Strategic Management Assignment: Growth & Stability in Business

Question

Task: Strategic ManagementAssignment Brief The overall strategy of a business organization depends on the analysis of its strategic position, strategic choice, and strategy in action.

Task 1
a) Critically analyses how a firm develops its strategic position by analyzing its internal and external environments.

b) What roles do strategic capabilities and competitive advantage(s) play in defining the strategic position of the firm.

c) Critically analyses, with one example, the relationship between strategic choice and the acquisition of a substantial and sustainable competitive advantage.

Task 2
Provide a critical review of the following two statements:
a) “A volatile business environment can open up greater business opportunities than a stable environment. The conventional entrepreneurs favor a stable environment but innovative entrepreneurs prefer changes.”

b) “Organizations cannot search for ‘cook book recipes’ in change management. How to make a change is the sole responsibility of leadership and team work”

Task 3
The strategic purpose of an organization rests on: Governing structure, stakeholder expectations, social responsibility and ethics.

a) How would you assess stakeholder interests in a situation where the stakeholder interests are varied and diverse? Provide guidelines for managing diverse stakeholder interests.

b) Managers often consider social responsibility and ethics as a cost rather than instruments, which lead to growth and sustainability. How would you change such negative attitudes of managers?

Task 4
a) What global forces attributed a greater significance of managing organizational culture as an inherent feature in business management?

b) Globalization often promotes foreign investment, acquisitions and mergers. What are the issues that would crop up when two companies in differing cultures move into acquisition or merger? How would you resolve these issues?

Answer

Strategic Management Assignment Task 1
1. Definition of Strategic Position
The strategic positioning of a firm depends on various strategic decisions and encouragement to implement those strategies to increase the firm's reputation and profit. It depends on the ability of a firm to create and evaluate the new value that is different from the competitor's offered value to its customers (Dimitrova, 2017). An organization’s positioning within its industry is a very important scale to measure its performance.

a. Analyzing Internal and External Environments
An organization’s internal environment can be analyzed by,

VRIO analysis
Organization’s capacity Assessment Tool or OCAT analysis
Firm’s core competency analysis
McKinsey 7s analysis

An organization’s external environment can be analyzed by,

SWOT analysis
Porter’s 5 forces
PESTLE analysis
Market survey

b. Environmental Analysis Influences the Development of Strategic Position of a Company
The structure of a firm or an organization is primarily associated with its internal and external environment factor analysis. Strategy positioning needs to be flexible so that it can adapt to the changing environment of the firm (Kyrylov et al., 2020). A manager has to predetermine the possible changes of the firm's environment to establish the strategy and its positioning. The environmental analysis helps to plan strategic posting because it forecast growth opportunities of the farm by evaluating various threats and possible errors. It also helps in lowering the cost by increasing the focus on available resources (Sukcharoensin, 2018). If the result of the environmental analysis shows more negative factors than positive once then the strategic positioning can be changed according to the result by altering the previous plans.

c. Real-world Example
The internal environment of Amazon showed various strategic capabilities and weaknesses. Amazon needs to include broad customer relationship management to increase the relationship between Amazon and its customers (Majed, Nuraddin and Hama, 2018). The company also needs to include modern information technology to improve its positioning in the retail industry. On the other hand, external analysis of Amazon illustrated various threats and opportunities. The strong economy of America and Europe provides the potential growth in Amazon (Majed, Nuraddin and Hama, 2018). Political, social, and technological factors also produced a diverse impact on Amazon's performance in the retail industry.

2. Definition of Strategic Capabilities and Competitive Advantage
Strategic capability refers to the resources and the skills use by a firm in its business environment. It evaluates the firm's various strengths and weaknesses and provides a guideline that illustrates the firm's competitive advantages or disadvantages in contrast to its competitors. Competitive advantage is the term that defines a firm’s produce goods and services are better than its rivals or not. It helps the firm to generate sales and increase its margins than its rivals

a. Strategic Capabilities and Competitive Advantage Influence the Strategic Position of a Company
Strategy capabilities include employees, skills, capacities of the firm. It gives the firm a strategic position in the industry. A business should have the proper capacity to strengthen its skills. It helps to gain competitive advantages in the open competitive business platform. Strategic capabilities and competitive advantage help the firm to survive and increase its value over time. On an economic scale proper internal structure, geological location influences the competitive advantage of a firm. If a firm has the strong strategic capability and offers low-cost product then the strategic position of the company positively influences the strategic position of the company.

b. Read-world Example
Amazon focuses on building the comparative advantages of the company. The e-commerce platform of Amazon developed strong skills, capacity, and efficacy that is impossible for other retailers to replicate (Arnett, Goldfinch and Chinta, 2018). It gives Amazon a higher position in the retail industry as well as increase the level of price in the industry.

