Professional Documents
Culture Documents
1
Course: Business Policy and Strategy (887) Semester: Spring 2010
Level: MBA Total Marks: 100
Pass Marks: 40
Note: Attempt all questions.
Q. 1 Develop your vision and mission statement for an organization of your choice from
broadcasting sector and compare your vision and mission statement with the original vision
and mission statement of that organization. (20)
Q. 2 (a) As a manager of any service organization, how would you identify and analyze
strategic gap? (10)
(b) Select any firm from manufacturing sector, discuss the general environment and
competitive environment of that firm. (10)
Q. 3 Suppose you are running a large scale business organization, how will you use the
technology to leverage human capital and knowledge? (20)
Q. 4 For any government organization in Pakistan, what will be the challenges and implications
for the strategy development of Human Resource Management? Discuss in detail. (20)
Q. 5 (a) How an international organization develops its different strategies? Explain the
factors affecting international strategies. (10)
(b) Describe the growth of any international business through related diversification and
through unrelated diversification. (10)
Globalization was the buzzword of the 1990s, and in the twenty first century, there is no
evidence that globalization will diminish. Essentially, globalization refers to growth of
trade and investment, accompanied by the growth in international businesses, and the
integration of economies around the world. According to Punnett (2004) the globalization
concept is based on a number of relatively simple premises:
• A smaller world means that people are more aware of events outside of their
home country, and are more likely to travel to other countries.
• These increases mean that the economies around the world are more closely
integrated.
Managers must be conscious that markets, supplies, investors, locations, partners, and
competitors can be anywhere in the world. Successful businesses will take advantage of
opportunities wherever they are and will be prepared for downfalls. Successful managers,
in this environment, need to understand the similarities and differences across national
boundaries, in order to utilize the opportunities and deal with the potential downfalls.
The globalization of business is easy to recognize in the spread of many brands and
services throughout the world. For example, Japanese electronics and automobiles are
common in Asia, Europe, and North America, while U.S. automobiles, entertainment,
and financial services are also common in Asia, Europe, and North America. Moreover,
companies have become transnational or multinational-that is, they are based in one
country but have operations in others. For example, Japan-based automaker Honda
operates the largest single factory in the United States, while U.S. based Coca-Cola
operates plants in other countries including France and Belgium—with about 80 percent
of that company's profits come from overseas sales.
During the early1990s, there were reasons to feel that globalization was working. The
economic success of Singapore, the rapid economic growth in the Asian Tigers (as the
Asian countries that grew rapidly were called), the industrializing of countries, such as
Brazil and Mexico, and a variety of other positive economic events around the world
suggested that the results of globalization were indeed good for development in poorer
countries, as well as in richer ones. During the 1990s, the United States experienced one
of its most sustained periods of growth as well, and there was much talk of a "new
economy", based on globalization, which was immune to economic shocks and recession.
Unfortunately, this rapid growth was not without consequences. The Seattle meetings of
the World Trade Organization turned into a fiasco, with anti-globalization groups
demonstrating against globalization on all fronts—from animal rights to environmental
concerns, poverty alleviation, and jobs for Americans. The anti-globalization forces have
not coalesced into a coherent whole because they represent such diverse and often
contradictory views. The vehemence of their protests, however, make it clear that
globalization is not a panacea for the world's problems. In addition, the Asian Tigers
suffered major economic setbacks in the late 1990s. In 2002, Argentina's economy, which
had been one of the stars of the 1990s, crashed, when the country could no longer
maintain its currency at par with the U.S. dollar.
Further problems occurred in the Triad economies. Japan, Europe, and the United States,
often referred to as the Triad, dominated international trade and investment for much of
the second half of the twentieth century. The Japanese economy went into a severe period
of recession and deflation in the late 1990s, and in 2001 both the European and the U.S.
economies took a downward turn as well. In turn, the rest of the world was negatively
affected by the economic situation in the Triad. The terrorist attacks in the United States
in September, 2001, exacerbated this already negative economic situation.
In developing appropriate global strategies, managers need to take the benefits and
drawbacks of globalization into account. A global strategy must be in the context of
events around the globe, as well as those at home.
