week 21

1. What are the benefits and drawbacks of taking an ‘emergent’ approach to strategy making?

Emergent Strategy:

Emergent strategy is defined as the patterns of actions inside an organization which took place lacking a clear relationship to, and the mission or the targeted goals of the company. The model usually becomes obvious only after the fact, but organization often accept the change as a new business policy. A clear example of this may be a comedian book shop owner setting a strategy for control comic books sales in selected area or place. The manger, conversely, notes that earnings from tabletop gaming foodstuffs far exceed that of the comics and shift resources to complain of gaming inventory. Profit increases and the owner recast the strategy to become the leading gaming shop in a selected area.

Advantage of emergent strategy:

Manly, in every case emergent strategy take place from individuals of a company responding straight forward to market forces. Their decisions reveals shift in order sizes, consumer taste and preferences of competitors business. In fact, the benefit of taking emergent strategy is that it guide a company to supply what the market really wants, relatively than what the executive or owner thinks or consider the market needs, effective emergent strategy does involve that the business maintain the flexibility, mainly at the executive or owner level, to grip the latest or newly strategy.  

Disadvantage of Emergent strategy:

Via nature, emergent strategy takes place as piece of continuing managerial activity. Whereas a business could miss a deliberate strategy and rely on an emergent strategy to build up, the chances of such order patent from pure, shapeless business action remains lean. In this case, emergent strategy does not recommend genuine choices than further traditional deliberate strategy, particularly for new business in service or narrow margins. At finest, it supplies to balance and serve as a corrective measure for deliberative strategy.

2. Did Honda Entry strategy demonstrate the characteristics of ‘logical incrementalism’?

According to Quinn, “Logical incrementalism is the development of strategy by experimentation and learning from partial commitments rather than through global formulation of total strategies”. Dynamic changes are required to respond to the unexpected changes in the environment rather than planning the strategic direction well ahead (Johnson et al., 2005).

Yes, I think Honda entry strategy demonstrate the characteristics of logical Incrementalism due to following reasons:

 v  Only Four percent of the Honda Motorcycles was exported in 1960, however mass production is applied in home country Japan; it leads to reduction or cutting down the cost of motorcycles through mass production.

 v  A very limited people attracted in the USA to use motorbikes after the second world war as they called them “Satan’s Slaves”. Or “Hell’s Angels”. & they also thought that providing a motorbike as a bad image. Honda Experiment their product in such complicated point of time naming “American Honda Motor Company” which was also stated in their 1963 annual report and on marketing strategy. 

 v  In 1961 with the help of 125 distributors and investment of 150000 on their regional advertising they focused on young families in their advertising theme named “You meet the nicest people on a Honda”.

 v  Honda also follow the emergent strategy and supply according to the customer demand on the light-weight products which help them to increase their sales level from $ 5000,000 in 1960 to $ 77 million by 1965.

 v  US market share of motorcycles at that time (in 1966) was

Motorbike (Brand)	% Shares
1.      Yamaha	11%
2.      Harley Davidson	4%
3.      BSA/ Triumph and others	11%
4.      Suzuki	11%
5.      Honda	63%

 v  After struggling different things such as sharing furnished apartment in $ 80 per month, sleeping in floor and different others they find out Japanese community as well as the suitable environment to sell their motorbikes choosing Los-Angeles and pointing out the growing motorbike users.

 v  Honda motorbike was extremely in poor condition in their first year, they are unaware of environment certainty that during the time of April to August in US business. Although they hard-learned and achieve knowledge with distributorship in Japan influenced them to struggle to go to the retailers directly. They lope advertisement in the motorbikes magazine for wholesaler. Fortunately, their all bad times are swept like the sand in swept near the seashore, different 305cc and 250cc motorbikes began to sell.

In my opinion they followed every element like uncertainty on environment, experimentation, general goals as well as coordinating emergent strategies. This shows they are following “logical Incrementalism”

References:

1.  Johnson, Whittington and Scholes (2011) Exploring Strategy, 9th Edition, Pearson Education, Chapter 12

2.      Lynch, R (2011) Strategic Management, 6th Edition, Pearson Education, Chapter 1

3.       Lynch,R (2012) Strategic Management 6th Edition, chapter 2

4.      Mintzberg, Ahlstrand and Lampel (2009) „Strategy Safari‟ Edition 2, FT Prentice Hall, Chapter 8

Week 20

Week 18

  1.      How can using the Change Kaleidoscope and Force-field analysis help an organization to deliver its intended strategy?

