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1. Solve any two
A.Define strategic management
Strategic management analyses the major initiatives taken by a company's top management on behalf of owners, involving resources and performance in external environments. It entails specifying the organization's mission, vision and objectives, developing policies and plans, often in terms of projects and programs, which are designed to achieve these objectives, and then allocating resources to implement the policies and plans, projects and programs. A balanced scorecard is often used to evaluate the overall performance of the business and its progress towards objectives. Recent studies and leading management theorists have advocated that strategy needs to start with stakeholders expectations and use a modified balanced scorecard which includes all stakeholders.
B. with a clean and neat diagram explain the importance of business process integration and the roles and responsibilities of each department?
2.A. What do you mean by pestle and sca analysis
PEST analysis "Political, Economic, Social, and Technological analysis" and describes a framework of macro-environmental factors used in the environmental scanning component of strategic management. It is a part of the external analysis when conducting a strategic analysis or doing market research, and gives an overview of the different macro environmental factors that the company has to take into consideration. It is a useful strategic tool for understanding market growth or decline, business position, potential and direction for operations.
Political factors are how and to what degree a government intervenes in the economy. Specifically, political factors include areas such as tax policy, labour law, environmental law, trade restrictions, tariffs, and political stability. Political factors may also include goods and services which the government wants to provide or be provided (merit goods) and those that the government does not want to be provided (demerit goods or merit bads). Furthermore, governments have great influence on the health, education, and infrastructure of a nation Economic factors include economic growth, interest rates, exchange rates and the inflation rate. These factors have major impacts on how businesses operate and make decisions. For example, interest rates affect a firm's cost of capital and
. technology incentives and the rate of technological change. It allows the maintenance and improvement of your enterprise's competitive position in the market. factors that are more likely to change in the future or more relevant to a given company will carry greater importance. its costs. therefore to what extent a business grows and expands. Applicability of the Factors The model's factors will vary in importance to a given company based on its industry and the goods it produces. For example. Furthermore. They can determine barriers to entry. companies may change various management strategies to adapt to these social trends (such as recruiting older workers). and lead to innovation. Additionally. both creating new markets and diminishing or destroying existing ones. consumer law. while a global defense contractor would tend to be more affected by political factors. which may especially affect industries such as tourism. automation. quality. climate. and insurance. Furthermore. Trends in social factors affect the demand for a company's products and how that company operates. and the demand for its products. These factors can affect how a company operates. For example. growing awareness of the potential impacts of climate change is affecting how companies operate and the products they offer. antitrust law. farming. a company which has borrowed heavily will need to focus more on the economic factors (especially interest rates). conglomerate companies who produce a wide range of products (such as Sony. Furthermore. For example. age distribution. Environmental factors include ecological and environmental aspects such as weather. minimum efficient production level and influence outsourcing decisions. Legal factors include discrimination law. Sustainable Competitive Advantage(SCA) Sustainable competitive advantage is the focal point of your corporate strategy. employment law. Technological factors include technological aspects such as R&D activity. Exchange rates affect the costs of exporting goods and the supply and price of imported goods in an economy Social factors include the cultural aspects and include health consciousness. It is an advantage that enables business to survive against its competition over a long period of time. and health and safety law. career attitudes and emphasis on safety. an aging population may imply a smaller and lesswilling workforce (thus increasing the cost of labor). Furthermore. population growth rate. thus focusing on the specific factors relevant to that one department. technological shifts can affect costs. or BP) may find it more useful to analyse one department of its company at a time with the PESTEL model. Disney. consumer and B2B companies tend to be more affected by the social factors. and climate change.
exclusive licenses. sustainable competitive advantage is achieved by continuously developing existing and creating new resources and capabilities in response to rapidly changing market conditions.and their unique combination you create to achieve synergy.are the basis of your sustainable competitive advantage. or can only be replicated with great difficulty . financial and marketing capabilities are of this kind. Distinctive capabilities are the basis of your competitive advantage.the characteristics of your company which cannot be replicated by competitors. Today. cheaper. Your distinctive capabilities . Reproducible capabilities are those that can be bought or created by your competitors and thus by themselves cannot be a source of competitive advantage. . According to the new resource-based view of the company. Your distinctive capabilities need to be supported by an appropriate set of complementary reproducible capabilities to enable your company to sell its distinctive capabilities in the market it operates.Hypercompetition is a key feature of the new economy. Distinctive capabilities can be of many kinds: patents. The fundamental quantitative and qualitative shift in competition requires organizational change on an unprecedented scale. your sustainable competitive advantage should be built upon your corporate capabilities and must constantly be reinvented. or tacit knowledge. effective leadership. Distinctive and Reproducible Capabilities The opportunity for your company to sustain your competitive advantage is determined by your capabilities of two kinds – distinctive capabilities and reproducible capabilities . strong brands. and they want it their way. teamwork. Many technical. New customers want it quicker.
