Strategic Management on the Workplace - Essay Example

Strategic Management At Workplace Contents Introduction 4 Discussion 5 Conclusion 14 References 15 Introduction Strategy can be defined as a valuable and unique position that encompasses different kinds of activities. These strategies are formulated by an organization so as to remain competitive in the industry. There are many firms who consider the process of strategic planning to be their core principle. Strategy basically requires one to make trade-offs as to which of the policies to choose or not to choose. There are various theoretical frameworks which are based on the procedure of strategic planning or rather change management initiative. Three reasons are there for which trade-offs are necessary they are inconsistencies in reputation or image, different configurations are essential for different positions, etc. A strategy which is framed by an organization enables a firm to achieve the best fit amongst all its activities. In this study a critical analysis will be performed on different theories which describe the major aspects of strategic planning. The entire study would even highlight the difference between operational effectiveness and strategic planning. On the other hand the study would even outline the importance of leadership to manage such strategic planning. These strategy formulations often lead to widespread changes throughout the system. In context of change management it is essential that appropriate leadership approach is adopted so that change can be communicated effectively throughout an organization. It is even important that there is a common goal set for the change so that all team members can efficiently accomplish the set goals or objectives. The company to be focused on is Toyota Motor Corporation. Over the years this multinational corporation has been able to set high quality standards and believes in constantly upgrading its business operations so that best service and products can be delivered to the customers. In this particular study strategic planning objectives and change management initiatives associated with Toyota Company would be thoroughly analyzed and will be related to theoretical frameworks. Discussion Strategy is a mechanism which brings forth stability in an organization and there are various factors which actually defines well the concept of strategy. A strategy which is adopted by an organization sets forth a new direction for the organization; it defines an organization, focuses on overall effort of an organization and even provides required consistency so that an organization can achieve its desired goals and objectives (Whittington, 2001). In the present scenario there is an opportunity for all automotive companies to adopt green technology and transform their product line to green vehicles. Toyota as an automobile company has tried their best to remain competitive as well as offer innovative features which cannot be easily imitated by any other players in the market place. However when the company witnessed that their operational procedures are facing tough competition than they incorporated a strategic plan that could have give them a competitive edge. This plan was focused towards adopting best measures which could reduce the level of environmental damage caused by their manufacturing process (Ali and Kaynak, 2012). It can be stated that this strategic initiative was framed so as to ensure customers that their operations are closely associated with delivering high quality. The main aim of the company was to develop a carbon free zone which meant that all of their production operations were free of carbon content. As per Mintzberg’s scan of theory of strategic planning, the strategy of the company can be stated as a school configuration process. In this framework a company basically implemented a strategy so as to bring forth certain kind of transformation into the system (Andersen, 2006). However the strategy was more aligned towards remaining competitive in the market place than to transform the entire mechanism of their operations. In the initial phase of strategy formulation there are three kinds of models which can be applied directly to an organization known as design school model, planning school model and positioning school model. Design school model is often considered to be the most influential approach in the strategy formulation procedure. This model is mostly dependent on SWOT analysis of an organization, as it states that this method helps in identifying the probable opportunities which can be explored by an organization by eliminating all possible threats in external environment. The model describes that SWOT analysis helps in identifying core competencies and key success factors. These factors help to develop strategies and amongst them the best fit solution is chosen taking into consideration managerial values and social responsibility. On the contrary, planning school model states that the entire procedure of strategy formulation cannot be based on SWOT analysis and hence it incorporates certain significant steps such as objective setting, external audit, internal audit, strategy evaluation, strategy implementation and overall works scheduling. In this model the main aim is not only to develop probable strategies but even to allocate resources which can ensure effective implementation of the strategy (Andrews, Cameron and Harris, 2008). On the other hand, positioning school model states that there can be wide array of strategies which can prove to beneficial for a company but only few or rather one such strategy is there which can be used against the competitors. The strategic planning process at Toyota Motor Corporation can be considered to be a mixture of all the three models. In real time scenarios it is often difficult to categorize a change management initiative as per any specific model (Boxall and Purcell, 2003). The major issues related to Toyota Motor Corporation was the fluctuating rate of fuel prices, weak presence in some of the emerging markets across the globe, intense competition and new standards of emission. Objectives for formulation of the new strategy are quality improvement, minimizing environmental impact, enhancing levels of customer satisfaction and maintaining high standards of emission rate. The capabilities of the organization is its innovative culture, brand reputation which is been valued to be $30 billion, strong portfolio of the brand and the company is an industry leader in terms of sales and production (Cole, 2003). There are certain problems witnessed by the company such as increasing costs, less revenue margins, large recalls, instable government conditions and too complex structure of agreement. On basis of these factors it can be