Assignment 3-2: Strategy Formulation
Franklin University
BSAD 495: Business Strategy Capstone
Strategy Formulation
Strategy formulation develops into a key construct within an organization as it facilitates the development of strategies geared towards promoting organizational growth as stipulated within the organization’s vision and mission statements (David et al., 2004). Strategy formulation develops from the existence of need within the businesses, which hinders potential development and growth. The strategy formulation process is initiated upon the identification of the problem and consequent development of several measures geared towards countering the existent problem.
The study will integrate an analysis of several potential strategies, which may facilitate the growth of StilSim’s position in the market. The proposed strategies will incorporate all aspects of the organization and will include generic, corporate and operational strategies (Malina & Selto, 2001). The analysis will remain crucial in the identification of the most viable strategies, which will facilitate the provision of a recommendation and following implementation.
Strategic Options
The decreasing level of organizational performance at StilSim highlighted by decreased revenues and profits necessitates the adoption of strategic options geared towards facilitating business growth and development. The development of numerous strategic options remains crucial in promoting the review of the options and the applicability of the specific options. The development of generic, corporate and operational strategies will continue to be critical in facilitating the integration of the desired change across all organizational aspects (David et al., 2001). Additionally, the process will remain instrumental in promoting the adoption of innovative and robust strategies that may improve flexibility regarding the changing business environment. The developed strategic options will continue to be crucial in ensuring that StilSim integrates an analysis of the company’s vision and mission, organizational culture and the level of organizational flexibility and growth.
Generic Strategy
Generic strategies comprise of business level strategy, which may be adopted to facilitate the efficiency attached to the internal processes of an organization. StilSim identifies that increased growth of the market coupled with an increasing number of competitors necessitates the adoption of strategies geared towards maintaining the company’s competitive capacity in the market (Norreklit, 2000). The changing demographics in the market concerning the required services and employee skill set necessitate the adoption of differentiation across the business processes.
The integration of service differentiation at StilSim will remain crucial in facilitating the firm’s relevance to the market through the provision of numerous services in-line with the existent recruitment services provided. The adoption of the cost-leadership strategy will remain instrumental in reining the expenses incurred in the business about revenues (Malina & Selto, 2001). The development of a cost leadership strategy remains critical in ensuring that the company decreases the level of expenditures experienced in comparison to the generated revenue. Therefore, the selection of the differentiation and cost leadership strategies remain crucial in facilitating the standard of business expansion and an increase in revenues.
Corporate Level Strategies
Corporate level strategies remain essential to the firm as they involve the development of strategic decisions geared towards meeting the needs of the entire organization. The adoption of business level strategies remains instrumental in facilitating the identification of the existent organizational needs across all departments and functions (Norreklit, 2001). The company seeks to integrate value-creating strategies whereby the adopted strategies will continue to be instrumental in facilitating the firm’s competitive capacity in the market.
The current market share for StilSim is identified at 15%, which necessitates the integration of business processes geared towards facilitating continued market growth. The adoption of value-creating strategies as part of the corporate level strategies remains crucial in the identification of the real and perceived value of the business services within the market. Value-creation strategies remain essential in the determination of the existent market position and the desired position relating to the value of the firm (Butler et al., 2011). Consequently, the process facilitates the identification of the required resources instrumental in meeting the needs stipulated by the strategies.
The key corporate level strategies proposed for StilSim comprise of the adoption of additional services to the organization portfolio relating to human resources. Additionally, the company may compound on the development of an effective relationship with customers through the adoption of a customer-relationship management framework (Butler et al., 2011). The firm may facilitate the level of efficiency experienced in the organization through the adoption of the regular training program for staff.
Corporate Level Strategy 1
Increased level of competition in the market necessitates the adoption of organizational factors and processes crucial in facilitating the competitive capacity of the firm in the market. The company currently holds 15% of the market, which remains considerably large, but provides room for the development of a larger market share. The development of an extensive business portfolio will remain instrumental in the provision of additional business services that relate to the human resource function (Dollard & Bakker, 2010). For instance, the company may develop in the recruitment process to accommodate the delivery of other human resource services including outsourcing and consulting. Additionally, the company may adopt a recruitment process that facilitates the existent needs of the current clients and potential clients across numerous fields. The adoption of the strategy will grow the company’s portfolio and facilitate the development of a larger market share and increased revenues.
Corporate Level Strategy 2
The development of a strong customer relationship remains crucial in facilitating the standard of business growth within the existent and potential markets. The growth of the StilSim’s brand has remained instrumental in promoting the growth of the customer base. However, the development of a customer-relationship-management framework will continue to be crucial in facilitating the introduction of new services in the market and consequent development of a larger customer base (Kaplan et al., 2010). StilSim compounds on the need for the development of a relational aspect to the services offered to customers. Therefore, the adoption of CRM will facilitate the achievement of the company’s vision, mission and objectives while facilitating continued business growth.
