Discuss about the Critical Analysis Of Strategic Choice And Determinist Theories.
The present essay provides an intensive analysis on the deterministic theories and strategic choices. Many managerial and organizational actions are embedded in the strategic choices, whereas deterministic theories help to make appropriate managerial decisions. However, it is not certain that theories would provide the same and desired results. In this context, Friend (2011) commented that strategic choices are referred to the decisions that determine the future strategy of an organization. For example, a SWOT analysis is performed to identify the strength and weaknesses of the organization and opportunities. Similarly, based on the analysis, the organization selects a suitable path among different alternatives that help the firms to achieve the objectives. The strategic choice is thereby, the decision to choose from the granted strategies.
Determinism is generally understood to exclude free intention as it entails that human might not act otherwise than they do. Such theory provides the facts that the universe is rational and the complete knowledge of any particular given situation that unerring knowledge of its future is also possible. Hence, Avery (2014) mentioned that a theory is considered as deterministic if, provided some all the positions as well as the velocities of its elements at only moment in time. It wholly determines what could happen before and after that particular moment. Nonetheless, the fact that if a theory is deterministic does not mean that it is actually possible to anticipate the evaluation of a particular system in practice. The present essay discusses these facts with the real-life contexts.
In the following essay, the strategic choices have critically been defined with the real life example and facts. Likewise, the deterministic theories have critically been discussed with the supporting evidences. The essay also presents the facts regarding how managers are shaping the ideas to implement the managerial actions. For conducting the analysis, existing academic and management journals have been cited as the supporting requirement. Firstly, two variables such as the strategic choices and deterministic theory have been defined in the analysis and then those definitions have been analyzed comparing them with the opinions provided in the previous studies.
As put forward by Nielsen and and Nielsen (2011), strategic choice is central to the strategy making, which means an effective strategic choice process could position an organization for preparing sustainable strategic decisions. Kraus, Kauranen and Henning Reschke (2011) defined strategic planning as the systematic as well as formally documented method for deciding the useful key decision that an organization considers, for implementing them into the operation. The study conducted by Wüstenhagen and Menichetti (2012), presented the fact that focuses on the decisions to be made in a particular planning situation, whatever their timescale and whatever their substance is. The first step in strategic choice approach is evaluating as well as selecting a strategy to evaluate the outcome of the strategic situation including the analysis in general with respect to factors critical to the success of the business.
On the other side, Baybeck, Berry and Siegel (2011) mentioned that strategic choices are mainly concerned with the decisions regarding an organization’s future and the way in which it is supposed to respond to the stress as well as the outcome of its immediate and macro environment. When it comes to determinism, people consider it as a basic idea that every event including every human decision is inevitable and essential consequence of previous state of affairs. In this context, Ida, Lin and Nagasawa (2013) mentioned that determinism should be distinguished from pre-determinism, the idea that a complete past was determined in the origin of the universe.
Among many deterministic theories, Resource dependency theory is often considered in the managerial activities (Verbruggen, Christiaens & Milis, 2011.). This theory investigates the relationship between the firms and the resource they need to run the operation. Hence, the resource could take several forms such as the raw materials, employees, and financial resource. For example, the large oil and gas organization Shell is dependent on minerals and other materials from mining (Shell, 2017). If one organization maintains the large proportion of the resource, another organization could become dependent on it to operate, which certainly creates a symbolic relationship. In this context, Gerlagh and Liski (2011) commented that too much dependency creates uncertainty and this could lead the firm to a state of risk from the external control. Here, the government as well as other organizations could impose the external control and they might have a significant influence on the operation. Here, the organizational managers apply the strategic alternatives to minimize such risks. For example, SIS Security system is the technology security agency for the large FMCG company Unilever and Unilever is also SIS’ only client. In such context, SIS is largely dependent on Unilever as their only source of revenue (Unilever, 2017). Such strategic approaches increases the risks, as such relationship gives Unilever a complete advantage at the time of providing service as well as fee negotiation.
