Example Exam Answers For Strategic Management Essay

Q1: ( A ) Describe some of the Strategies that fit the markets of emerging states. Give some brief illustrations. Identify what are the BRIC states?

If a company wants to win in emerging markets they normally follow the followers schemes which enable them to vie in these markets:

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1-Be prepared to vie on the footing of lower monetary value: consumers in emerging markets are more frequently focused on monetary value, which can give local ( low cost ) rivals some advantage over their challengers. The company has to be able to happen ways to pull the purchasers by deal monetary values in add-on to better merchandises. For illustration, when Unilever decided to come in the laundry detergent market in India, it discovered that a bulk ( 80 % ) can non afford their merchandises, so they went back to the pulling board and decided to establish a new trade name ( called WHEEL ), by utilizing a low cost expression and new production installations and packaged it in single-use sums, so it can be sold stingily compare to its other merchandises. The merchandise had rapidly captured 100 million dollar in gross revenues, and was named the no 1 detergent in India in 2008.

2- Modify facets of the company ‘s concern theoretical account or scheme to suit local fortunes ( but non so much that the company loses the advantage of planetary graduated table and planetary stigmatization ) : To win, multinationals must modify their concern theoretical accounts for each state. They may hold to accommodate to the nothingnesss in a state ‘s merchandise markets, its input markets, or both. But companies must retain their nucleus concern propositions even as they adapt their concern theoretical accounts, if they make displacements that are excessively extremist, these houses will lose their advantages of planetary graduated table and planetary stigmatization. For eexample: In the U.S. , McDonald ‘s outsources supply concatenation operations. But when it tried to come in Russia, it could n’t happen local providers. So, with aid from its joint venture spouse, it identified husbandmans it could work with and advanced them money so they could put in seeds and equipment. And it sent Russian directors to Canada for preparation. By set uping its ain supply concatenation and direction systems, it now controls 80 % of the Russian fast-food market.

3- Try to alter the local market to better fit the manner the company does concern elsewhere: Many multinationals are powerful plenty to change the contexts in which they operate. The merchandises or services these companies offer can coerce dramatic alterations in markets, which can hold far-reaching effects. The houses must assist states to the full develop their possible. That creates a win-win state of affairs for the state and the company. For case, Metro Cash & A ; Carry, a division of German trading company Metro Group, invested in a cold concatenation in China so that it could present goods like fish and meats from rural parts to urban locations. That changed local conditions in several of import ways. First, Metro ‘s investing induced fanners in China to put more in their agricultural operations. Metro besides lobbied with authoritiess for quality criterions to forestall companies from selling cheapjack green goods to hapless consumers.

4- Stay off from those emerging markets where it is impractical or uneconomic to modify the company ‘s concern theoretical account to suit local fortunes:

Profitableness in emerging markets seldom comes rapidly or easily-new entrants have to accommodate their concern theoretical accounts and schemes to local conditions and be patient in gaining a net income. The Home Depot has expanded to Mexico in 2001 and Russia in 2006, but it has avoided come ining other emerging markets, because its value proposition of good quality, low monetary values and attentive client service, to draw that off, it relies on a assortment of U.S- specific establishments. It depends on the U.S. main roads and logistical direction systems to minimise the sum of stock list it has to transport in its big, warehouse-style shops. It relies on employee stock ownership to actuate shop-level workers to render ace service. And its value proposition takes advantage of the fact that high labour costs in the United States encourage place proprietors to prosecute in do-it-yourself undertakings.

The BRIC states:

Brazil, Russia, India, and China are group in together under the acronym “ BRIC ”, this is an acronym normally mentioning to these states base on the impression these emerging markets are traveling to be a major force in the hereafter. The BRIC thesis postulates that China and India will go the universe ‘s dominant providers of manufactured goods and services, severally, while Brazil and Russia will go likewise dominant as providers of natural stuffs. It ‘s of import to observe that this thesis is n’t that these states are a political confederation ( like the European Union ) or a formal trading association – but they have the possible to organize a powerful economic axis. BRICA is now besides used as a more generic marketingA termA to mention to these four emerging economic systems. Due to take down labour andA production costs, many companiesA besides cite BRIC as a beginning of foreign enlargement chance.

( B ) Is it a good thought to associate Social public presentation marks to executive compensation? Why? Why non?

