TWO ASSIGNMENTS

Strategic Management in Dynamic Environments

Strategy Composition (3-4 Pages)

Deborah enters your office, and you notice that she looks apprehensive. “Hi, Deborah. What’s up?” you ask, hoping that nothing is wrong.

“Well, your team is doing an excellent job researching, and you’ve been keeping me up-to-date on your findings. My concern is that we are approaching this from a narrow-minded approach.”

“How so?” You ask. You are puzzled. “Our team has been looking at every aspect of the company and considering both internal and external pros and cons.”

“We need your findings put into some kind of management system so we can really see where we are headed regarding our global expansion. I think we need to cover our bases here. Please report back to me next week with your thinking put into a framework.”

Complete the following:

A balanced scorecard suggests that we view the organization from four perspectives (the learning & growth perspective, the business process perspective, the customer perspective, and the financial perspective). Briefly discuss these four perspectives analyzing what each means to your organization? Based on this analysis:
What other strategies would be a good fit for your company profile?
Provide a brief overview of these strategies.
Why is it important to have more than one strategy in mind when pursuing global expansion?
The materials found in the M.U.S.E. may help you with this assignment such as the audio file Choosing a Strategy. This file provides real-world experience that may help you with this assignment. In addition to your textbook material, here are a few resources that may help you learn more about the basics of the balanced scorecard:
- http://balancedscorecard.org/Resources/About-the-Balanced-Scorecard
- http://ap-institute.com/kpi-white-papers/what-is-a-modern-balanced-scorecard.aspx

You decide that Deborah has brought up another good point that should have been discussed in the beginning of the project. You make a note to add this to a list of project management ideas to help make future projects go smoother.

Complete the following:

What other strategies would be a good fit for your company profile?
Provide a brief overview of these strategies.
Why is it important to have more than one strategy in mind when pursuing global expansion?

The materials found in the M.U.S.E. may help you with this assignment such as the audio file Choosing a Strategy. This file provides real-world experience that may help you with this assignment. (See BELOW for M.U.S.E.)

MU SE STUFF: The Benefits, Costs, and Risks of Doing Business in Another Country

The potential benefits, costs, and risks of doing business in a country are partly a function of its political and legal systems. A political system includes the structures, processes, and activities by which a nation governs itself. It is important for managers to understand whether a political system is characterized by wide or narrow participation because it forms the context for the creation of laws and the selection of political leaders.

A legal system is the set of laws and regulations, including the process by which a country's laws are enacted and enforced. Global legal issues include standardization across different legal systems, intellectual property, product safety and liability, taxation, and antitrust regulations.

We must view global business as not as a collection of distinct forces, environments, and business functions but as an integrated, global environment consisting of many national business environments, the global business environment, and global business management. The national business environments remain important since each nation has a distinct culture and systems of politics, law, and economics that define business activity within its borders. No nation is immune to the global business environment due to the long-term trend toward more porous national economic borders. Both environments (national and international) define the context of global business management.

Globalization is the trend toward greater interdependence among national institutions and economies. It is characterized by denationalization in which national boundaries are becoming less relevant. Increased interdependence means a freer flow of goods, services, money, and people across national borders. Two areas having profound effects included globalization of markets and globalization of production.

Culture is the set of values, beliefs, rules, and institutions held by a specific group of people. The main components of culture include aesthetics, values and attitudes, manners and customs, social structure, religion, personal communication, education, and physical and material environments. Managers must strive to overcome ethnocentricity—the belief that one's own ethnic group or culture is superior to that of others. Ethnocentricity causes people to view other cultures in terms of their own, causing them to overlook important human and environmental differences among cultures. Managers must also have cultural literacy—detailed knowledge about a culture that enables people to live and work within it.

A political system includes the structures, processes, and activities by which a nation governs itself. A country's political system derives from the history and culture of its people. Factors such as population, age and race composition, and per capita income influence a country's political system.

Political risk is the likelihood that a government or society will undergo political changes that negatively affect local business. It can threaten an exporter's market, manufacturing facilities, and the ability to repatriate profits. Political risk arises from the following:

Corrupt or poor political leadership
Frequent changes in the form of government
Political involvement of religious or military leaders
An unstable political system
Conflict among races, religions, or ethnic groups
Poor relations with other countries

A country's legal system is the set of laws and regulations, including the process by which laws are enacted and enforced and how courts hold parties accountable. It is influenced by cultural variables, including class barriers, religious beliefs, and emphasis on individualism or conformity. A legal system is also influenced by the political system. Totalitarian governments favor public ownership and enact laws limiting entrepreneurial behavior; democracies encourage entrepreneurial activity and protect businesses with strong property rights laws. Also important are political "moods," including nationalism—the devotion of a people to national interests and advancementategy

competitive strategy

Also referred to as competitive strategy, a firm’s business strategy deals with how it will achieve a competitive advantage over its rivals within an industry.

A firm's competitive strategy is important because it enables a firm to perform at a higher level than its rivals in the same market. Obtaining a competitive advantage is dependent upon a firm’s bundle of resources and capabilities, and the extent to which the resources and capabilities are valuable, rare, inimitable, and nonsubstitutable. The competitive advantage is also dependent upon the nature of the external industry and how well these resources and capabilities fit and/or are positioned within the environment.

Opportunity Through Change

Yet, where exactly does the opportunity for competitive advantage stem from? The answer is change. The change can be external, internal, or a combination of the two.