•         There are different tools which help to deliver its intended strategy. Among them change kaleidoscope and force-field analysis are the two important widely known tools which facilitates to recognize the change within the organization. The positive features of these tools help to assist the change within an organization whereas negative features resist the change.

•          Both change kaleidoscope and force-field analysis which helps the organization to deliver the intended strategy is described below:

Change Kaleidoscope: In 2002, Hope Hailey and Balogun developed change kaleidoscope to find out the various aspect and implementation option at the time of changes take place in an organization. Nowadays different organization as well as industry used change kaleidoscope strategy to assist the change. In simple term, this tool consists of eight factors which help organization to assist the change by getting the familiar to change management and to identify the complexity and risk associated with change. Many researchers suggest that change kaleidoscope is the best when the change is transitional.

The eight elements which consist on change kaleidoscope are as enlisted through the diagram:

Force-field analysis: In 1940, Kurt Lewin developed Force-field analysis which facilitates an initial view of changed troubles that need to be handled, by recognize forces for and against change found on the understanding of the situation of change – together with the existing culture. It permits some key questions to be inquired:

•         What needs to developed or introduced to assist change?

•         Which part of the present situation might assist change in the preferred direction, and how might this be reinforced?

•         Which part of the present situation would resist change, and how this can be overcome?

      Different element for and against the change are as given below:

For example : Product want to extend its brand into cerel market

2. Add your change kaleidoscope diagram for Hewlett Packard to your Learning Journal?

•    The kaleidoscope table and diagram for Hewlett Packard to are as enlisted below:

 References

1. Johnson, Whittington and Scholes (2011) Exploring Strategy, 9th Edition, Pearson Education, Chapter 14

2. J. Balogun and V. Hope Hailey, Exploring Strategic Change, 3rd edition, Prentice Hall, 2009 

3. http://www.learnmarketing.net/forcefieldanalysis.jpg accessed in march 29th 2013.

4. http://www.marketinginsight.ch/wpcontent/uploads/2011/09/Change_Kaleidoskop.jpg accessed in march 29th 2013

Week 17

Can you think of an organization that has implemented a ‘high risk strategy’ that has resulted in success (why was it high risk at the time and why was it a success- was it good luck or good judgment)?

Answer:

There are various organizations that had implemented a ‘high risk strategy’ which has resulted in success. One of them is the wall-mart which is described below:

In Arkansas Sam Walton opened the first store of wall –mart in 1962. In five years, there was the total revenue of $ 12.6 million in sales earned by 25 stores in total. Also, Wal-Mart integrated in sustainability in international business under their CEO H Lee Scott Jr. In 2007 August Bharti enterprises and wall-mart announced an agreement to establish Bharti wall-mart private limited. Currently there are 1800 stores and club setting in 15 markets provide work for more than two million associates, serving more than 176 million of client every year.

Vision and Mission.

Ø  To provide best quality products and services in very low prices, from household items, school supplies as well as top quality groceries.

Ø  To saves the customer money and maintain them the quality of life and live them better.

Ø  To earn a huge amount of profit also by maintaining and satisfying the consumers.

Partnerships:

Ø  Engaged in partnership with hospitals to quickly expand its store and also want the good will a trusted hospital name can provide.

Ø  To implement sustainability in international business partnership with CRM and environmental defense fund.

Ø  Strategic partnership with P & G and several Chinese firms which provide wall mart sustainable business consulting.

Strategy of wall mart (which is successful):

·         To earn profit still by providing same goods as others provides with 2-5 percent lower than competitors.

·         Operational efficiency is very high.

·         Company largest importer of Chinese consumer goods in USA market.

·         Successful utilization of logistic & supply chain management.

·         Worldwide expansion of business for getting the new market opportunity.

·         Use of Information Technology in all area of business.

·         To predict demand for optimization of cost.

·         Bargaining power over suppliers.

Wall mart generates significant advantage through the system it developed to run its warehouse and stores. Wall-mart prefers locations without direct competition from large chains i.e. rural areas. It also fashioned a culture of sustaining values, skills, technology, supplier- customer relationships, HR and approaches to motivation which could not be replicate or copied by the competitors. 

