Compare and Contrast the Strategies of Rival Companies Microsoft and Red Hat. Essay

STRATEGIC ANALYSIS AND THINKING Strategic thinking can be said to be the way in which people in an organization conceptualize the future for themselves and their associates. This involves changes to the ideas being conceived and relating it to an ideal future and achieving results that add value. Strategic thinking has to go through some processes before it can materialize into reality and achieving desired results. This process involves analysis; planning; execution. According to Henry Mintzberg [1994], to formalize a strategy, one has to employ a sequence from analysis, through procedure and then action.

That is to say thinking precedes action and sometimes action necessitates thinking. Knowing the requirements and understanding strategic thinking is the start of a good analysis. This as a variable interferes with our ability because of the limited understanding of: What strategy is; how to go about it; and when to start strategic thinking. As [Thompson A. A, Strickland A. J, Gamble J. E [2010] crafting and executing strategy, McGraw-Hill ] emphasized analysis as a start for strategy.

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The dynamism of our environment and society interferes with strategic thinking and analysis, as every business is dependent on it. Issues like Legislations, geographical borders, market, government policies, technology, climate are some of the factors that could affect strategic thinking analysis. Accessibility and availability of necessary information and details can also interfere with strategic analysis. Managers need necessary data to make strategic analysis and implement successful business strategy that works or ‘achieve results’ for an organization.

Lack of appropriate information could result into distorted strategic analysis that is bound to fail. Analysis, as an understanding of what one wants, why, and how to go about achieving ones goal is very important, as it gives an insight to actualization. These help to understand the parameters that influence thinking and planning. As stated in Harvard Business Review, November –December 1996, ‘the essence of strategy is choosing to perform activates differently than rivals do. ’

A practical example of above can be associated with ‘COWBELL’ a brand name for powdered milk and its maker in Nigeria. Cowbell was introduced into an already saturated market with known brands like PEAK, DANO, NIDO, etc that have stood the test of time in terms of quality. After its introduction, it was apparent that the company stood no chance against the “giants”, thus there is need to rethink their strategy. After proper thinking, analysis, planning and executing, COWBELL came up with little (10g) sachet packs enough for a cup of tea and is affordable to all.

Within a very short while, this product became popular even before they started their advert campaign; because every kid want a pack of cowbell in their lunch box while adults can just buy no more than they need (as other brands are 500g packs). Not only was the company successful, it has also made the “giants” to go its route. Another example is in the banking industry in Nigeria, where every bank places more emphasis on government fund due to it high yield in terms of liquidity and deposit base. This however has a lot of uncertainty attached to it as factors like government policies or cabinet change could cause the funds to be moved.

As such, the management of the bank decided to change strategy by exploring the retail end of the market, which has gotten less attention from most banks until recently. The result of this change in strategy is astonishing and proved an absolute success. H Mintzberg [1994] article in Harvard Business review, The rise and fall of strategic planning. Accessed 16 Jul. 10 Arthur A Thompson Jr, A . J Strickland, J E Gamble [2010] Crafting and Executing Strategy: The Quest for Competitive Advantage: Concepts and Cases, McGraw-Hill,17/e Harvard Business Review, November – December 1996

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