International strategy is the continuous and comprehensive management technique
designed to help companies operate and compete effectively across national boundaries.
While companies' top managers typically develop global strategies, they rely on all levels
of management in order to implement these strategies successfully. The methods
companies use to accomplish the goals of these strategies take a host of forms. For
example, some companies form partnerships with companies in other countries, others
acquire companies in other countries, others still develop products, services, and
marketing campaigns designed to
Table 2
Differences Between Domestic and
International Strategy
Country GDP per Capita (2003 Estimate in US$)
Luxembourg 55,100
United States 37,800
Norway 37,700
Bermuda 36,000
Cayman Islands 35,000
San Marino 34,600
Switzerland 32,800
Denmark 31,200
Iceland 30,900
Austria 30,000
products or services. Managers also should consider the currency stability of the different
markets, which can be done by using documents from the home countries to determine
currency value and fluctuation over a period of years.
To select the best markets for entry, managers also should consider the degree of
competition within different markets and should anticipate future competition in them as
well. Determining the degree of competition involves the identification of all the
companies competing in the prospective markets as well as their sizes, market shares, and
prices. Managers then should evaluate a prospective market by considering the number of
competitors and their characteristics as well as the market conditions—that is, whether
the market is saturated with competition and cannot support any new entrants.
Next, managers should evaluate the regulatory environment of the prospective markets,
since knowing tax, trade, other related policies is essential for a successful international
business. This step entails determining the respective tariffs and trade barriers of
prospective markets. Different types of trade barriers may influence the kind of business
activity a company chooses for a particular market. For example, if a prospective market
has trade barriers that restrict the entry of foreign-made goods, a company might decide
to access the market through foreign direct investment and manufacture its products in
that country itself. Ownership restrictions also may limit a company's interest in a
particular market; some countries permit foreign companies to set up local operations
only if they establish a partnership with a local company. In addition, managers should
find out if prospective countries charge foreign companies higher taxes or if they offer
tax breaks and incentive to encourage economic development. A final consideration
companies must make concerning government is stability. Since some countries have
rough government transitions resulting from coups and uprisings, companies must
countenance the possibility of political turmoil that could substantially disrupt business.
The last step in international market evaluation is the assessment of cultural factors. To
avoid difficulties associated with cultural differences, some managers look for new
markets that have cultural similarities to their home market, especially for initial
international market penetration endeavors. Unlike market potential, competition, and
regulation, cultural differences are more difficult to evaluate. Nevertheless, managers
must try to determine the consumer needs and preferences in the prospective markets.
Managers must also account for cultural differences in labor relations such as worker
motivation, compensation, hours, etc. if planning foreign direct investment in an overseas
company. Moreover, a thorough understanding of a prospective country's culture will
greatly facilitate any kind of global business enterprise. This cultural knowledge should
include a basic understanding of a prospective country's beliefs and attitudes, language
and communication styles, dress, food preferences and customs, time and time
consciousness, relationships, values, and work ethic. This kind of cultural information is
essential for developing an effective and realistic global strategy.
Since conducting primary research is labor intensive and time consuming, managers may
obtain preliminary information on prospective markets from books such as Dun &
Bradstreet's Guide to Doing Business Around the World and Business Protocol: How to
Survive and Succeed in Business, or the Economist's "Doing Business in…" series, which
list potential trade opportunities, policies, etiquette, taxes, and so on for various countries.
After examining the prospective markets in this manner, managers are ready to evaluate
the advantages and disadvantages of each potential market. One way of doing so is the
determination of costs, advantages, and disadvantages of each prospective market. The
costs of each market include direct costs and opportunity costs. Direct costs are those a
company pays when establishing a business in a new market, such as costs associated
with purchasing property and equipment and producing and shipping goods. Opportunity
costs, on the other hand, refer to the costs associated with the loss of other opportunities,
since entering one market rules out or postpones entering another because of a company's
limited resources. Hence, the profits that could have been earned in the alternative market
constitute the opportunity costs.
