Developing a vision, mission and values is the foundation for long term success, as demonstrated by Collins & Porras in Built to Last, the Disney organisation, and Dee Hock at Visa.
If a vision and mission is recognised by all stakeholders and affects every hiring, strategic decision and communication; its effect can be magic.
A vision helps unite people towards a purpose. Creating and living a vision is the role of leaders in organisations. They have to espouse it and help others to believe it. Visions are aesthetic and moral, they come from within as well as outside. According to Disney, a successful vision accomplishes six goals:
gives a sense of the future
guides decision making and strategy
creates a shared purpose
provides guidelines that determine behaviour
connects to values
A mission statement is a unifying statement of what an organisation is in business to do. It is a key reference point in the planning and implementation of change.
A mission statement is a description of the organisation’s key purposes.
Values are the beliefs of an organisation, the expression of what it stands for and how it will conduct itself. Values are the core of an organisation’s being. They underpin policies, objectives, procedures and strategies because they provide an anchor and a reference point for all things that happen.
P2 (04.1.02): Evaluate the extent to which an organisation achieves the objectives of three stakeholders
Businesses, like people, are part of the world community and as such have responsibility for the activities carried out in their name.
Businesses are also responsible to a range of stakeholders with often differing and conflicting aims. For example an electronics manufacturer might have the following stakeholders:
Objectives of stakeholders
to maximise profits of the business, dividends and the value of shares
to maximise salaries and job security
value for money, good quality products
P3 (04.1.03): Explain the responsibilities of an organisation and strategies employed to meet them
Simply put, strategic planning determines where an organization is going over the next year or more, how it’s going to get there and how it’ll know if it got there or not. The focus of a strategic plan is usually on the entire organization, while the focus of a business plan is usually on a particular product, service or program.
There are a variety of perspectives, models and approaches used in strategic planning. The way that a strategic plan is developed depends on the nature of the organization’s leadership, culture of the organization, complexity of the organization’s environment, size of the organization, expertise of planners, etc.
Quite often, an organization’s strategic planners already know much of what will go into a strategic plan However, development of the strategic plan greatly helps to clarify the organization’s plans and ensure that key leaders are all “on the same script”. Far more important than the strategic plan document, is the strategic planning process itself.
P4 (04.2.01): Explain how economic systems attempt to allocate and make effective use of resources
Economic systems – An economic system is one that a society attempts to meet people’s material needs and wants through the production of goods and services. From the country’s point of view, production of goods and services is influenced by the limited supply of such elements as labour, land and natural resources and capital. The scarcity of supply of resources means that the Government has to decide the allocation of these limited resources among competing claims, given the opportunity costs associated with the decision of producing a certain products and services within the economy systems instead of others.
Effective use of resources –
The extent to which the mix economies, for effective allocation of resources, between the government intervention and private enterprises varies from countries to countries.
Government interventions are usually in the form provision or prohibition, subsidies or tax and regulation
In the case of telecom business, Singapore Government has provided that telecom sector to be liberalized in 1998 in line with Singapore’s broad direction of economic development, that is, to withdraw from commercial activities which no longer need to be undertaken by the public sector. Privatization also allowed government to raise cash through sale of state enterprises, getting rid of poorly managed state enterprises. SingTel has evolved from a government agency since 1955 through the processes of corporatization in 1992 and privatization in 1993 freeing a state enterprise from political interference so that they can function as commercial entities.
On the other hand, the Singapore government has created and maintained what is known as an enabling business environment providing the legal and infrastructures needed to support private sector activities to act as the engine of economic growth. By privatization, Singapore government avoided the competition with private sector, hence, creating a business environment that allowed competition among private telecommunication providers.
P5 (04.2.02): Discuss the impact of social welfare and industrial policy initiatives on organisations and the wider community
The Industrial Policy plan of a nation, sometimes shortened IP, “denotes a nation’s declared, official, total strategic effort to influence sectoral development and, thus, national industry portfolio.” A nation’s Industrial Policy plan is composed of a comprehensive set of sector-specific industrial policies.
Most if not all countries in the world have chosen to intervene actively in their domestic economy through industrial policies. Some authors believe that what motivated the Canadian government to pursue an industrial policy during the 1970s was their concern of deindustrialization, a problem that seems to justify the use of interventionist practices, since manufacture has been considered the engine of growth in economic theory. Even the United States, a nation historically in favor of “free-trade”, has implemented strong tax, tariff, and trade laws to protect itself from “dumping”, the flooding of a market by a competing nation with goods or services below market prices in order to gain an advantage over domestic firms.
European socialist commitment is for welfare programmes and universal suffrage to extend citizenship and equality of opportunity. “Property” must prepared to pay for its security and the infrastructures “society” provides – law, stability, a productive, educated population, the right to trade in the market which has institutions and safeguards enabling commerce to occur – the features of Adam Smith’s marketplace.
P6 (04.2.03): Evaluate the impact of macro economic policy measures and the influence of the global economy on UK-based organisations and stakeholders
The outlook for the global economy has deteriorated rapidly. We are now faced with a synchronised downturn in most of the world’s major economies. These developments will have a profound impact on the UK economy and raise the prospects of an especially severe recession.
As an economy enters a recession many macroeconomic forecasters typically expect growth to return to its trend or average rate reasonably quickly. As economic conditions continue to deteriorate the projections for a recovery are successively pushed further out into the future. The common assumption appears to be that the underlying forces putting downward pressure on economic activity, which we often have a poor understanding of, are likely to dissipate. But often these shocks to economic activity are more prolonged than anyone expects.
With Bank Rate at a historic low of 1.5% we must consider the options available to monetary policy makers in case we approach the zero bound in the near future. In this speech I will argue that the Bank of England has a range of tools available to provide an effective monetary stimulus to the economy, even at the zero bound.