their strength and control over you. then you can often have tremendous strength. Again. then buyers have bargaining power over each supplier. For example. 5. On the other hand. Competitive Rivalry: What is important here is the number and capability of your competitors – if you have many competitors. respectively. Industry rivalry is likely . This is driven by the number of suppliers of each key input. opening a home-cleaning business is simple. powerful buyers. then this weakens your power. if there is only one supplier for a particular component. the uniqueness of their product or service. 3. If you deal with few. the cost to them of switching from your products and services to those of someone else. If suppliers and buyers don’t get a good deal from you. the more powerful your suppliers are. which affects profitability. and the more you need suppliers' help. For example. the importance of each individual buyer to your business. but starting a manufacturing company is considerably more difficult. The fewer the supplier choices you have. and so on. Supplier Power: Here you assess how easy it is for suppliers to drive up prices. Low-entry barriers attract new competition.With an example of your choice explain the importance of Michael porters five forces model Five Forces Analysis assumes that there are five important forces that determine competitive power in a situation. if the same product is available from several suppliers. These are:1. then that supplier has bargaining power over its customers. The bargaining power of buyers and suppliers affect a small company's ability to increase prices and manage costs. Buyer Power: Here you ask yourself how easy it is for buyers to drive prices down. However. if no-one else can do what you do. this is driven by the number of buyers. then you can preserve a favourable position and take fair advantage of it Importance: Five Forces Model Porter's five forces determine a company's competitive environment. while high-entry barriers discourage it. 2. If it costs little in time or money to enter your market and compete effectively. if you supply a unique software product that automates an important process. or if you have little protection for your key technologies. and they offer equally attractive products and services. If you have strong and durable barriers to entry. Threat of New Entry: Power is also affected by the ability of people to enter your market. then new competitors can quickly enter your market and weaken your position. they are often able to dictate terms to you. If substitution is easy and substitution is viable. if there are few economies of scale in place. and so on. people may substitute by doing the process manually or by outsourcing it. the cost of switching from one to another. then you’ll most likely have little power in the situation. Threat of Substitution: This is affected by the ability of your customers to find a different way of doing what you do – for example. they’ll go elsewhere. 4.B.
a term coined by Toyota. Autonomation technically refers to a technique for detecting and correcting production defects that combines a mechanism for detecting defects with another for stopping the line or machine when defects occur. The measure of productivity is defined as a total output per one unit of a total input. JIDOKA Jidoka is a Toyota concept aimed at describing the man-machine interface such that people remain free to exercise judgement while machines serve their purpose. and intense rivalry leads to lower prices and profits. Toyota officially defines heijunka as ‘distributing the production of different [body types] evenly over the course of a day …’ It incorporates the principles of line balancing by attempting to equate workloads.to be higher when several companies are vying for the same customers. The problem with this is that there is often no device for stopping the process if a malfunction occurs. What do you mean by productivity? explain any three productivity techniques as one of the strategic fit for enhancing productivity at the shop floor level Productivity is a measure of the efficiency of production. 3. Because this process can lead to a large number of defects in the event of a machine malfunction it is considered unsatisfactory by Japanese manufacturers. • Do not accept defects. Productivity is a ratio of production output to what is required to produce it (inputs). Automation refers to changing from a manual process to a mechanised process. Machine jidoka incorporates fail-safe devices on machinery to prevent. refers to automation that automatically controls defects. HEIJUNKA Heijunka is the Toyota planning system. defects are found. Human jidoka allows operators to stop the process in the event of a problem. or materials or parts shortages occur. • Do not pass on defects. Workers have the ability to stop the line if: • • • • equipment malfunctions. which focuses on achieving consistent levels of production. Jidoka has two separate meanings – automation and autonomation. ‘Autonomation’. Jidoka is often referred to as ‘automation with a human mind’. • Do not make defects. work delays occur. levelling demand out by creating an inventory . The following three principles are central to the jidoka way of working.