Each prospective market usually has a variety of advantages, such as the possibility for
growth, which will lead to greater revenues and profits. Other advantages include
relatively low material and labor costs, new technology gaining strategic advantage over
competitors, and matching competitors' actions. However, each prospective market also
usually has a number of disadvantages, including opportunity costs, greater business
complexity, and potential losses stemming from unforeseen aspects of prospective
markets and from currency fluctuations. Other disadvantages might result from potential
losses associated with unstable political conditions.
ASSIGNMENT No. 2
Total Marks: 100
Pass Marks: 40
This assignment is a research activity. You are required to visit any business/ commercial
organization and prepare a research report of about 15 to 20 pages on one of the topics given
below. To avoid the duplication, a student is required to select the topic according to the last digit
of his/ her role number. For example if your roll number is
I-342718 then you will select topic # 8 from the given below list (last digit):
As there are four topics, you will select the topic according to the last digit mentioned as under:
1, 2, 3
4, 5, 6
7, 8
9, 0
Topics
Strategic Analysis
Strategy Formulation
Strategy Implementation
Strategy Evaluation
Introduction 10 marks
References 10 marks
Annexes
You are required to prepare two copies of 2nd assignment. Submit one copy to your tutor/ teacher
for evaluation and the second copy for presentations in the workshop in the presence of the
resource person and classmates, which will be held at the end of the semester prior to the final
examination.
Guidelines for workshop
The workshop is a compulsory component of this course to cover practical aspects of the
curriculum, which will be held at the end of the semester and your attendance is compulsory in all
sessions.
There are two components in the workshop. The first part is a group activity. The students will be
divided into four groups and they would be assigned topics as under:
Each group will select a group leader and discuss the topic within the group. The group members
will act as members of the top management team of a company and discuss aspects of
management by using models and theories covered in the course. The focus of the group activity
would be on theories, models, case studies and practical examples of real life situation of national
and international industries, business organizations, and products. The group discussion will
enable students to share their knowledge and experiences. This will also help them in getting
clarity of the concepts and discuss the issues faced by the management of different organizations
observed and studied by the group members.
All students will come with full preparation and this activity will be supervised by one of the
resource persons, who will act as a facilitator.
All groups will work simultaneously and complete this task on the first day of the workshop. The
group will prepare a presentation based on the findings of the discussion.
If a student does not participate in this activity he/she will be declared absent from the workshop
and will have to attend the workshop in the next semester or act according to the university rules.
Each group will perform the said activity and other groups will participate as observers. The tutor
will write a report on the strengths and weaknesses of each group member and will evaluate each
student.
The tutors/teacher will keep record of his observations and submit the same to the RD who would
send it to the Quality Assurance Cell Department of Business Administration Allama Iqbal
Open University Sector H-8 Islamabad, within one week of the evaluation by the tutor.
The 2nd component of the workshop is an individual activity.
Students are advised to prepare the presentations based on their 2nd assignments.
Each student will be given 10 to 15 minutes for presentation and 5 minutes for class discussion.
The participants and tutor/ teacher will allow the presenter to make his/her presentation for 15
minutes to provide him/her an opportunity to gain confidence and improve his/her
communication skills. The questions to generate the discussion and evaluate the performance will
be asked in the last five minutes.
To maintain the discipline and for effective time management, each student is required to make
presentation according to the last digit of his/ her roll number. For example if your roll number is
I-342701 then you will be the first presenter (last digit).
Fifty percent marks will be assigned to group activity and the remaining fifty percent to the
individual presentation.
The resource person/ teacher/ tutor (academic Incharge of the workshop) will write a two page
report about the workshop activity as a whole and send it on the following address along with
individual report about each student’s performance in the group activity for quality assurance.
Level: MBA
Prerequisite: Student should have good communication skills in English language and good
understanding of Management, Marketing and Finance.
Course objectives
To enhance the student’s understanding of the present and future environments within which
organizations function
To develop advanced analytical skills to identify and analyze strategic options and present well-
supported recommendations for future actions
2.3.4 Scenarios
2.4 The competitive environment
2.7 Markets
3.8.3 Benchmarking
3.9 Robustness
3.9.1 Rarity
3.9.2 Complexity
3.9.4 Culture
4.3.4 Diversification