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ASSESSMENT 2 Part B BRIEF
Subject Code and Title MGT604/MGMT6011 Strategic Management
Assessment Stakeholder Meeting Simulation and White Paper
PART B: Final Submission
Individual/Group Individual
Length Up to 2,000 words
Learning Outcomes b) Critically evaluate different strategy formulation processes utilised by organisations and evaluate their relevance to particular organisational contexts
c) Develop and plan the implementation of a selected strategy for different organisational levels including for change management processes
Submission By 11.55pm AEST/AEDT Friday of Module 4.2 (Week 8)
Weighting 30%
Total Marks 30 marks
Context:
The assessment of this subject supports students in developing their skills and knowledge in
topics that include environmental assessment, problem diagnosis, strategy development,
and cultural and ethical contexts. Stakeholder meetings are a critical element in strategic
management. This assessment task provides experience and immersive understanding of
the complex interactions involved in the development of strategic choices, and the need to
take an integrative approach to problem solving. The increasing pace of technological
change and the increased impact of social media provides many challenges for businesses
attempting to navigate towards growth and increased profitability. Rapid cycle times for
new products can lead to decisions being made that are not always in the best interests of
the long-term survival of the firm. Disruptions to the everyday course of business come
from anywhere and need to be responded to often in short time frames.
Introduction
Assessment 2 Part B continues from scenario in Part A. In Part B, a disruption is introduced
which necessitates re-consideration of the white paper done in Part A of the Assessment.
Here is a recap of the scenario.
Scenario Recap
Page 2 of 6 MGT604_Assessment 2B Brief
Pro-Go Pty Ltd is a privately-owned manufacturer of small, high-quality action cameras based in Geelong, Victoria. Founded in 2004 it has enjoyed continuous year-on-year growth until the last financial year. Pro-Go has a track record of innovation, and technology that provides excellent quality results in a small package able to operate with small batteries for extended periods of time. The video files these cameras produce are known for having superior colour, and operate effectively in lower lighting conditions than competitor’s cameras. They are also marketed on the basis of their extreme ruggedness, and reliability. Much of the technology used in its devices has been patented by Pro-Go and is not currently available to other manufacturers.
The Pro-Go management team has recognised that the ability to capture videos is now a feature of
most phones. It suggests to them that the future of the stand-alone camera may be limited. Pro-Go’s
CEO has requested the executive team meet independently to develop a strategy to guide the
company over the next five years.
Instructions:
Please watch the below video Announcement from the CEO of Pro-Go Pty Ltd.
DISRUPTION
A number of Pro-Go cameras have burst into flames without an explanation being found. In addition,
the company’s largest customer – a major retail chain throughout China – exercised their right, under
our sales agreement, to cancel their contract with us. Sales have halved in the last 24 hours and
immediate action must be taken.
The stakeholder meetings must discuss this disruption and develop a modified strategic plan/white
paper. Please return to your groups immediately to discuss these events and adjust your strategic
approach accordingly.
Your 2000 word, individual, White paper should be structured as follows:
• Executive Summary - Summarise the entire report – for example, don’t tell the reader that
the report discusses the external/internal environment, summarise the points the report
• Table of Contents - Make it look good. Include page numbers and ensure the layout looks
balanced on the page.
• Introduction - Provide background and context to the report. Tell the reader what has
• Aim - State in a single sentence what this report is seeking to achieve.
• Discussion - Cover the content you wish to address.
• Conclusion - Restate the aim and sum up the discussion to demonstrate to the reader that
• Recommendations - What are the next steps? What is required to progress into the future?
• References - Please ensure you use the correct APA referencing style throughout.
Re-convene the (emergency) stakeholder meetings to address these concerns raised and Develop a modifiedstrategic plan/white paper reflecting the impact of the proposed strategy on the particular part of de business(operations area in my case as I am playing the Operations Director roll) after the disruption and should becompleted to the professional standar that would be required if the below scenario were real. Include strategy concepts and apply a strategy framework(s) to analyse and justify why you believe it is the beststrategy option. Discuss the implications specifically relating to your part of the business, and what challengesthese might represent. Refer to the learning resources provided.
makes about the external/internal environment. (200 words)
happened in the past that has led to this report being needed (200 words)
the aim has been satisfied. There should be no new content in the conclusion. (200 words)
Evaluate/justify your recommendations? (600 words)
A minimum five (5) academic (books & peer-reviewed journal articles) & two (2) other sources(newspaper article, trade publications, websites, etc.) must be used. These should be referencedin the APA style, both in-text and in a reference list.
