Introduction
Strategic management is a process that involves a systematic approach to the creation and implementation of plans, goals, and objectives aimed at achieving long-term success for an organization. The objective of strategic management is to align the organization’s resources and capabilities with its vision, mission, and values, thereby ensuring sustainable competitive advantage. Strategic management theory refers to the body of knowledge that has developed over the years to explain how organizations can effectively plan, execute and evaluate their strategies. There are various schools of thought that have contributed to the development of strategic management theory, including the resource-based view, the institutional perspective, and the dynamic capabilities approach. The relationship between strategy, innovation, and change is critical in today’s rapidly changing business environment. Organizations that are able to develop and implement innovative strategies are more likely to adapt to changes in their environment, thus ensuring their survival and success.
On the other hand, organizations needing help to develop and implement innovative strategies risk becoming irrelevant and losing market share. This paper will focus on Company Z. This tech company aims to provide an in-depth understanding of the strategic management process and its impact on innovation and change within the company. In today’s fast-paced and constantly evolving technological world, companies need to be ahead of the curve to stay relevant and successful.
Critical Literature Review
Strategy development is a crucial aspect of organizational management and is often a significant determinant of organizational success. There are numerous theories that have been developed over the years to help organizations understand and implement effective strategies. For instance, a Resource-Based View (RBV) theory emphasizes the importance of a company’s internal resources and capabilities in shaping its strategy. Organizations need to identify their strengths, weaknesses, opportunities, and threats in order to develop a strategy that leverages their unique abilities. The Resource-Based View (RBV) theory is particularly important for tech companies like Company Z. The fast-paced nature of the technology industry means that organizations must constantly evaluate and leverage their internal resources and capabilities to stay ahead of the competition.
The RBV theory suggests that a company’s unique resources and capabilities can give it a competitive advantage in the market. For a tech company like Company Z, this might include its intellectual property, such as patents and trademarks, skilled workforce, and technology infrastructure. By identifying its strengths and weaknesses, Company Z can develop a strategy that leverages its unique capabilities and creates a barrier to entry for competitors. One of the key benefits of the RBV theory for tech companies like Company Z is that it recognizes that a company’s internal resources and capabilities can change over time. This means that companies must be proactive in identifying and developing new resources and capabilities that will give them a competitive edge in the future. For example, Company Z might focus on developing new technologies, hiring highly skilled employees, or building more robust technology infrastructure.
Also the RBV theory also helps organizations to focus their attention on the areas where they are most likely to succeed. For example, if Company Z has a strong patent portfolio, it might focus its strategy on protecting and leveraging its intellectual property. On the other hand, if Company Z has a highly skilled workforce, it might focus on developing new products and services that take advantage of its employees’ expertise.
An illustration of the Resource-Based View (RBV) theory in action may be seen in the competitiveness of companies such as Apple Inc., Samsung Electronics, and Company Z. The RBV hypothesis states that the distinctive resources and capabilities of a business can give that business a competitive advantage in the market and that for a business to remain one step ahead of its rivals, the company must continually evaluate and make use of its unique resources and capabilities.
In the cases of Apple, Samsung, and Company Z, each of these companies has its unique collection of resources and competencies that give it an advantage over its competitors. Take, for instance: Apple enjoys a high level of brand recognition in addition to having a devoted customer base. Its product design and user experience are quite distinct from its competitors, providing it an advantage in the market. Samsung significantly emphasizes research and development as well as new product development. Because of this, they have been able to rapidly introduce new products to the market and maintain a lead over its rivals. Company Z may have an advanced technology infrastructure and a highly qualified workforce. This gives it an advantage over its competitors in terms of designing and putting into practice cutting-edge technology solutions.
Indeed, each of these companies is constantly conducting research and making use of the resources and capabilities that are unique to it in order to remain one step ahead of the competition. For instance, Apple may place a higher premium on the user experience. In contrast, Samsung may place a higher premium on research and development, and Company Z may place a higher premium on technical infrastructure.
