MN7405 Strategic Management Assignment Sample
Introduction
Emergent strategy can be referred to as a business strategy developed over a period of time in order to balance the changing circumstances with the business goals. These strategies are specially known to emerge at the times when any business carries on a set of actions in a repetitive manner for developing a pattern (Fluker, 2022). Emergent strategies can be referred to as somewhat different from that of deliberate strategies as the pattern of emergent strategy is by definition unintended. Certain examples are provided, which can analyse the reasons for prompting of emergent strategies such as economic changes, market changes, growth, new ideas and others.
Emergent strategies can be regarded as essential for businesses in order to sustain in the competitive market scenario. Primarily, one of the major advantages of incorporating emergent strategy in businesses is that it allows the organizations to become more flexible and provides enough opportunities for the companies to become agile (Soderling, 2019). This significant strategy is also considered as a continuous process, which enables adaptation of the organization along with continuous learning. Furthermore, with emergent strategies, practicality of the businesses to absorb changes efficiently becomes feasible. Unlike companies with deliberate strategies, emergent strategies provide practical vision to the companies. On the other hand, the company gets a chance to learn from the results of emergent strategy execution. In order to achieve success, the companies can apply those to their strategic plan. Moreover, through emergent strategies, the opportunity to grow becomes accelerated. Additionally, the creativity in the businesses allows them to address challenging issues with innovative solutions. Finally, with application of emergent strategies in the businesses, a healthy and prosperous working culture can be facilitated with enhanced creativity and flexibility. Thus, the importance of emergent strategies is immense in terms of operating a business in the competitive marketplace.
Conducting this research is necessary in order to develop a creative and flexible mindset. Often, deliberate strategies provide benefits to the companies. However, in relatively changing market conditions, emergent strategies work best, which allows the businesses to flourish through the challenges of economies and market. Therefore, understanding the need and importance of emergent strategies is essential that would be provided with the help of this research.
The main purpose of this research is to analyses the role, challenges, and benefits of the emergent strategies in the businesses. All the aspects of emergent strategies need to be analyzed in depth for understanding its impacts on the organizations, and in order to provide insights to such companies to apply those in their operations. Furthermore, through this research, an in-depth insight can be provided to the students as well and they can use this research work as a guide in their future assignments. In the primary section of the discussion, the differences along with similarities between strategic renewal and strategic inertia would be discussed for providing in-depth insight on the strategies. Furthermore, as the discussion proceeds, challenges and critiques are going to be discussed.
Main body
Differences and similarities between strategic renewal and strategic inertia
Strategic renewal can be referred to as the process of change and adjustment in the strategic decisions of the companies in order to facilitate potential for determining long-term competitive advantages (Schmitt et al. 2018). Whereas, strategic inertia is demonstrated by a complex relationship between strategic actions and interpreted performance negotiated in formal planning, conditioned by mechanisms of trajectory reinforcement that are known to interfere with the strategic change conditions. With the advancement of technologies and rapid globalisation, organisations need to adjust their strategies for adapting with the external challenges. In this case, companies can undertake strategic renewal for coping with the changes. On the other hand, certain factors are present that are responsible for interrupting the adapting ability of the companies, which are called strategic inertia (Hoppmann et al. 2019).
These two forces of strategic inertia and strategic renewal cannot be termed as independent in nature, rather they co-exist and its influences vary in the companies. It becomes evident to make strategic renewal in businesses. In order to fit in the dynamic environment, keeping the strategies updated becomes essential. Strategic renewal is most often used at the times when researchers refer to the process of change. However, the focus of strategic renewal needs to be on the content as well rather than focusing only on the process of change (Schmitt et al. 2018). Therefore, strategic renewal is known to hold the processes, outcome and contents together and this can also relate towards the prospects of the companies in the long term. On the other hand, the companies that are able to meet its external challenges efficiently can discover opportunities and threats due to which a strategic fit is established between these and their competencies along with internal structure. Furthermore, despite the need for change, often companies are challenged by certain forces, which abstain them from adjusting to the external environmental changes and these forces are called strategic inertia (Amberg and McGaughey, 2019). Additionally, strategic inertia is the influence, which has the capability to strongly inhibit yet it does not completely quell the renewal efforts.
Strategic renewals have three sub processes, which can be connected together to the events and behaviour of the employees in a company. The three sub processes can be identified as competence deployment, competence definition and competence modification (Pratap and Saha, 2018). Competence deployment can be referred to as a process where managers of a company arrange the resources in such a way, which enables a company to enter into a new market. In order to make deployment take place, it is essential for a company to know what competencies they have and what are required to be obtained. Accordingly, organisational readjustment, relocation of personnel or duties needs to be done for a successful implementation of strategic renewal. In the competencies modification, managers question the way of monitoring the competencies and strategies of a company (Nguyen et al. 2021). Furthermore, in competence definition managers are typically known to step away from adaptive behaviour or relocating resources and instead encourage employees to uphold experimentation with new skills.