an approach to running the organisation which pursues excellence in both the product and every area of the business. maintenance.. as well as achieving uniform scheduling of production so that as one operation ends the next operation is ready to begin. accounting. and . This will not be achieved by reacting to latest developments. Although the levelling aspect of heijunka typically results in more even production and process workloads. it requires careful planning. Heijunka is a key operating concept of just-in-time (JIT) manufacturing systems. One of its benefits is that the levelled load benefits upstream parts-fabrication processes and parts suppliers too. testing and agreement as to how all those involved with both manufacturing and support functions will act. it involves load levelling and line balancing. pull systems. purchasing. which aim to promote a rapid response to customer demand while minimising inventory – for example. If perfect heijunka is attained in a JIT manufacturing system. the underlying rule is essentially the rule of heijunka – an even work load for all employees. Multiple products are assembled simultaneously instead of first dedicating the line to one product then changing the entire line to produce another. The basic aim of JIT in a factory is to: • • • • reduce lead times minimise inventory reduce the defect rate to zero and accomplish all of the above at minimum cost There are three essential ingredients to effective manufacturing excellence through JIT: • JIT manufacturing techniques. • a total quality culture. In the factory. who are freed from having to maintain high capacities solely to cope with large lots in downstream processes. more advanced lean plants are using loadlevelling boxes to visually represent the levelled schedule. The goal is to minimise the standard lead-time by adopting a keep-it-moving approach to manufacturing. small transfer batch sizes and plant layouts that support short movements of materials. For example. a uniform or rhythmic flow of mixedmodel production is possible. JIT continually focuses attention on waste and in particular on the time spent on all aspects of the manufacturing process. short change-over times. In practice.buffer and replenishing that buffer. etc. design. Just-In-Time (JIT) A philosophy of manufacturing based on planned elimination of all waste and continuous improvement of productivity. Heijunka also has the capability of reducing lead times by minimising time losses due to changeovers. The entire line is seldom changed over between products. parts must also be supplied to the assembly process in very small lots without delays. In heijunka. including customer service. order taking.
when connected via business intelligence tools with CRM.• people involvement. clients. A business can obtain major cost savings by acting upon information from CRM systems. and finished goods from point of origin to point of consumption. and sales prospects. can throw light on many hitherto unknown aspects of a company's business processes. but also those for marketing. As it continues to grow. An important feature to understand when deploying CRM is that it can only provide information that has to be used both at the front end and back end to improve processes. entice former clients to return. customer service. Dell’s collaboration with other computer software companies has allowed it to become a leader in customer relationship management (CRM) and supply-chain management (SCM). Customer segmentation information can be used to structure the purchase of raw materials. that is the involvement of all employees in the development of the organisation through its culture and its manufacturing and other business processes. it is important that it be linked to the back processes. scheduling manufacturing. service and retain those the company already has. Customer relationship management (CRM) is a widely implemented model for managing a company’s interactions with customers. What do you mean by scm? And how do you correlate this with customer relationship management for creating brand for the product Supply chain management (SCM) is the management of a network of interconnected businesses involved in the provision of product and service packages required by the end customers in a supply chain. and technical support. attract. and win new clients. For any business to extract maximum benefit from its CRM deployment. and synchronize business processes—principally sales activities. The overall goals are to find. managing inventory. It involves using technology to organize. The insight offered by CRM into customer behavior and demand patterns can be made use of to streamline manufacturing and distribution of products as managed by the supply chain function. ensuring availability of the product and maintaining profitability of the manufacturer. Supply chain management spans all movement and storage of raw materials. CRM-SCM integration strives to satisfy and promptly deliver products to customers. work-in-process inventory. while continuing to meet the demands and requirements of its customers. automate. It has been known for its innovative customer service and product custom configuration. 4. it is faced with the challenge of how to maintain its customer relationships and inventory management. Supply chain management. and overall running the supply chain. There . and reduce the costs of marketing and client service. Dell Dell is one of the most successful and profitable computer corporations in history.
in real-time. This has instilled trust into their customers. information with suppliers about customer demands and buying patterns. this has created a very strong relationship with the customers. test. As one part became more efficient. Customers were able to save money while being able to purchase a customized machine because Dell passed on the savings. while at the same time increasing efficiency. then Dell added other components in stages.are many lessons learned from Dell’s experience. It set-up mock environments to develop. Dell ensured that each stage of the process performed will and allowed for future growth before rolling out the entire system. which resulted from efficient inventory management. Dell has become an industry leader in service and reliability. . and support systems in patches without disrupting the live version. It was able to share. Ensure better customer service is offered. These lessons can be transferred to other companies in the industry. This minimized the risk. By custom-building a computer that the customer desires. Extend the connection from the customer to the supplier Dell was able to extend its build-to-order model from suppliers to the customer while continuing to maximize operational efficiency and customer satisfaction. Dell has used CRM to its advantage. Dell was able to bring on one piece of the system at a time. no excess inventory or inventory shortages. Implement technology in a phased fashion Dell tested key tasks in each of its regions prior to deployment.
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