From the leadership perspective, many scholars have written various scholarly and empirical works to rationalize strategic management theories. Indeed according to Siegel and Sohvi (2018), there are few theoretical frameworks to choose from when discussing the organizational issues and strategies of tech organizations. However, strategic management theory provides an opportunity to explore these difficulties, such as growing rivalry, tighter financial limits, and higher expectations held by various stakeholders. More specifically, the dynamic capabilities framework has emerged as a helpful tool for universities to manage essential issues better, such as commercializing their innovations, partnering with industry, and promoting economic and social development in their respective regions. This is because the framework is designed to help universities better understand the interplay between economic growth and social progress.
The classical theory of strategy, also known as the industrial organization (I/O) model, is a traditional approach to strategy that focuses on a company’s internal and external environment and how it affects its competitiveness. This theory posits that a company’s success is primarily determined by its ability to achieve and maintain a competitive advantage. In the context of tech companies, the classical theory of strategy plays a crucial role in determining the success of these organizations. Tech companies operate in a rapidly changing and highly competitive industry and must continuously adapt to changing market conditions to maintain their competitive edge.
One of the critical elements of the classical theory of strategy is the analysis of a company’s internal and external environment. Tech companies must constantly assess the strengths, weaknesses, opportunities, and threats (SWOT analysis) of their internal operations and the external market to develop strategies that will enable them to stay ahead of their competitors. For example, a tech company may analyze the strength of its existing technology and the threat posed by emerging technologies to determine if it needs to invest in research and development to stay ahead. Another key aspect of the classical theory of strategy is the identification of a company’s core competencies and how they can be leveraged to achieve a competitive advantage. Tech companies often have a strong focus on innovation and must continually develop new products and services to remain relevant in the market. This requires a deep understanding of the company’s core competencies and how they can be used to create value for customers.
According to Howard, the classical theory of strategy is characterized by a focus on the systematic analysis of the external environment and the internal resources of an organization in order to develop and implement effective strategies. This approach involves considering the strengths and weaknesses of an organization, as well as the opportunities and threats posed by the external environment, in order to develop a strategy that will enable the organization to achieve its goals. The author also discusses the role of the strategist in the classical theory of strategy. He argues that the strategist must be a leader who is able to think critically and make decisions based on sound analysis. The strategist must also be able to communicate the strategy effectively to all stakeholders and ensure that the organization is capable of executing the strategy. Indeed, in “The full-range leadership theory: the way forward,” John Antonakis and Robert House propose the full-range leadership theory, which is based on the idea that leaders can positively impact their followers and organizations by inspiring and motivating them. They argue that there are different types of leadership, including transformational leadership, transactional leadership, and laissez-faire leadership, and that each type has a different impact on followers and organizations. Transformational leadership, which is the article’s focus, is characterized by a leader who inspires and motivates followers to achieve a common goal. The authors argue that transformational leaders can create a shared vision and align the goals of their followers with the goals of the organization. They also argue that transformational leaders are able to create a positive organizational culture, which is critical for the development and implementation of successful strategies.
Scholars like Higgs (2003) examine how ideas about leadership have evolved through time and where they fit into the dominant discourses of the era in which research was done. The author defends the idea that if a “sense making” paradigm is used, the problem will be solved. A leadership paradigm that applies to the environment of complexity and change that organizations face in the early twenty-first century becomes discernable. This paradigm takes shape when we shift our focus from the leader’s effect on the organization to the leader’s influence on their subordinates and the development of their skills. Changing organizational logic from a Weberian rational/analytical one to one that incorporates emotional concerns supports the need for this change. It has been argued that emotional intelligence plays a crucial role in leadership. The study provides findings from recent literature that empirically establish causal links between EQ and leadership effectiveness, and the results are analyzed in light of the Emergent theory.
The evolutionary theory of strategy proposes that organizations evolve and adapt their strategies through time through a succession of incremental modifications rather than radical overhauls. This notion is fundamental to technology companies operating in a quickly changing and highly competitive environment where adaptability and evolution are critical to success. For instance, technology businesses evolve their strategies incrementally via trial and error, learning, and adaptation. This process is influenced by internal and external factors such as technological advancements, market conditions, and competitor conduct. As the company grows, it is able to fine-tune its tactics and strengthen its competitive position.
