Business Management



Business Management

Question#1

Main steps in the process of international strategic management

Strategy is a long term plan for managing a company's business effectively. The main steps involved in the process of international strategic management are following. (Prenhall)

Defining the current business

Every company has to define its core business first outlining exactly what it is offering i.e. the goods and the services and how it is differentiated from the other competitors. Seiko and Rolex both sell watches but Seiko offers relatively inexpensive watches while Rolex offers high quality watches targeting the upper class people.

Performing Internal and External Audits

It is ideal to start the strategic management process with an understanding of the internal and external situation. It is done to know exactly what are the external threats & opportunities and internal strengths and weaknesses. Managers use SWOT analysis for this.

Formulating Business & Mission Statement

On the basis of SWOT analysis the managers formulate the new business area outlining what goods and services they should offer. After deciding this, they formulate a mission statement of the business.

Making Strategic goals from the Mission Statement

Now it's time to translate the mission of the business into realistic strategic goals. This is done separately for each department i.e. for example for the production dept. what are the production standards.

Implement the Strategies

The next step is to translate the strategies into results and actions. This involves hiring and sometimes firing people, adding new products or deleting some, and opening a new plant or closing an old one etc.

Performance Evaluation

It will be wrong to say that strategies always succeed e.g. P&G's decision to sell its food business. Hence it is wise to have timely review.

Making strategies to target the strategic goals

A strategy guides a business exactly how to reach the business it targets from the business it is now. Concise strategies help managers achieve targets efficiently.

Problems faced in undertaking the process

Business enterprises face different problems while executing the above process of strategic management depending upon the type of industry they operate. Some of the common issues are discussed below.

Globalization

The world has become a global village, where several multinational corporations have presence in several countires simultaneously. This environment presents several global opportunities but it also exposes these business enterprises to multiple global challenges.Companies while using the above process often face problems because of the globalization. Globalization is there around every business. Businesses are also compelled to revise their strategies because of globalization, (Hajara Saleeth).

Problems in conducting the Audits

Sometimes businesses miss out some of the most important opportunities or threats which they realize latter when it's too late.

Ambiguous Mission Statement

Firms offering some differentiated products find it difficult to make a proper mission statement and they end up making a vague and ambiguous statement.

Vague Strategies

Making proper realistic and understandable strategies is another challenge faced by the firms. If all the other steps are performed effectively but the mangers fail to formulate proper strategies, the whole effort goes useless.



Corporate Social Responsibility (CSR)

Corporate Social Responsibility (CSR) is the constant commitment of the business ...