consider the following disruption announced
(900 words)
MGT604_Assessment 2B Brief Page 5 of 6
Learning Rubric: MGT604 Assessment 2 Part B Stakeholder Meeting Simulation Final Submission
Assessment Attributes
Fail (Unacceptable) 0-49%
Pass (Functional) 50-64%
Credit (Proficient) 65-74%
Distinction (Advanced) 75 -84%
High Distinction (Exceptional) 85-100%
Research and
comprehension:
30%
Content does not adequately demonstrate a postgraduate standard of detail and thought
Content somewhat superficial or with some gaps in understanding
Good coverage of the topic with clearly articulated explanation of the topic. Reasonable fit between theory and practice
Thorough coverage of the topic. Good application of theory. Good use of credible sources
Demonstrates a comprehensive understanding; insightful discussion; excellent and relevant application of theory. Multiple and credible references used
Analysis and
synthesis:
30%
Reader cannot understand the foundations of the topics from the information provided. Poor logic. No evidence provided to support arguments. Disruptive event not adequately considered
Basic intent covered; analysis and arguments could be more convincing with some evidence provided. Disruptive event considered but with little insight
Reader understands the arguments presented through focused analysis and evidence. Disruptive event considered with appropriate level of detail
Reader has a good sense of the analysis and evidence which is well discussed in argument. Insights are drawn from synthesised information. Disruptive event considered in considerable detail consistent with all internal interrelationships
Readers’ understanding of the analysis and arguments is clear; logical and well organised; detailed and insightful analysis; structured arguments; synthesis and understanding of links between issues. Disruptive event considered and integrated into revised strategy with elegance and insight
Writing mechanics:
15%
Layout is confusing; logic, flow and use of language difficult to
Layout is adequate with acceptable logic flow and use of language. Some
Overall presentation is easy to digest; language succinct and well chosen;
Good presentation content and language; easy to read and draw
Overall style, use of language, figures and tables encourages
MGT604_Assessment 2B Brief Page 6 of 6
follow; numerous spelling and grammatical errors
misspellings and grammatical errors
less than four spelling and grammatical errors
conclusions; no more than two spelling and grammatical errors
comprehension; creative and engaging report
Reflection and
conclusions:
25%
Little reflection evident; unclear conclusions. Little consideration of the disruptive event.
Poor reflections and generic or somewhat irrelevant conclusions. Some consideration of the disruptive event
Good reflections highlighting key aspects; relevant conclusions which are a mix of generic and specific conclusions. Appropriate consideration of the disruptive event
Rich reflections drawing from good research, analysis and synthesis. Relevant and specific conclusions. Well detailed consideration of the disruptive event
Insightful conclusions drawing well from the discussion and evidence; creative and insightful reflection with relevance to the topic. Excellent, insightful and detailed consideration of the disruptive event
STAKEHOLDER MEETING SIMULATION AND WHITE PAPER
PRELIMINARY OUTLINE
PART A
STRATEGIC MANAGEMENT
Torrens University
INTRODUCTION
Pro-Go is an Australian company which produces high-quality mainstream cameras mostly for
athletes and thrill seekers market. Its cameras are well known for having an excellent quality video,
superior colour and extreme ruggedness in a small package. However, due to the nature of the
market and increased competition, there is a limited growth opportunity for the company nowadays
(Henderson, 1989). Additionally, the casual purchases of cameras have become less attractive
because of the smartphone heyday, so consumers are using more the smartphone cameras for
capturing, saving and sharing their memories as users can easily edit and share footage on social
media platforms. Another factor that can be considered as a threat is the scarcely availability of
cheaper options in the market which cannot be addressed through price slashed strategy because it
will affect negatively the company´s shares. In order to overcome this, an attempt to attract new
audience and launch new products will be the strategy to increase sales and keep Pro-Go in race.
AIM
This report suggests a strategic plan for Pro-Go to ensure future success keeping the company on
track for a long term. This strategy combines its reliable technology into an enterprise software
offer.
DISCUSSION
In order to develop a strategy to lead the company over the next five years all the team conducted
several meetings to discuss every single strategy proposed for each department. The meetings were
carrying on through WhatsApp videos and chats were senior finance manager, operations manager,
union official and General manager took part. (see team log in Appendix 1)
By offering discounts on new products and developing lower price products the company can
encourage upgrade sales. In order to continue its growing, Pro-Go must take advantage of brand
recognition which still resonate within consumers and market. However, as the operations manager
of this company, the awareness of one of the company weakness such as cost production according
to IFE matrix analysis (See table 1. Pro-Go key internal factors) give us the evidence to refuse the
proposition of release new products as it will increase expenses not only considering production
but also research and development. Therefore, the idea to penetrate new markets through
developed software and services able to generate data for businesses could be viable to consolidate
brand loyalty as well as new incomes in the future.
