Nowadays, the business world is looking for continuous expansion to generate higher revenues and enhancing the quality of the production processes. Additionally, mergers and acquisitions contribute to the strengthening of the competences and stimulation of the core competitive advantage while facing the increasing and intense competition in the world. Nonetheless, the significant differences between mergers and acquisitions tend to exist due to the different nature of the phenomenon. The takeover and acquisition imply having control of the acquired firm’s equity by 50 %. In turn, the merger implies the creation of the new business unit. Despite having slightly dissimilar nature, the intentions remain the same, as they remain an essential instrument to stay competitive on the market. In turn, the concept of the synergy enhancement also has to be taking into account while improving the quality of acquisitions and justifying their importance. It is commonly known that one of the Continue reading
Corporate Strategies
The Nadler-Tushman Congruence Model
The main responsibility of the management is to ensure smooth operations of a firm. In addition, the management must ensure that the goals being pursued by the organization are attained. Essentially, the goals of the organization can only be reached when the inputs are transformed into the final products and services. In other words, the major function of the management is to ensure that they put in place strategies that will ensure effective transformation of the organization’s inputs into the desired outputs. In addition, the management must also be efficient in all other operations related to the company’s functioning. However, managing the organization effectively has remained a challenge for the most of managers. Understanding the dynamics occurring within the organization including the group and individual behaviors, changing processes as well as the relationships that exist between the processes is complex . Despite the complexity of these processes, the changes occurring Continue reading
Case Study: Starbucks Survival From the Financial Crisis of 2008
The beginning of the economic crisis of 2008 significantly affected all businesses throughout the country, and this event influenced the companies involved in international operations in the first place. For example, Starbucks faced challenges stemming from the emerging hardships expressed by financial losses and wrong strategic choices, deteriorating its overall position in the market. However, the managers’ external circumstances were not the most critical considerations since the existing problems in Starbucks’ activity were added to the new issues. The failure to adhere to the company’s original vision related to providing not simply a product but valuable experiences led to difficulties in overcoming the crisis. From this perspective, the analysis of all conditions as of 2008 is required to demonstrate Starbucks’ capability to survive in the future. The Company During the Economic Crisis of 2008 During the economic crisis of 2008, Starbucks’ managers were reported to struggle with maintaining operations while Continue reading
4 Important Perspectives on Strategy
There are four perspectives or views on strategy, the classical approach to strategy, evolutionary perspective on strategy, processual approach to strategy and systematic perspective on strategy. Their features are described below. 1. Classical Perspective on Strategy In the classical approach to strategy perspective, profit is seen as the ultimate objective of the firm and profit targets can only be attainable through rational planning by the firm’s management. This perspective was designed by a businessman and historian Alfred Chandler, a theorist Igor Ansoff and a businessman Alfred Sloan. The perspective is based on three assumptions and they include; rational analysis, distinguishing conception from execution and the commitment of firms to maximize their profits. The major question is to position a business in markets where profits are likely to be maximized. The aim of the perspective is to ensure that there are returns on capital, and in this case, a focus on the Continue reading
Corporate Reputation – Meaning, Definition, Elements and Importance
Meaning and Definition of Corporate Reputation Corporate reputation refers to perceptions of an organization held by all stakeholders acquired over time. This indicates that corporate reputation must be earned. It represents the image of an establishment that the customers have. While a section of scholars believes that reputation cannot be directed and controlled, most believe that it is an integral part of a business and must be managed. Therefore, reputation management refers to an attempt by organizations to influence how their clients perceive them. Corporate reputation defined as overall estimation in which a company is held by its constituents. A corporate reputation represents the net affective or emotional reaction – good bad, weak or strong – of customers, investors, employees and general public to the company’s name. World’s leading companies such as Coca cola, Unilever, Johnson & Johnson, Disney, etc. had truly created their corporate identities that define their who Continue reading
Reputation Risk – Meaning, Definition and Management
Reputation is an accumulation of perceptions and opinions about an organization that reside in the consciousness of its stakeholders. Reputation has becoming increasingly important to any company as the world becomes more complex. Tangible factors of business are becoming less significant and rapidly replaced by the intangible factors. Reputation is considered as the most valuable intangible asset. Though reputation is considered as an intangible asset which will not be presented in any balance sheet, it will represent the market value. Warren Buffet said: “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” The hard-owned reputation is much more vulnerable in 21st century, as the globalization and development of technologically interconnection make news more easily transmitted and more transparent. Once reputation is compromised, it may be costly to rebuild reputation and the period may be extremely long. Continue reading