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Strategic Management And Linear Model

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Discuss about the Strategic Management And Linear Model.



The fact is known to all that companies in the global world who wants to achieve success and gain the competitive edge need to initiate strategic management. Strategic management refers to activities held in an organization which initiates their growth and fulfills the objective of the organization. It is basically the formulation of different plans in an organization so that to provide profit to the organization. But it shall also be noted that in an organization the strategic management activities shall be held in such a way that it assists the stakeholder's interest or increase it (Kramar 2014). The organization shall always look after their interest and aim to provide the maximum benefits. Further, the linear model in strategic management refers to the planning process developed by the company so as to assist the working of organization gain benefit out of the business activities.

The linear model helps the organization to implement strategies by planning process; they plan activities which shall be done in a way that it provides an advantage to the company along with the stakeholder. But in strategic management, the linear approach many times fails to fulfill the requirements of the organization and its members. So to resolve that issue there are many other approaches defined to assist the working of the organization in the global market (Armstrong, and Taylor 2014). The company shall always to look after all the approaches and then select the approach which adequately fits the management of the organization. The report further provides a detailed view of some approaches to strategic management and how they are utilized by different business process. Additionally, the benefits and drawbacks of implementation of these processes are discussed in the report.

Strategic Approaches with example

As discussed above, strategic management is the process in which the management activities are conducted in a business. The efficiency of a business in the market depends upon the efficiency of its internal management system only. Thus, the companies shall adopt definite management approach which positively affects the organization (Stark 2015). Some of these approaches are discussed below:


Stakeholder Approach

Stakeholders are the people who are affected by the activities of a business process. It is not mandatory that a stakeholder needs to be connected with the business in financial terms only; a person who is connected with the non-financial activities of the business is also regarded as the stakeholder of the company. Some of the stakeholders of an organization are suppliers, consumers, customers, community, government etc. (Galliers, and Leidner 2014). The stakeholder approach states that the managers of an organization shall implement and formulate actions and plans which shall satisfy the expectations of the customers; it also states that in order to gain long-term success it is mandatory for the company to fulfill the requirements of the customers. As per the amount of participation of different groups in the activities of organization, company can also make profit in the imperfect market. This process actively emphasizes the business environment, relationships, and promotions of shared interest (Hill, Jones, and Schilling 2014).

The dominant part of the stakeholder approach is that the business entity needs to focus on the satisfaction of shareholder more than profit rising. The management process under this approach shall be designed in such a way that it benefits the interest of shareholders. It can initiate reinforce values in the management process and initiate creation of competitive edge. The approach is planned and executed in the management while considering various factors which are defined according to the interest of stakeholders (Wheelen, and Hunger 2017). With this effect, it can be seen that there is an interdependent relationship between organization's managerial activities and the objective of stakeholders. The stakeholder approaches also develop and increases the powers of stakeholder to rule the management of the organization. Hence, the process ultimately results in generation of more profits to satisfy the requirements of the stakeholder in a better way.

Further, the stakeholder theory is better understood with the business management if they take care of the interest of the stakeholders. The process through which the interest of stakeholder can be managed is by communicating the recent business changes or other information with them. Consult with them regarding some problems occurring in the business environment (Al Ariss, Cascio, and Paauwe 2014). Apart from this, the company shall adapt to manage the stakeholder risk, also the stakeholders of the organization can also be regarded as the risk as they have the authority to make changes in the organization and these change may affect the business activity in a positive or negative way. Along with this they also come with an opportunity, thus the management shall make sure that they minimize the risk and optimally make use of the opportunity provided by stakeholders of an organization (Mok, Shen, and Yang 2015).

Stakeholder Approach example

Looking at one of the companies who uses the stakeholder approach and earns optimum return for the organization is the coca cola company. The company competently uses the stakeholder approach and implements the business sustainability in their organizational culture. The company efficiently aims to initiate various business management processes keeping in mind the interest of their stakeholders. The main purpose of initiation of these processes is to provide maximum benefits to members and drive maximum satisfaction for them. This will initiate proper growth of the organization. As discussed earlier the company believes that if they maximize satisfaction level of customers and stakeholders then profit is automatically maximized (Berrone, Cruz, and Gómez-Mejía 2014).


Dynamic Capabilities Approach

Dynamic capabilities refer to the abilities of an organization to perform better with efficient use of their available resources. According to this approach, the company shall plan and implement strategies in such a way that they obtain maximum use of the resources available to them and drive incentives for the organization. In this way, adequate growth for the organization is achieved.

 In accordance with this approach, the company shall involve in activities which excessively use the natural resources, instead the management of the organization shall ensure that adequate use of resources is made; as with maximum utilization the environment will get affected adversely and natural resources will get depleted. This concept helps the organization to know about their capabilities on the basis of which they can work and put their effort in the management (De Brucker, Macharis, and Verbeke 2013). The resources of an organization include natural and well as artificial resources. Human resource is the most important asset of an organization which helps them to gain competence in the market. Use of dynamic capabilities approach will help an organization to develop an understanding of their abilities and resources which they are under or over utilizing. Thus, this process will help an organization to optimally use the resources present with them and achieve success. The dynamic capabilities approach includes their abilities, involvement of which will help the organization to achieve their targets in the target market. These are:

  • The ability of the employees of the organization to learn and adopt changes in the fluctuating external environments.
  • Adoption and involvement of new assets in the organization's working.
  • And the process of adoption of methods to transform the used or waste resources in such a way that benefit is achieved (Doh, and Quigley 2014).

