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Relevance of strategic management and its benefits
Relevance of strategic management and its benefits
Positives of outsourcing in the free market
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Every organization has its plan on how to execute different operations for achieving the set goals. Corporate strategy shows how to implement these activities and the expected results for the organization. Some of the activities have little impact on the overall performance of an organization and therefore the management takes an option of outsourcing them from the external markets. The company gives core businesses the first priority because they are the source of revenue for the company and better strategies taken towards their success.
Corporate Strategy, Outsourcing and Core Business Focusing
Corporate strategy
Corporate strategy shows the patterns of an organization which portray the missions, goals, policies, and guiding principles which outline how to achieve various plans and the type of business category to pursue. The strategy also gives the plan on the type of economic organization it intends to be in and the different plans for the members, employees, customers, and shareholders of the company. Corporate strategy applies to the whole organization in contrast with the business strategy which only concerns with the specific product which is on demand at a particular time. Corporate strategy enables superior performance of an organization through tough competition with others in the same field while focusing on the resources to achieve high returns at the end. Since it involves a process, the organization formulation and implementation are the aspects in analyzing the strategy. The senior executives who include the managers, the directors, and the chairpersons are responsible for the implementation of the organization’s corporate strategy (Foss, 2003).
How external turbulence encourages outsourcing
Many companies ...
... middle of paper ...
...ce efficiency (Mahadevan, 2010). As such, outsourcing is a good corporate strategy in the current business world.
References List
Dalal, J. (2011). Outsourcing in the Age of turbulence. International Association of Outsourcing
Professionals (IAOP): Global Business magazine. Retrieved from:
http://www.iaop.org/PrintContent.aspx?CTX=2&AID=3192&SID=34&SSID=175
Foss, J. N. Resources, Firms, and strategies: A Reader in the Resource-Based Perspective. Cape Town: oxford University Press. pp 54-55
Huber, B. (2011). The Great Procurement Outsourcing Debate: Important or Core Business
function. Technology Partners International, Inc. Retrieved from:
http://www.tpi.net/pdf/pointofview/POV-The-Great-Procurement-Outsourcing-
Debate.pdf
Mahedevan, B. (201). Operations Management: Theory and Practice. South Asia: Dorling Kindersley (India) PVT. Ltd. p 49
a. Basically, corporation strategy demonstrates a corporation’s overall direction in the light of its general mindset toward growth and the management of its businesses and product portfolios. There are three crucial categories, which are stability, growth, and retrenchment, that involve within corporation strategy. Additionally, business strategy often occurs at the business unit or product level, and it highlights the improvement of the competitive position of a company’s products and service in the particular market segment served by the business unit. Competitive and cooperative strategies are two main categories that match within business strategy. Furthermore, functional strategy is the method that through a functional area to
One the other hand, corporate strategies consider about the selection of direction for a company as a whole and the management of its business or
Business strategy is the means by which firm’s plans to achieve its goals and objectives. It can also be termed as organization long-term planning. The strategy covers periods between 3-5 years and sometimes longer. Businesses use two major types of strategy, general or generic and competitive strategies. The overall strategy involves strategies of growth, globalization and retrenchment. The competitive advantage includes low pricing, product and customer differentiation. We will look at the business strategy used by Marks and Spenser (Cole, 1997). The company is a British multinational located at Westminster London and specializes in clothes and luxurious food products.
Selecting a business strategy that details valuable resources and distinctive competencies, strategizing all resources and capabilities and ensuring they are all employed and exploited, and building and regenerating valuable resources and distinctive competencies is key. The analysis of resources, capabilities and core competencies describes the external environment which is subject to change quickly. Based off this information a firm has to be prepared and know its internal resources and capabilities and offer a more secure strategy. Furthermore, resources and capabilities are the primary source of profitability. Resources entail intangible, tangible, and human resources. Capabilities describe environment and strategic environment. Core competencies include knowledge and technical capability. In this section we will attempt to describe in detail the three segments which are resources, capabilities, and core competencies.
But outsourcing decisions tend to be a good choice when companies are trying to reduce the cost of capital or maybe labor intensive processes. Other reasons to consider outsourcing today are increased flexibility to adjust output in response to changing demand, gain access to new process or network technologies, or leverage external expertise.
Business institutes are in front of stirring and dynamic challenges in the 21st century. In the globalised business, Texas Chicken requires strategic ideas and only by developing good corporate strategies can they become deliberately competitive. A sustained or sustainable cutthroat advantage occurs when compact implements a value – constructing strategy of which other companies are incapable to duplicate the benefits or find it too pricey to initiate. Texas Chicken corporate strategy includes the commitments, decisions and actions required for a firm to achieve deliberate competitiveness and produce above average returns. Business Corporate Strategy Strategic management is basically required for every business and it proffer several benefits.
Outsourcing has been around for many years. In this paper I will discuss some of the history of outsourcing, the goods things about outsourcing, and the bad things about outsourcing.
S, Tywoniak 2007, Making sense of resource based view, Academy of Management Conference, University of Technology, Australia.
It is also perhaps not feasible to evaluate the attractiveness of an industry independent of the resources a firm brings to that industry. It is thus argued that this theory be coupled with the Resource-Based View (RBV) in order for the firm to develop a much more sound strategy. It provides a simple perspective for accessing and analysing the competitive strength and position of a corporation, business or organisation.
Acedo F.J 2006, ‘The Resource Based Theory: Dissemination and main trends’, Strategic Management Journal, Vol. 27, pp. 621-636.
Ovidijus, J. (2013, October 14). Strategic Management Insight: Resource Based View. Retrieved November 6, 2014, from http://www.strategicmanagementinsight.com/topics/resource-based-view.html
This strategy emphasizes the use of an organization’s resources and capabilities to achieve a core competence that cannot be imitated by competitors. Furthermore, the resource based school argues that if an organization distinctively improves its internal capability; that is being able to have effective inside machinery to deliver products and services to customers, the organization will enjoy a massive advantage in the market. This school also argues that in order to have a competitive advantage, an organization must have resource and capabilities that are sophisticated to those of competitors (QuickMBA, 2010).
A successful business strategy will identify changes in the external trends in the market place. Plan out what the company’s future direction is. Set out the goals for the management team. It will identify a vision of where the company wants to be in the future. Keep all employees informed of the direction of the company.
The main problem Bharti Airtel Limited facing is "How to manage its capital expenditures for its operations and how to face the expected exponential growth and a competitive environment." The challenges that the company is facing are
A strategy which is adopted by an organisation indicates what area the firm intends to do well in.