According to this theory, in order to remain competitive, technology companies must be flexible and adaptable. Companies must be able to respond swiftly to market developments and developing innovations in a rapidly evolving tech economy. This triggers a continual development and learning culture in which employees are encouraged to experiment, take chances, and learn from their mistakes. Technology firms must be proactive in influencing their environment and providing possibilities for growth and development. This necessitates an emphasis on innovation and the creation of new products, services, and business models. Tech firms must be able to recognize and pursue new opportunities, as well as pivot rapidly when necessary.
Barnnet and Robert (1996) argued that the study of strategic management should be approached from an evolutionary viewpoint. This would involve using dynamic, path-dependent models that allow allowances for possible random variation and selection inside and between firms. They suggested that by adopting this point of view, we can focus on some of the most intriguing challenges in strategic management. The articles that contributed to this special issue are summarized, and some of the implications that those articles have for developing an evolutionary viewpoint on strategy are discussed. Collectively, the papers draw on a variety of theoretical rationales, illuminating how an evolutionary perspective can help to integrate the diverse and otherwise separate theoretical traditions that meet within the realm of strategic management and illustrating how this can be accomplished with the aid of an evolutionary perspective.
As per Sarros and Joseph (2001), the majority of CEOs are of the opinion that both leadership theories, when put into reality, have both strengths and disadvantages. that primary leadership strengths are found in the behaviors of executives, particularly those relating to role modeling, coaching, and consideration. The failure to motivate and challenge personnel beyond what is expected of them is one of the company’s significant flaws. In their study, they investigate a variety of other aspects of both the transformational and transactional leadership characteristics that they identify. Their article provides a list of leadership methods and approaches that can be used to achieve positive results.
In their book “Transformational Leadership,” Bernard Bass and Ronald Riggio explore the concept of transformational leadership, which is a leadership style that focuses on inspiring and motivating employees to achieve their full potential. The authors argue that transformational leaders have a profound impact on the individuals and organizations they lead and that this impact is evident in increased motivation, job satisfaction, and overall organizational performance. The scholars describe transformational leadership as a multi-dimensional construct that involves four key components: idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration. Idealized influence refers to the leader’s ability to serve as a role model and inspire others to follow. Inspirational motivation refers to the leader’s ability to articulate a vision and motivate employees to work towards it. Intellectual stimulation refers to the leader’s ability to encourage creative thinking and problem-solving. Individualized consideration refers to the leader’s ability to provide support and guidance to individual employees.
The growth and success of Company Z are all directly tied to the interconnected notions of strategy, innovation, and change. A company’s strategy is comprised of all of the plans and choices it has taken in order to work toward achieving its objectives. It include assessing the resources and actions required to fulfill the organization’s goals, in addition to establishing the purpose of the organization, which includes specifying its target market. For instance, Amazon’s goal is to become the world’s most customer-centric firm by offering customers a diverse selection of goods and services while also working to enhance the overall quality of the experience they have shopping with the company. The development and introduction of new concepts, items, procedures, or services is what we mean when we talk about innovation. It propels an organization’s growth and competitiveness by continuously upgrading its offerings and producing new value for its customers. For instance, Apple is well-known for developing ground-breaking devices such as the iPhone, iPad, and Macbook, which have caused significant shifts in various markets and created entirely new ones. The process of adjusting one’s behavior in response to novel settings or circumstances is referred to as change. It entails making changes to an organization’s operations and culture and offers to keep up with current trends and maintain a competitive edge. For instance, to stay competitive in the quickly evolving media market, Netflix completely revamped its business model, shifting from one focused on renting DVDs to one that centers on providing a streaming platform.
The connection that exists between these three components is similar to that of a cycle. A clearly articulated strategy points an organization in the right direction and lays the groundwork for new ideas and approaches. After that, innovation leads to the creation of new products, services, or processes, all of which have the potential to shake up the market and propel change. In turn, change generates new opportunities for innovation and bolsters the organization’s strategy while allowing for its continued development and refinement. One example of Tesla’s approach is to hasten the shift toward the use of renewable energy sources all over the world. Its success is leading to the refinement of its strategy and continuing innovation, both of which are a direct result of the company’s innovations in electric vehicles and renewable energy products, which are driving change in the automotive and energy industries, respectively.
