Strategic And Operational Management In Global Organisations

Key Aspects of Strategic Management Process

1.

1. a) Strategic management is the process of determining and implementing the necessary strategies that improves the performance of an organization and increases its competitive advantage in its environment. This process contains several steps but the main components include strategy formulation and strategy implementation (Blakeman, 2018). In formulating a strategy, three aspects are recommended. They include the corporate level strategy, the business level strategy and the functional level strategy. The corporate level strategy entails decisions that are widely made on the overall organization’s direction and scope. The organization pay attention on the changes that require to be done on the basis of its objectives and the strategy for achieving them, the business lines and how they contemplate each other. This level is divided into the growth strategies associated with its objectives, the portfolio of the business lines and the parenting strategy that entail how resources are to be allocated and the capabilities managed as well as the necessary activities. The internal resources which may be either tangible or intangible, and capabilities in terms of the products and services they offer, provides a framework that aid in assessing an extensive variety of factors that are impactful in the performance of the business (Broman & Robèrt, 2017). The competitive level also the business level entails making decisions on ways the organization completes within each given line of the business or unit (Alhaddi, 2015). It indicates how the business gains its competitive advantage (Phadermrod, Crowder & Wills, 2019). The functional level strategy is a short term activity that highly deals with the internal part of the organization. It shows how each functional sector and component will perform its activities to enhance effectiveness and maximized production using the allocated resources. Coordination between the management, leadership and staff highly contributes towards a successful implementation of the strategy (Cândido & Santos, 2015). On strategy implementation, a system to ensure success and effective application of strategies, a few steps are adopted. First the strategic plan should be evaluated and communicated with respect to its activities, performance and budget. Afterwards a framework in form of an implementation structure is developed. Once development has been done, the key policies and programs that will facilitate implementation are taken into considerations.  The programs may be used to gather feedbacks, monitor and manage performance using the Key Performance Indicators (Badawy, El-Aziz, Idress, Hefny & Hossam, 2016). Budgeting and allocating resources for functionality of this process is now planned for. The fifth step entail the putting the strategies into action in line with the major activities. There is continuous engagement through offered trainings and orientations, enforced control measures and evaluation of performance at each level. This will ensure there is time to market, satisfaction of the employees, the time taken to fulfill an order and the employee churn rate.

For the AA insurance industry, competition has increased rapidly over years. This is a direct result of developed innovation within competitors and new entrance into the market. The new competition consequently, result into losing market share and at the worst some insurance companies have been closed. With the help of strategic planning, the AA insurance company analyzes its internal and external factors that facilitate organization understanding and promote strategic thinking especially when issue emerge. It is able to handle complexity facts of its company and overcome its inefficiencies. These aspects help the AA company reach a point of attracting, motivating and retaining its employees as they have intellectual and suitable skills thus raising the profitability rate of this insurance company. They also enable the AA insurance company to develop a fit between the environment and the organization so that they adopt and thrive (Karami, 2016).