Table 1. Pro-Go key internal factors
The company should launch a subscription-based software service to administer digital footage
recorded from Pro-Go body cameras which could propose an innovative revenue stream for the
company. Furthermore, this would build up shareholder value. Through this, Pro-Go could lead a
new retail segment.
By combining the existing technology and a new software, the footage could be analyzed directly
from its cameras to generate insights that can be useful for retail businesses. This service model is
focused on retailers which like to convert data from their operations to analyze customers behavior
through human observation and lead business improvements (Baird & Parasnis, 2011). To
contextualize this needs, dissatisfied costumers drive costly problems and most of them will never
come back as unhappy consumers do not usually complain; so the company losses the opportunity
of making improvements (Liedtka, 2000). Sentiment analysis and emotional state could be
detected through the analysis of facial expression so this would improve consumer´s understanding
as a result of their emotional response (Hutter, Hautz, Dennhardt, & Füller, 2013).
Due to Software development and data analysis are not capabilities for the company, Pro-go should
partner or acquire other companies with these core competencies; this in fact, will diversify the
Pro-Go revenues.
To conclude, as the current Pro-Go market has been insufficient, the company could expand its
market and include not only athletes and retailers, but also the public service sector and sports
training industry to enhance training processes. In order to increase revenues and diversify its
portfolio, the expansion into new markets will be essential for the company.
REFERENCES
Baird, C., and Parasnis, G. (2011). “From Social Media to Social Customer Relationship
Management.” Strategy & Leadership, 39(5):30–37
Dobbs, M. (2014). Guidelines for applying Porter's ve forces framework: a set of industry analysis
templates. Competitiveness Review, 2 4 (1), 32-45.
Henderson, B. D. (1989). The origin of strategy. Harvard Business Review, 67(6), 139-143.
Hutter, K., Hautz, J., Dennhardt, S., & Füller, J. (2013). The impact of user interactions in social
media on brand awareness and purchase intention: the case of MINI on Facebook. Journal
of Product & Brand Management, 22(5/6), 342-351
Liedtka, J. (2000). In defence of strategy as design. California Management Review, 42(3), 8-30.
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MODULE 4MODULE 4
Strategy Formulation
4.1: The building blocks
Introduction:
Business level strategy requires an understanding of the �t between the
external environment, and the �rm itself in order to achieve the �rm’s
strategic goals. Both the environment in which the business operates and
the �rm itself demonstrate complex dynamics, and establishing and
maintaining a �t between the two is di�cult. Unless the business is
continually addressing both the needs of the market and its own resources
and capabilities it risks becoming misaligned – something that could
potentially jeopardise its long-term survival. For the �rm to be able to make
informed decisions it needs to understand with great clarity both the unmet
needs of its target market, and the way it goes about solving the problems
for (and therefore meeting the needs of) that market. Value is created at the
interface between the customer and the �rm, and the e�ciency with which
this happens is dictated by many other related factors. Approaches to
organisational learning, brand and market development, organisational
complexity, and the ability of the �rm to respond in a �exible, appropriate
manner all contribute to the quality of the execution of the value
proposition.
Perhaps most importantly it should be recognised that all strategy
formulation is an ongoing and dynamic process that seeks to impose order
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over chaos, and generally turn the uncertain into the certain. As such, it
represents something of a gamble. There are no single correct approaches
to strategy formulation, and there are no guaranteed outcomes. It’s not
uncommon for technological innovation or new business models to
fundamentally shift market dynamics, and these are often di�cult to
identify in advance. The impact of Uber on the taxi industry around the
world is an example. An expectation that a single right answer can be
derived through following particular processes or practices is incorrect and
can lead to often erroneous, full expectations of success.
Business Model Canvas
A key element of strategy formulation is the understanding of how the
�rm's business model enables the �rm to assert its competitive advantage.
The business model may be considered the means by which the value
added transformation happens to the input of production. Central here is
the consideration of what the outputs of that production process look like
and the extent to which they address the unmet needs of the target market.
The Business Model Canvas is a tool that provides a high level outline view
of ‘moving parts’ of a business and enables comparisons to be made in the
way value is created. It is a very valuable tool for establishing the di�erences
between di�erent �rms that might be operating in the same industry, and
for identifying opportunities for altering a business model to better adapt to
changing times.