3. Definition of Sustainability of Competitive Advantage
A company or firm can increase the sustainability of competitive advantage by value investors. It acts as a unique company's attributes, skills, and assets (Hamid, 2019). It cannot be replicated. It helps the company to keep its value in the industry for a long time and also overlap the positions of the competitors.

a. Real-world Example
Customers buy goods for Amazon because the company provides the customer with low price, fastest delivery a trustable service. They provide the best services in the retail industry to the customer.

b. Relation Between Strategic Position of a Company and Its Sustainable Competitive Advantage
Sustainable competitive advantage understands the market and its segments. It identifies the various role of the firm that are not properly serviced by rivals and can be used to meet the target and gain profit (Changchenkit and Plangklang, 2020). It gives the company an idea about what customers want helps to structure the value to offer to the customers.

c. Example
Amazon gets the best lowest price range from its vendor. Thus, the company can offer a huge amount of sales to its customers. Amazon does not have physical stores it primarily depends on delivery business. Amazon also includes advanced software, robots, and strategic warehousing to make the delivery fast to the customer. Amazon also started Amazon Fresh which incorporated with national food banks (Polacco and Backes, 2018).

Task 2
4. Critical Review of The Statements
a. “A volatile business environment can open up greater business opportunities than a stable environment. The conventional entrepreneurs favor a stable environment but innovative entrepreneurs prefer changes.”

Business activities and business opportunities of diverse organizations are impacted by increasing digitalization and setting advanced collaboration between organizations and their services. The companies are adapting their corporal, human and administrative source bases at the time of confronting technical and market changing conditions(Rachinger et al., 2019).In this era, innovative entrepreneurs do not only rely on their job on the paper as they converted their papers into practical work.

Conventional entrepreneurs build businesses but innovative entrepreneurs modify and develop the new productions with more effective procedures to enhance business models. For instance, conventional entrepreneurship covers learning curricula, delivering banking facilities in urban areas, and serving orphan children by epidemic illness. Whereas, innovative entrepreneurship leads to changes in music and electronics like “Apple”, in taxi business such as "Uber", in retail such as “Amazon” etcetera.

b. “Organizations cannot search for ‘cook book recipes’ in change management. How to make a change is the sole responsibility of leadership and team work” It is vital for considering the background to understand appropriate team dynamics and products, but often teams acting in diverse backgrounds are more alike than not. It is dangerous for teamwork-supportive administrative situations and circumstances where protection can nurture and develop a solution of struggles, certify protection, moderate faults, study, and expand performances. There are cooperative teamwork capabilities that can upsurge efficiency across groups or acknowledged responsibilities too (such as synchronization, communicating, and adaptableness)(Salas, Reyes, and McDaniel, 2018). Though teams are made up of specialists, they cannot be upgraded if they do not identify how to collaborate, synchronize, and make discussions well together. For ensuring the development and conservation of efficient team operating, the companies have to develop team growth involvements and assess appropriate team results with healthy analytical measurement.

Task 3
5. AssistingStakeholder’s Interest
a. Guideline for ManagingStakeholder’s Interests
Stakeholders of an organization include the internal staffs, suppliers, members, customers, regulators and local communities that help to develop the business of an organization. The interests of the stakeholders should be very important while developing a project of an organization. The company stakeholders are interested in the final result of an organization as they are investing in it. The interests of stakeholders should be analyzed from the project manager’s point of view of an organization (Aragonés-Beltrán, García-Melón and Montesinos-Valera, 2017). The guidelines for managing the interests of the stakeholders help the policymakers and managers to follow the objectives and the systemic process to analyze and collect data about the stakeholders. The guidelines of managing stakeholder's interests consist of providing input for strategic planning, institutional assessment and others, developing action plans for increasing support of modification of policies.

To manage the stakeholder's interests of an organization, the project manager should first identify the stakeholders and develop the most preferred method of communication with them.
The stakeholders should be updated regularly by the authority of the company. They should ask and consult with the stakeholders about the development of the project.
Sometimes, the interests of the stakeholders are varied and diverse. Some stakeholders give priority on the meeting of the final deadline of a project while some will consider the end of user functionality of the final product as important. It should be very important to match with each of the stakeholders' point of view. The organization should organize a meeting for mutual settlements.

6. Reasons for Managers to Depends on CSR As A Cost to Achieving Sustainability
a. Rational measures to Change the Manager’s Attitude
Sometimes, the mangers of an organization consider ethics and social responsibilities as a cost rather than instruments, that leads to growth, development and sustainability of an organization. It is necessary to change such negative attitudes of the managers. Negative attitudes in an organization create many problems such as lacking productivity, negative atmosphere in the workplace and customers dissatisfaction. The Amazon should look into these problems and change the attitude of the manger.

The role ethical considerations are one of the key elements of the manager’s attitude in an organization (Kangas et al., 2018). The ethical cultures of a company support the well-being of the managers and are connected with fewer absences due to sickness. On the other hand, unethical culture creates a negative impact on the manger's attitude.

There should be an effective communication system between the managers and employees of an organization and the manager should work together by planning and training with the employees if possible.

The negative attitudes of the manger can harm the workplace culture and environment. The management of the organization should meet with the manager and advise to change the negative attitudes of the manger. Sometimes, the mangers consider social responsibilities for the development and sustainability of Amazon. The authority should give the manager proper training to improve the strategic management system of the organization.

Task 4
7. Definition of Globalization and Global changes with Reasons
Globalization means the way of connecting people more politically, socially and economically around the world. In business, globalization refers to the change that a company is operating in multiple countries to sell the products internationally.