1. b) The layout design strategy ensures an economical layout is developed in the ability of meeting equipment of product design and volume process, the work life quality and the location strategy (Bocken, De Pauw, Bakker & van der Grinten, 2016). The basic reasons as to why this strategy decision crucial is that the mistakes that can rise have long term effects, the layouts have a main impact on the efficiency rate of output and the facilities included are significant investments. This is important in a Honda automotive company as it help in settling on the human machine interface design, a class data shape, the color and material. Under supply chain management, some of the areas that require decision to be made include; the production, location, inventory and distribution sectors. They are all influenced by the operational and strategic elements. These decisions are required so that there can be a continuous flow of information, processes, products and finances involved. In the case of the Honda automotive company, supply chain management help to select and identify the target customers and also mark the target market share (Omar, Nawawi & Puteh Salin, 2016). This is important as it gives the company a rough idea of the number of products sell in a certain period of time and hence an estimate of the expected profits (Ahi & Searcy, 2015).
2. c) Zappos adopted Holacracy to be the organizational culture pattern since it required a new form of the company as it was extensive and had to maintain its brand name. The Holacracy is a structure that involves flexible self-governing opportunities. It makes temporary jobs that are not fixed available as it is project and tasks based. It is advantageous in that, it ensures employees fully utilized their skills, collaboration is at its best and eliminates bureaucracy and bottlenecks. It encourages and influences all members at an individual level to be entrepreneurial. Its unit is the circle that has a strict governance process and are designed to meet certain goals (Lee, Kozlenkova & Palmatier, 2015).
3. d) Once Zappos changed to Holacracy, it became a more self-managed organization. This was possible as its activities were embedded into circles that were business-centric. It has now simplified consultation process as incase the employees need to know about their pay, they conduct the research themselves. Decision making process has been made easy too as people make the them at departmental levels. This strategy has also curbed time wastage before a decision is made as it does not have to be dependent on the top management. The employees have now embraced the idea of conflict resolution and taken it to be their responsibility.
4. e) The Zappos choose to focus on the customers’ interests using the Customer- centric strategy. This would result to buying of the specific shoes its customers wanted. They took huge amounts of money to grow the business. They also began a ‘drop ship’ relationship with its manufacturers so as it could be easy to forward customers’ request of any kind of brand. The relationship bore a direct shipment of the goods to the customers. This is advantageous to the Zappos as it could keep up the competition over its rivals and also maintain its company’s brand reputation. Zappos was able to safeguard its customers and satisfy them.
5. f) For Zappos to implement its business level strategy, it required adaptation of micro-blogging platforms that provided transparency and good working relations among the Zapponians and its customers. The top management had to keep up a casual relationship with its customers as it intended to wow its customers. The CEO advocated for free and reliable delivery services. Phone calls ventures were also introduced so to maintain a good performance culture. This venture was to be consistent and effective to customers at all times. The hiring of employees and rewarding of those who were well self- motivated was emphasized widely to encourage the workers. Tours were also planned for and they came with the freedom of the media (Makadok, Burton, & Barney, 2018).

1. a) Porter’s Five Forces is a framework that analyzes the environment of competition of a company. Despite providing an external situational analysis framework, it has several critiques. This model fails to support the interaction and the collusion possibility among the buyers, suppliers and the customers affecting the organization performance. It also merely helps in identification of sources that have a sustainable advantage, thus denying it a higher advantage over its competitors. Moreover, this model does not grant it the compatibility with other diversified firms as it does not analyze the external situation of the firm with broad products and services to offer. It does not have quantifying mechanism towards qualitative evaluation creating indistinctness subjectivity. This becomes hard to weigh the factors that are of a higher benefit than the other.
2. b)  Proctor & Gamble Ltd, requires to apply Porter’s Five forces for strategic management practices. Under the threat of new entrants, it indicates that with the high yields the P& G Ltd has, it poses a threat to the attracted new entities (David & David, 2013). Once there is limitation of the new entrants in joining the competition, the company will retain or increase its profitability rate. On the threat of substitutes, the P&G Ltd has to improve on the production quality of the existing 10-K. This will kill the idea of seeking for substitute products that will maintain it in market. They must ensure they meet all the economic needs at all times. For the bargaining power of customers, which is the outputs market, will help the P&G Ltd, to reduce the buying power by cutting on the available alternatives. A loyalty program can also be considered so that the customers can have less sensitivity to the changes in price. The ratio of the buyer concentration to firm concentration is balanced. The force of bargaining power of suppliers of raw materials, labor, components and services help the company in having power to source from a different supplier in case there is only a few sources. They gain the ability to cut out the buyer as they integrate forward vertically. Additionally, the fifth force model is the competitive rivalry. Once the P&G Ltd understands its rivals in its field, it will be easy to market a product successfully.  They should know its performance position in the public sector on the feedback of its customers about their production for ease reaction to required changes.

c)Porter’s value chain is known as a collection of activities performed by a company to create added value that increases the profitability and provide a competitive advantage (Noe, Hollenbeck, Gerhart & Wright, 2017). The critic behind this value chain is that the overall strategy of the organization, mission and vision can be lost once its operations are integrated into different categories. It fails to associate one activity to the other thus subjecting the company in losing track of the relationship that exist among these activities. It can also consume a lot of time to complete a value chain analysis of your company and that of the competitors’.

