Scribd Logo
Upload

Welcome to Scribd!

  • 83 views

    Jan Assignment 6

    Uploaded by

    Jan Gelera
    Strategy formulation differs for small versus large organizations and for-profit versus non-profit organizations in several key ways: - For small organizations, strategy formulation focuses on meeting short-term objectives within available resources, while large organizations formulate strategies to meet both short-term and long-term goals and achieve sustainable profits. - The main goal of for-profit organizations is to generate profits and returns for shareholders, while non-profits focus on fulfilling their social mission, though they also need to generate sufficient revenue to operate. - Non-profits also tend to rely more heavily on volunteers and have higher turnover among leadership and staff than for-profits.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    Jan Assignment 6

    Uploaded by

    Jan Gelera
    83 views3 pages
    Strategy formulation differs for small versus large organizations and for-profit versus non-profit organizations in several key ways: - For small organizations, strategy formulation focuses on meeting short-term objectives within available resources, while large organizations formulate strategies to meet both short-term and long-term goals and achieve sustainable profits. - The main goal of for-profit organizations is to generate profits and returns for shareholders, while non-profits focus on fulfilling their social mission, though they also need to generate sufficient revenue to operate. - Non-profits also tend to rely more heavily on volunteers and have higher turnover among leadership and staff than for-profits.

    Original Description:

    Strategic Managements chapter questions and answers

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Strategy formulation differs for small versus large organizations and for-profit versus non-profit organizations in several key ways: - For small organizations, strategy formulation focuses on meeting short-term objectives within available resources, while large organizations formulate strategies to meet both short-term and long-term goals and achieve sustainable profits. - The main goal of for-profit organizations is to generate profits and returns for shareholders, while non-profits focus on fulfilling their social mission, though they also need to generate sufficient revenue to operate. - Non-profits also tend to rely more heavily on volunteers and have higher turnover among leadership and staff than for-profits.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    83 views3 pages

    Jan Assignment 6

    Uploaded by

    Jan Gelera
    Strategy formulation differs for small versus large organizations and for-profit versus non-profit organizations in several key ways: - For small organizations, strategy formulation focuses on meeting short-term objectives within available resources, while large organizations formulate strategies to meet both short-term and long-term goals and achieve sustainable profits. - The main goal of for-profit organizations is to generate profits and returns for shareholders, while non-profits focus on fulfilling their social mission, though they also need to generate sufficient revenue to operate. - Non-profits also tend to rely more heavily on volunteers and have higher turnover among leadership and staff than for-profits.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    1. How does strategy formulation differ for small versus large organization?

      For a for-
    profit versus a nonprofit organization?

    Strategy formulation are essential to all organizations whether small or big or for profit or non-
    profit organizations. To begin with, strategic formulation is an important organizational concept
    that focuses upon the formulation and development of strategies for a business to attain long
    term competitive edge and sustainability (Burke, 2003). The key goal lies in aligning the need of
    the organizations with the available resources and performs well. The strategy formulation
    process across different organizations differs in the following ways:

    Small Versus Large Organizations


    In small organizations, strategy formulation process is mainly inclined towards meeting short
    term organizational objectives within the available resources whereas in case of large
    organizations, the focus lies on formulating any kind of strategy with any type of resources and
    requirements to meet both the short term and long term goals as well as attain long term
    competitive edge with sustainable and huge profit margins.

    Profit and Non-Profit Organizations


    To start with, for-profit and non-profit organizations do not differ a lot in terms of operations or
    day to day processes but the main and most important point of differentiation is in terms of goals.
    The main goal of a profit company is to grow the business, make money and to return dividends
    to shareholders or profit to owners over time while for non-profit organization is to take care of
    an unmet need in the community, state, nation or world and to further its mission, which includes
    making enough money to continue to operate. Another major difference between for-profit and
    non-profit organizations is staffing. For-profit organizations are run by paid staff. Most non-
    profit organizations have some paid staff, but unpaid volunteers usually do most of the work.
    Another area where for-profits and non-profits often differ is organizational memory and
    continuity. Most non-profit organizations suffer from high turnover among board members,
    volunteers, staff, and even executive leadership.

    2. Give [hypothetical] examples of the following: market penetration; market


    development; product development; forward integration; backward integration;
    concentric and conglomerate diversification; joint venture; retrenchment; divestiture;
    and liquidation.

     market penetration – McDonalds: Known to be an “all American brand”. In order to


    penetrate the Latino market, the company uses culture based themes and maintains a
    Spanish-language website. Same when they target the Filipino market. they used the
    importance of “family and the elderly” in their advertisements. Even coining Taglish
    catch phrases like “McDo, Love ko to.”
     market development – Starbucks: The company now sells coffee beans in
    groceries/supermarkets. This enables Starbucks to reach customers that do not visit its
    coffeehouses.
     product development - Starbucks: The company developed ready to drink coffee of
    different flavors that is sold in their own coffeehouses and groceries/supermarkets to
    expand their product line.
     forward integration -  Disney operating retail stores that sell merchandise based on
    Disney’s characters and movies. This allows Disney to capture profits that would be
    otherwise enjoyed by another store.
     backward integration – Ford Motor Company created subsidiaries that provided the
    company key products like rubber, glass and metal. This ensured that Ford would not
    be hurt/affected by suppliers holding out for higher prices or providing materials of
    inferior quality.
     concentric diversification – Telephone companies like PLDT/Bayantel offers Internet
    access
     conglomerate diversification – Avon Jewelry: Avon used its door-to-door sales force and
    existing channels of distribution to market new products like this year the company
    started selling jewelry as well.
     joint venture – Google and NASA developing Google Earth
     retrenchment – Layoff of ABS-CBN workers due to non-renewal of congressional
    franchise resulting in ceasing of operations of the media company.
     Divestiture – LEGO divesting or discontinuing products that were not solely focused on
    their core product because it almost went bankrupt in 2004.  It sold four theme parks,
    their video game development division, and shortened the time spent in product
    development to turnaround the company. 
     Liquidation – Enron (already completed liquidation) and Lehman Brothers (ongoing
    liquidation)

    3. Compare and contrast financial and strategic objectives.  Which type is more
    important in your opinion?  Why?

    Financial objective means the financial requirements or goals that a company or


    organization plan for the future. In simple words to set a target on how to achieve
    profit and make more money. These objectives only covers how much money needs to
    invest in the company to achieve the required target. How to earn more profit within
    the amount available for the business and how to increase the profit ratio and
    expenditures. While in Strategic Objectives, all aspects of the business are taken into
    consideration. From planning to run the business, to invest money, to hire employees,
    marketing, dealing with competitors, etc. So we can say that financial objectives covers
    only the financial issues while strategic objectives deals with all aspects of the business.
    To answer the question which objective is more important, I would say both are equally
    important in running a business or organization. Strategic goals provide a sense of
    direction, a vision. It outlines the goals that the organization would like to achieve at the
    same time a business needs to manage its finances to ensure sustainable growth.
    4. Explain "First mover advantage"

    A first mover is a service or product that gains a competitive advantage by being the first to
    market with a product or service. Being first typically enables a company to establish strong
    brand recognition and customer loyalty before competitors enter the arena. Other advantages
    include additional time to perfect its product or service and setting the market price for the new
    item.

    Example of first movers are Amazon and eBay. Amazon being the first to sell books online
    which was immensely successful. By the time other retailers established an online bookstore
    presence, Amazon had achieved significant brand recognition and majority of the market. eBay
    built the first meaningful online auction website in 1995 and continues to be a popular shopping
    site worldwide nowadays.

    You might also like