Strategy Formation and Implementation Essay

Posted: July 5th, 2021

The primary purpose of businesses and companies is to maximize their profit margins, spatial influence, and market share in the industries. However, the business environment has become extremely competitive, necessitating the companies to develop and implement business strategies that align with their objectives. A business strategy involves the practices a company adopts to maximize its competitive advantage, increase efficiency, and benchmarking. Businesses and companies are in stiff competition against each other to acquire the highest numbers of customers and the highest market share in the industry (Ovans, 2015). This assignment focuses on four central aspects, namely, strategy definition, formulation, implementation, and evolution. The discussion involves two main articles, where main ideas are highlighted as well as the similarities in thoughts, and conflicting opinions of the authors.

To begin with, in the article Adaptability: The New Competitive Advantage, the author emphasizes the need for businesses to become flexible and adaptable to the ever-changing economies and their trends. He believes that many risks and instability characterize the world in which companies are operating. Some of the dangers highlighted include the new and ever-changing technologies, globalization and its spillover effects, and increased transparency (Deimler, 2011). With such new trends that keep changing and shifting the cause of business operations, it is easy to destabilize any business. The author recommends that these businesses have to structure themselves or instead adopt strategies that are flexible and adaptable to these risks and insecurities.

Secondly, the authors explain in the nexus between adaptability levels, effective strategy formulation, and competitive advantage. Competitive advantage is a priority in all companies; however, it keeps changing due to the trends mentioned earlier. It requires the companies and businesses to implement adaptive business strategies, as it is the new competitive advantage. To ascertain this argument, the author shows how various companies in the media industry have shifted their ranking positions. Some are falling from the most profitable companies to failing companies due to their strategies and change in the market trends (Deimler, 2011). According to the authors, sustainable competitive advantage is attained not from a company’s spatial influence or first-order core competencies but its organizational capabilities. It is in that case that companies should differentiate between ‘being good in doing something’ from ‘being good at learning to do things.’ A company that adopts a learning culture is flexible and easily adapts to external and forced changes without constraints. A company with adaptive strategies is likely to achieve sustainable competitive advantage compared to rigid companies.

Thirdly, four main organizational capabilities are highlighted that enable companies and businesses to attain adaptive competitive advantage in their industries. Successful companies can recognize change and react quickly and efficiently. Different companies develop strategies that will allow them to identify potential changes in the market trends, their customers, and other risks. Information is power, and every company must invest in intelligence to acquire the change signals (Deimler, 2011). Secondly, successful companies can experiment on new products or services to find the most successful strategies and business models for their companies. For instance, e-commerce is widely increasing, and companies are forced to adapt the strategy if they are to maintain a competitive advantage. By doing so, a company should experiment using efficient and effective technologies that will maximize the value while minimizing the costs.

Successful companies have strategies and abilities to manage complex systems in their operations. Companies can be multidimensional, diverse, and explorative in their services. It can serve different market niches. With the diversity and use of new technologies, the company can be adaptive to any industry, thus increasing its adaptive competitive advantage. Finally, adaptive companies inspire learning working environments, autonomy among workers, flexibility, and diversity (Ghemawat, 2016). These elements are the building blocks of an adaptive competitive company. The authors emphasize the need to adopt an adaptive approach among companies operating in competitive and unstable environments. Adapting, accepting, embracing, and incorporating change is a useful survival strategy for companies.

When comparing these ideas and arguments with the author of What is Strategy? The tow authors concur and conflict in various aspects. To begin with, the two authors agree that a company needs to invest in its organizational effectiveness to maximize its competitive advantage. Organizational effectiveness includes adopting strategies that maximize its profits, minimizes the costs, and adds value to the company. In the articles, the authors show the importance of effective strategy formulation and implementation in the company (Anbalagan, 2017). They describe that in unstable environments, a company requires to adopt strategies that only maximize its competitive advantage. These strategies should be reflected in their products, business process, organizational culture, and business models.

Secondly, the two articles concur on the issue concerning the risks and uncertainties emerging industries and technologies have on companies. Deilmer and Reeves argue that such new trends keep changing and shifting the cause of business operations. They further recommend that requires companies should adopt strategies that are flexible and adaptable to these risks and insecurities. On the other hand, Porter describes the uncertainty managers face due to the instability created in the markets. He further shows that improving the company’s operational structure and effectiveness can help managers address these issues (Ghemawat, 2016). They both agree that adaptability is essential in the success and high performance among companies. They advise companies to make changes to their strategies to accommodate and react to changes.

Thirdly, the two authors conflict on what enables a company to attain sustainable competitive advantage. According to Deilmer and Reeves, companies require an adaptive approach to achieve sustainable competitive advantage. However, according to Porter, sustainable competitive advantage among companies can be achieved through strategic positioning. This means that a company is likely to differentiate its operations and actions from its competitors if it can perform unique activities or similar events in unique ways (Deimler, 2011). This aspect also differs from Deilmer and Reeves’ idea that a sustainable competitive company must differentiate ‘being good in doing something’ from ‘being good at learning to do things.’ One article emphasizes on the need to be good at learning to do things while the latter emphasizes on the need for companies to perform unique activities, or similar events in unique ways (Anbalagan, 2017). The authors have different views on how companies should formulate and implement their strategies.

Finally, the articles show the need for companies to manage their complex systems to increase their competitive advantage as well as making it consistency. According to Deilmer and Reeves, successful companies have strategies and abilities to manage complex systems in their operations (Deimler, 2011). On the other hand, Porter describes the need for companies to map their strategies and complex systems to strengthen their strategic fit. He represents the importance of having a compelling strategic fit to be an added advantage. It will enable a company to achieve not only a competitive advantage but also a sustainable competitive advantage (Anbalagan, 2017).

These two articles emphasize strategy continuity, as a priority among companies in their quest to attain not only a competitive advantage but also sustainable advantage. Other than the difference in adaptability and strategic positioning, as main strategies of achieving sustainable advantage, the two articles have consistent thoughts and ideas.

References

Anbalagan, S. (2017). Harvard Business Review What Is Strategy Michael Porter . Harvard Business REview, pp. 58-78.

Deimler, M. R. (2011). Adaptability: The New Competitive Advantage. Harvard Business Review, pp. 3-9.

Ghemawat, P. (2016). Evolving Ideas about Business Strategy. Business History Review, Volume 90, Issue 4 pp: 727-749.

Ovans, A. (2015, May 12). What Is Strategy, Again? Harvard Business Review.

Porter, M. E. (2012). Towards a dynamic theory of strategy. Strategic management journal, 95-117.