Performance is measured by each of these groups according to their own particular interest. For example, brilliant commercial performance may be rated very highly by consumers but not by shareholders if this brilliant performance does not result in rises in the share prices. It is measured continuously by each of the groups indicated. It is punctuated by formal and semi formal events: annual reports, interim reports, staff, production and service performance appraisal, production and sales figures, pay rises and pay rounds, activity levels, and budget efficiency and effectiveness.
For staff: there is a need to be well rewarded; to gain job satisfaction, fulfillment, development and achievement, to be associated with a positive an prestigious organization or occupation, to be valued, respected and esteemed; steady and increasing levels of wages and salaries, the capability to earn commissions and bonuses where these are stated or implicit in reward patterns, be treated fairly and well, have prospect of advancement, be treated with respect.
For shareholder and backers: there is a need to receive regular positive returns on investment; to receive specific dividends and other benefits as the result of investment, be paid to deadlines anticipated or agreed, longevity, stability and profitability of organization. Suppliers: the ability to establish a pattern of financial management that ensures that their cash flow management is adequate.
Customers, consumers, clients and users: expect satisfaction and utility from the products and services; in many cases, they also expect esteem, respect and value to be enhanced, value for money, and be treated with courtesy and accuracy. Media and financial analysts: unless carefully managed, the media and financial analysts are likely to arrive at their own view of the performance of a particular organization, partly on their own judgment. Vested interests, pressure groups, and lobbies: require a proportion of organizational finance to be spent in addressing their own particular concerns; of especial currency are the needs to put a proportion of resources into maintaining and improving the environment, quality of life and quality of working life.
Communities: expect to feel pleased and proud to have certain organizations established and working in among them. It is necessary to recognize the range of parties, both internal and external, who have a legitimate interest in the organization, who measure it for success or failure, and the measures that they bring to bear from their point of view. Long term viability is much more likely where the concerns of each group can be addressed and reconciled successfully. One of the main tasks of top managers is to recognize the nature and legitimacy of the interests of the different stakeholder groups and interested parties, and to take steps to see that these are widely understood and satisfied as afar as possible.
4 Strategic tools and techniques – reason for employing a number of different tools, what they are used for. The overall purpose of strategy is to guide and direct the inception, growth and change of organizations as they conduct their activities. A clearly articulated, accurate and well understood strategy is at the hub of all successful commercial and public activities; where success is not forthcoming it is often where this clarity of purpose id also not presents.
Strategic analyses are conducted to ensure that each aspect of the organization, and its competitive and general environment, are clearly understood. The approaches used are as follows: SWOT analysis. The purpose of SWOT analysis is to help organizations learn, clarify issues and identify preferred and likely directions. In this activity issues are raised, highlighted and categorized under the four headings of strengths, weaknesses, opportunities and threats or SWOT. It is an effective means of gathering information, of illustrating or illuminating particular matters, and for gathering or articulating a lot of information and ideas very quickly.
STEP analysis. The purpose of STEP analysis is also to help organizations learn, but the material arising is much more concerned with the analysis of the wider strategic situation, and organization and its environment. It establishes in more detail the wider background against which particular product or service initiatives are to take place, and raises wider issues or concerns that may in turn require more detailed resource and analysis.
Industry structure analysis In this analysis focus is directed at each of the five distinctive elements, ‘five elemental forces of competition’, that are present to some extent in all sectors. The purpose is to clarify the position of the organization in its chosen sphere of operations, and also to signal any likely or obvious issues for concern. The five elements are: the industry competitors, suppliers, buyers, potential entrants, substitutes.
Competitor analysis This involves the assessment of other players in the filed. It considers the initiatives that they may themselves take to promote their own strategic advantage and also to measure their likely responses to such initiatives on the part of organizations in question. The components of competitor analysis are: the strategy of the competitor; its current business operations, capacities, strengths and capabilities; the assumptions held about both the competitor and industry itself; a detailed profile of the competitor.
Customer and client analysis The purpose of conducting customer and client analyses is to ensure that the business or public service relationship is considered from the point of view of customers, clients, consumers and end users. It should form a major component of strategic analysis. Customer and client analysis is key task of strategic management, and a critical component in the determination of policy, direction and priorities.
A successful strategic approach can only be achieved if the ways in which the particular sector operates are fully understood and analyzed. This analysis must also depend in gaining as full as understanding as possible of customer and client behavior, demands, wants and needs. Devising and implementing strategy is a continuous process, one that is subject to constant analysis, evolution and review. It must be clear and strong enough to give a universally understood clarity of purpose. 5 Recession and bubbles, friendly, hostile environments, how should mangers behave, what ways can they operate, what is their reason.
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