On the other hand, strategic inertia is present in several ways and through a combination of unique internal forces. Additionally, companies that have achieved their predetermined goals can be considered to become less likely to introduce renewal of strategies and as a result are more expected to depend on strategic inertia (Slagmulder and Devoldere, 2018). Furthermore, an organisation’s commitment towards its current strategy can be defined as a contributing force towards strategic inertia, which is likely to increase over time.
Challenges and critiques of the theories with real business examples
The consequences of strategic renewal are utterly dependent upon the concept of strategic inertia. In terms of describing this concept, the context of the scientific management theory can be undertaken. The theoretical understanding has reflected its strength by emphasising on the creation of the most productive workplace by depending on simplification of tasks (Palla and Billy, 2018). From this viewpoint, the prime focus of this theory can be recognised upon productivity enhancement in the workplace by identifying the optimal way of completing a task in a successful manner.
As an example, the context of Netflix can be highlighted where the organisational management has been focusing on simplification of relational tasks and operation that has been adding a greater value to the overall organisational productivity. However, the financial performance of Netflix can be highlighted in this concern where the organisation has been able to empower their financial standings based on the simplification of tasks. This attribute has also contributed to a large extent to improve the overall organisation productivity that can be supported through their revenue generation throughout the years. The fourth quarter of 2021 witnessed USD 7.7 billion total revenue of Netflix which has also come up from USD 6.64 billion in the corresponding quarter of 2020 (Stoll, 2022). The figure provided in the appendix section has also been demonstrating gradual and consistent growth of Netflix supported through increasing productivity and simplification of tasks (Refer to appendix 1).
However, this theory has eventually highlighted certain drawbacks among which the most significant one reflects to ignore the humanity of an individual. In this regard, this theory can force an individual or employee to go beyond their abilities in order to increase workplace productivity. By referring to the case context of Netflix, significant attention can be drawn upon the consequences of strategic inertia related to the aspects of achieving competitive advantage in the market (Pettit and Crossan, 2020). Due to this reason, Netflix has paid attention to improve their overall workplace productivity as an integral part of achieving consistent financial growth and thereby ensuring competitive growth in the market.
Apart from that, the context of the disruptive innovation theory can also be highlighted for this purpose. The theoretical understanding looks forward to the small companies, which used to develop their existing products and services in order to challenge an established business in the market by entering the bottom of the market and continue to move up the market (Si and Chen, 2020). In this case, the prime strength of this theory can be recognised as the evaluation of successful processing and adaptation of better services in order to improve overall accountability of an organisation. Moreover, this theory focuses on modernisation of processes within an organisation that may provide immense benefits in business growth.
In order to draw real business examples of this concept, the context of Netflix can again be highlighted. Netflix has paid attention to conceptualise disruptive innovation by revolutionising the concept of daily entertainment among common people (Fast company, 2022). In order to ensure success, Netflix paid attention to enable faster menu scrolling facilities on mobile devices during 2017, which eventually changed the way content is encoded. This innovative feature has enabled Netflix to provide a more efficient and seamless user experience with attractive service quality. Apparent concerns can also be highlighted by referring to the consequences of digital streaming innovations undertaken by Netflix that have been changing customer experience (Fast company, 2022). From this viewpoint, real business implications of disruptive innovation concepts can be highlighted from the perspective of Netflix where the company is able to create a better platform for shaping consumer experience. It can also be highlighted by recognising the growth of the user base in Netflix that has also supported the organisation growth over the years. The figure provided in the appendix section has been highlighting gradual growth of Netflix throughout the years (Refer to appendix 2). It reflects successive conceptualisation of disruptive innovation within the operations of Netflix that has been helping the company to achieve an adequate competitive edge over the leading market computers like Amazon prime and others. This aspect successively reflects the conceptualisation of strategic renewal in the operations of Netflix with the inclusion of advanced technologies. It reflects certain dependency of this strategic renewal of Netflix upon respective strategic inertia like intense market competition and others.
However, certain limitations can be highlighted of this theory where the most important aspect highlights the concept of undefined inventions. Moreover, the context of technology disruption may also take place that could create troublesome consequences for an organisation to continue with their innovation strategy (Khanagha et al. 2018).
Apart from that, the concept of the systems management theory can be undertaken in this case. The theoretical understanding highlights multiple components that usually work in harmony for a large system in order to function in an optimal manner (de Camargo Fiorini et al. 2018). In this regard, the prime strength of this theory can be identified upon the establishment of an interrelation between an organisational success and its relational interdependence on respective subsystems. Similar consequences can be highlighted from the perspective of Netflix where the organisational employees are provided with equal significance in order to ensure business growth. The company is eventually notified to consider employees as the most valuable stakeholder that has also been adding a fair value to their operational efficiency as well as competitive growth over the global market (Richter, 2022). From this standpoint, purposeful implication of systems management concepts can be highlighted in Netflix that has been enabling their adaptability with reference to the business requirements.
