Running Head: STRATEGY MANAGEMENT
Strategy Management
Name
Subject
Institution
Date
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Question 1: Reasons Why Strategy Evaluation Is Becoming Increasingly Difficult With the
Passage of Time
Strategy evaluation is a very vital practice in an organization well-being; timely
evaluation can alert management to problems or potential problems before the situation becomes
critical .Strategic evaluation is based on three parts which include examination of base on which
strategies are developed, comparing expected and actual results and performance conforming
plans development.
Adequate and timely feedback is the cornerstone of effective strategy
evaluation. Strategy evaluation can be no better than the information on which it operates.
Strategy evaluation is becoming increasing difficult with the passage of time, for many reasons.
The main reason is rapid change faced by world and domestics economics, in past time it was
stable but is part of current economics. Life cycles and development cycles of products were also
longer in past which supported strategic evaluation but things have changed now and so is
strategic evaluation is becoming difficult. Too much emphasis on evaluating strategies may
become expensive and counterproductive. Nowadays there is stiff competition among
organization and also due to the nature that foreign companies are becoming strong and some
policies to regulate industries are being faced out. Since the evaluation strategy is a long lasting
process it may not yield to what the organization want for the shortest time possible. This is
mainly due to some dramatic change that has led to environmental complexity, increasing
challenges of predicting the future with accuracy, some plans are becoming obsolete, too many
variable that are difficult to control some, and the urgency on degree of certainty in planning.
Question: 2 Characteristics of an Effective Evaluation System
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For strategy evaluation to be effective it must meet several basic requirements.
First; strategy-evaluation activities must be economical to the organization providing
only adequate information for prosperity. The evaluation activities should be
purposive, and directed toward the organization objectives. They should provide
managers with useful information about tasks over which they have control and
influence. Strategy-evaluation activities should provide timely information; on occasion
and in some areas, managers may need information daily. Strategy evaluation should
be designed to provide a true picture of what is happening. For example, in a severe
economic downturn, productivity and profitability ratios may drop alarmingly,
although employees and managers are actually working harder. Strategy evaluations
should portray this type of situation fairly. Information derived from the strategyevaluation process should facilitate action and should be directed to those individuals
in the organization who need to take action based on it. Controls need to be actionoriented rather than information-oriented.
The strategy-evaluation process should not dominate decisions; it should foster
mutual understanding, trust, and common sense enhancing cooperation among
department in evaluating strategies. Strategy evaluations should be simple, not too
cumbersome, and not too restrictive. Complex strategy-evaluation systems often
confuse people and accomplish little. The test of an effective evaluation system is its
usefulness, not its complexity.
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Question: 3 Some of the Reasons for and Against the U.S. Adopting International Financial
Reporting Standards (IFRS)
U.S have adopted the IFRS because it them to reflect the increasing demand for high
quality standards that can improve the quality and comparability of financial reporting and
promote the development of national capital markets and the integration of markets
internationally and has promoted cross border investment . With capital market development
there is strong links on the U.S legal and financial infrastructure and the maturity of its capital
market. The impact of IFRS on efficient operation of capital market is outstanding, the share
price and on return and in relation to international investors. With adopting the IFRS the market
liquidity has enormously increased with decrease in cost of capital and increase in equity value
with high degree of transparency. Since U.S has a very clear legal framework it is quite easy to
have an increased benefit which in turn reflects enhanced information comparability. Through
adoption of IFRS, the IFRS reveal new firm specific information and subsequently reduces the
surprise in future disclosures.
Despite the many benefits that come with IFRS, the system is likely also to have a greater
impact in debt market than equity market. The may lead to, increases in foreign debt investment
flows because it’s not dependent on governance quality, consistent with covenants in bond
contracts being used to offset U.S weaknesses in investor protections. Since IFRS depends
highly on the level of enforcement (or, the legal setting and business and financial reporting
culture), if there are no adequate incentive for appealing the report there may be benefits for
cerebration.
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Question 4: Most Commonly Used Quantitative Criteria to Evaluate Strategies
There are four most commonly used criteria to evaluate strategies namely; consistency,
consonance, feasibility, and advantage.
Consistency
A strategy should not present inconsistent goals and policies. Organizational conflict and
interdepartmental bickering are some problems that result from strategic inconsistency.
Examples that indicates that organizational problems are due to inconsistencies in strategy;
continuity of managerial problems despite changes in personnel resulting from issue-based
strategy; regarding failure of other department if one organizational department succeeds; when
problems and policies are to be addressed by the top management.
Consonance
This involves examining sets of trends as well as individual trends in evaluating
strategies to check they adaptability to the external environment. For example, the boom of some
products comes came about as a result of combined many trends that included a rise in the
average level of producers, increased income level, and reduced tax on some product by states
Feasibility
A strategy must neither overtax available resources nor create unsolvable sub problems.
Feasibility tries to ascertain whether the strategy be attempted within the physical, human, and
financial resources of the enterprise? The financial resources of a business are the easiest to
quantify and are normally the first limitation against which strategy is evaluated. A less
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quantifiable, but actually more rigid, limitation on strategic choice is that imposed by individual
and organizational capabilities. For example, in evaluating a strategy, it is important to examine
whether an organization has demonstrated in the past that it possesses the abilities, competencies,
skills, and talents needed to carry out a given strategy.