Meaning of Competition and Competitive Markets:
The concept of competition can be defined in many ways. In common parlance, competition refers to rivalry between firms in a market for objects like market share and profits. Market power is the ability to raise market prices above competitive levels and exclude competition.
Competition in a market refers to actions of incumbents in an established market and those potential entrants who would like to sell the same product. The instruments of competition would be price or capacity (quantity competition) and other non-price instruments like advertising etc. This involves erecting entry barriers, product differentiation, vertical integration etc.
Competition for a market is defined as a process of creating a new market based on innovative technologies and/or new standards (example new operating system for Windows). This involves challenging the sellers of existing products through the introduction of new products or creating potential competition by upfront investment in facilities to supply a new product. Here the instrument of competition is not the price or capacity. Measurement of competition for a market is much more difficult than the measurement of competition in a market.
It is helpful to discuss certain standard models that economic analysis uses to understand competition and competitive behaviour.
P8 (04.3.01): Use a range of examples to illustrate the relationship between market forces and organisational responses
Market forces are economic factors that affect the price and availability of a product or a service in a free market.
Major market forces that influence demand and supply
New entrants and substitutes
Competition among exiting rivalry
Response to loss of domestic market share-
Embark on regionalization enlarging its customer based covering Singapore, Indonesia, India, Thailand and Australia. –
Build economies of scale through an enlarged market
Response to threats from new entrants: –
building economies of scale through the enlarged regional market.
Response to competitive rivalry-
backward integration by selling content, i.e. MioTV instead of just merely a broadband supplier-
exclusive distributorship for apple’s I-phone leading to a monopolistic position in the Asia region
Response to Regulator:-
Collaboration with competitors by allowing them to share telecom network.
Market forces have impacted SignTel – SignTel responded by its regional and channel strategies to strengthen its leading position in Asia including Singapore telecom market.
P9 (04.3.02): Explain the behaviour and competitive strategies employed by an organisation and discuss the role of the Competition Commission and regulatory bodies
The choice of competitive strategy is one of the most important decisions for small business success. Traditionally, external adaptation has been the focus of strategy process research. We know little, however, about the relationships between the firm’s internal resources and the strategic orientations. Current issues that call for action in strategy research include why small business managers make certain strategic choices rather than others, and how small business managers can develop competitive strategies based on available resources. In order to achieve high performance each strategy must be supported with appropriate resources and distinct competencies (Snow & Hrebiniak, 1980). Before we address these questions we need, however, to understand the relations between strategies and resources, including the relationships between various resource configurations and the actual competitive strategies employed by small firms.
The competitive strategy literature based on Porter’s seminal contributions and Miles and Snow’s (1978) typology focuses on the competitive positioning part of strategy. It has to a lesser extent highlighted the internal parts of the firm. Day and Wensley (1988) as well as Spender (1993) called for research addressing the conversion of an organization’s skills and resources into positional advantages. We may find that the most critical elements in creating sustainable competitive advantage are found in the internal resource configuration of the firm (Amit & Schoemaker, 1993; Barney, 1991; Black & Boal, 1994). The interplay between the market oriented positioning aspects of strategy and the internal resource configuration and governance of the firm is still within business strategy research.
P10 (04.3.03): Discuss the importance of international trade, economic integration and global markets to UK business organisations
The Government’s central economic objective is to achieve high and stable rates of economic growth and employment. Trade openness and globalisation have an important role to play in raising the long-run rate of growth in the economy. Evidence suggests more open economies tend to grow faster.
Openness to trade strengthens the drivers of productivity by providing greater opportunities to exploit economies of scale; by exposing the domestic economy to greater competitive pressures; by rewarding innovation and providing access to new technologies; and by increasing incentives for investment.
Alongside the benefits to economic growth, consumers are already benefiting from globalisation through both the increased choice of goods and services available and through lower prices of imports, for example, of consumer electronics.
In addition to these effects, globalisation offers potential benefits to certain subsets of the economy. For example, the creation of global supply chains could increasingly enable specialised SMEs to compete more effectively by performing specific operations in the supply chain. Their flexibility, nimbleness and quality advantages may provide a competitive advantage over larger competitors.
P11 (04.4.01): Analyse the impact of two policies of the European Union on UK business organisations
Most participants considered that the benefits of participation exceeded the costs they had incurred. However, although a high proportion of projects were concerned with product or process development there has been little commercialisation of project outputs since completion. In total these represent over 25% of the sample but the size of the commercial returns are in most cases very small, typically amounting to a few thousand pounds per annum. Technical success rates in the project were high with over 80% of participants having achieved all, or most, of their objectives. The fact that participants were satisfied with their participation despite the low levels of commercialisation reflects the other benefits they derived. Over three-quarters of those interviewed cited enhanced scientific or technical knowledge as a key benefit of participation.
P12 (04.4.02): Explain the economic implications for the UK of entry into EMU
The UK has to decide whether to join the other members of the EU in a monetary union. This choice depends in part on the outturns for the economy inside and outside EMU. The UK has chosen to target inflation, and this can involve some ‘price level drift’, whilst the ECB emphasises ‘Price Stability’ and would plan to reverse the drift in the price level that might be caused by external shocks such as an increase in the oil price. It compares these ideas with the more Anglo-Saxon approach embedded in inflation targets. These regimes are then compared over the future using a large macro model (NiGEM) which includes descriptions of all the European economies. It is repeatedly subject to historically representative shocks. The effects of these shocks on the UK and Europe are compared with the UK in and out of EMU. Membership of EMU helps stabilise inflation and the price level in the UK, but leaves output more volatile. The differences depend on the rules in place and on the set of shocks applied to the model. It concludes a discussion of the options available to the UK.