Review Questions Critical Analysis
In your own words explain what is meant by: vision, mission and goals. Vision – it is an aspirational view of what the company will be like in the future. It is a detailed description of how things will be when the organization eventually reaches its destination. Mission ” A mission statement answers the question “Why do we exist? ” and expresses the company’s purpose both for those in the organization and for the public. It identifies the organizations reason for being and may define the rganizations primary customers, the products and services that they produce.
Purpose is to communicate what the company stands for and where it is heading. Goals – Is basically what the organization alms to achieve In future, perhaps to increase revenue, profit, reputation and loyalty to the public. 2) Discuss their role on strategy formulation. The vision, mission and goals play a great part when organizations formulate their strategy for the long term direction as it will help to identify the implementation steps, the planning, coordination, collaboration, communication and control that the ompany will need to do In order to achieve the maln goal of their organization. ) In your opinion, what should be the starting point for strategy formulation be? The competitive advantage from the resource and capabilities of the organization will be the starting point of strategy formulation. Organizations identify how they differ from their competitors and design such strategies to exploit such differences, as strategy is about being different and this will help In formulating long term direction, scope of the organization and alrnlng to achieve advantage In a changing environment.
International strategy 1) What Is the difference between global and multl-domestlc strategy? Global Strategy – assumes a single market and offers a standard product to meet customer needs wherever they are located. This is a cost leadership strategy, exploiting economies of scale and other cost efficiencies. Multi-domestic strategy – assumes variance in customers needs according to their location and therefore issues a differentiation strategy, adapting products and services to make unique local requirements. ) Identify five examples of each. Multi-domestic Strategy 1) Red bull and Packaging 2) Nokia 2) 3) Reebok 3) 4) Ford Motor 4) 5) McDonalds 5) Value chain and value system 1) Explain how the concept/framework of the value chain and value system may help in the strategy formulation process. The value chain will help identify competitive advantage. Focusing on the way the organization may use its resources may allow the organization to identify how it can be different and unique or where it can be more efficient. ) With reference to the value chain; identify alternative strategies available to the nternational organization Since an international organization will typically comprise of more than one business, the organization should be decomposed into strategic business units with different strategies considered for each. An organization can develop cost leadership, product differentiation, and business innovation strategies to confront its competitive forces. Cost leadership requires the organization to find and exploit sources of cost advantages, efficient manufacturing processes and tight cost controls.
Product differentiation is based on understanding the customers and heir needs in order to provide something unique and valuable to them. Generic Strategy 1) Describe each of the generic strategies Segmentation strategy Cost leadership – This strategy involves the firm winning market share by appealing to cost-conscious or price-sensitive customers. This is achieved by having the lowest prices in the target market segment, or at least the lowest price to value ratio (price compared to what customers receive).
To succeed at offering the lowest price while still achieving profitability and a high return on investment, the firm must be able to Differentiation strategy – A differentiation strategy is appropriate where the target customer segment is not price-sensitive, the market is competitive or saturated, customers have very specific needs which are possibly under-served, and the firm has unique resources and capabilities which enable it to satisfy these needs in ways that are difficult to copy. 2) Identify and describe the strategies that may deliver a competitive advantage.
Since an international organization will typically comprise of more than one business, he organization should be decomposed into strategic business units with different strategies considered for each. An organization can develop cost leadership, product differentiation, and business innovation strategies to confront its competitive forces. Cost leadership requires the organization to find and exploit sources of cost advantages, efficient manufacturing processes and tight cost controls. Product differentiation is based on understanding the customers and their needs in order to provide something unique and valuable to them.
Strategy formulation 1) Identify and describe the different ways strategy may be formed within organizations In general terms, strategy formation in most organizations can be thought of as resolving around the interplay for three basic forces: An environment that changes continuously but regularly; An organizational operating system A leadership whose role is to mediate between these two forces, to maintain the stability of the organizations operating system while at the same time ensuring its adaptation to environmental change. Describe the key stages in a typical planning approach to strategy formulation 3) Critically evaluate, compare and contrast the planning and adaptive modes of strategy formulation Competitive advantange 1) In your own words, explain what is meany by resource, routine, capability and competence.