stated that there are multiple strategies which could have been adopted by the company. Firstly in order to sustain in the competitive market the company can innovate new product line. This would help the firm to attract a lot of customers who are inclined towards innovative products. On the other hand, the company can even acquire those automotive firms which possess required competencies but due to certain investment issues is not able to perform well in the global markets (Hayes, 2010). The company could even enter into any form of contractual agreement where it can gain required expertise from any such foreign companies. This kind of agreement would enable the organization to train their employees in appropriate manner so that they are able to maintain high standards of quality. There is another strategy which was chosen by the company for its long term benefits which is adoption of green mechanism. Through this strategy the organization would be able to manufacture green vehicles. In present scenario majority percentage of pollution is created by carbon emission from automobiles. This even has an impact on consumer behavior as they tend to be more conscious or rather environmental friendly (Hiatt and Creasey, 2003). The concept of green vehicles will not only support the company to earn high revenue margins but would enhance the brand image of Toyota Motor Corporation. It can be stated that this approach of carbon free production will not only safeguard social responsibility of the company but will even encompass promotion of an innovative product that cannot be easily imitated by other players in the market place. According to Michael Porter the best strategy should be implemented by an organization which can be regarded as a best fit in relation to diverse activities of a firm (Iqbal, 2011). For Toyota the best fit solution is to adopt such a strategy which would given them a competitive advantage and even facilitate long term gains. There are three major sources as per Michael Porter on basis of strategic positioning is achieved. They are variety based, needs based and access based strategic positioning. Toyota Motor Corporation was at a phase when they aimed towards transforming their operational procedure. Hence it was more of variety based positioning where a company produces best possible services or products utilizing various set of expertise. However in economic sense this form of strategic planning cannot be considered as viable since it encompasses huge amount of investment. As per Michael Porter all such strategic planning either requires core competencies which an organization possess or certain previous qualities that needs to be applied again. In present scenario an organization basically develops a strategic plan on the basis of their core competencies. It can even be stated that success of implementation of such strategies is totally dependent on the expertise possessed by an organization. The three types of fits as stated by Michael Porter drives sustainability and competitive advantage. Toyota can proclaim its change management initiative to be best fit as it is simply consistent between overall strategy and its activities (Jeffs, 2008). The entire strategic planning as per theoretical frameworks takes place in ten important steps. For instance, the first step for Toyota Motor Corporation was to agree upon the strategic planning process which even encompasses the key decision makers, next is to identify the organizational mandates, then clarifying the values and mission of the organization, assessment of external and internal environments, identification of various strategic issues, developing plan so as to address such issues, establishing a common vision and developing a strategic implementation process (Lasserre, 2012). In the overall procedure, importance is majorly given to assessment of environmental conditions and development and implementation of a strategic initiative that could mitigate various issues identified within an organization. On the other hand the approach of Strategy Change Cycle states that there are certain steps which ensure success of strategy implementation such as sequencing of steps, making proper use of issues, goals and vision, application of the process throughout organization as well as organizational boundaries, and appropriate role of implementers, planners and decision makers. This cycle in real time cases cannot ensure success of any strategic initiative (Leopold, Harris and Watson, 2005). The reason behind this is implementation process is subjected to various hurdles and some of which are closely related to the workplace environment. In real world this theory does not hold much significance as success of any strategy depends on the organizational competencies, alignment of workforce towards common initiative and proper leadership approach to manage such change. Often these factors are not taken into consideration which is the main drivers of strategic change initiatives. The concept of strategic thinking is basically based on three major steps such as current position of the company, position where the company wants to be in nearby future and possible ways to succeed towards that position. For instance the company chosen for the research study that is Toyota Motor Corporation is considered to be an industry leader in relation to production activities and sales. In current context the company offers best quality products to its customers along with that it maintains high level of quality standards throughout its operational procedure. The company aim towards becoming such an organization that not only generate high revenue margins but even takes care about environmental factors (Markides, 2013). As per step three of strategic thinking the company can achieve that position by focusing more on green technology and designing some green vehicles which are carbon free in nature. These steps are regarded as ABCs of strategic thinking. In any organization strategy formulation usually depends on the nature of the issues being witnessed by an organization. These issues are then scrutinized well by the management so as to identify the opportunities which can be explored with the support of internal strengths. Toyota was witnessing the major issue of rising environmental damage that was being caused by their manufacturing process. The company to certain extent was unable to control the level of carbon content being discharged into the atmosphere (Reiss, 2012). It mainly focused on becoming a carbon free organization and analyzed that this strategic initiative will not only serve its corporate social responsibility but even offer desirable product to customers. In order to get there the company framed a plan through which they recruited those members