Operational Strategies
Operational strategies remain crucial in facilitating the operational aspects experienced within the business. In this case, the StilSim may promote the adoption of organizational processes geared towards improving the operational efficiency experienced within the organization (Dollard & Baker, 2010). StilSim may adopt employee-driven and aggressive policies geared towards facilitating the level of service and product provision within the market. The placement of placement consultants, special projects managers, and the business manager at SimStill will remain crucial in facilitating the identification of new markets and the growth of the company’s clientele base.
Operational Strategy 1
Employees develop into a crucial component of the organization and remain instrumental in promoting the standard of business growth and sustainability. StilSim may introduce regular employee training across the departments geared towards developing employee skills and knowledge across the additional business processes. The adoption of the strategy will facilitate the development of an efficient workforce vital in promoting overall business growth. For instance, the provision of special project managers will remain crucial in facilitating the success of individual projects essential to business growth.
Operational Strategy 2
The maintenance of the company’s competitive capacity in the market remains crucial in facilitating business growth and development. The evaluation of the company services remains fundamental in the identification of the existent needs in the market and the viability of the business resources to meet the diversification strategy developed. The adoption of a review of the operational costs together with the creation of different service packages that retain value will remain instrumental in facilitating the provision of excellent services and potential customization of the products to the clients in the market.
Weighted Decision Matrix
The critical decisions for StilSim include differentiation, customer relationship management, and employee training. In order of priority concerning the company needs, differentiation develops into a critical decision followed by employee training and the client relationship framework (Kaplan et al., 2010). The results maintain that business growth develops into the most important factor followed by customer satisfaction and employee engagement.
The adoption of differentiation as the key decision will facilitate the adoption of business processes geared towards developing the company portfolio and an increase in company revenues. The provision of employee training will remain crucial in promoting the implementation of the additional services to customers in the market. The development of the customer-relationship framework will communicate the service portfolio to customers thus facilitate the adoption of new services due to the existence of a trained workforce.
Balanced Scorecard Strategy Map
The balanced scorecard develops into a crucial component that promotes the adoption of the desired company and business processes. The balanced scorecard integrates an analysis of several perspectives including the financial perspective, customer value perspective, process, and internal operations perspective together with the learning and growth perspective, which develop a direct link to the organization vision (Kaplan et al., 2010).
The adoption of the differentiation strategy will remain vital in facilitating the development of a relationship between the internal business process and financial perspective as the company will introduce a diverse range of products that will increase the company revenues and reduce operational costs. The adoption of the customer-relationship management process will meet the needs of the clients in the market leading to the growth of a larger customer base. The provision of employee training will facilitate learning and growth perspective through continued employee skills development and increased identification of operational efficiency.
Figure 1: Balanced scorecard
Strategic Objectives and Goals
The development of strategic objectives remains crucial to StilSim as the goals will provide a guideline regarding the need for the adoption of the recommended strategies. Firstly, StilSim should adopt differentiation as a key strategic objective. The approval of the process will facilitate the development of the organization’s portfolio thus attracting a larger clientele base and revenue derived from the provision of numerous services. Secondly, StilSim should adopt an extensive customer-relationship framework. The process will facilitate the development of a relationship with customers, which remains crucial in the communication of the new product and service offerings thus promoting business growth. Thirdly, StilSim should invest in employees through the provision of regular training necessary in developing employee skills and knowledge regarding the work processes.
Recommended Strategies
The recommended strategies include the adoption of service differentiation, employee training and the adoption of customer-relationship management framework. The recommended strategies will remain crucial in facilitating a 50% growth of StilSim’s operations across all the firm’s processes.
References
Butler, J. B., Henderson, S. C., & Raiborn, C. (2011). Sustainability and the balanced scorecard.
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Davig, W., Elbert, N., & Brown, S. (2004). "Implementing a Strategic Planning Model for Small
Manufacturing Firms: An Adaptation of the Balanced Scorecard". S.A.M. Advanced Management Journal, 69 (18).
Dess, G. G., Lumpkin, G. T., Eisner, A. B., & McNamara, G. (2012). Strategic management: Creating Competitive Advantage. (5th). New York, N.Y.: McGraw-Hill Irwin.
Dollard, M. F., & Bakker, A. B. (2010). Psychosocial safety climate as a precursor to conducive
Work environments, psychological health problems, and employee engagement. Journal of Occupational and Organizational Psychology, 83(3), 579-599.
Franklin University. (2013). StilSim personnel simulation. Retrieved insert date you retrieved here, from http://video.franklin.edu/Franklin/BSAD/495/StilSim/index.html
Kaplan, R. S., Norton, D. P., & Rugelsjoen, B. (2010). Managing alliances with the balanced
Scorecard. Harvard Business Review, 88(1), 114-120.
Malina, A., & Selto, H. (2001). "Communicating and Controlling Strategy: An Empirical Study
Of the Effectiveness of the Balanced Scorecard", Journal of Management Accounting Research, 13 (1).
Norreklit, H. (2000). "The balance on the Balanced Scorecard - a critical analysis of some of its
Assumptions", Management Accounting Research, 11, pp. 65-88.
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