Discuss about the Strategic Management for Physical Distribution & Logistics Management.
The organizations functioning in the current economic structure tries to improve their business structure in order to be ahead of their competitors. The firms take the help of the innovative techniques thereby producing new and creative commodities according to the demand, taste and preferences of the consumer. The firms even make use of strategic business plans in order to create a framework that is useful for an efficient functioning of the business. There are various types of strategic approaches that are available to the industries functioning in the economy and every organization uses different strategic approaches according to their line of business (Hill, Jones and Schilling 2014).
It is seen that every firm in the present scenario makes use of strategic management process in order to control and supervise their business plans. The idea of strategic management is to cordially manage the strategies thereby bringing out the best out of the organization. The most common strategic management process that is used by most of the organizations is the current standard linear approach, which is a standardized technique that is easily accepted by the firms and is easy to understand and execute.
The linear approach strategy concentrates on constructing various goals and the process of accomplishing them. This is the main aim of the strategic management. In this process of strategy, the leaders of the firm plan how they would compete with their rivals to accomplish their company’s aim and goal. It is a planned execution of the initiatives, aims, goals and the assignment of the resources in line with the standard norms. The linear strategy is the most reliable to the strategic planning approaches and has a long organizing prospect. The management of the firm who strategizes even deals with the current environment but the environment is not the major concern for the organization. It is seen that there are various shortcomings that are compelling the firms to change their strategic management process. The firms are therefore taking help of alternative strategic management techniques in order to keep their goals and aims on track (Hitt, Ireland and Hoskisson 2012). The shortcomings of this technique show that this mechanism does not unfold the correct anticipations that are thought for the future. It is even seen that this technique may be expensive for some of the firms as they may not properly understand the use of the technique. The process may be effective to provide immediate results to the firm but may not be effective in providing long term benefits to the firm. The organizations are in need of a strategic plan that will reap benefits for the future as well. Finally, it is seen that this process can even impede the flexibility of the firm according the changing time and demand in the market. This technique does not have the advantage of flexibility and therefore a firm may stick to function in the traditional approach thereby losing its competitive edge.
The current study tries to analyze the various alternative strategic techniques that the firms functioning in the economy uses in order to stay alive in the market. The paper uses extensive research to explain the various methods along with their validity and issues.
The above discussion has provided that linear standard approach may not be appropriate as strategic technique to successfully being implemented in an organization. Therefore all the organizations that are functioning in the competitive market try to make use of alternative strategic techniques to make sure that their business functions efficiently and accurately. There are various strategic management techniques that can be utilized by organizations (Swayne, Duncan and Ginter 2012). However, this paper will evaluate the most important alternative techniques namely, Stakeholder Approach, Dynamic Capabilities and Sustainable Approach. All the three approaches are discussed below:
The primary principles of the stakeholder based unifying strategic management network are raising the efficiency of a firm. The approach is used by the Coca-Cola Company and it is seen that resource based plans, environment based strategies, strategy for corporate responsibility, and networking plans are the major aspects that provide knowledge to stakeholder oriented plans to provide advantage establishment knowledge and establishing stakeholder relations in the central competencies and dynamic capabilities of the firm. These abilities establish the organizations responsibility and financial presentation, which could be supervised through the loops of feedback to the strategy origination. The major doctrines underlying this technique comprise of environment based plans that determine responsibility and competitive context for the resource based plans, the strategy of networking and the responsibility plan. The strategies based on resource provide the basic needs for the knowledge management techniques (Eden and Ackermann 2013). It is even seen that the resource plans are helped by the strategy of network established with reference to sustainability and responsibility plans to make sure the value junction. The sustainability and the corporate responsibility techniques provide the basic needs of the strategies based on the stakeholders. The networking and the organizational techniques determine a common background that provides guidance to the creation of unified strategies for the stakeholder and knowledge management. The stakeholder management and knowledge techniques provide synergistic enhancement of the knowledge of advantage creating and the stakeholder relations with advantage creating.