Business Model innovation
There is an ever present risk that a �rm will develop a strategic agenda
based on what it sees as its own core capabilities potentially imposing
solutions on the market. While this appears sound from a distance, closer
examination will reveal that �rms following this approach can potentially
end up with products that are “solutions in search of a problem”. In other
words, just because a company is good at something doesn’t mean there’s a
market for their product or service. Many is the company that has
foundered through lack of customer focus. An alternative approach might
involve the market dictating the direction the �rm takes. In this case, the
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�rm follows the changing needs of the market, but in doing so always being
subject to the boundaries of market expectation. This prevents the �rm
from creating new segments, or delivering truly innovative solutions to the
market. The potential to fall victim to disruption through such an approach
is high. So should the �rm lead, or follow? Leading the market enables the
�rm to anticipate needs that customers may not currently have. While �rst
mover advantage is often overstated, there is something to be said for
creating uncontested market space through the development and
marketing of new categories of product and service. An alternative is for
organisations to orient themselves towards following closely the changing
needs of their target markets. This might be considered an outsider-in
approach where strategy is dictated by the response to market trends,
rather than being dedicated to creating market trends.
Deliberative or Responsive?
One important consideration in strategy formulation is whether to adopt a
deliberative process, or to allow strategy formulation to emerge and evolve
when and as needed. The deliberative process is one that takes place as
part of the ongoing planning of the �rm's resources. Many organisations
have an annual strategy planning and review process. Usually the process
seeks input from sta� at all levels in the business, and has some sort of
review and prioritisation process that enables ideas that are considered
worthy to be implemented over the coming period. Decisions in relation to
the ongoing strategy of the �rm may typically be categorised into short-
term, medium-term, and long-term. Short-term strategies may involve what
was known as low hanging fruit. These are quick wins, simple to implement
and with immediate payback. By contrast medium-term strategies generally
require more resources, more planning, and the results are more tied to
successful implementation. While short-term strategies typically revolve
around improving operational e�ciencies, medium-term strategies are
more likely to involve accessing new markets, or generating new products.
Long-term initiatives are those that require signi�cant planning and often
involve the organisation shifting its strategic direction. Longer term
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strategies may often involve signi�cant reorientation of the resources within
the �rm, or repositioning of the �rm within its market.
The problem with deliberative strategy formulation processes is that the
market doesn't change in a predictable orderly fashion. Competitive
pressures don't evolve on a cyclical basis. A strategy formulation process
that operates on �xed annual cycles may be too in�exible to enable the �rm
to capitalise on opportunities as they arise. For this reason, some �rms
prefer to be more reactive in this strategy formulation. Typically smaller
�rms use this approach. The �atness of the management structure enable
small �rms to be more nimble in their approach, and generally their
commitment to �xed resources is less than that of larger �rms. Smaller
�rms typically also have fewer stakeholders that need to be convinced of
the wisdom of the decisions being made. Smaller, more agile �rms running
reactive strategy formulation approaches can represent a signi�cant threat
to larger income and organisations. Larger organisations with �xed strategy
formulation timelines require a greater commitment to resources, which
makes them potentially unable to follow their nimble competitors often
conceding market share along the way.
Firms can choose to grow in a number of di�erent ways. Often when
organic growth opportunities become less attractive �rm may consider
acquiring another �rm. This raises a number of questions and
opportunities. The �rst of these is should the �rm stay in the industry in
which it is currently active, or diversify its risk into other industries? This is
called horizontal integration, and there are strong arguments for and
against this approach. By integrating within the industry, the �rm acquires
competitors thereby consolidating its market position. When diversifying
outside the industry, the �rm makes investments in industries that may or
may not be related. The �rm can also make the decision to integrate
vertically. In this case, the �rm either purchases a customer, or a supplier.
Diversi�cation inside or outside the industry may seem super�cially
attractive, but either approach may lead to market distortions and
suboptimal outcomes.
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Essential Resources:
There is no set text for this subject – instead we embrace a mixture of
foundational literature, and contemporary peer-reviewed sources to build
up a picture of the context from which modern strategy practice has
emerged, along with an understanding of contemporary best practice.
Baden-Fuller, C., & Hae�iger, S. (2013). Business models and
technological innovation. Long range planning, 46(6), 419-
426.
A contemporary view of business models and considerations that
need to be taken into account when integrating technological
innovation.
McGrath, R. G. (2010). Business models: A discovery driven
approach. Long range planning, 43(2-3), 247-261.