This company also pursue the organic growth strategy in which they construct stores in chief location with room for expansion development and growth via standard and efficient design and standard not by the acquisition but only 10% of space for storage.

Wall mart not only excels at attributes like price but also on time delivery, quality, availability, selection that their competitors cannot compete. Non-commodity, brand based on lower prices, which is a key differentiator and value proposition to most of the world today. In addition wall mart changes their tagline last year from ‘everyday lower price to “save money-Live better, which also demonstrate that they move towards sustainable products with low cost. Due to this wall-mart develop into the leader in low cost retailing industry with revenue of $404.16 billion; also this company is bigger than 160 nations.

Now, do the same for an organization who embarked in a high risk strategy that resulted in some sort of failure (why was it high risk and why did it fail – bad luck or poor judgment)?

There are various organizations that embarked in high risk strategy that resulted in some sort of failure among them one is the British Broadcasting Corporation which is described below:

Overview of the organization

The British Broadcasting Corporations signify a form of broadcasting which is clued-up by the attitude of public services. It is a pioneer in broadcasting and for many years and is a public monopoly organization. Basically, the association get on on the policy of giving the public what they thought is good for them rather than what they want .Today, it exists in a competitive world with its future estimate in the international contexts.

Its home programmers and broadcasts make fund from the levy of TV license fees and from its profit-making activities. For the license fee of BBC to be justified, it is requisite to fabricate high rating shows which are not usually broadcasted by the business broadcasters. The BBC management is free from straight intervention of the government with its actions supervised by the BBC Trust, the previous Board of Governors. The Direct General chosen by the Trust holds the universal management of the firm.

The PEST Analysis:

This analysis in attendance is the external factors which caused the strategic dilemmas and affected its strategic decisions.

Political Factors.

Ø      Government limitations on license fee contract.

Ø      Country’s legislation on outsourcing programme manufacture.

Ø      Preventive legislation from other regime towards the nature of fresh media.

Ø      European Union Competition Regulation barring the abuse of foremost position which may influence the trade among member states

Environmental Factors.

Ø      Geographical partition which limits right to use to technology.

Social Factors

Ø      Growing consumer demand on content.

Ø      Difficulty of the poor people to access different kind of services.

Technological Factors

Ø      Modernism in new media variety and channels

Ø      Media combination and Digitization.

Ø      Integration of customer policy and devices.

Reasons of this business failure due to high risk are as given below:

This company faced the risk of coming out as bureaucratic and inflexible. In recent years showed that BBC to adapt a commissioning model which makes them less of the programmer and more of the designer of programs made by independent production house. However, these two differs in terms of structure cultures and skills.

Among the numerous advantages of the BBC is its inbuilt creativity. However, this necessary element has reduced and become marginalized. Historically, the BBC is run under a bureaucratic and hierarchical structure that is characterized by strong values surrounding the public service ethos. However, these carry out are changed gradually. Ultimately, the BBC was portraying to be an expensive, elitist and lacking of customer focus. This kind of criticism led to an organizational reorganization including the approval of a commissioning form. Throughout the few years of completion, this move has caused the amplified loss of key talents in each the useful function areas of the firm.

Former to the absolute adoption of the commissioning model, the association is countenance with the dilemma of choosing the kinds of programs it will offer to the viewers. The survivals of competitors from around 200 channels create clear threat to the BBC. The increasing prices for talent and broadcasting cost make it even further tricky for the organization to remain pace with the competition.

BBC was indicting of take up market popular programs such as those of the ITV to attract more viewers. The popularization of the UK broadcasting business also led to smaller ground breaking programs because they are high as well as too risky in an industry that has turn into obsessed in ratings.  Therefore, good quality program are less probable to be created.

References:

1. Johnson, Whittington and Scholes (2011) Exploring Strategy, 9th Edition, Pearson Education, Chapter 6

2. Johnson, Whittington and Scholes (2011) Exploring Strategy, 9th Edition, Pearson Education, Chapter 11


3. http://ivythesis.typepad.com/term_paper_topics/2009/09/case-study-british-broadcasting-corporation.html#ixzz2AuIDRkjN accessed on march 30th 2013