Strategic Business Management: Analyzing The Organizational Environment

Disucss about the Strategic Business Management, The strategic analysis phase interprets the strategic position of the organization by first determining the changes that have occurred in the economic environment and identifying their impact on the organization and its activities.

Infographics on Organizational Strategy

My name is Dr. Stanley Romin the CEO and managing director of Plats IT services, a company that helps in strategic technological management consultancy to medium and small enterprises dealing in banking and finance. I am here to address you on the strategic analysis of our company in which I believe we must all work together in order to achieve the missions and visions of our great organization. I welcome you to this meeting as we forge the way forward to our strategic mission and vision in our organization.

Indeed all we need is to become the best in what we do and through our strategies we will achieve that (Bock & Strecker, 2016). As explained so far is still very diffuse, we will understand more thoroughly what it is about and develop it with an example. The strategic plan for our organization contains the following;

Mission

Provision of IT consultancy services to SMEs in order to drive them to their optimum efficiency towards achieving their goals.

View

Our view is to become the biggest IT service provider in the country and to develop a rapport that helps to strengthen our organizations.

Policies

To be the best IT service provider in the country and all over the world.

Principles and values

The principles are the ethical line of the organization. Values ??are the determination of what we have to be as an organization. They also include the problems that have to be solved. It is not usually choose more than six purposes.

The strategic analysis phase interprets the strategic position of the organization by first determining the changes that have occurred in the economic environment and identifying their impact on the organization and its activities, and second, determining the benefits and resources of the organization, depending on these changes (Bryson,2018). The main goal of the strategic analysis is to assess key impacts on the current and future position of the organization and determine their specific impact on strategic choice.

The proposed improvement programs align human resource management actions with the fulfillment of the strategic objectives of the organization, which will be reflected in better indicators and in the achievement of goals through innovative initiatives, managing efficient budgets.

There are three components of strategic analysis.

1. Purpose and objectives.
2. Analysis of the external situation.
3. Goals, vision and mission

One of the novelties that incorporates the revision of the standards for ISO management systems is the extent to which the concept of the organization's context is addressed. The organization stops being considered in isolation to be part of a group and occupy a place that must know (Elmes & Barry, 2017). By understanding the situation in which it finds itself, the efficiency of the management system increases, favoring its strategic focus. The analysis of the context of the organization provides useful information for decision making. The long-term success of the organization is possible when the requirements of the interested parties are taken into account, including all the people and organizations that may affect, be affected or perceived as affected by a decision or activity of this organization.

Company Environment

With regard to the consideration of interested parties, flexibility is provided so that each organization determines which stakeholders are relevant in terms of the impact on their ability to provide products and services that comply. The internal and external factors relevant to the purpose of the organization and its strategic direction will be determined. As input elements in the planning of the system include all issues, requirements or factors that may affect your ability to achieve the desired results.

Internal factors

They can be, among others, employees, owners, partners, organizational structure, products and services, roles and responsibilities, policies and objectives, resources to achieve them, assets (facilities, assets, equipment, technology), financial resources, communication networks, culture organizational, capacities (resources and knowledge), information systems, decision-making processes (formal and informal), information flows, standards, guidelines, models adopted by the organization.

External factors

Clients: are the enablers of the organization that must offer products and services that meet their needs.

Suppliers: fundamental to be competitive and ensure the availability of resources to carry out the activities.

Investors: necessary to grow so they must be handled with care to ensure long-term success.

Media: attract success by helping maintain a good image

Competitors: the organization must be aware of the activities of its competitors maintaining the value bet to maintain and improve its position in a competitive environment.

Knowledge of the external context can also be facilitated when considering issues arising from the technological, cultural, social (pressure groups, agreements with other organizations), legal (regulations, regulations, government policies, international relations, industry-specific factors), market (monetary issues, international trade, consumer attitudes, changes in the needs of users, changes derived from citizen demands) or economic (taxes, financing, development, growth).

A SWOT analysis can be useful for a context evaluation. It allows identifying the strengths and weaknesses of the organization, as well as relating it to its environment based on an analysis of the opportunities and threats of its activities in the target market (Grant, 2016). It is advisable to carry out this analysis on a regular basis in order to know if the proposed objectives are being met, or the internal and external factors have been modified.

This analysis can be completed with a competitive analysis relating the organization with its environment. A market study will allow us to know the success of the changes adopted by our competition and what is their response to strategic movements of third parties or changes in the environment (Kono,2016). It is important that each organization determines what factors are relevant to the implementation and planning of the management system, since not taking them into account can affect the ability to achieve the expected results.

The micro-environment (or competitive environment) determines the conditions of operation and development of companies and greatly limits their strategic decisions. Companies can influence the micro-environment, but the strength of their influence will be determined by their power in the market.