The business model concept o�ers strategists a fresh way to
consider their options in uncertain, fast-moving and unpredictable
environments. In contrast to conventional assumptions, recognising
that more new business models are both feasible and actionable than
ever before is creating unprecedented opportunities for today’s
organisations.
Osterwalder, A., & Pigneur, Y. (2010). Business model
generation: a handbook for visionaries, game changers, and
challengers. John Wiley & Sons.
Easy to read and straightforward. A classic text explaining in detail the
Business Model Canvas with many tips for its implementation.
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Bene�eld, G. (2014). Business Model Canvas in 5 minutes.
YouTube. Retrieved from https://www.youtube.com/watch?
v=_4MHqyf4Vw0&feature=youtu.be
This video provides a brief overview of the nine parts of the Business
Model Canvas and should be used as a means of clarifying your
understanding. It includes a practical example demonstrating the
strength of this tool.
tutor2u (2017) Business Growth Strategy - Horizontal and
Vertical Integration. YouTube. Retrieved from
https://youtu.be/uOO4ClVUrkw
The concepts of horizontal and vertical integration help to explain and
categorise the strategic rationale for external growth options such as
takeovers and mergers. This short video explains what is meant by
horizontal and vertical integration and provides some examples.
Learning Activities:
Learning activities are not part of summative/graded assessment; however
they are designed to prepare you for incremental graded assessment and
expand your learning. These activities encourage a community learning
experience between peers, and provide opportunities for facilitators to o�er
formative feedback, throughout a module, to the student cohort.
Learning Activity 4.1 : Business model canvas
Develop a business model canvas for Amazon and one for
the Ford Motor Company. Consider the di�erences between
the two. What does this imply about
a. The ability of each company to respond to changes in themarket?
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b. The level of �exibility with which each might be able to solvecustomer problems?
Please place your answers to the above questions on the module 4
discussion forum. The recommended word count is 300 - 400 words.
You may like to use images and diagrams. You are also welcome to
include factors that may not be explicitly stated but which you believe
�t within the context of the subject and are worthy of inclusion.
To participate in the Discussion Forum, click here to scroll to the
bottom of this page then click on the "Module 4 - Discussion
Forum" link.
Learning Activity 4.2: Suppliers
Buying your suppliers is a way of guaranteeing price stability
and improving the co-ordination of your value chain. But
does it make sense? Consider the ways in which purchasing a supplier
represents a form of market failure, and consider the ine�ciencies
that might arise as a result.
Please place your answers to the above questions on the module 4
discussion forum. The recommended word count is 300 - 400 words.
You may like to use images and diagrams. You are also welcome to
include factors that may not be explicitly stated but which you believe
�t within the context of the subject and are worthy of inclusion.
To participate in the Discussion Forum, click here to scroll to the
bottom of this page then click on the "Module 4 - Discussion
Forum" link.
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MODULE 4MODULE 4
Strategy Formulation
Topic 4.2: Interpreting and Integrating StrategicPerspectives
Introduction:
We now have an understanding of the external environment, the internal
environment of the �rm, and we have deconstructed some of the ways in
which the �rm creates value. We are now able to consider some of the key
questions that relate to the formation of competitive strategies. An
interesting issue that arises here concerns opportunities in pursuing
emerging markets. Emerging markets may represent a considerable
opportunity, but the state of infrastructure development in those markets
might well be insu�cient to enable the �rm to properly capitalise on any
investments it might make in this area. Many of the texts and journal
articles relating to emerging markets were published at a time before the
impacts of social media had been widely felt and represent older ways of
approaching the issue. Emerging economies today are in a position to
leapfrog more traditional economies in the rapid implementation of new
technologies – including telecommunications. This means that while some
social media capabilities that may have developed over a period of 10 years
in a developed economy, the same technologies may become a dominant
in�uence in emerging markets in signi�cantly less time. The extent to which
an organisation can become socially embedded in the market becomes a
key di�erentiator for its success, and a signi�cant strategic consideration.
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While the Business Model Canvas was discussed in the previous topic, the
organisational structure of the �rm is an important consideration.
Organisations can today be conceptualised as collections of competencies
and practice areas, rather than rigid hierarchical structures. This leads to the
idea of the networked organisation, or the boundaryless organisation.
These organisational forms enable the �rm to respond dynamically to
changes in its external environment. It enables �rms to �exibly add and
remove resources and capabilities as required, without the need for
wholesale restructuring.