In my sentiment associating Social public presentation with executive compensation is non such a good thought good Idea. Many have blamed incentive strategies as the exclusive perpetrator for unsought corporate behaviours such as deceitful fiscal coverage, corruptness, revenue enhancement equivocation, development of minor workers and other signifiers of self-interest, malfeasance and white-collar offense. The advocate for this impression think that one of the chief benefits of honoring societal public presentation at the top is that it would excite directors to deploy attempts and resources towards societal enterprises, which are expected to increase the house ‘s value. But there are at least three issues that cast uncertainty on the truth of this statement. First, it is non clear whether societal enterprises have a good impact on the house ‘s economic public presentation. While some surveies have shown a positive association between societal public presentation and fiscal consequences, many bookmans have professed a negative association.

The latter claim is that if investors cared adequate about the pollution public presentation information required under the passage to penalize hapless performing artists, houses would hold a market-based inducement to ship on societal enterprises, and therefore no societal ailments would be. In a recent reappraisal of research documents sing the association between societal enterprises and house public presentation, Margolis and Walsh ( 2003 ) found that less than half of the reviewed surveies exhibited a positive relationship, and that the bulk showed a impersonal or negative nexus. This reappraisal, together with other research, suggests that the nexus between societal public presentation and fiscal consequences is equivocal at best. That is, while socially irresponsible concerns can be punished by society ( consumers, employees, local communities, NGOs ) in footings of their image, repute, and legitimacy for non carry throughing their public duties, it is ill-defined how a good societal public presentation can do their market portion to increase.

The 2nd facet that casts uncertainty on the benefit of honoring directors for set abouting societal enterprises ( which presumptively considers the demand of a broader array of constituencies ) is that all stakeholders are assumed to prefer responsible actions and therefore are treated in an indiscriminate manner. But the truth is that while some constituencies may hold a general penchant for societal enterprises, one can non presume that social-friendly policies do n’t conflict with the involvements of other stakeholders or that they are unmindful to tradeoffs. For case, workers and their households have been documented non to prefer environmental policies on the portion of authoritiess or houses if implementing them would set their occupations at hazard. Therefore, honoring certain actions believed to be good for a certain group can do discontent among other stakeholders. A 3rd facet to see is that societal enterprises are chiefly driven by intrinsic motives.

Indeed, many people and houses invest their clip and money in bettering the environment and back uping charities without economic returns. It could be that some people are selfless, that is, they seek to better the public assistance of others without having any personal benefit. Another intrinsic motive is “ impure selflessness, ” that is to state, people ( or houses ) may acquire a “ warm freshness ” , and improved self image from transporting out societal plants. A related intrinsic motive is concern for equity. Regardless of its motivations for selflessness, self image or equity, it can be safely assumed that in many instances underlying motives for societal enterprises are intrinsic. Harmonizing to partisans of the nexus between societal enterprises and executive wage, to supply an economic ( and explicit ) inducement can reenforce the natural inclination of directors to set about societal responsible actions. But theoretical and empirical grounds from psychological science and economic sciences suggests that such extrinsic inducements can herd out the intrinsic motives which motivate voluntary parts.

The implicit in thought of this watercourse of research is that motives are non linear, and pecuniary wagess may cut down the sense of control a individual has over her actions, cut downing her willingness to apportion resources ( clip, money and the similar ) towards societal enterprises. As a effect, including societal standards in compensation bundles could take toward the antonym of the intended end. In other words, acknowledging and back uping societal attempts monetarily can sabotage the “ constitutional ” inducements and therefore hold the possible for negative effects and unintended effects.

Another frequently mentioned benefit of associating wage to societal public presentation is that it would screen directors from unsure consequences of societal schemes. As argued above, consequences from societal enterprise are equivocal and, as a effect, if directors are non compensated for the increased hazard associated with societal investings, they will presumptively apportion capital into less unsure options. Several facets deserve to be mentioned sing this issue. First, associating wage and societal public presentation could take directors to see societal standards opportunistically. Since societal public presentation may be easier to obtain than fiscal consequences, troughs may be tempted to prefer the latter in order to maximise their income. Furthermore, given that including societal standards alleviates the drawbacks from possible losingss of societal actions, directors have small inducement to do the most out of them, and overlook the possible fiscal results that may deduce from them.

Another related facet refers to how to mensurate societal public presentation. While fiscal steps are good developed, societal public presentation steps are still an unfastened field to be explored. Even with a precise step of societal public presentation, these steps may besides be unfastened to use. As a effect, control policies and information systems are needed, which in bend would increase the costs of honoring societal public presentation efficaciously.