Amazon has started a global selling program to sell the products internationally. It has started with a small online retailer and now developed into a renowned brand (Garner, 2018). It helps the customers of Amazon to increase the visibility of the brand.

8. Globalization and Regionalization Made Culture Issues
Not only Amazon reaches the customers internationally, but also it operates in various countries and provides services like Amazon Prime. Amazon has to adapt to various international cultures and changes to develop globalization but sometimes, the negligence of regionalization has often made culture issues among the customers. While the globalization in the products of Amazon helps in low cost of the products and innovation of new technologies, it creates problems in managing employee immigration and loss of cultural identity.

9. Real-World Example
Amazon has changed the way of online shopping all over the world. It has started as an online bookseller and now it has become one of the largest e-commerce in the world. According to a report, Amazon's revenue has increased to 23.1% in U.S retail sales in 2020 (Djatmiko et al., 2020). However, the development of globalization has created problems like unemployment in regional cultures. The regional culture does not match with the international market and sometimes, the cultural identity has been lost.

10. Definition of Acquisitions and Mergers
The process of mergers and acquisitions has attracted attention from the business leaders in the last few years (González-Torres et al., 2020). Acquisitions and mergers mean the transactions that encompassing two companies that are combined in some form. Acquisition refers to the purchase of an organization or company by another organization. Particular acquisition targets are identified through market research, exposition of trades etcetera. Through the acquisitions and mergers, the organization can develop its sustainability in the market.

11. Strategies for Culture Management
After conducting acquisition or merging, the organizational culture management can maintain in the following processes –

Understanding the internal cultural beliefs, values, assumptions, and paths to communicate with the employees as well as its customers
Working on deploying authentic approach among the leaders and linking change behaviors with the existing business
Establishing a psychological and social environment within the organization to ensure the new contributions ?

12. References
Aragonés-Beltrán, P., García-Melón, M. and Montesinos-Valera, J. (2017) ‘How to assess stakeholders’ influence in project management? A proposal based on the Analytic Network Process’, International Journal of Project Management, 35(3), pp. 451–462. doi: 10.1016/j.ijproman.2017.01.001.

Arnett, J., Goldfinch, B. and Chinta, R., 2018. ‘Multi-dimensional nature of innovation at Amazon’, International Journal of Business Innovation and Research, 15(1), pp. 1–13.

Changchenkit, C. and Plangklang, T., 2020 ‘Impact of Sustainability Marketing: An Empirical Study on Consumers’ Perception and Attitudes towards Bio Plastic Coffee Cups in Thailand’, International Journal of Trade, Economics and Finance, 11(3).

Dimitrova, T., 2017. ‘Evaluating the strategic position of an organisation through space analysis’, ???????????????? ?????, 333(3), pp. 19–32.

Djatmiko, M.B., Chauhan, R.B., Tuguz, N.S. and Shah, S.A.S., 2020. A RESEARCH STUDY ON LOGISTIC AND E-COMMERCE OF AMAZON AND FLIP-KART. PalArch's Journal of Archaeology of Egypt/Egyptology, 17(6), pp.7863-7882.

Garner, B. A., 2018. ‘Amazon in the global market’, Journal of Marketing and Management, 9(2), pp. 63–73.

Dicu, R.M., Robu, I.B., Aevoae, G.M. and Mardiros, D.N., 2020. Rethinking the Role of M&As in Promoting Sustainable Development: Empirical Evidence Regarding the Relation Between the Audit Opinion and the Sustainable Performance of the Romanian Target Companies. Sustainability, 12(20), p.8622.

Hamid, H., 2019. ‘The Strategic Position of Human Resource Management for Creating Sustainable Competitive Advantage in the VUCA World’, J. Hum. Resour. Manag. Labor Stud, 7, pp. 1–4.

Kangas, M., Kaptein, M., Huhtala, M., Lämsä, A.M., Pihlajasaari, P. and Feldt, T., 2018. Why do managers leave their organization? Investigating the role of ethical organizational culture in managerial turnover. Journal of Business Ethics, 153(3), pp.707-723.

Majed, S. Z., Nuraddin, S. H. and Hama, S. V. S., 2018. ‘Analyzing the amazon success strategies’, Journal of process management. New Technologies, 6(4), pp. 65–69.

Polacco, A. and Backes, K., 2018. ‘The amazon go concept: Implications, applications, and sustainability’, Journal of Business and Management, 24(1), pp. 79–92.

Rachinger, M., Rauter, R., Müller, C., Vorraber, W. and Schirgi, E., 2019. Digitalization and its influence on business model innovation. Journal of Manufacturing Technology Management.

Salas, E., Reyes, D. L. and McDaniel, S. H., 2018 ‘The science of teamwork: Progress, reflections, and the road ahead’, American Psychologist, 73(4), pp. 93–600. doi: 10.1037/amp0000334.

Sukcharoensin, S., 2018. ‘Strategic Position of Bond Markets in ASEAN-5: Challenges and Directions for Development’, DLSU Business & Economics Review, 27(2), pp. 23–34.

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