Advantage
A strategy must provide for the creation and/or maintenance of a competitive advantage
in a selected area of activity. Competitive advantages normally are the result of superiority in one
of the resources, skills, or position. Position can also play a crucial role in an organization's
strategy. Once gained, a good position is defensible-meaning that it is so costly to capture that
rivals are deterred from full-scale attacks. The principal characteristic of good position is that it
permits the firm to obtain advantage from policies that would not similarly benefit rivals without
the same position. For example, creation of infrastructure helps the organization around to enjoy
external economies of scales.
Question 5: How Japan is dealing with problems associated with an aging and shrinking
workforce
Japan has continued to experience greater changes her demographics and the country are
expected to lead to both a labor shortage and to insufficient resources to care for the elderly
people. However, the country has adopted some measures to try and trickle this downward. It has
presented itself with a number of choices to augment the workforce and cope with elder care
issues. The adoption of a few social solutions could ameliorate the problems associated with
population decline, although on short term basis. For example, to cater for labor shortage the
country has harmonized immigration policy, to encourage more people to the country thereby
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employing them, it has greatly also encourage female participation in the workforce, and even
encouraged greater employment for the elderly workers. Since the country does practice extreme
culture homogeneity there is no complication experienced upon foreign immigrant. The country
has also heavily invested in robotics and automation to help to bridge the shortfall both in the
workforce and in elderly care. Since 1928, Japanese Engineers and Scientist have continued to
create machines that reproduce the human form and movement. The adoption of technology has
the country workforce and thereby promoting economic development. Through automation the
shortage of workforce has been addressed. Special types of robots have been developed with
greater flexibility; they trained to do therapist and other to care for the elderly.
Question 6: Five reasons why preserving the environment should be a permanent part of
doing business
o To promote cohesion-By preserving environment the business people are in a
better position to co-operate in an effective manner with the different authority
and at the same time boost cohesion among its members.
o Quality preservation-With desirable working environment the customers tend to
view your business as one that has got higher quality product in comparison with
your competitor in the market.
o For international recognition-A business earns international recognition if it
complies with the set international standards regarding the benefits it obtains by
practicing environmental management.
o Increase worker morale-With a good working condition the workers morale is
boosted which translates to increased productivity and hence fetching high
revenues.
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o Minimize resource wastage-Working in good condition has direct relation with
resources usability. This helps to minimize time wastage and other useful
resources thereby avoiding reworks which use extra resource and increase
production cost.
I agree that the above reasons are good for every business to adopt as far as business and
environment is concerned. For the business enjoy a bigger market its business environment plays
a very vital role. Even though there is an expected cost for it, the profits fetched are huge enough
to cater for that and still be left with more.
Question 7: Why whistle-blowing is important to encourage in a firm
There is a greater desire for every firm or organization to have some honest individual
amongst their employees. Such an element allows for complete dedication to the organization's
mission, and success. By encouraging a whistle blowing culture within the organization, the
organization promotes, transparent structure and effective, clear communication. Whistle
blowing, also, is a necessary facet within an organization. Without it, fraud, misconduct,
and failure become prominent within an organization. Once such kind of issue are identified and
acted upon the firm will accrue benefits that could have otherwise led to not only loss of resource
but could also ruin the firm reputation. Whistle blowing helps the firm to create a culture that
encourages early by employees to the attention of their bosses to act on. Firm encourage whistle
blowing policy to their employees to encourage them to voice out if they have legitimate
concerns about wrongdoings. Firm can create a code of conduct to set rules for employees to
make reference to laws, rules, regulation and directives applying to that organization operation.
The code helps employees to know about their obligations to the firm and to their colleagues.
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The application of whistle blowing policy assures the employees that they will not be subject to
reprisal as long as their concerns are legitimate. For example, the chief magistrate was notified
by his junior on how some lawyer were planning to overthrow him following a certain
jurisdiction to a certain business man in illegal drug dealing.
Question 8: How business ethics, social responsibility, and sustainability are interrelated
A proper strategic plan helps the business to accomplish the set goals and give an
indication where time and resource should be channeled in realizing the business plan. The
strategic plan is the road map to how to get the desired end result. To build a successful strategic
plan a business needs to understand who they are and how the market perceives them. To realize
the strategic plan ethical issues should be in the fore front. Ethics should be part of a business
mission statement so that it provides guidance for all to follow. Through business definition it
becomes quite easy to build a strategic plan thus helps to emphasis on their values for the
purpose of achieving organization objective while ethics plays an important role in the company,
it helps to create social responsibility for each employee to play their role to realize the company
goal. The social standard for individual in company helps the company have consistency in its
operation which is a key aspect in sustainability. For example, Coca-Cola company practice
fairness in treating its employees on the basis of the company performance in the market and the
profits obtained. By so doing the workers morale is boosted and this enhance efficiency,
profitability thus providing goods and services at the price and quality that meets the customer’s
needs.
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Reference
Chan, C. K. (January 01, 2006). Renegotiating the Social Contract: Challenges to Health and
Social Policy in Japan. Japanese Economy, 33, 4, 128-1
Sloman, J. (2008). Economics and the business environment. Harlow: Financial Times Prentice
Hall.
Teece, D. J. (2008). Technological know-how, organizational capabilities, and strategic
management: Business strategy and enterprise development in competitive environments.
New Jersey: World Scientific.
Welford, R., & Gouldson, A. (1993). Environmental management and business strategy.
London: Pitman Pub.