Ani RE: Ch. 2,p.56 Question 9
Question 9: What do we mean when we say that strategy formation is situational or contingent in nature? Why is this important to understand?
Strategy formulation is not an easy, clean process. In fact, it is evolutionary in nature rather than revolutionary. The strategy and the process of formulating it should be always flexible for it to be adoptable to many different needs of an organization. Furthermore, when we say that strategy formation is situational or contingent in nature we mean that basically what can work for one firm might not be good for another. (Anthony, Kacmar, Perrewe, 2009) In addition, a formulation of a proper strategy for a particular organization must be organization specific. The reason for it is because the proper strategy is determined by its unique internal characteristics and its specific environmental opportunities as well as its threats. This goes for organizations in the same industry. To be exact, what might work for one HR consultative agency might not work for another agency. However, it is important to note that the situational or contingent strategic approach doesn’t imply that organizations should ignore what other organizations are doing. (Anthony, Kacmar, Perrewe, 2009) In fact, in the case of competition organizations need to look at what their competitors are doing to see if their strategy can work for them even if it needs to be modified. In the end, it’s important to view strategy formation as contingent or situational, because every organization has its unique needs, and through its proper formation it can anchor an organization to some position in the future.
Nicholas RE: Ch. 2,p.56 Question 9
What do we mean when we say that strategy formation is situational or contingent in nature? Why is this important to understand?
What they mean is that even though you develop a strategy it will not work in every situation and for everyone. Meaning that because you work in a hospital this plan will not work for every hospital, the plan is based on the situation of circumstances that this particular hospital has based on their unique set of parameters. The formulation of a proper strategy for a particular firm is firm specific. (Anthony P.55). Just because this plan that someone else might have developed may not specifically work for you in your own situation does not mean that you should not be aware of strategies and situations that others in your industry are doing.
This is important to understand because you need to know that you cannot just take a glimpse at the end result and try to reimplement a plan or strategy that someone else used just because you are both in the same industry. You should look at it more as a guide and work from there.
Alison RE: Ch. 3,p.96 Question 8
8. What are the environmental changes faced by AT&T as described in the case at the beginning of this chapter, and how have these changes affected basic AT&T strategy?
The most striking change to AT&Ts environment was change in regulation and competition. With antitrust laws and the breakup of their monopoly, the competitive environment became more saturated. The regulatory action meant that AT&Ts viability as a firm now rested on the abilities of its employees to adapt (Anthony, Kacmar & Perrew, 2010, pg. 63). The basic strategies of AT&T have changed significantly since the company was no longer the default choice for customers. AT&T started to work across cybercommunications with computer companies, starting innovating, and actively marketed to customers. The company also actively had to react to competition by not only advertising quality, but putting more resources to the stability of their product. Further, incorporating a cable strategy was a large shift that also stemmed from changes to competition. In the last few decades, packages have started to include phone, text, and cable. To get employees to innovate and be more productive, the company has also shifted their people strategy by offering stronger benefits packages and changing to a more pay for performance oriented culture.
Anthony, William P., Kacmar, Michelle K., Perrew, Pamela L. (2010) Human Resource Management: A Strategic Approach, (6th Edition) Cengage Learning
Nicholas RE: Ch. 3,p.96 Question 8
What are the environmental changes faced by AT&T as described in the case at the beginning of this chapter, and how have these changes affected basic AT&T strategy?
There are many environmental challenges that AT&T faces in its course of operating in the markets. These forces are broken up into two major categories, societal forces and the task environment forces. The societal forces are economic forces, technological forces, legal forces and political forces. The task forces are forces that directly influence the strategy that the company will take such as the labor market, competition, the customers and the government and special interest groups.