The deterministic facts and the given example helps to understand that deterministic theory helps to create the initial base of organizational activities; thereafter, the strategic choices are applied by the organization to deal with the barriers and find a suitable solution (Avery, 2014). Thus, it can be added that somehow related or inter-linked to each other. Furthermore, it is found that before making a strategic choice, the firm is supposed to conduct a strategic analysis, which further helps to identify the strength of the business’s position as well as understand the significant external factor that could influence the position of a firm.
The usual factors that are usually taken into the consideration are the major internal factors such as management, marketing, operation/production, finance, accounting and research and the external factors such as political, economical, social and others (Ates et al. 2013). Before implementing a strategic alternative, the firm must develop long-term goals, particular approaches to act it. During the implementation of strategic choice, the manager of the firm should play the role of fixing long-term goals and different types of strategies that should be most significant for the mission of the firm. Rekonen (2013) mentioned that middle managers play a very strong role in the strategic choice implementation.
According to Bititci et al. (2011), managers interact with divers employees and such practice allow them to formal as well as informal approaches to promote innovation and calculated risks. The managers play the role of communicating their ideas for the advancement and innovation to senior management. This practice helps the managers and organizational executives to generate new opportunities where these concepts and ideas are evaluated within the context of organization’s strategic priorities. A study conducted by Rekonen (2013), manager’s job is to create a vision for the organizations in way that could engage both imagination as well as energies of other organizational member. Moreover, a skilled manager knows that the ultimate activity of manager is to create human energies and human vision. Nielsen and Nielsen (2011) mentioned that visions should be tied to what organization values; hence, the manager should make this connection in a manner that the firm could understand as well as support. For example, in the operation of Coco Cola, as customers’ taste and preferences change, the leaders lead the business increasingly evolving the business to reach a wide range of new as well as different drinks (Coca-Cola, 2017).
The leaders are strictly committed to generate the lasting values for their associates such as the customers, shareowners, communities and bottling partners. The effective leadership style helped Coco Cola to shape such large set of activities. Today, Coca Cola has more than 30,000 employees throughout the world, which certainly would not have been possible without a stiff and accurate managerial direction (Coca-Cola, 2017). The leader John Murphy of Asia pacific of Coca cola lead whole operation in all Asian nations and brought a rapid growth to the firm within an very short time. This example indicates that the organizations are more concerned about the strategic actions that can be implemented by leveraging the human resources. Thus, it can be mentioned that strategic actions are compelling for the growth and expansion of business compared to theoretical ideas.
However, this has also been identified that institutional theory under deterministic, provides way to understand how organizations could navigate rules and the norms of the system to appear legitimate as well as survive. The principles of this theory are related to the strategic choices or the managerial actions on the basis of the strategies. Therefore, Brammer, Jackson and Matten (2012) mentioned that even though strategic alternatives work as the solutions for organization’s issues, the alternatives are based on the theories first. More specifically, it has been studied that one aspect of organizational theory- coercive process signifies that firms adopt changes consistent with the larger firm due to the stress from other organization on which they could depend on, or by which, they could be regulated such as the customer or the suppliers’ demand.
This fact makes it evident that wherever an organization applies a particular strategy to decrease external stress or fulfill the growing demands, the practical actions are largely related to the deterministic theories. However, it is worth mentioning that theories might show the process to act on a particular action but the strategy implementation is a major organizational activity, which should be prioritized. Inappropriate implementation of strategies could provide unexpected results. From theories, the managers might derive each element for performing the organizational activities but eventually, the organization as a whole, or the mangers implement those activities with the help of the resources that organizations have. More specifically, theories might help to identify organizational requirements but eventually strategies determine what actions need to be applied to meet those requirements. In this context, Friend (2011), strategic analysis as well as the choices of strategies are usually done through a number of techniques. Certainly, those techniques are determined based on the situations that managers observe.
Thus, if a proper strategic choice is selected, a firm could become more efficient to develop sustainability in the competitive advantage as well as increase company’s valuation. This fact also signifies the significance of strategic choices in the organizational operation. Wüstenhagen and Menichetti (2012) mentioned that leaders play a most significant role in the strategic choice implementation. This is because the strategic implementation of any kind of new firm policy required engagement participations from all of the departments that could be impacted. Hence, the organizational leadership should identify what those departments are as well as generate an implementation team that is built of representatives from each involved group. Thereby, compared to deterministic theories, the strategic choices are more important to an organization because eventually, the outcomes of organizational activities are dependent on how what strategic choices are selected and how they are implemented. In order to support this fact, Rekonen (2013) mentioned that theories do not help to create organizational goals and objectives, they only show the directions but in a real-world context, the leaders understand the scenario and develops appropriate objectives to deal with the scenarios.