Besides, it has been argued that an advantage of societal standards in executives pay bundles would do directors explicitly accountable for the societal behaviour of the house. While this may be true, it is of import to see the context in which the house operates. It is frequently said that stakeholders like consumers want companies to advance the public good by supplying healthier and safer merchandises, retirement and wellness attention benefits for its employees, and much else besides. However, stakeholders ‘ outlooks vary by industry and geographics. For case, environmental concern is an on-going hazard for many companies, particularly those in the energy and chemical industries. Too frequently, nevertheless, companies in fouling industries ignore environmental demands and invest in other societal enterprises with the misguided belief that any societal action will do to signal appropriate corporate behaviour to the market.

Q2: ( A ) Companies have used centralized constructions. However the current organisational tendencies are to alter them in to tilt, flatter, decentralized constructions. Describe briefly some of the alterations taking topographic point in the organisation?

Major alterations that have emerged from Organization Changing their centralised constructions to decentralised constructions:

( 1 ) Managers and workers empowered to move on their ain judgements.

( 2 ) Work procedure ( redesign ) in order to accomplish greater streamlining and tighter coherence.

( 3 ) Self directed work squads.

( 4 ) Rapid incorporation of cyberspace engineering applications.

( 5 ) Networking with foreigners to better bing organisation capablenesss and make new 1s.

Some other organisational features that are emerging include:

– Extensive usage of Internet Technology and E-commerce concern patterns, existent clip informations and information systems, greater trust on on-line systems for transacting concern with providers and clients, and Internet based communicating and coactions with providers, clients, and strategic spouses.

– Fewer barriers between different perpendicular ranks, between maps and subjects, between units in different geographical locations, and between the company and its providers, distributors/dealers, strategic Alliess, and customer- an result partially due to permeant usage of on-line systems.

– Rapid airing of information, rapid acquisition and rapid response times- besides an result partially due to permeant usage of on-line systems.

– Collaborative attempts among people in different functional fortes and geographical locations, indispensable to make organisation competences and capablenesss.

– Collection work squads that include more members and have a greater geographic scattering of squad members. During the 1990s, most formal squad agreements contained 20 or fewer members. Today, squads at many transnational corporations include 100 or members that might be scattered across 10 or more states.

( B ) Why do you believe the schemes ( or strategic planning ) fail to present coveted consequences? Be brief and precise.

The strategians think that there are two chief grounds why a strategic program fails. First, the thought that the strategic program itself is non incorrect with it, but because the execution of this program is non been done right it fails. Second, the company ‘s senior direction has non taking it earnestly plenty, that there is a failure to acquire direction involved right from the start, and the failure to obtain sufficient company resources to carry through the undertaking. There are other grounds that may do a strategic program to neglect, which include:

Failure to understand the client: the strategic program that alternatively of understanding a client demands and wants fail to present. It fails to reply the inquiry “ Why do they purchase? ” It is besides caused by them making unequal or wrong selling research.

Over-estimation of resource competency: Failure to measure whether the staff, equipment, and procedures can manage the new scheme. In add-on to Failing in developing new employee and direction accomplishments.

Failure to organize: Coverage and command relationships non adequate, with Organizational construction non flexible plenty.

Failure to obtain employee committedness: the new scheme that is gone to be applied is non good explained to employees. Besides, there are no inducements given to workers to encompass the new scheme.

Under-estimation of clip demands: No critical way analysis is been done.

Failure to follow the program: No follow through after initial planning, and no trailing of advancement against program.

Failure to pull off alteration: Inadequate apprehension of the internal opposition to alter. In add-on to, deficiency of vision on the relationships between procedures, engineering and organisation.

Poor communications: Insufficient information sharing among stakeholders. Exclusion of stakeholders and delegates

Failure to concentrate: Inability or involuntariness to do picks which are true to the strategic mission ( i.e. to make fewer things, better ) , leads to averageness, and inability to vie.

Q3: ( A ) Describe briefly what is ( 1 ) concern procedure Reengineering ( 2 ) Total choice direction. What are the differences?