Martin (2014) has identi�ed �ve considerations to be taken into account in
the formulation of strategy. The �rst of these is an understanding of the
aspiration of the �rm. What is it the �rm is trying to achieve? This relates to
the �rm’s vision and mission. Without properly understanding the purpose
of the enterprise, any resultant strategy formulation would by de�nition the
ambiguous and lacking in impact. The second consideration concerns where
the �rm will compete. This includes physical geographies, product
categories, consumer segments, and vertical stages of production. Here the
question is as much what the �rm is not going to do, as it is what the �rm is
going to do. The next question is critical – how will the �rm win? This
involves a detailed understanding of the �rm's competitive advantage. It's
not enough just to be part of the race. The �rm must understand the basis
by which it delivers barriers to customers in a way that none of its
competitors can. Following on from this is the understanding of the
capabilities that must be in place in order to continue delivering this value.
In order to make this work – the �rm needs an understanding of the
reinforcing activities and speci�c con�gurations of resources that allow
value to be created. However, these activities by themselves are insu�cient
for ongoing value creation - management systems are required in order to
monitor and control the value creation process. The support systems
include things such as measures and methods required ensuring the
ongoing delivery of value to the customers. You will note that these �ve
choices are iterative in nature - the systems impact on the capabilities,
which in turn impact on how the �rm can win, which then impacts on where
the �rm will play, which �nally impacts on the winning aspiration. The
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important thing to note here is that these are all aligned. If the capabilities
are not in line with the value proposition for the target market then the
organisation will fall short to create value. As environments change, and
consumer markets evolve, so will the elements in this chain need to evolve
also. As such, the model is not a one-shot play – it should become central to
the discussion of the ongoing evolution of the �rm.
Govindarajan (2016) has presented another approach to strategy
formulation, this time using three distinct compartments or boxes. The �rst
of these relates to the present time, while the other two relate to the future
orientation of strategy. This recognises the pragmatic imperative of having
to manage for the present whilst creating a vision for the future. In this
article, it is recognised that a greater focus on the present will blind the
organisation to future alternatives. The three-box solution requires
managers to maintain a balance across each of the three boxes. Managers
need to remember part of their role is to create the business of the future.
The three-box solution is seen as a generalisable approach that works
across industries and business types. A key learning from this approach is
the need to adequately resource the third box - to ensure that resources are
dedicated to and that these resources are preserved in activity. A �nal point
is that the company needs to be aware that the criteria for measuring
success in box 3 are very di�erent from that of box 1. Managing quarter-to-
quarter and monitoring �nancial results as a proxy for organisational
success makes sense in box 1. The same approaches do not make sense in
the broader context of creating the future. Return on investment is more
long term, and the way risk is addressed needs to be di�erent. Therefore,
management needs to take a more �exible response, one that recognises
the essential di�erences between planning and executing strategy for today,
versus doing the same for a longer-term view.
Essential Resources:
There is no set text for this subject – instead we embrace a mixture of
foundational literature, and contemporary peer-reviewed sources to build
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up a picture of the context from which modern strategy practice has
emerged, along with an understanding of contemporary best practice.
London, T., & Hart, S. L. (2004). Reinventing strategies for
emerging markets: beyond the transnational model. Journal
of international business studies, 35(5), 350-370.
These strategies include developing relationships with non-traditional
partners, co-inventing custom solutions, and building local capacity.
Together, these successful strategies suggest the importance of MNCs
developing a global capability in social embeddedness.
Ashkenas, R. (1995). Creating the Boundaryless
Organization. Business Horizons, 42(5), 5-5.
The way we perceive companies and the processes by which
they create value has changed over time. The idea of the
‘boundaryless organisation, while no longer revolutionary, still has
profound implications for the strategic choices management must
make
Knowledge@Wharton. (2016). A three box Solution for
leading Innovation. Wharton University of Pennsylvania.
Retrieved from
http://knowledge.wharton.upenn.edu/article/govindarajan-book-the-
three-box-solution/
How to innovate and execute: Leaders already know that innovation
calls for a di�erent set of activities, skills, methods, metrics, mind-sets,
and leadership approaches. This Three Box solution give an easy to
follow framework to guide decision making in innovation
implementation. Please take the time to listen to the podcast by Vijay
Govindarajan.
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Tuck School of Business. (2016). Summary of the three box
solution by Vijay Govindarajan. YouTube. Retrieved from
https://www.youtube.com/watch?
v=wgD2VzFqCaE&feature=youtu.be
How do you meet the performance requirements of the current
business—one that is still thriving—while dramatically reinventing it?