Conclusion
The essay presented the fact that strategic choices are more compelling than the deterministic theories. The above-mentioned discussion justifies the fact by mentioning that theories only provide the ideas and some particular requirements related to the organizational activities but it does not concentrate on the techniques or the methods that organization needs to implement. In addition to this, theories provided in the previous studies are formed based on the observations of facts. However, the business environment in the recent time have become more dynamic; thereby, the strategic choices are need to be implemented based on the present situation instead of being depended on the existing theories. Lastly, based on the analysis provided above, it can be ascertained that strategic choices are compelling than deterministic.
References
Ates, A., Garengo, P., Cocca, P. & Bititci, U., 2013. The development of SME managerial practice for effective performance management. Journal of Small Business and Enterprise Development, 20(1), pp.28-54.
Avery, P., 2014. Variability in a deterministic model of language acquisition: A theory of segmental elaboration. Phonological acquisition and phonological theory, p.23.
Baybeck, B., Berry, W.D. & Siegel, D.A., 2011. A strategic theory of policy diffusion via intergovernmental competition. The Journal of Politics, 73(1), pp.232-247.
Bititci, U.S., Ackermann, F., Ates, A., Davies, J., Garengo, P., Gibb, S., MacBryde, J., Mackay, D., Maguire, C., Van Der Meer, R. & Shafti, F., 2011. Managerial processes: business process that sustain performance. International Journal of Operations & Production Management, 31(8), pp.851-891.
Brammer, S., Jackson, G. & Matten, D., 2012. Corporate social responsibility and institutional theory: New perspectives on private governance. Socio-economic review, 10(1), pp.3-28.
Coca-Cola Australia, New Look – Same great feeling. Discover our brands and stay up to date with the latest news and special events. 2017. Coca-cola.com.au. https://www.coca-cola.com.au/en/home/, October 18, 2017.
Drees, J.M. and Heugens, P.P., 2013. Synthesizing and extending resource dependence theory: A meta-analysis. Journal of Management, 39(6), pp.1666-1698.
Friend, J., 2011. The strategic choice approach. Wiley Encyclopedia of Operations Research and Management Science.
Gerlagh, R. & Liski, M., 2011. Strategic resource dependence. Journal of Economic Theory, 146(2), pp.699-727.
Heinonen, K., 2011. Consumer activity in social media: Managerial approaches to consumers’ social media behavior. Journal of Consumer Behaviour, 10(6), pp.356-364.
Home. 2017. Unilever Australasia. https://www.unilever.com.au/, October 18, 2017.
Ida, S., Lin, D.N.C. & Nagasawa, M., 2013. Toward a deterministic model of planetary formation. VII. Eccentricity distribution of gas giants. The Astrophysical Journal, 775(1), p.42.
Kraus, S., Kauranen, I. & Henning Reschke, C., 2011. Identification of domains for a new conceptual model of strategic entrepreneurship using the configuration approach. Management Research Review, 34(1), pp.58-74.
Nielsen, B.B. & Nielsen, S., 2011. The role of top management team international orientation in international strategic decision-making: The choice of foreign entry mode. Journal of World Business, 46(2), pp.185-193.
Rekonen, S., 2013. Managing Innovative Projects-Dynamics of Managerial Activities in the Front-End and Development Phases of Innovation Process.
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Verbruggen, S., Christiaens, J. &Milis, K., 2011. Can resource dependence and coercive isomorphism explain nonprofit organizations’ compliance with reporting standards?. Nonprofit and Voluntary Sector Quarterly, 40(1), pp.5-32.
Wüstenhagen, R. & Menichetti, E., 2012. Strategic choices for renewable energy investment: Conceptual framework and opportunities for further research. Energy Policy, 40, pp.1-10.
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