Business Procedure Reengineering:

Business procedure can be defined as “ a set of logically related undertakings performed to accomplish a defined concern result. ” It is “ a structured, mensural set of activities designed to bring forth a specified end product for a peculiar client or market. ” Bettering concern procedures is of import for concerns to remain in front of competition in today ‘s market place. Over the last 10 to 15 old ages, companies have been forced to better their concern procedures because clients are demanding better merchandises and services. Many companies begin concern procedure betterment with a uninterrupted betterment theoretical account. The BPR methodological analysis comprises of developing concern procedures are simplified instead than being made more complex. Job descriptions expand and become multi-dimensional — people perform a broader scope of undertakings. Peoples within the organisation become empowered as opposed to being controlled. The accent moves off from the person and towards the squad ‘s accomplishments.

The organisational construction is transformed from a hierarchy to a flatter agreement. Professionals become the cardinal focal point points for the organisation, non the directors. The organisation becomes aligned with the end-to-end procedure instead than sections. The footing for measuring of public presentation moves off from activity towards consequences. The function and intent of the director alterations from of a supervisor to train. People no longer worry about delighting the foreman — they focus alternatively on delighting the client. The organisation ‘s value system transforms from being protective to being productive. In this context it can be mentioned that, some of the biggest obstructions faced by reengineering are deficiency of sustained direction committedness and leading, unrealistic range and outlooks, and opposition to alter.

Entire Quality Management ( TQM ):

TQM is non merely an academic construct ; it is a manner of commanding your concern. TQM is concerned with increased client satisfaction, along with improved concern procedures. It uses the end of client satisfaction to bring forth the organisation ‘s schemes. During the rough economic clime of the 1980s, many western organisations began to look earnestly at bettering activities in their service and merchandise bringing. Different enterprises were put in topographic point within the operations of an organisation to seek to better these activities but, disappointingly, the benefits of such steps, when used in isolation, were limited and hard to measure in strategic footings. Some organisations continue to utilize this method of activity betterment, but frequently the consequences end up being partial or short term. In fact, some of these attempts may make a localised feeling of supplying solutions, when what they are truly accomplishing is switching the job elsewhere.

A TQM system may really do usage of any or all of these enterprises as its constituent parts. However, it differs most significantly from any one of them in its graduated table. In TQM, all the betterment activities are tied together, so that the ‘knock-on ‘ effects produced are recognized and used to originate farther betterments. It is a uninterrupted betterment procedure. This is the cardinal difference between TQM systems and other quality betterment systems. TQM integrates all activities within an organisation, warrants that the activities of one country support alterations made in another, and ensures that the consequences can be evaluated at strategic degree. Under TQM, quality is applied in all concern maps, non merely fabrication.

To accomplish entire quality confidence, an organisation needs to set about incorporate quality betterment that improves all sections, non merely a willing few.

The Difference between Business Process Reengineering ( BPR ) and Entire Quality Management ( TQM ):

Entire Quality Management and BPR portion a cross-functional relationship. Quality specializers tend to concentrate on incremental alteration and gradual betterment of procedures, while advocates of reengineering frequently seek extremist redesign and drastic betterment of procedures. Quality direction frequently referred to as TQM or uninterrupted betterment, means plans and enterprises, which emphasize incremental betterment in work procedures, and outputs over an open-ended period of clip. In contrast, reengineering, besides known as concern procedure redesign or procedure invention, refers to prudent enterprises intended to accomplish radically redesigned and improved work processes in a specific clip frame. In contrast to uninterrupted betterment, BPR relies on a different school of idea. The utmost difference between TQM and concern procedure reengineering prevarications in where you start from, and besides the magnitude and rate of ensuing alterations.

In class of clip, many derived functions of extremist, breakthrough betterment and uninterrupted betterment have emerged to turn to the troubles of implementing major alterations in corporations. Leadership is truly of import for effectual BPR deployment, and successful leaders use leading manners to accommodate the peculiar state of affairs and execute their undertakings, giving due importance to both people and work. Business procedure is basically value technology applied to the system to convey Forth, and prolong the merchandise with an accent on information flow. By mapping the maps of the concern procedure, low value maps can be identified and eliminated, therefore cut downing cost. Alternatively, a new and less dearly-won procedure, which implements the map of the current procedure, can be developed to replace the present one.

( B ) Define empowered employee. How does direction exercising adequate controls over empowered employees?

Employee Empowerment if we elaborate the term giving powers to employee. Empower the employee for assorted undertakings and activities of their occupation. To authorise agencies to enable, to let or to allow, and can be conceived as both self-initiated and initiated by others. Authorization is the procedure of enabling employees to put their ain work-related ends, make determinations and work out jobs within their domains of duty and authorization. An of import portion of authorization is the definition of domains of duty and authorization by direction.