1. d) The Porter’s value chain places focus on systems and activities that involve customers as the core participants. It links these systems and activities showing their relationship and demonstrating their effects on cost and profit. In IKEA, this value chain clearly shows the relationship between product range, supply chain, industrial development and the franchise investments (Camerinelli, 2016). These activities are effective in the production, maintenance, sales and supply sectors. The IKEA will meet and improve on its interaction relations within a wider range as it will continue investing in new ways to shop, sustainable working strategies and adopt affordable production range. Inbound logistics are handled as the IKEA will increase the positive results they are gaining from their retail sales men. Their relationship with the Inter IKEA Group companies strengthens. All its activities related to products and services delivery to its customers are watched to be efficient and developed in terms of supply, logistics and procurement. Its marketing and sales strategy should relate to placing the products and services in the market to generate and manage the customers’ relationship. This will include a few principles and policies that will have to be set (Erl, 2016). The IEKA prices of raw materials, availability of the required resources and the growing tariffs must maintain the products and services value to continue developing the relationship for organizational growth (Ouzrout, Savino , Bouras & Di Domenico, 2018).
2. e) SWOT analysis help in listing down the strategic considerations of the internal and external factors of the operations of Starbucks. The Internal strategic factors are considered as Starbucks strengths that addresses the company’s weaknesses and ensure it keeps up with the competition. One of the factors is the extensive global supply chain that supports the company’s operations strongly. The company tends to have a network of suppliers globally that are selected in terms of quality (Gürel & Tat, 2017). Also there are subsidiaries that are through the moderated diversification done via acquisition or development. This reduces the risks of marketing. Moreover, Starbuck is able to protect and maintain the brand name and reputation. There are other internal factors that are considered to be weaknesses. These promote limitations of the company capabilities. The High price points reduces the rate of its products affordability as much as they maximize the margins of profits. This factor limits the company in the sector of marketing its shares mostly when there is lower rate of disposed incomes. Having weaknesses, it states that Starbucks should develop more strengths to the hostile effects of imitation and the high points price influence in the global industry (Sholihah, Ali, Ahmed & Prabandari, 2016). The company external factors offer opportunities that enhance growth and development. Once the Corporation has expanded its marketing sectors, revenue increases. This shed light in a direction different from the U.S market that generate revenue (Sarsby, 2016). The diversification of the business improves the stability of the Starbucks company to a long term basis. This can try to be achieved by reduction of its dependence in the current industries inducing the general revenue opportunities of growth. Its environment also grants them a chance of its avoidance in the market through formed partnerships with other organizations. If Starbucks from an alliance with the main retailers of their commodities an advancement of distribution process and market share of goods that consumers need. If Starbucks exploits these opportunities fully, its industrial position is improved as well as its operations in the global environment of its field (Hitt, Xu, & Carnes, 2016). Threats are also identified as external factors that are against the business advancement. These threats reduce the performance of the business. Starbucks tend to face competition that involve low-cost coffee sellers. Such can reduce its market share as the competition will be based on low prices. The imitation factor also affects the coffeehouse business as firms that try to copy their ideas are involved. Also, there is the factor of independent coffeehouse movement that support operations of upcoming local coffeehouses. This hinders Starbucks from expanding (Bull, Jobstvogt, Böhnke-Henrichs, Mascarenhas, Sitas, Baulcomb & Carter-Silk, 2016).