Further, some of the stages of the dynamic capabilities approach are discussed below:

Learning: learning is the initial and the basic phase of this approach. It involves that the human resources of the organization shall initiate to change their current routine and schedule in such a way that it assists the organization in achieving the objective. The management shall ensure that adequate activities in the business process are carried out that ensure proper communication and learning in organization. If the communication process of the organization is efficient, then it can act as an advantage for the organization as with this the employees can learn and adapt new changes easily (Verbeke, and Tung, 2013).

New assets: it refers to the techniques and the degree of understanding that the management shall have to adopt new assets in the organization. They shall be efficient enough to manage the use of new and innovative technology.

Transformation of available resources: all organizations have resources which are used less or are wasted in its use. Thus, the dynamic approach of strategic management states that the organization ensures that such resources are adequately used and managed in the business process (Harrison, Freeman and de Abreu 2015).

Co specialization: regular use of single type of technology or resources helps the organization to gain excellence in that work. Thus, due to the process of dynamic capabilities and organization becomes efficient to initiate a single type of work and gain success. This process is called co specialization, which is by making use of resources becoming efficient and gaining advantage for business.


Dynamic Capabilities example

Apple is the company which utilizes the dynamic capabilities approach in their management process and initiates efficiency and competence in the local market. The company is not a technological innovator but it is a good marketer. The company efficient analyzed their resources and things they are good at, after that, they utilized their resources and efficiency in a direction so that the organization objective is achieved. They adequately placed their product in the target market and efficiently promoted the product which gained everybody's attention and sale was initiated. Thus in this was the company utilized the dynamic capabilities approach to become a leader in the electronics industry (Villar, Alegre, and Pla-Barber 2014).

Sustainability Approach

Sustainability refers to the process of using things in such a way that they are utilized adequately and saved for the future generation as well. Sustainable approach refers to the approach of business management that helps an organization to use the available resources and technology efficiently in such a way that they are used properly. If the process of sustainable develops in occurred in an organization then it can be said that the organization can easily live with the available resources for an adequate period of time and they do not need to spend more to optimize resources. All organization in the current era shall understand the need of resources and utilize them wisely so that they are left for the future generation as well (Helfat, and Peteraf 2015).

The sustainable approach also states that the activities of a business shall not negatively affect the environment and society in which they are prevailing. All organizations shall aim to fulfill their corporate social responsibilities. Some of the activities which the business shall use are, use less electricity and water, emit less carbon and initiate to plant more and more trees. In this way, cleaner environment will sustain (Di Stefano, Peteraf, and Verona 2014). The managers of the organization shall understand the need of the sustainable development in business context and execute those activities only which positively affect the business growth. The organization which emits more carbon particles in the environment shall take initiative to somehow survive in cleaner environment. Thus, the sustainable management refers to the process of doing business in the market in such a way that it does not hamper the growth of the business and instead assists the society in fulfilling their social responsibility (Schilke 2014). Industrial functioning shall be changed and new rules shall be applied in the organization which improves its growth. The manager of an organization who is concerned with the different activities happening in the organization, they shall ensure that the employee working under the organization and executing activities in such a way that they are not disturbing the nature and also they are complying to the organization's mission and vision statement as well (Carmenado, et. al., 2016).


Sustainability Approach example

It shall be noted that the company famous for providing pure coffee beans uses the sustainability approach in their business context to help the nature and earn good profit from it as well. The company came into alliance with the supplier and communities present in the external environment to provide premium quality coffee beans in the market (Youngran, et. al., 2017). Looking at this proposal in the market the stakeholders initiated to invest in the plan of the organization. Thus, due to which the company earned profit and in return they provide organic quality products in the market as well. Keeping the interest of stakeholders aligned with the activities of the organization the company Starbucks initiated this activity so that a win-win situation for both company and stakeholder is created. Thus in this way, the stakeholders approach is used in organizations.

Advantages and disadvantages of different approaches

  1. The advantage to stakeholder approach is that the organization provides an opportunity to the stakeholders of the organization to use their powers and speak for their rights. It gives them the power to utilize the rights and initiate activities which are best for the business process. Whereas disadvantage of this activity is that, more power given to the stakeholders of the organization can result in hindrance in the managerial activities of the organization. The stakeholder can interrupt in the activities proceeded by the board in the organization. More autonomy to stakeholders can act as a risk for the organization (Neubert, and Dyck 2016).
  2. The advantage to dynamic capabilities approach is that it helps the organization to understand the essence of resources available, and it also initiates the proper use of resources so that they are left for the future generation. Whereas drawback of this approach is that if an organization is unable to understand this concept then they might overuse the resources which can create a bad impact on the environment and society.
  3. The sustainable approach helps an organization to work efficiently so that their growth is sustained in the market. Whereas disadvantage of this approach is that it distracts the organization from doing its core business activities which are harmful to the growth of the organization in the market (Armstrong, and Taylor 2014).