The dynamic capabilities and the central competencies are guided by the advantage creating idea and advantage establishing stakeholder dealings and show a vaster need from both the responsibility techniques and resource based techniques. If the strategy with respect to responsibility show an instrumental approach of stakeholder, idealist responsibility and financial performance is on the basis of the situations for the sustainable competitive edge, which shows that responsibility techniques reveal the responses of the organizations towards responsibility with relation to opportunities and challenges like any other strategic issues. The idealist responsibility and financial accomplishments of Coca-Cola Company would show suboptimal financial achievements (Slack 2015). However, it should be acknowledged that optimistic effects of internal responsibility on the demand of the investors and the social capital may decrease costs related to responsibility. The internal stakeholder techniques could create privileged demand from the investors resulting to higher level of value of shares in particular if the organization performs better than their competitors in responsibility aspect. The responsibility and the financial conducts of the firm loops the environment, responsibility and resource techniques provide the basis for the performance control.
The core foundation of the outline of the approach is the harmonious enhancement of the knowledge of advantage creating and the advantage creating shareholder relations in relation to the resource based approach.
The idea of business value rises with accordance to the criteria of the functions the organization supports. The knowledge of advantage creating can be referred as the idea supporting strategic systems that are emulates strategies with respect to the three dimensions responsibility, value and responsiveness (Simons 2013). The value of advantage creating knowledge is a role of the value of knowledge that supports the components with reference corporate responsibility classification weighted or customized according to the exact needs of Coca-Cola Company.
The strategies related to the stakeholders initiates with the recognition of the vital stakeholders of the firm and then explaining their features like interest and influence, vitality to the firm’s survival, challenges and collaborations, response urgency etc that determines the relation type the firm needs to construct within them (Felin et al. 2012). The typical shareholders relationships are inclusive of the following factors:
The stakeholder relation about advantage creating can be explained as the relations that support strategic techniques that contribute to responsiveness, value and responsibility abilities. The advantage creating stakeholders relation value can be explained as a role of stakeholder sustain in every component of the 4CR classification with respect to the four dimensions:
Idea enhancement support: The organization can be seen as a framework of idea communities giving repositories to helpful ideas embedded in the day to day function and their relationships. It is through this knowledge that exchange of each community establishes a basic cognitive base and common social regulations, which acts as a guide for the learning and behaviors of the newcomers (Hair et al, 2012). The communication between the societies generates vaster central competencies and dynamic abilities.
Transform support: This supports transformation in the management by making use of essential technological and human resources. The major issue is transforming resistance by the stakeholders having an impact by the transformation (Priem, et al. 2012).
Developed influence: The organization requires influencing decisions at sectional, regulatory, political and at regional levels aiming at raising the market attractiveness where Coca-cola operates and establishing efficient resource, dependence conditions. The developed influence is dependent on the on the organization’s performance of responsibility, participation in the initiative of the multi-stakeholders for the controlling or setting of standard and involvement in partnerships for continuous development (Evans, Stonehouse and Campbell 2012).
Developed trust based exchanges: This is done with the help of good relations with the stakeholders. The developed trust based exchanges can be calculated by the encouragement to the stakeholders to give their best, which has an impact on the efficiency of the production, supplier co-operation and customer loyalty (Beske, Land and Seuring 2014). Trust exchange is dependent on the past experience, integrity reputation and value junction
The advantage creating stakeholders respects the value. It is very similar to the creation used for the value of advantage creating idea, relation value advantage creations that can be expressed by a matrix. This will show a relation of the stakeholder’s value dimensions (Barney, and Hesterly 2015).
In the recent years there has been a strong demand of the dynamic strategies, which are linked with the developed organizational responsiveness (Keupp, Palmié and Gassmann 2012). This paper will discuss about the dynamic capabilities strategy undertaken by IBM. This strategy can be divided into the following:
The dynamic capability show the organization’s strength to combine, construct and restructure competencies to answer the swift changing environments and even includes business intelligence abilities for examining and explaining new technological areas and new markets (Rothaermel 2015). Dynamic capabilities can be featured as the directories of competence enhancement that combines flexibility restricted with history of the firm, which makes them distinctive and implicit. This strategy is needed for both configuring and integrating resources to allow the firm to release and obtain resources.