There are many methods, instruments or tools to perform the analysis of the micro-environment and the evaluation of the attractiveness of the sector in which the company operates. Among them are:Weighted evaluation of the attractiveness of the sector in which the company acts - the elaboration of a list of criteria that allow evaluating the attractiveness of said sector.Analysis of stakeholders (stakeholders) - the analysis of the group or individual that can affect or be affected by the achievement of the company's objectives.

Another essential aspect of the analysis carried out during the strategic management process of an organization is its resources (potential of the company). If the latter selects them adequately and possesses the skills and capacities necessary to take advantage of them, they will become part of their strategic potential, that is, the basis for creating the competitive advantage of the organization. To evaluate the potential of the company I propose to use the following methods of strategic analysis:

The matrix of functions and resources, whose purpose is to study the way in which resources and functions are distributed in an organization. In general, this method consists of ordering and describing the existing resources of the organization through a cross function in order to determine if they are sufficient to carry out a specific strategy and to check if their distribution is the most appropriate.

The SWOT analysis, whose objective is to help an organization to find its critical strategic factors, to use them, once identified, and to support organizational changes in them: consolidating Strengths, minimizing weaknesses, taking advantage of opportunities and eliminating or reducing threats. As the leading organization is considered one that achieves the best results in the sector in which it develops its activities (Morden, 2016). At this point it is convenient to point out that benchmarking is not about copying, nor imitating a practice or determined way of doing things in another organization that is successful or improvements with it, it is about emulating, internalizing and adapting that practice to the own organization and its own organizational culture. Strategic analysis of the company in this place is worth noting that in the specialized literature, you can find dozens of different strategic analysis methods to carry out this analysis (Walker, et al, 2014).

The option that managers of companies have today to optimize scarce resources and achieve better decisions, is to incorporate new alternatives to traditional management models, which allow improvements through the development of innovative and effective ideas at the same time. One of the most effective ways to achieve this option is to use Indicators through the use of Strategic Maps (Thompson, 2017). Before applying metrics for measurement, relationships between human resource improvement programs and strategic business objectives must be "mapped".The strategic objectives are linked in a chain of "cause-effect" improvement relationships. What is the impact of the training improvement program on the results of the organization through Indicators? In order to answer this question, the "cause-effect" relationship of the human resources improvement program in the organization's results must be valued with numbers. Let's use an example of measuring a training improvement program in which the role of the indicators defines the success of human resource management and the impact on the organization (Rothaermel, 2015).

The measurement indicators should be simple and structured on the basis of questions to the supervisors of the trained collaborators, such as: The challenge of implementing efficient indicators and their strategic role in the organization via human resources management programs will continue in the future, generating a virtuous circle of productivity and improvement. If I want to have a lot of money, it is necessary to specify what amount I want to have. Based on the above, I must make a strategy and activities that allow me to have the specified amount. But nothing of the previous thing, will surely be carried out if before I am not a person apt to carry out said strategy (World Health Organization, 2015). It is necessary that I have a series of principles, values ??and abilities that allow me to do in order to have.

Conclusion

The strategic role of the indicators is achieved by measuring and managing the improvement programs in human resources and therefore generate greater value in the processes of the organization. The Return on Investment (Benefit / Cost) of human resources programs must always be greater than 1, which implies in terms of money that for each monetary unit invested there is a multiplying factor on the utility of the organization.

References

Bock, A., Frank, U., Bergmann, A., & Strecker, S. (2016, November). Towards Support for Strategic Decision Processes Using Enterprise Models: A Critical Reconstruction of Strategy Analysis Tools. In IFIP Working Conference on The Practice of Enterprise Modeling (pp. 41-56). Springer, Cham.

Bryson, J. M. (2018). Strategic planning for public and nonprofit organizations: A guide to strengthening and sustaining organizational achievement. John Wiley & Sons.

Elmes, M., & Barry, D. (2017). Strategy retold: Toward a narrative view of strategic discourse. In The Aesthetic Turn in Management (pp. 39-62). Routledge.

Grant, R. M. (2016). Contemporary strategy analysis: Text and cases edition. John Wiley & Sons.

Kono, T. (2016). Strategy and structure of Japanese enterprises. Routledge.

Morden, T. (2016). Principles of strategic management. Routledge.

Thompson, J. D. (2017). Organizations in action: Social science bases of administrative theory. Routledge.

Rothaermel, F. T. (2015). Strategic management. McGraw-Hill Education.

Walker, R. V., Beck, M. B., Hall, J. W., Dawson, R. J., & Heidrich, O. (2014). The energy-water-food nexus: Strategic analysis of technologies for transforming the urban metabolism. Journal of environmental management, 141, 104-115.

World Health Organization. (2015). Global technical strategy for malaria 2016-2030. World Health Organization.