1. f) The TOWS analysis of Starbuck can be done in a matrix form, that is the, SO, ST, WO and WT (Kulshrestha & Puri, 2017). The SO quadrant uses strengths to capitalize the available opportunities. This is achieved by highly marketing the brand to extensively trigger the company existence globally. Also they can extend the mix of the product and partner with other well recognized brands available in the Asian market. The WO ensure weaknesses are overcome to exploit on the opportunities. This can be possible by releasing a medium price for the products to attract all kind of customers and increase sales across Asian countries. The ST utilizes strengths to eliminate threats. This is possible by focusing on marketing and advertisement strategies to attract and retain customers, changing the demographic trends by bringing the market to the millennials, advertising products quality to curb imitation and also market an image that is ethical to reduce competitive pressure (Kovács & Kot, 2016). The WT quadrant reduces the weaknesses to eliminate the threats. This is by releasing low cost products to minimize the challenge of cost from other brands that are posing competition and also marketing the premium products quality to reduce the threats coming from the cheaper imitated products.

3.

1. a) Analysis and assessment is one of the four phases that make up the Strategic management practices. This phase involves identification of the internal and external factor that are affecting the current state of an organization (Engert, Rauter & Baumgartner, 2016). Internal environmental factors refer to all the things that are within a company and under the supervision of that particular company regardless of whether they are tangible of intangible. These factors can be a strength or a weakness to the company depending on how they affect it. Among these factors one may include, but not limited to, plans and policies, value proposition, financial marketing resources, labor management, task execution and operation as well as financial forecast. On the other hand, external environmental factors are defined as elements from the outside that affect an organization. These factors are not found within the company nor are they under its control. They can be divided in macro and micro factors for better understanding. These factors include the following, but not limited to, customers, competitors, market and social media, economy, politics as well as the social factors.  All these factors affect the activities that contribute to the efficiency of the production process. A global technology organization has to consider the internal and external environment factors for it to be successful in delivery of their services. All resources must be well coordinated and planned so as to ensure the quality of technological products they produce is outstanding as well as the services they offer. The external environmental factors must be put under serious consideration because they affect the organization directly. Without this, the production process executed by this technological company would stand to face a lot of difficulties (Westerburg & Bode, 2018).
2. b) Strategy formulation is the second phase during the implementation of strategic management practices. This stage is important because it involves development and structuring of the actual strategic plan (Trigeorgis & Reuer, 2017). After a high-level strategic plan is developed, it must be documented. The documentation will involve all the details in the main plan. It will show precisely what the plan is meant to do and exactly how it will do that. A technological company can be faced by many challenges during the process of production or delivery of service (MOMIN, 2018). For this reason, all the activities involved in that process must be carefully drafted in such a way that they will run efficiently. Every personnel or expert must be assigned a responsibility to avoid confusion during the production process. It is mandatory that all expert s be responsible for their role in the production process. This will ensure that the process will encounter less issues which will have a minimal effect since the team will be prepared. The company should also consider documenting all the steps involved in the production process. The record kept will help the organization in the future and it will also be evidence of the work performed shall any issues arise. This document should contain all activities, date the activity was performed as well as the one who performed the task. This will ensure accountability in the event there has been an issue attributed to that particular task (McCullough, Gillespie, Petrakis, Jones, Park, Lukas & Rose, 2017).
3. c) The third phase of the strategic management practice involves implementation of the strategy formulated. At this stage, the plan that was designed is put into action. This means it is deployed into the organization as an operational plan in an attempt to realize the organizational goals using the already formulated strategy (Annarelli & Nonino, 2016). All the processes in the plan are executed systematically as they all lead towards a common goal. A technological organization has to execute this phase with great care. The products are designed and documented in advance. After the design has been tested for efficiency and accuracy, it is then put into action and the appropriate expertise is put on it. The implementation of this process involves identification of all the processes or tasks that need to be carried out as well as those that are responsible for the actions. Proper execution of the formulated strategy is paramount to the technological company. This is because the company depends entirely on the quality of the end product. Through strategy implementation the technology company will be able to realize their vision as an organization. It is this phase that will make all the projects within the company a reality since it involves execution of a project’s blue print (ul Musawir, Serra, Zwikael & Ali, 2017). This process is exclusively based on action and it deploys certain tools that are used to keep the team responsible on track. A technological company would consider breaking down this phase into smaller tasks that can be easily managed. This technique would help them make sure that the product is developed in small bits which will also be tested separately.