Dynamic capabilities are closely connected inter-organizational relationships of the firm, which are distinctive and difficult for the rivals to duplicate and to alternate and they allow IBM to adapt to the transforming opportunities and challenges by hacking into a diverse and vast platform of network resources. The networks may depend with respect to the relational and structural features such as tie pattern, nodal diversity or a change in the mixture of the relationships (Wang and Feng 2012). There are two crucial categories of networking that have an effect on the theory of organic and mechanistic management systems. Mechanistic network is featured by the stability, rules, formal standardization, loyalty and rules. Organic networks are featured by adaptive and loose links controlled by participative knowledge, mutual adjustments and progress commitment. It is seen that mechanistic approach is more ideal for value strategies and organic network is ideal for responsiveness strategies. It is seen that IBM has a business plan comprising of both response and value. Therefore it is suggested that the organization adopts a layered model for the networking of the business having an internal layer comprising of the long term relationships connected to the value strategies and the outer layers with looser relationships and the extreme outer layer comprising of the service providers connected to the responsive plans (Kor and Mesko 2013). It is seen that each layer of the dynamic strategic management of the firm is featured with the various relationship qualities and strategic deviation requirements that requires reflection in the corresponding engagement strategies of the stakeholders.
The corporate sustainability approach is linked with the support for continuous enhancement and the long run performance balance and the existence of the organization. This approach has been implemented by various firms one of which being Nestle Company Ltd. This process answers the requirements of the current needs of the stakeholders while trying to protect, develop and support the natural and human resources that are essential by the stakeholders in future for the betterment of the corporation (Killen et al. 2012). The measurement of corporate sustainability performance is done with the help of Nestle’s environmental, economic and social impact and the interlinked satisfaction of the stakeholders. The definition of sustainability impact can be well explained with the help of the following dimensions:
Economic Effect: The sustainability of the business of Nestle and its human capital and response in the sustainable creation of wealth processes at the international, national and local level holds a great key.
Social Impact: The effect of the commodities or the activities on human rights, health, safety, regional enhancement, human rights and other social concerns are of great need (Simons 2013).
Environmental Effect: The effect of the commodity and the operations on any environmental depletion including the firm’s waste and emission related concerns.
The important aspects of sustainable approach are supporting unprejudiced globalization and vigorous participation in the enhancement of the regions within which the organization operates. Clean globalization needs equitable and productive markets and proper rules that support equal chance and access for every country that recognizes the variety in the capacity of the nation and the needs of development (Beske 2012). Therefore, it is need of a shared responsibility among different countries and the organizations that do not have access of globalization by marketing there and availing products to that country. Nestle has done the same by providing their various products in parts of Africa that did not have access to globalization. Therefore, it is seen that this approach holds good for the benefit of the society that encourages the customers to gain confidence about the firm and purchase their services or products (Morgan, Katsikeas and Vorhies 2012).
Conclusion
The above analysis provides an in depth knowledge about the most vital alternative strategic management techniques that organizations use in order to keep track with the changing environment and maintain their market share and try to stay ahead of their competitors. It is seen that the stakeholder approach is inspirational in encouraging all the stakeholders to comprehensively work hard to ensure that all the plans are implemented and the decisions are taken properly so that it is helpful for the organization to perform. The viability of dynamic capabilities involves the bringing in encouragement from all the aspects who attain profit and have any benefits from the service of the organization. The viability of sustainable approach is gaining the confidence of the society or the community so that they are satisfied to purchase the product or the services provided by the firm. The benefits that each of the methods provide have been discussed above and it is seen that there exists implementation issues like having a conflict among the stakeholders, difference in the dynamic capabilities of every firm. It is known that the organizations are different from each other and the issue of sustainable approach involves changes in the planning of the organization according to the location. This is due to the fact that every region has different culture and societies and therefore the firm needs to use various strategies according to their business environment. It is seen that the most common limitation that all these three strategies possess is that they are all expensive and stakeholder approach involves the knowledge about all the stakeholders and their needs so that a common ground can be attained. Dynamic capabilities have the limitation of the fact that as it is a complex method, it is difficult for many organizations to segregate between the value and response of the clients. Sustainable approach is looking after the society and therefore it is essential for the concerned firms to operate and prepare their strategic plans according to the location where they operate so that all the needs of the consumers are met. The paper thereby answers all the queries and even provides assistance for the use of these alternative strategic processes.
Reference List
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