On the other hand, this theory has also incorporated some limitations. The top most limitation of this theory reflects the existence of equality in entire variables in the extent of impacting and controlling entire business environment conditions of an organisation. Moreover, the theory has only reflected efficient collaboration by working together in order to ensure success where no specific focus has been kept upon evaluating the relational challenges and mitigation strategies.
Interrelation between strategic renewal and strategic inertia
With reference to the above mentioned evidence and evaluations, a number of factors can be stated, which forces an organisation to review their strategies and plans. In the case of Netflix, one of the most important factors that are creating the need for renewal of strategies is competition in the market. It has already been mentioned that the competition in the entertainment industry has risen to a significant extent with the entry of different streaming service providers. This has led the organisation to evaluate their operational strategies in order to develop brand recognition and to dominate the consumer’s preference list. Apart from that, another factor which comes under the strategic inertia of the streaming giant is the demand of new and wide variety of content by the viewers. In this context, the company has effectively renewed their existing strategy and have adapted to generic competitive advantage strategy in order to increase the diversity in the content, which eventually helped the company to gain competitive advantage (Putri and Paksi, 2021).
In addition to competitive advantage, innovation is another factor, which has driven the changes in the strategic plans of the organisation. It has been mentioned that Netflix has introduced a number of innovative features in order to provide consumers with quality content and flawless experience (Song, 2021). There are certain factors, which forced the company to bring innovations in the service. These factors were technological glitch, disruption of service, lack of variety in content and others. Additionally, Netflix has focused on designing the strategies, which treat employees as important stakeholders. Job satisfaction in employees and the sense of job security given to them is an important element operating behind any organisation’s success and growth (Onyusheva and Baker, 2021). Therefore, the company has renewed their previous strategies and have implemented some employee centric strategies in order to ensure job satisfaction in employees. Netflix has focused on creating a free and comfortable working environment for the employees, which allows them to share their opinions and worries freely with the management. This improvement in the strategies has helped the organisation in skilled and loyal employee retention, which has contributed greatly in the success of the organisation (Dillon, 2020). Overall, it can be stated that the strategic inertia has motivated Netflix to adapt to different effective and improved strategies.
Conclusion
From the above discussion, it can be eventually concluded that incorporation of appropriate strategies in companies is essential at the right time for gaining competitive advantages and also to encounter external challenges of the market. In this regard, incorporation of emergent strategies rather than focusing only on the deliberate strategies can increase a firm’s potential to become more flexible and adaptive in nature. Furthermore, creativity and innovativeness in the companies can also be increased through emergent strategies. Additionally, with emergent and efficient strategies, the internal working environment of the companies can be nourished and enriched with the positive culture of accepting change. With the concept of globalisation and technological advancement, the need for strategic change in the organisations has become essential for sustaining ahead of the competitors in the competitive market. Strategies are certain actions that are taken by the organisations to increase the efficiency, performance and profitability of the organisations.
In this context, Netflix has been taken for an instance to demonstrate its effectiveness of adopting effective strategies in its operations. Netflix has focused extensively towards simplification of relational tasks, and through application of this strategy, the company has been noticed to grow consistently in the market over the years. Furthermore, through the application of principles of scientific management theory, Netflix has potentially enhanced focus towards enhancing its profitability, which has brought forth negative impacts like ignoring humanity. Due to the principles of scientific management theory, the scientific approach towards increasing performance and profitability has been specifically addressed, ignoring the human aspect. This has led to excessive work pressure on the employees for increasing working output. Furthermore, through the analysis of the disruptive innovation theory, it can be understood that even the smaller companies with limited resources can flourish and progress through the market challenges by application of innovative approaches. Through incorporating innovation in products and services of a company, the potentiality to attract the customers of incumbent companies towards the smaller companies increases phenomenally, that poses a threat to the incumbent companies.
Thus, from the evidence gathered from the functioning and operations of Netflix, it can be derived that effective strategies play a major role towards achieving success of the companies. Additionally, through strategic renewal and strategic inertia, the organisations as per the external and internal challenges and forces can adjust the dynamic of organisational culture for bringing forth competitive advantages. Moreover, the importance of emergent strategies has been observed extensively, providing an in-depth knowledge of the company’s operations as per the current changes in the market. Thus, every company apart from deliberate strategies need to adapt emergent strategies as well for achieving a high range of flexibility. On the other hand, employees as well as the management get to learn several aspects, due to the encounter of practical scenarios. With time, different challenges are brought forth by the market towards the companies, and according to the challenges, companies need to exercise strategy renewals for being successful with flexibility in operations through the application of emergent strategies.
References
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