Documente Academic
Documente Profesional
Documente Cultură
STRATEGIC MANAGEMENT
Concepts and Cases
ECONOMIC FORCES:
Economic factors have a direct impact on the potential attractiveness of various strategies. For example, when interest rates rise, funds needed for capital expansion become more costly or unavailable.
TECHNOLOGICAL FORCES:
Revolutionary technological changes and discoveries are having a dramatic impact on organizations. Superconductivity advancements increase the power of electrical products. The Internet is acting as a national and global economic engine that is spurring productivity and it is saving companies billions of dollars in distribution and transaction costs. It is changing the very nature of opportunities and threats by altering the life cycles of products, increasing the speed of distribution etc. To effectively capitalize on e-commerce, a number of organizations are establishing two new positions in their firms: chief information officer (CIO) and chief technology officer (CTO). A CIO and CTO work together to ensure that information needed to formulate, implement, and evaluate strategies is available where and when it is needed. Technological advancements can create new markets. Technological changes can reduce or eliminate cost barriers between businesses, create shorter production runs, create shortages in technical skills, and result in changing values and expectations of employees, managers, and
3 customers. Technological advancements can create new competitive advantages. An emerging consensus holds that technology management is one of the key responsibilities of strategists. Many strategists spend countless hours determining market share, positioning products in terms of features and price, forecasting sales and market size, and monitoring distributors; yet too often, technology does not receive the same respect.
COMPETITIVE FORCES:
Competition in virtually all industries can be described as intense and sometimes as cutthroat. An important part of an external audit is identifying rival firms and determining their strengths, weaknesses, capabilities, opportunities, threats, objectives, and strategies. Collecting and evaluating information on competitors is essential for successful strategy formulation. Many businesses use the Internet to obtain most of their information on competitors.
5 suppliers. The strategic partnership with select suppliers may reduce invetory and logistics cost, speed up the availability of next-generation components, enhance the quality of product ane reduce the defect rates and squeeze out important cost savings.
Multinational Corporations:
Multinational corporations face unique and diverse risks, they often confront with the need to be globally competitive and nationally responsive at the same time.Before entering international markets, firms should scan relevant journals and patent reports, seek the advice of academic and research organizations, participate in international trade fairs, form partnerships an conduct extensive research to broaden their Contacts and diminish the risk of doing business in new markets.
Globalization:
Globalization is a process of worldwide integration of strategy formulation, implementation, and evaluation activities. A global strategy seeks to meet the needs to customers worldwide, with the highest value at the lowest cost. Globalization of industries is occurring for many reasons, including a worldwide trend towards similar consumption patterns, the emergence of global buyers and sellers and e-commerce and the instant transmission of money and information across continents.
CONCLUSION:
External audit has become a expilicit and vital part of the strategic management process. A major responsibility of strategists is to ensure development of an effective external audit system. Firms that do not mobilize and empower their managers and employees to identify, monitor, forecast, and evaluate key external forces may fail to acticipate emerging opportunities and threats and consequently mnay pursue ineffective strategies, miss opportunities and invite organizational demise.