How do you foresee a change in your current model before a crisis
forces you to abandon it?
Learning Activities:
Learning activities are not part of summative/graded assessment; however,
they are designed to prepare you for incremental graded assessment and
expand your learning. These activities encourage a community learning
experience between peers, and provide opportunities for facilitators to o�er
formative feedback, throughout a module, to the student cohort.
Learning Activity 4.3: Strategic drift
Organisations can drift out of alignment with their
customer’s needs if they do not continue to monitor the way
they create value. Changes in consumer behaviour need to be
factored into the ongoing strategy development process.
Using Starbucks as an example, consider how both Martin’s
framework, and the Three Box Solution might have been applied to
counter the strategic drift experienced by the company over the last
decade.
Please place your answers to the above questions on the module 4
discussion forum. The recommended word count is 300 - 400 words.
You may like to use images and diagrams. You are also welcome to
include factors that may not be explicitly stated but which you believe
�t within the context of the subject and are worthy of inclusion.
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To participate in the Discussion Forum, click here to scroll to the
bottom of this page then click on the "Module 4 - Discussion
Forum" link.
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MODULE 3MODULE 3
Internal Environment
3.1: The mechanics of business
Introduction:
Businesses seeking to improve their market performance must align their
internal environment with the external environment in which they compete.
The capabilities of the �rm must match the requirements of the market
before a transaction can take place. Many managers focus on the external
factors without properly considering the extent to which the �rm is
equipped to address those factors. A starting point for considering the
internal environment of the �rm is the vision and mission the �rm has
adopted to guide its activities. The �rm's vision can be thought of as an
aspirational, long-term ambition. It characterises in broad terms what the
�rm is trying to achieve. Vision statements are notoriously di�cult to
construct. While they appear to be simple and straightforward, the need to
adopt a form of words that conveys meaning unambiguously makes the
task quite di�cult. The mission statement of the �rm builds on the vision
statement, and adds more detail and direction. Together the mission and
the vision provide the boundaries of the �rm's strategic activities.
All �rms achieve results through their people. Every enterprise is at its heart
a collection of individuals, aligned in their attitudes and beliefs. Increasingly,
organisations are seeing themselves as ‘values driven’. Contrast this with
organisations that use rules and guidelines to govern behaviour. A values-
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based organisation is one, which engages deeply held principles and uses
these to guide its decision making. Values-based organisations tend to be
more successful than rules-based organisations because there is a greater
sense of cultural engagement and employee satisfaction, which
consequently drives customer satisfaction. Values are critical to culture, and
culture is critical to the success of the organisation. Culture might be
de�ned simply as, ‘the way we do things around here’. Coleman (2013)
identi�ed six components of corporate culture: vision; values; practices;
people; narrative; and place. These six components establish a basis for the
identity and culture of the organisation. The culture then determines the
attitudes, the beliefs and behaviours of the employees. A bad culture – one
that is not conducive to looking after the needs of the customer – cannot be
�xed easily or quickly. A strong positive culture can represent a signi�cant
market advantage.
However culture, while important, is just one aspect of an organisation. The
organisation can be seen as a collection of resources and capabilities joined
together by an operational model. The resources controlled by the �rm may
be tangible or intangible. Tangible resources include things like plant and
equipment, IT systems, retail footprint, and so on. Intangible resources are
things such as goodwill, patents, trademarks, and culture. Barney (1991)
recognised that the resources controlled by the �rm determined the nature
of the competitive advantage that some �rms enjoy. Barney determined
that for a competitive advantage to be sustainable, the resource controlled
by the �rm needed to be valuable, rare, di�cult to imitate, and able to be
operationalised in the business. Only if resources demonstrated all four of
these characteristics could be said to provide a sustainable competitive
advantage. This provides a contrasting view to Porter who considered the
dynamics of the industry to be the key determinant of success. Porter
surmised that if the industry in which the �rm competed were attractive,
then the �rm would achieve better returns than if the market was not
attractive. Attractiveness in this case was determined by the Five Forces
framework.
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Contrasting Porter’s view, Barney noted that it was still possible to have
successful businesses in unattractive industries, if the resources controlled
by the �rm satis�ed the criteria to provide sustainable competitive
advantage. It is interesting to consider that while both authors have
contributed, and to an extent de�ned, the debate the performance of
business that we observe, is often not completely explained by these two
frameworks.
