Chapter 1 The Concept of Strategy Essay

Essay questions 54. Lady Gaga has been compared to Madonna with regard to her ability to court popularity and cultivate fame. In terms of strategy, what do you see as the main similarities and main differences between Lady Gaga and Madonna? Answer. The basic principles of strategy: clear goals, understanding the environment, awareness of resources and capabilities, and effective implementation are features of both artists. Both have adapted to the emerging business models of popular music; both have used adaptation, surprise, and shock as key tools for engaging the media and fans. Both have allied with talented individuals within the industry. However there are differences: Lady Gaga’s image changes are fast cycle compared to Madonna. Lady Gaga puts even greater emphasis on visual impact and less on audio impact than Madonna placed sex at the center of her image and quest for attention—Lady Gaga is clearly feminine but startlingly asexual. Lady Gaga’s relationship with her fans is also different—much more a cult leader, which is fostered through social media. Reference: pp8-9 55. Why are we able to affirm that “understanding” is the key word across the four attributes of strategy that lead to success? Answer. These four attributes are: 1 Goals 2 Competitive environment 3 Resources 4 Implementation For each of these four attributes, gaining an accurate insight into the concepts involved is critical. Thus a deep understanding –knowledge about the content, the causes, the drivers and the consequences- of goals, of competitive environment, and of the firm’s resources and the implementation process is key to success. Knowing these phenomena require theoretical and practical insights, linked with some forecasting or betting, because a great deal of uncertainty does exist. References: pp9-11 56. Why do we use the basic framework for strategy analysis? Answer. This basic framework consists of three main large variables: 1 The firm 2 Strategy 3 The industry environment It allows managers and researchers to reduce the complexity of the real world and to “manipulate” variables at a higher level of abstraction. A model is always a representation (generally simplified) of a phenomenon. Therefore, it helps strategic decision makers to build a representation of reality through a system and to forecast what could happen if…, then to identify and design the best actions to undertake for success. References: p10 57. What are the similarities and differences between strategy in the business world and in the military arena? 7 Answer. Both types of strategies share some attributes such as: 1 They are important for overall success, 2 They involve a significant commitment of resources, 3 They are largely irreversible, 4 They accommodate the classic distinction between strategy and tactic, 5 They share lessons and principles applicable in both fields and 6 They lack a comprehensive and global theory that explains and guarantees universal success. However, although strategy in the military field often implies the total destruction of the enemy, different intermediate situations have been identified in the business world; rivals may tolerate each other, or even cooperate and compete simultaneously. Total destruction and the emergence of monopolies is not often a realistic option. References: pp12-13 58. Why is integration and cohesiveness a major issue in strategic management? Answer. Because strategy is characterized by complexity, uncertainty, multiple levels of variables, many players, and a broad scope of involved variables. Because strategic management is envisioning, designing and building the future of the organization, integrating, injecting cohesiveness and consistency between many conflicting objectives, organizational players at different levels, and extremely diverse variables, is an absolute requirement. Most organizations suffer from a lack of integration; achieving effective integration is probably one of the most daunting tasks of strategic management. References: pp15-17 59. Are corporate-level strategic decisions only made by top managers? Answer. In most cases, top managers are in charge of the corporate level strategy, which consists of the definition of the scope of the firm’s business portfolio and the determination of the fundamental orientation and “strategic formulae” of the firm. Corporate strategy is a unifying theme across the different businesses. Top managers are in an organizational position that allows them to understand the big picture and the entirety of the strategic dimensions. They determine corporate strategy with the help of corporate staff. However, they have to take into account the actions of all the members of the organization who contribute daily to the implementation of the strategic orientations. Top managers rely upon information delivered by all levels of the organization and must integrate the existing variables in their strategy design. Therefore, corporate strategy decisions are made by top managers relying on and thanks to a “functioning organization”. References: p19-20 60. How can a start-up strategy be identified? Answer. A start–up is like a baby just entering our world. He has no past and his future is completely ahead. However, a baby already has assets and capabilities that will be developed during his lifetime. For a firm, at least an individual founder has started the firm and he has objectives, plans, a founding fundamental idea, products or services, a market to serve, and so on. All of these elements are usually integrated into a business plan and used to attract capital. Therefore, strategic dimensions exist at an embryonic stage within a start-up but they do exist. Internal variables such as structure, culture, and other dimensions appear less complex than in large and older organizations but they are present. Their existence is critical for the start-up survival because the weakness of its available resources and experience appear as strong obstacles to its development. References: p19-20 8 61. Is the business strategy the strategy of a part of the firm or the strategy of the whole firm competing in a specific market? Answer. This question relates to at least two elements: 1 the distinction between corporate and business level strategies 2 the organizational support of the business level strategy (which organizational actors deal with it in the firm?) Corporate level strategy consists of the choice of the business portfolio of the firm and of the overall integration of all strategic orientations. Business level strategy deals with “how to” compete in a specific business, which can be defined simply as a product x market combination. Therefore, generally the business level strategy or the responsibility to design and implement orientations for the future of a specific business is delegated to a division or a subsidiary. This division or subsidiary is also in charge of running the operations for this business. We can frame the situation as both propositions pertinent simultaneously: a a part of the firm strategy because there is a vertical relationship of inclusion of all business strategies within the corporate level strategy b the whole firm competing in a specific market because even if a division is more specifically in charge of the business, the firm’s overall resources are mobilized for this goal. References: p18-20 9