AT&T was faced by challenges from the government when they were forced to break up their monopoly and then had to come up with a new way of operating. Once they broke up, they were challenged by the new competitors that resulted from breaking up their company. They faced technological challenges in that they were faced with being on the cutting edge of the market, so they had to introduce and develop new technology to offer to the clients that suited their unique needs. They faced economic forces in that AT&T was faced with their stock prices plummeting being $73.5 billion in debt. The labor market many people had to transition from older position to newer position. Those who did not want to voluntarily switch was reassigned or terminated (Anthony p.64). They underwent creative restructuring during that period, and they didnt not have to hire new people, rather they recirculated its existing staff.
Anthony, W.P., Kacmar, M.K., Perrewe, P.L. (2009). Human Resource Management: A Strategic Approach. (6th ed.) Cengage Learning.
Alison RE: Ch. 3,p.96 Question 12
12. Many have written that the external environment changes very rapidly, often in unpredictable ways. Do you agree? Why or why not? Assuming that the environment does change in unpredictable ways, what relevance does this have for (1) attempting to take a proactive approach and (2) strategy formulation?
I agree that the external environment changes rapidly and unpredictably. The external environment is made up economic, technological, legal, political, sociocultural, and demographic forces (Anthony, Kacmar & Perrew, 2010, pg. 66). The task environment is manipulated by those elements in the societal environment which vary greatly. Looking at technology for example, companies have needed to adapt quickly as their customers expect 24/7 service across geographies at their fingertips. It can drive supply and demand, share feedback in real-time, influence company valuation, and change a companys productivity. If that is just one part of the external environment, it is easy to make the argument that companies struggle to keep up with all external factors influencing their businesses.
The key to taking a proactive approach in a rapidly changing environment is understanding the environment. Environmental scanning is the process of examining the external environment to determine trends and projections of factors that will affect the organization (Anthony, Kacmar & Perrew, 2010, pg. 94). Environmental scanning allows for companies to forecast, ideate based off of their market assumptions, and evaluate where the organization is versus where it should be. These elements in turn affect strategy formulation, as scanning is done with the intent of planning and making decisions. for effective strategy formulation, a firm must monitor the relevant portions of each environmental sector: the economy, labor market, technology, demographics, competitors, and legal/political sectors (Anthony, Kacmar & Perrew, 2010, pg. 95). The faster and more unpredictable the market is, the more a company needs to monitor their strategy, assess environmental factors proactively, and realign their strategy depending on their assessment.
Anthony, William P., Kacmar, Michelle K., Perrew, Pamela L. (2010) Human Resource Management: A Strategic Approach, (6th Edition) Cengage Learning.
Ani RE: Ch. 3,p.96 Question 12
Question 12: Many have written that the external environment changes very rapidly, often in unpredictable ways. Do you agree? Why or why not? Assuming that the environment does change in unpredictable ways, what relevance does this have for (1) attempting to take a proactive approach and (2) strategy formulation?
I do agree that the external environment can change very rapidly in unpredictable ways. Time always changes, with that new technological advances, products, services, competitors, societal environment, task environment, and other general needs arise that change the overall external environment. To be exact, with societal environment, an organization eventually or indirectly can get affected by outside environment forces. As for the task environment, an organization can directly get affected by outside forces. (Anthony, Kacmar, Perrewe, 2009) Therefore, rapid and unpredictable changes should always be expected when we deal with external environment. Furthermore, there’s also a global environment factor that makes everything even more large scale for organizations.
When attempting to take a proactive approach as an organization you should keep in mind your external environment, and make decisions based of how will it benefit you in regards to your external environment. Furthermore, an environmental scanning needs to be conducted which will determine trend and projections of factors that will impact the organization. (Anthony, Kacmar, Perrewe, 2009) Moreover, an anticipated environmental trends require a proactive approach in strategy formulation. That is why enacted environment can help with proactive approach taking, because an enacted environment is when an organization creates a relevant environment for itself by aggressively scoping, narrowing, and scanning the external environment. In effect, the organization creates the environment to which it can react proactively.
Reference:
Anthony, W.P., Kacmar, M.K., Perrewe, P.L. (2009). Human Resource Management: A Strategic Approach. (6th ed.) Cengage Learning.