This leads us to the question of what sits at the heart of the business’ ability
to di�erentiate itself, to attract a market segment and satisfy the needs of
that segment in a way that is better than its competitors – i.e., the core
competence of the �rm. Prahalad and Hammel (1999) de�ned the core
competence as a harmonised combination of multiple resources and skills
that distinguishes the �rm in the marketplace. This becomes the essence of
the company’s ability to complete. Often, the actual core competence of an
organisation is not easy to determine. To satisfy the criteria the activity must
provide superior value or bene�ts to the consumer, it must not be easily
replicated or imitated by competitors, and it should be rare – not something
easily able to be adopted by a competitor. The core competence of a �rm
might exist a long way upstream or downstream from the ultimate
customer. For example a retailer may attract customers through a diverse
range of products, but this may simply be a re�ection of a core competency
in purchasing and supply chain management. To take another example,
Apple may have a reputation for great design, but their exceptional
pro�tability is the result of a core competency related to supply chain
management.
In summary, understanding the mission and vision of the organisation, the
way this translates to values, the way this impacts on culture, and the way
the culture re�ects in the resources controlled by the �rm can lead to
strategic capabilities and core competencies that deliver superior value to
customers.
Essential Resources:
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There is no set text for this subject – instead we embrace a mixture of
foundational literature, and contemporary peer-reviewed sources to build
up a picture of the context from which modern strategy practice has
emerged, along with an understanding of contemporary best practice.
Sorensen, J. B. (2002). The strength of corporate culture and
the reliability of �rm performance. Administrative Science
Quarterly, 47(1), 70-91.
Prevailing research claims that strong corporate cultures improve �rm
performance by facilitating internal behavioral consistency. This paper
addresses an unexamined implication of this argument by analyzing
the e�ect of strong corporate cultures on the variability of �rm
performance. This relationship depends on how strong cultures a�ect
organizational learning in response to internal and external change.
Dobbs, M. (2014). Guidelines for applying Porter's �ve forces
framework: a set of industry analysis templates.
Competitiveness Review, 24(1), 32-45.
The purpose of this paper is to provide practitioners and students a
practical yet comprehensive set of templates for applying Michael
Porter's �ve forces framework for industry analysis.
Frost, J. (2014). Values based leadership. Industrial and
commercial training, 46(3), 124-129.
This article explores the power of values based leadership in
connecting colleagues and clients to an organisation and in doing so
creating sustainable business success.
Barney, J. (1991). Firm resources and sustained competitive
advantage. Journal of Management, 17(1), 99-120.
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Understanding sources of sustained competitive advantage has
become a major area of research in strategic management. This
article examines the link between �rm resources and sustained
competitive advantage.
Johnson, B. (2010). Whats the di�erence between Mission
and Vision. YouTube. Retrieved from
https://youtu.be/b2MyaR0gMo0
What’s the di�erence between Mission and Vision statement? This
video compares and contrasts the two, and provides practical
examples.
Virtualstrategist. (2016). How to write a Vision Statement.
YouTube. Retrieved from https://youtu.be/7yBUBmciQBk
A practical guide to developing Vision statements.
Learning Activities:
Learning activities are not part of summative/graded assessment; however
they are designed to prepare you for incremental graded assessment and
expand your learning. These activities encourage a community learning
experience between peers, and provide opportunities for facilitators to o�er
formative feedback, throughout a module, to the student cohort.
Learning Activity 3.1: Vision Statements
Conduct a desk review on vision statements of large, well
known companies. These may be hard to �nd although
annual reports are often a good source of information. Select two
companies and critically assess the performance of the �rms against
their aspiration set out in the vision statement. Does the �rm live up
to the vision it has set for itself?
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Please place your answers to the above questions on the module 3
discussion forum. The recommended word count is 300 - 400 words.
You may like to use images and diagrams. You are also welcome to
include factors that may not be explicitly stated but which you believe
�t within the context of the subject and are worthy of inclusion.
To participate in the Discussion Forum, click here to scroll to the
bottom of this page then click on the "Module 3 - Discussion
Forum" link.
Learning Activity 3.2: Vision Statements continued
Identify the core competence of the two companies you
have focused on in learning activity 3.1.
How are these core competencies expressed?
What resources does the company control that enables it tosecure a sustainable competitive advantage?
Please place your answers to the above questions on the module 3
discussion forum. The recommended word count is 300 - 400 words.
You may like to use images and diagrams. You are also welcome to
include factors that may not be explicitly stated but which you believe
�t within the context of the subject and are worthy of inclusion.
To participate in the Discussion Forum, click here to scroll to the
bottom of this page then click on the "Module 3 - Discussion
Forum" link.
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