Scholars have varied thoughts about innovation, strategy, and change. In fact, Kenny (2003) suggests that project management and the implementation of strategy in an organization are related; projects are a tool for doing this. In order to evaluate how to effectively connect project management to strategic organizational processes, some of the most recent project management literature is analyzed, and a case study from the education sector is employed. Many different fields have effectively employed project management approaches. They are frequently used in IT innovations, construction, administration, and education. How to more precisely fit the methodologies to the character of individual projects has come under scrutiny in recent thinking.
The nature of various project types is investigated by examining initiatives involving significant amounts of change and/or innovation. Such initiatives sometimes necessitate numerous development cycles because of the ambiguity of their intended goals.
A system for classifying projects inside of an organization is created. The management of a business will be able to more effectively think through the effects of implementing strategic projects thanks to this and predetermined process guidelines. When tight processes are imposed, and management accountability mechanisms demand results, monitoring such initiatives can become problematic for a company.
However, John Alban-Metcalfe and Beverly Alimo-Metcalfe examine how leadership is evolving and the need for fresh thinking in both theory and practice. The authors contend that more than conventional theories of leadership, which concentrate on the traits and behaviors of the leader, is required to satisfy the intricate and evolving demands of modern companies. They postulate a novel method of leadership that they dub “relational leadership.” This method focuses on the interactions between leaders and followers and emphasizes how crucial it is for leaders to foster an environment that is encouraging and empowering for their subordinates. According to the authors, this strategy is crucial in today’s organizations, which are distinguished by rising complexity, variety, and ambiguity. In this regard, it is crucial to talk about the need for a fresh approach to leadership development. They contend that conventional methods of leadership development, which emphasize education and training, are unable to satisfy the demands of modern businesses.
Critical Analysis of Strategic Processes
Company Z is a leading global provider of innovative products and services in the industry. The company’s success can be attributed to its focus on strategic processes, which drive growth and competitiveness. In this analysis, three strategic processes within Company Z will be discussed, namely broad differentiation, integration of production, and investments and competitiveness. These processes are considered critical to the success of Company Z and will be analyzed in detail in relation to relevant theories.
Broad Differentiation:
Broad differentiation refers to the company’s ability to offer a wide range of products and services that are unique and distinguishable from its competitors. This approach is considered a key factor in ensuring that Company Z stays ahead in the highly competitive industry. According to Porter’s Five Forces Model, differentiation is a critical factor in reducing the bargaining power of suppliers and buyers and helps to reduce the threat of substitutes. Additionally, Michael Porter’s theory of the value chain states that a company can achieve a competitive advantage through the differentiation of its products and services. Company Z has been successful in differentiating its products and services through continuous innovation and R&D efforts, resulting in a strong brand image and customer loyalty.
Integration of Production:
Integration of production refers to the company’s ability to integrate different stages of production and distribution within its operations. This approach enables Company Z to reduce costs and increase efficiency. According to the Resource-Based View of the firm, integration of production can help to create unique capabilities and competencies that can provide a sustainable competitive advantage. Additionally, the theory of economies of scale suggests that increased integration can lead to lower costs due to increased production volume and increased efficiency. Company Z has been successful in integrating its production processes through the implementation of advanced technology and automation, resulting in improved productivity and cost savings.
Investments and Competitiveness:
Investments in technology, R&D, and human capital are critical factors in ensuring competitiveness and long-term success for Company Z. According to the Dynamic Capabilities Framework, investments in these areas can help to create and sustain competitive advantages by enabling companies to adapt to changing market conditions and opportunities. Additionally, the theory of innovation suggests that investments in R&D and technology can lead to the development of new products and services, which can provide a competitive advantage. Company Z has been successful in maintaining its competitiveness through ongoing investments in technology and human capital, enabling it to stay ahead in the industry and respond to changing market conditions.