on board who were familiar with green technology and even simultaneously trained team members so that they are able to incorporate this technology into business operations. Apart from this budget allocations were also done by the management and even proper financial analysis was conducted in order to determine the return on investment. The strategy formulation and implementation process requires engagement of people in the procedure. There are significant differences between implementation and planning phase as in the planning phase various variables are taken into consideration but in the implementation phase only feasible variables are taken into consideration while others are eliminated. It is often observed that employee engagement in such strategic planning is more difficult for government organization in comparison to private or public sector firms (Sadler, 2003). Like in case of Toyota it was easier to convince all the team members for the common strategic goal as it was for the common benefit. However in government firms people tend to be rigid towards any form of change in the system. In this scenario it becomes difficult for the top authority to implement any strategy as change is not accepted by team members. It is important for an organization to identify probable issues that leads to formulation of a plan (Senge, 2010). There are different approaches which are utilized for identification of issues and the approach which can be associated with Toyota Motor Corporation is issues tensions. As per this approach there are four tensions which basically surround any form of strategic issue such as HR equity, change and innovation, productivity improvement and maintaining tradition. The factor of innovation and change was a major tension which encouraged the management to adopt such a technology which would be able to deliver green vehicles. On the other hand the intense competition in the external world even motivated the company to incorporate such features in their product line that could attract more customers. Issue framing is an art that needs to be considered by every organization who desires to remain competitive in the market place (Simerson, 2011). Strategic issues surrounding the company were widespread but the management was able to focus on the major one which was exceptional service delivery. While being one of the players in the automobile industry the company was aware about the fact that innovation is must as that is the only factor which would result into product differentiation. In any form of change management initiative it is essential that core ideology is maintained by an organization. A change in a system can only be advantageous if it is properly aligned with its core values and core purpose. The core value of Toyota is to earn high reputation in terms of integrity and quality, as well as fulfill their commitment in context of environmental practices and being a responsible management. On the other hand the core purpose of the company is to obey the set laws, be honest in deed and word, be responsible, respect overall community values, and perform their corporate duties being aligned with ethical code of conduct and using good judgment so as to avoid any form of conflict within the organization (Srinath, 2009). The five critical dimensions in executing the strategy framed by Toyota was to clarify whether the decision is right or wrong, ensuring that information flows where it is required, decisions need not be second guessed once it has been made, flow of information is free across the boundaries of the organization, and line or field employees should be well aware about the decisions being framed and their probable bottom line impact. The change management initiative which was undertaken by the company was firstly communicated across all the departments so that they are well aware about the change taking place and its benefits. Kotter’s 8 step model basically states that the process of change in an organization. Figure 1: Kotters 8 step model (Source: Kneer, 2013) As per figure1, establishing a sense of urgency is essential so as to communicate change at a faster rate. Toyota Motor Corporation was able to create this urgency by proclaiming amongst team members that pollution created by their business operations can lead to severe damage of their business operations. On the other hand the next step taken by the company was communicating this change initiative in broader context along with ensuring short term wins (Thompson and Martin, 2010). The last measure which was taken by the organization was to sustain the change and incorporate the new process within its culture. This was done effectively by motivating team members towards change initiative on basis of reward system and appraisals. In theoretical frameworks it is often stated that leadership and management is essential for any form of organizational change as stated in figure2. Figure 2: Impact of leadership and management on change (Source: Iqbal, 2011) Toyota Motor Corporation had implemented participative leadership approach throughout the system as the company was aligned towards employee empowerment. This factor increases the level of productivity in the system and in such change management initiative where the entire operational procedure would be transformed it is necessary that leaders work in collaboration with all team members. Conclusion From the above analysis and discussion it can be conclude that Toyota Motor Corporation desired to remain as an industry leader for a long period of time. The company realized a major strategic issue which was surrounding the organization. This was growing trend of environmental damage caused by the firm through their vehicles. The company took into consideration this issue and focused towards incorporating green technology in the system. It was able to design green vehicles and distributed their products to many countries. This concept was highly innovative as it encompassed production of such vehicles which exhibited carbon free discharge. On the other hand the company even engaged all the employees in strategic planning process so that better results can be obtained. The company even had witnessed high revenue margins when such vehicles were launched in certain countries but the rate of investment was high in such green technology activities which restricted business operations of the company. However the organization had adopted a well planned process for implementation of its change management initiative that can be greatly associated with various theoretical frameworks proposed in context of strategic planning. References Ali, A. A., and Kaynak, E., 2012. Globalization of Business. New York: Routledge. 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