External Change: The Economy

When the competitive forces within the external industry or environment change, they open up many different opportunities. For example, take times when there is a noticeable decline in the economy. This change impacts how firms compete. Firms that are not able to quickly and effectively respond to recession conditions have to close their doors when conditions are severe. Yet, other firms embrace the change. For instance, when gas prices in the United States hit an all-time high, a well-known online map service added the functionality to be able to compute estimated gas prices when mapping out a trip. As postage cost increased, a local newspaper put itself completely online with the intention of increasing its emphasis on online classified advertising.

Combined Changes

Another example of an external change is in the arena of technology and the rise of the Internet. A company, whose name has been virtually synonymous with cameras and film for over 100 years, has struggled to compete in more recent times because its camera technology and printing became outdated and less relied upon. However, other firms, such as a famous online photo sharing website, took advantage of this change and entered the industry to provide cheaper printing and related services to a wider audience.

Internal Change: Resources, Capabilities, Innovation

Change can also happen internally to a firm. This involves the acquisition or development of resources and capabilities to be better able to compete. Sometimes, major innovations can serve as the change needed to develop a competitive advantage.

In most instances, the opportunity for competitive advantage emerges when there is an external change to the environmental landscape combined with a firm that is responsive by making some internal changes to its resources and capabilities. These are firms that are flexible and able to quickly respond to changes. A famous computer company (who is well known for its customizable computers, quick manufacturing, and distribution system) is able to quickly respond to any new demands that need to be offered. This company is not stuck with a large inventory of computers and product that it must first sell.

In summary, companies that carry out a strategy that is agile and smart in response to its environment—whether internal, external, or both—are able to achieve higher returns or profitability

Reputational Resources

Reputations can be of great value and contribute significantly to firm competitiveness. The reputation of a firm is a "perceptual representation of a company's past actions and future prospects that describes the firm's overall appeal to all of its key constituents when compared with other leading rivals" (Fombrun, 1996). Stakeholders of a firm such as customers, employees, and investors are influenced by its reputation because it signals the firm’s quality and abilities. In many cases, the reputation of a firm can help leverage its relationship with existing and future exchange partners to obtain lower costs, enter new markets, and create competitive barriers (Deephouse, 2000).

Reputation contributes to firm competitive advantage mainly because of the difficulties in creating, imitating, or substituting reputation. First, it is evident that reputation is difficult to create (e.g., rare) because of the variation in reputation among firms. Because a firm’s reputation is a perceptual representation by key stakeholders, the development of reputation is also very socially complex. This leads to difficulties for firms in imitating the reputation of others (Barney, 1991). While guarantees and other long-term contracts have been argued to serve as potential substitutes for firm reputation, Barney argues the implicit psychological contract differs when an arrangement is made because of reputation. This makes reputation difficult to substitute.

Human Resources

The human resources of a firm can also serve as a key competitive advantage. If a firm hires the right person(s), it has the potential to make all the difference. Those employees with a highly specialized skill set or knowledge base, coupled with the right motivation and ability to work well in a specific organizational culture, can at times be especially difficult for a firm to identify and recruit. Yet, it is also difficult to find a substitute for these individuals.

The importance of human resources as a contributor to competitive advantage is especially apparent in the consulting industry for many firms. A famous global management consulting firm has worked hard to create a organizational culture that is attractive for persons that not only have the right skill set and knowledge base for consulting, but also that are willing to put in the time and travel required of such a career. This firm also invests heavily in their employees by sending them to customized training on a regular basis. By doing so, they are helping contribute to their knowledge base and team-building skills. The end result is a group of employees that enables the firm to derive a competitive advantage and perform well.

Innovation Capabilities

Being innovative is not something that comes so easily to every company but can contribute significantly to a firm’s competitive advantage. One of the most innovative companies known for sticky papers (and much more) is also one of the most admired companies. How exactly did this company develop such a capability? It is difficult for the management team to explain exactly how to create such a culture. This, in part, is one of the reasons why it serves as such a great competitive advantage for them. It is difficult to imitate or recreate a comparable innovation capability. Many of its competitors frequently benchmark and try to learn from this company, yet its position in the market stands firm.

References

Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120.

Deephouse, D. L. (2000). Media reputation as a strategic resource: An integration of mass communication and resource-based theories. Journal of Management, 26(6), 1,091–1,112.

Fombrun, C. B. (1996). Reputation: Realizing value from the corporate image. Boston, MA: Harvard Business School.

Projects are comprised of tasks that, when completed, meet an objective. In today's environment, projects are generally worked on by a matrix or project organization. A matrix organization combines functions and divisions that create cross-functional teams, bringing expertise from these areas to the project. Projects are executed appropriately when the project is completed on time, the project is completed within budget, and technical performance objectives are achieved. It is important that all relevant aspects of a project be studied thoroughly to convert the project into financial terms, meaning expressing how many resources were expended on the project in relation to the revenue that will be generated. Additionally, the project should be completed in a timely manner because delays in a project can be costly to an organization and to its customers.

Work Breakdown Structure

Often referred to as a task list for a project, a work breakdown structure (WBS) takes a daunting project and breaks it down into manageable tasks—a work package with summary tasks. The project definition and risk management outputs are used as outputs for a WBS. The foundation of planning a project is based on the tasks listed in a WBS. There are two presentations of a WBS: graphic or outline form. Either format will provide a detailed illustration of the project, allow you to monitor the progress of the tasks, allow you to create well-defined cost and scheduled estimates, and give clear assignments to project team members.

Critical Path Method

When it comes to managing the project tasks, a delay in the critical path could jeopardize a project. A critical path is the longest series of tasks in order from start to finish. It is the path with zero or negative float, meaning that there is no flexibility to adjust the schedule. Not all projects have a critical path. With an externally imposed finish, you generally have more than enough time to complete all the tasks.

for Competitive Advantage

The Benefits, Costs, and Risks of Doing Business in Another Country