Empowerment allows people, separately and in groups, to utilize their endowments and cognition to do determinations that affect their work. Peoples are held accountable for the consequences produced by others, whose formal function gives them the right to command but who lack informal influence, entree to resources, outside position, sponsorship, or mobility chances, are rendered powerless in the organisation.

Authorization is nor a plan. It is a civilization alteration. Authorization is the procedure of enabling or authorising an person to believe, act, and take action, and control work and decision-making in independent ways. It is the province of experiencing self-empowered to take control of one ‘s ain fate.

How does Management exercising control over empowered Employee?

This is achieved by one of two methods, the first being by size uping day-to-day and hebdomadal operating Statistics, which is one of the most of import manner in which directors can supervise the consequences that flow from the actions of the sceptered employee expression good, so it is sensible to presume that the authorization is working. The 2nd method is used specially in a company that rely on sceptered employees, particularly in those that use self managed work groups or other such squads, is peer-based control. Most of the squad members feel responsible for the success of the whole squad and be given to be comparatively intolerant of any squad members behavior that weakens squad public presentation or puts squad achievements at hazard, particularly when squad public presentation has a large impact on each squad member ‘s compensation. Because Peer is such a powerful control device, companies organized into squads can take some beds of direction Hierarchy and rely on strong equal force per unit area to maintain the members runing between the white lines.

Q4: ( A ) Identify the features of high public presentation civilization.

A high public presentation civilization is a civilization where the standout civilization traits are can make spirit, plume in making things right, no-excuses answerability, and a permeant consequence oriented work clime where people go to the excess stat mi to run into or crush stretch aims. In a high public presentation civilization there is strong sense of engagement from the portion of the company employees and accent on single enterprise and creativeness. Performance outlooks are clearly delineated for the company as a whole, for each organisational unit, and for each person. Issues are quickly addressed- a strong prejudice for being proactive alternatively of reactive exists. Concentrate on what needs to be done, the civilization is permeated with a spirit of accomplishment and has a good path in meeting or whipping public presentation marks.

– A clear line of sight exists between the strategic purposes of the authorization and those of its sections and its staff at all degrees.

– Management defines what it requires in the form of public presentation betterments, sets ends for success and proctors public presentation to guarantee that the ends are achieved.

– Leadership from the top which engenders a shared belief in the importance of go oning betterment.

– Focus on advancing positive attitudes that result in a committed and motivated work force.

– Performance direction procedure aligned to the authorization ‘s aims to guarantee that people are engaged in accomplishing in agreement ends and criterions.

– Capacities of people developed through acquisition at all degrees to back up public presentation betterment

– Peoples provided with chances to do full usage of their accomplishments and abilities.

( B ) Compare and contrast the corporate civilizations at Google and Alberto-Culver ( mention to illustration capsule 13.1 page 417 of text edition ).

The corporate civilization in Google is an unfastened relationship civilization, whether it is between the work force and the disposal, or between the employees themselves. Google has managed to make an environment that make the employees prosecute non merely in the activities of the company, but besides some leisure free clip activities. The company makes certain that the employees are happy and there is a little household like feeling in the company, as all of them gather and sit in the same cafe where they sit together, all of them from assorted sections. Organizationally, Google maintains a insouciant and democratic ambiance, ensuing in its differentiation as a “ Flat ” company.

The company does non tout a big in-between direction, and upper direction is so hands on, it ‘s difficult to measure up them in a separate class. Teams are made up of members with equal authorization and a certain degree of liberty is maintained, and the employees are encouraged to suggest wild, ambitious thoughts frequently. The employees consist of assorted nationalities, with people from all around the universe working in their offices around universe. The transparence policy practiced by the direction is something that encourages people to make a better occupation, with the hiring procedure been done in a non-discriminatory manner, which ensures the rights of all the employees.

The civilization in Alberto- Culver corporate civilization focuses on the employee being the chief constituent in them being successful in their concern. A happy and satisfied worker is a precedence for the company, they are concentrating their civilization on bettering their employees, doing a net income is every bit of import to them as doing their employees happy, with the thought that an happy employee civilization spread in the company will separate it from others and conveying clients to it, either it be by their repute of being a good company, or the fact that the employees who they have kept happy and assist better are making a good occupation as a consequence of that.

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