Thus, concluding the above statements the fact that shall be noted is that the strategic management activities are necessary for an organization to work efficiently in the growing competitive market. Also, the linear standard approach applied in the organizations much time fits in the process, but there are some drawbacks to that approach as well. Thus, other approaches like stakeholder, dynamic capabilities, and sustainability approach help an organization to run peacefully and gain profit. Further, in the report, the activities of companies which use these approaches were also noticed. Thus, these sufficiently fulfill the requirement of an organization and its stakeholders as well. The analysis says that the business shall work to maximize the satisfaction of stakeholder considering the corporate social responsibility but many times the approaches lack behind as well. Thus, the management strategies shall be used wisely to provide benefits to the organization and nature on harm.


Further, considering the above analysis it shall be recommended that an organization shall only apply those strategies which best fit the organization's culture and its activities. They shall not compete with any company and imitate its business process; instead, the company shall analyze its management and then formulate action plans which assist the activists of the business process. Also, the main purpose of an organization is to earn profit, but they not earn profit with and wrongly means or by defrauding the customers. The company shall initiate activities which implement a sustainable growth for the organization. Sustainability shall be the major goal of the organization, and then only they will survive in the tough market conditions and gain good returns and competitive advantage as well.



Al Ariss, A., Cascio, W.F. and Paauwe, J., 2014. Talent management: Current theories and future research directions. Journal of World Business, 49(2), pp.173-179.

Armstrong, M. and Taylor, S., 2014. Armstrong's handbook of human resource management practice. Kogan Page Publishers.

Berrone, P., Cruz, C. and Gómez-Mejía, L.R., 2014. Family-controlled firms and stakeholder management: A socioemotional wealth preservation perspective. The Sage handbook of family business, pp.179-195.

Carmenado, I.D.L.R., Hernandez, H.B., Mendez, M.R. and Ferrer, C.G., 2016. Managing for the Sustained Success of Organic Food Associations: A Sustainable Management Approach. Food Science, Production, and Engineering in Contemporary Economies, p.25.

De Brucker, K., Macharis, C. and Verbeke, A., 2013. Multi-criteria analysis and the resolution of sustainable development dilemmas: A stakeholder management approach. European journal of operational research, 224(1), pp.122-131.

Di Stefano, G., Peteraf, M. and Verona, G., 2014. The organizational drivetrain: A road to integration of dynamic capabilities research. The Academy of Management Perspectives, 28(4), pp.307-327.

Doh, J.P. and Quigley, N.R., 2014. Responsible leadership and stakeholder management: Influence pathways and organizational outcomes. The Academy of Management Perspectives, 28(3), pp.255-274.

Galliers, R.D. and Leidner, D.E. eds., 2014. Strategic information management: challenges and strategies in managing information systems. Routledge.

Harrison, J.S., Freeman, R.E. and de Abreu, M.C.S., 2015. Stakeholder theory as an ethical approach to effective management: Applying the theory to multiple contexts. Revista Brasileira de Gestão de Negócios, 17(55), p.858.

Helfat, C.E. and Peteraf, M.A., 2015. Managerial cognitive capabilities and the microfoundations of dynamic capabilities. Strategic Management Journal, 36(6), pp.831-850.

Hill, C.W., Jones, G.R. and Schilling, M.A., 2014. Strategic management: theory: an integrated approach. Cengage Learning.

Kramar, R., 2014. Beyond strategic human resource management: is sustainable human resource management the next approach?. The International Journal of Human Resource Management, 25(8), pp.1069-1089.

Mok, K.Y., Shen, G.Q. and Yang, J., 2015. Stakeholder management studies in mega construction projects: A review and future directions. International Journal of Project Management, 33(2), pp.446-457.

Neubert, M.J. and Dyck, B., 2016. Developing sustainable management theory: goal-setting theory based in virtue. Management Decision, 54(2), pp.304-320.

Schilke, O., 2014. On the contingent value of dynamic capabilities for competitive advantage: The nonlinear moderating effect of environmental dynamism. Strategic Management Journal, 35(2), pp.179-203.

Stark, J., 2015. Product lifecycle management. In Product Lifecycle Management (Volume 1) (pp. 1-29). Springer International Publishing.

Verbeke, A. and Tung, V., 2013. The future of stakeholder management theory: A temporal perspective. Journal of Business Ethics, 112(3), pp.529-543.

Villar, C., Alegre, J. and Pla-Barber, J., 2014. Exploring the role of knowledge management practices on exports: A dynamic capabilities view. International Business Review, 23(1), pp.38-44.

Wheelen, T.L. and Hunger, J.D., 2017. Strategic management and business policy. pearson.

Youngran, S., Thai, V., Grewal, D. and Kim, Y., 2017. Do corporate sustainable management activities improve customer satisfaction, word of mouth intention and repurchase intention?: Empirical evidence from the shipping industry. International Journal of Logistics Management, 28(2), pp.555-570.


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