How will strength-based strategic management (like SOAR) be received internationally?
Strategic management refers to the process of specifying firms` vision, mission, and goals. In addition, strategic management involves developing policies which will be followed with an aim of realizing set goals and objectives. Strategic planning is extremely significant as an entity places itself at a competitive edge in a market by developing strategic policies and plans. Strength based strategic management lays more emphasis on factors that make an entity unique in the market. In the past, strategic planning has focused on verifying problems and finding out possible solutions to them. However, there has been a significant shift towards strength based strategies such as SOAR. Strength based strategies have been perceived positively by most leaders both locally and internationally. This is because companies which have employed strength based strategies such as Apple Inc.. have realized significant improvements. This is because strength based strategies encourage innovation, and a learning organization. Further, strength based strategies lay more emphasis on future results rather than past events.
Compare and contrast SWOT and SOAR in detail
SWOT analysis refers to determination of strengths, weaknesses, opportunities, and threats of a business venture or a project. An individual can also carry out a SWOT analysis on his or her own capabilities and develop his or her career. Business entities carry out SWOT analysis in order to gain competitive advantage over its` competitors in the market. In addition, SWOT analysis is used to comprehend various situations experienced in an organization. Strength refers to factors that make a firm unique as compared to other firms in the same industry. These factors include location of the firm, cost of resources, and quality of products. Weaknesses refer factors which ought to be changed in order to increase sales turnover. They also include things that if not avoided could adversely affect operations. On the other hand, opportunities refer trends and emerging issues that affect an entity positively. These trends and emerging issues may include changes in lifestyle, preferences, tastes, technology, and government policies. Lastly, threats refer to obstacles and challenges experienced in day to day operations. Changing technology, lifestyle, and cash flow problems can pose major threats in an entity.
On the other hand, SOAR focuses on strengths, opportunities, aspirations, and results. The strengths and opportunities analyzed in SOAR analysis are similar to those analyzed in SWOT analysis. However, SOAR analysis does not include weaknesses and threats like SWOT analysis. Instead, SOAR focuses on aspirations and results. Aspirations refer to what an entity can do in order to realize its` visions, whereas results refer the methods which an entity can use to measure its` goals and achievements. In addition, SWOT differs from SOAR in that when SWOT analysis is used in strategic planning, much time is dedicated to finding out what the management does not want to occur. This is unlike SOAR where the management focuses on building and nurturing what they want. Further, SOAR encourages innovation and creativity unlike SWOT which stifles innovation. This is because SOAR is based on the concept of appreciative inquiry.
Make a compelling case for why one of the seven long-term objectives is more important than the others
Strategic planners develop long term objectives which include productivity, technology leadership, public responsibility, employee relations, competitive position, employee development, and maintaining profitability. All these objectives are important since they aim at realizing a vision and a mission. However, I believe that employee development is the most important objective in a firm. Employee development entails continuous training and development. Employees form the centerpiece towards realizing good results in a firm. Therefore, there is a significant need to equip employees with adequate knowledge and skills necessary to perform various duties. Further, continuous training and development motivate employees and translates to higher profits as a result of increased involvement. In addition, employee development is extremely important since a business environment is dynamic in nature. Therefore, employees should be trained so as to be more knowledgeable. Training will also make them accept changes faster. This is because through training, employees can be made to comprehend and appreciate the essence of change.
Choose three companies in the Fortune 500 that you feel represents each of the three generic strategy categories -- low-cost leadership, differentiation and focusing Indicate your evidence.
Cost leadership strategy refers to an attempt by a company to produce quality products using extremely low costs. As such, a company that focuses on cost leadership strategy gains competitive advantage due to its ability to sell its products at a fairly low price as compared to its competitors. A company can attain low cost of production by taking advantage of economies of scale. Sources of economies of scale include high volume of production in relation to specialized machines, employee specialization, and reduced overhead costs. If a company produces its products at lower costs, it will be able to offer the products at a lower price. This will in turn attract many customers and eventually lead to high sales turnover. As such, a company that employs cost leadership strategy realizes huge profits and is better placed as compared to its competitors. Wal-Mart and McDonald companies have been able to use cost leadership strategy to maintain a competitive edge in the market. Wal-Mart has often realized huge profits due to its ability to offer cheaper prices as compared to other companies. This is because it is able to obtain raw materials cheaply and through an efficient chain of supply.
Firms that focus on differentiation ensure that their services or products have unique attributes. Product differentiation attracts customers who perceive that differentiated products and services are of a higher quality. As such, customers agree to purchase such products at higher costs than similar products. Firms which differentiate their products are able to pass extra costs of production to consumers who prefer products and services with unique characteristics. Nike has been able to successfully employ the use of differentiation. Nike, Inc. produces different athletic shoes, sports equipment, and apparels. There are various types of sports which require different types of equipment and shoes. Nike Inc. has realized huge profits as it has been able to meet customers` needs.
Firms that makes use of focus strategy determines a specific segment in which it strives to realize either differentiation or a cost advantage. Firms which use focus strategy are aware of the needs of a particular market segment and hence concentrate its resources on producing better products and services. This is with an aim of gaining a competitive advantage in the market. Pepsi Co has been able to use focus strategy and has since been among the largest company dealing in packaged goods. Pepsi Co. is well placed in the beverage segment as it enjoys so much loyalty from its customers.
References
Nieuwenhuizen, C. (2010). Business Management for Entrepreneurs. New York: Juta and Company Ltd.
Victor, S. W. (2008). Selling Places: The Marketing and Promotion of Towns and Cities (Illustrated ed.). London: Taylor & Francis.
Zoephe, M. (2011). Michael Porter's Competitive Advantage Theory: Focus Strategy for Smes (Illustrated ed.). Santa Cruz: GRIN Verlag.
