners. Praeger SAWAI, Minoru. (1999). Small Firms, Large Concerns: The Development of Small Business in Comparative Perspective. Oxford University Press SOUKUP, William R. (1992). Strategic Planning is not Long-Term Budgeting. ABA Banking Journal Vol. 84 WELLS, Louis T. (1998). Multinationals and the Developing Countries. Journal of International Business Studies, Vol. 29 Word Count: 3,041 Read More