MGMT1001 HW

Topic 9: Strategic Management

1. How might the process of strategy formulation, implementation and
evaluation differ for (a) large business, (b) small businesses, (c) not-for-profit
organisations, and (d) global businesses?
Different types and levels of organisations will have a different process of
strategy formulation, implementation and evaluation which are aimed to
achieve their goals. Large businesses employ competitive strategies to
promote innovation and product differentiation which is able to expand
customer base. Small organisations are likely to pursue stability rather than
using growth strategies that are implemented by large organisations seeking
profits. They may also use the cost-effective focus strategy which exploits a
narrow section of the market. Global organisations have similar goals to large
businesses however are interested in a market on a larger scale. This
includes many SWOT analyses and different strategies to appeal to different
markets which exist in the world market. In general, global organisations are
also seeking profits and expansion. On the other hand, non-for-profit
organisations are interested in delivering quality services rather than simply
seeking profits.
2. Should ethical considerations be included in analyses of an organisations
internal and external environments? Why or why not?
Yes, ethical considerations should be a part of all analyses as it will provide a
better reputation and prevent apathy to potential ethical problems. Unethical
conduct may cause boycotts as well as a change in consumer preference,
possibly resulting in a fall in stock price. Inclusion of ethics would provide a
greater customer base for the company and employees will experience
greater satisfaction due to their confidence of fairness in the organisations
operations.
3. Drawing upon Schuler & Jackson (1987), summarise 1 of the 3 different
competitive strategies and describe the implications of that strategy for HRM.
The Cost-Reduction strategy is designed to produce economies of scale
through a decrease in costs incurred by the company. This may involve a
reduction in employee levels or less ethical methods of production. As a
result of prioritising efficiency and reducing costs, employees are subject to
repetitive tasks. This will directly impact HRM as employees will experience
less job satisfaction due to both repetitiveness and lower flexibility from
tightened controls. This influences the recruitment process used by HRM,
firms will increase employment of part-time employees and subcontractors to
minimise cost. Training costs may be reduced as employees are generally
trained to complete a specific task. Over time, these employees will increase
their productivity due to improvements with practise. Furthermore,
employees may have lower task identity due to the limited scope of their
tasks as well as satisfaction. This may mean that HRM would have difficulties
retaining trained members, however due to the low costs of training on a

MGMT1001 HW
specific tasks, these employees are easily replaced.