4. d) The last phase is referred to as strategic evaluation. This phase can be explained as a process that involves determination of how effective the formulated strategy is in achieving the organizational goals as well as restoring into track where necessary. This stage involves activities such as, examination of the underlying strategies related to the organization, comparison of the results with the expected outcomes and taking remedial actions where needed. The main aim of this stage is to test the effectiveness of the strategy put in place. A technological company has to evaluate their strategies regularly so as to determine the level of customer satisfaction and also see if their objective as an organization have been met. This phase can be carried out through customer feedback. The information obtained by the organization is studies carefully to produce a report on the level of appreciation the customers have. This information must then be compared to the expected performance in order to get the success rate of the strategy. Strategy evaluation can be helpful to that company in the following ways; it checks the validity of the strategy selected, provide the relevance of the strategy implemented, it will give a basic idea on whether the decisions made contributed well towards the welfare of the strategy, it also provides valid experience and additional information to strategy developers that will contribute towards the developing a more successful strategy in the future and many other advantages (Clayton, 2015).
5. e) Lean production is a management technique which concentrates on reducing waste while still maintaining quality of the products and services offered. It aims at cutting the cost by ensuring that the business is more responsive to market needs and hence more efficient. The technique aims at cutting the cos by eliminating any activities that are not necessary or that do not add value to the process of production (Imran, Rehman, Aslam & Bilal, 2016). This approach was originally founded in a Japan based manufacturing plant but is currently being adopted all over in large and sophisticated manufacturing companies. The main activities in the lean production process contribute towards performing task in the simplest way possible, doing things in a better and more efficient way, involvement of employee in the improvement process and in doing so avoiding waste. This technique can be adopted in any organization regardless of what they are producing or the services they are offering. Lean approach is associated with increased product quality in the sense that elimination of unnecessary activities gives the employee time to focus on the quality of services and products offered in general. It also improves lead time because the manufacturing process is streamlined since the organization able to focus on market fluctuation and other variable in the market (Nicholas, 2018). The lean production can also increase sustainability as a result of less waste of resources and better adaptability which in turn ensures that the business is thriving. In addition to that, employees are satisfied better and profits are increased.
6. f) At the Virginia Mason Hospital, they adopted the lean production in the year 2002. This was after the Chief Executive Officer leant of the lean production technique which was applied in Japan. He then assigned several employees the task to evaluate the company’s tasks and also taught them on hour to apply the technique he had earlier learnt. In doing so, the hospital had to eliminate the nurses who were responsible for arranging meetings with specialist when doctors advised them to. This is because the nurses made this process hard and they wasted a lot of time before making the arrangements. By eliminating this nurses, the time wasted was reduced by sixty-eight percent. The doctors were supposed to send a text to the specialist in case they needed a patient to get special checkup. The specialist was then supposed to respond within ten minute of receiving the request. In the radiation oncology department, steps that were not necessary were eliminated and in doing that the time spent by patients was reduced from forty-five minutes to fifteen minutes. The Virginia Mason Hospital implemented the lean production technique effectively by reducing the time wasted through incorporation of activities that were completely unnecessary to the operation of the hospital. This helped them increase their customer response effectiveness, general performance of the hospital, reduce time wastage, reduce the distance travelled by workers within the hospital by over sixty miles and also reduce the time taken for lab results by eighty-five percent. 

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Key Aspects of Operational Management Process

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