Within the context of the theories that have been presented, broad differentiation refers to the process of developing a distinctive value proposition for customers by offering differentiated goods and services. The Resource-Based View (RBV) hypothesis, which claims that a company’s distinctive resources and competencies can be a source of competitive advantage, lends credence to this strategy. This approach is also supported by classical strategy theory, which emphasizes the significance of comprehending the requirements of the market and the requirements of the customers in order to devise a strategy that is differentiated from the competition. According to the evolutionary strategy hypothesis, businesses must consistently adapt their differentiation approach in order to remain competitive in the face of shifting market and industry conditions.
The goal of integrating several production processes is to achieve efficiency, lower costs, and improve quality. The RBV theory is supportive of this strategy since it argues that the integration of internal processes can lead to the production of resources and capabilities that are completely unique to the organization. This approach is also supported by traditional approaches to strategy, such as classical strategy theory, which emphasizes the significance of operating effectively in order to achieve a competitive advantage. According to the evolutionary strategy idea, in order for businesses to stay one step ahead of their rivals, they need to analyze and enhance the integration procedures they use consistently.
While investments in new technology, equipment, and processes are necessary to boost competitiveness, it is essential to note that such investments require financial resources. This strategy is supported by the Resource-Based View (RBV) hypothesis, which proposes that investments in distinctive resources and competencies can result in a competitive advantage. This approach is also supported by classical strategy theory, which emphasizes the significance of making financial investments in technological advancement and creative endeavors to maintain a competitive advantage over one’s rivals. According to the evolutionary strategy hypothesis, businesses are required to continually assess and alter their investment plan in order to remain competitive in the face of shifting market conditions and industry norms.
Assessment on the Engagement with the Strategy
The level of commitment shown by employees of Company Z toward the prioritized business goals of broad-based differentiation, production integration, investments, and increased competitiveness can be evaluated using a number of different metrics.
For example, the organization has a long-standing reputation for developing distinctive goods and services and for being known for its forward-thinking approach to problem-solving. The organization’s robust product development process enables employees from all different departments to collaborate and contribute their ideas. This process also fosters creativity and promotes idea generation. Additionally, the company places a strong emphasis on the customer experience, and input from clients is routinely solicited and analyzed to develop and differentiate products and services. Additionally, Company Z has a robust culture of innovation, and employees are encouraged to present new ideas and proposals for improving the quality of the experience that customers have with the company.
Company Z has a well-established production process, and the company often invests in new technologies and pieces of equipment in order to boost productivity while simultaneously lowering operating expenses. A culture of continual improvement permeates the organization, and staff members are strongly encouraged to contribute to this process by offering suggestions for new ideas and procedures that can be included into production. Additionally, it has a robust culture of collaboration, in which personnel from all departments work together to integrate procedures and improve the production process as a whole.
The reputation of the corporation is built on the significant amount of money it invests in research and development as well as technology. To ensure that it remains competitive in the market, the company places a significant emphasis on innovation and makes consistent investments in emerging technologies and product categories. The employees are strongly encouraged to participate in this process by offering fresh proposals and ideas for the development of new goods and services. It fosters employee training and development to ensure that employees have the skills and knowledge to support the firm’s investment in competitiveness. This ensures that the organization is able to attract and retain talented people.
This company does, in fact, have a culture of engagement and actively encourages its employees, management, and customers to contribute to its chosen strategies. Additionally, the company emphasizes innovation, continuous improvement, and customer satisfaction, all of which support the implementation of its chosen strategies.
Company Z has, from the very beginning, been a company that places a high emphasis on engagement and innovation, and this trait is readily apparent in the comprehensive differentiation approach that the company employs. The company’s management has been successfully brought on board with the implementation of this plan thanks to a variety of initiatives and practices that promote teamwork, inventiveness, and ongoing quality improvement.
Programs for Innovation: The company has developed a number of different innovation initiatives in order to encourage workers to present the company with fresh ideas and suggestions. A culture of innovation has been established within the company as a result of these initiatives, and management is actively participating in these initiatives, both of which contribute to the broad differentiation approach that the company employs.
Surveys of Employee Engagement: On a regular basis, Company Z administers surveys of employee engagement in order to collect comments and recommendations from staff members. Management is involved in the process of analyzing and putting these suggestions into action in order to improve the company’s products and services based on the feedback received from customers.
Collaboration and Cross-Functional Teams: The organization fosters an environment that is conducive to collaboration and cross-functional teams, with the goal of bringing together individuals who come from a variety of departments and fields of study. These teams collaborate with one another to create new goods and services for the organization as well as to improve its manufacturing procedures. In order to drive the differentiating strategy of the company, management is actively involved in these teams and contributes their experience and thoughts.
Customer-Centered Strategy: The strategy places a significant emphasis on the contentment of customers and is consistently on the lookout for new ways to enhance their overall experience. The feedback of the company’s customers is routinely collected, and the corporation makes use of this information in order to improve its products and services. Management is involved in this process to ensure that the overall differentiation strategy of the organization is in line with the requirements and preferences of customers.
Recommendations
The following tips can help to strengthen the strategic processes that are currently being utilized inside the company:
- Focus on Empowering Employees: The firm can enable its employees to participate in the strategic operations of the organization by giving those employees the tools, training, and support they require to be successful. This can include training and development programs for employees, frequent evaluations of their performance, and open communication channels where employees can share their ideas and comments.
- Encourage Employees from Different Departments and Areas of Knowledge to Collaborate Cross-Functionally One way that Company Z may continue to encourage employees from different departments and areas of expertise to collaborate cross-functionally is by establishing cross-functional teams. Because of this, employees will be able to collaborate on the development of innovative ideas and solutions that will help the organization enhance its strategic operations.
- Leverage Customer Feedback: The company can improve its strategic processes by regularly collecting and analyzing customer feedback and using this information to drive improvements in the company’s products and services. This allows the company to leverage customer feedback to improve its strategic processes. This may include things like customer surveys, focus groups, and analytics relating to customer happiness.
- Invest in New Technologies and Equipment: It has the ability to continue its investment in new technologies and equipment by devoting resources to research and development and purchasing both new technologies and equipment. Because of this, the corporation will be able to stay one step ahead of its rivals and keep the edge it currently enjoys over them.
- Encourage Employees to Identify and Implement New Ideas and Processes to Improve: the Company’s Strategic Processes in Order to Foster a Culture of Continuous Improvement The company can encourage its employees to identify and implement new ideas and processes in order to foster a culture of continuous improvement. This could include conducting frequent performance assessments, employee engagement surveys, and offering rewards to workers who make contributions to the strategic processes of the organization.
Conclusion
In summary, Company Z has a long-standing dedication to the strategic practices of broad differentiation, production integration, investments, and competitiveness. These processes are supported by applicable theories, including as the Resource-Based View of the Firm, Economies of Scale, and the Dynamic Capabilities Framework. Porter’s Five Forces Model is also one of these relevant theories. Because the company places a significant priority on innovation, customer experience, and staff involvement, it is able to successfully execute these strategic activities, which contributes to the company’s overall success. Metrics such as employee participation, feedback from customers, continual investments in technological advancement, and human resource development are some examples of metrics that can be used to assess the level of commitment to these objectives. Indeed the ability to guarantee that an organization’s resources and capabilities are aligned with its vision, mission, and values in order to maintain a sustainable competitive edge is the essence of effective leadership in strategic management. The development of strategic management theory has been influenced by a variety of schools of thought in the field of strategic management. These schools of thought include the resource-based view (RBV), and the dynamic capabilities approach, amongst others.
The RBV theory emphasizes the importance of a company’s existing resources and capabilities, such as its intellectual property, experienced personnel, and technological infrastructure, to mold the company’s strategy and establish a barrier to entry for new competitors. The dynamic capabilities approach educates firms on the dynamic relationship between economic expansion and social advancement. In today’s quickly shifting corporate environment, the interaction between strategy, innovation, and change is one of the most important factors to consider. Those businesses and organizations that are able to create and put into action novel strategies have a greater chance of successfully adjusting to the shifting conditions of their surroundings, which ensures their continued existence and prosperity. A key component of effective leadership in strategic management is maintaining a continuous evaluation and utilization of the organization’s one-of-a-kind resources and capabilities, as well as supporting a constant adaptation to changes in the external environment to ensure the success of the organization.
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