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similar, universities are similar, manufacturing firms are similar and so on (self similarity
of organizations). In our Company X case, company has some relationships with similar
organisations to itself. Over time similarities develop in terms of the people in the
company see the company and the environment in which the company operates,
including the nature of automobile manufacturers. They have also tendency to do the
things similar. In such an environment full of self similarities, development of strategies
is a necessity which is to be taken seriously.
Focusing on the Strategic Analysis, Environment of the company should be defined at
first. Customers , suppliers, competitors are the main part of the environment but besides
them government policies like taxes , economic situation , technological development
level ,labor cost and frequently changing demand are also important environmental
factors which is to be taken into consideration . Also distribution convenience as an
environmental factor is seemed to be one of the leading factors affecting the decision to
locate a plant in a certain location for Company X. The scheme below summarizes the
effect of environment in a very simple way.
Here our process is strategic management..
The same effect is valid for every process
in every type of organization
The second element which directly affects strategic analysis is Expectations and
Purposes. To understand the strategies of Company X, the expectations of different
stakeholders or owners of the company should be understood very well. Their
expectations and point of views create the vision, mission and goals of the company. For
example mission Company X seems to be the leading component manufacturer in
automobile industry and sell their products as much as possible. From another point of
view it might have been ‘to produce the most qualified product for Mercedes or any other
specific automobile company. The existing production and marketing system reflects the
expectations and purposes within the cultural and political framework.
Since it is a profit oriented organization (multinational company), its main goal is to
produce efficiently with a minimum cost and satisfy quality specifications.
The effect of culture both related to environment and expectations and purposes. So in
order to emphasize the importance of culture the table below should be analyzed.
The third element is Resources & Competences & Capabilities. “ Company X” brand
provides them reputation and increase their capability. Their financial resources and
investments have also some effects on future strategies. Flexible production lines in
production department can be considered as resources because they can easily implement
new product strategies or new customer strategies by using these flexible lines in an
efficient way. For the parent company in France a significant issue is how resources
should be allocated between plants and how this allocation is to be co-coordinated.
Indeed, the coordination of operational logistics across different plants and different
countries is especially important. Company X has to decide on the most sensible
configuration for the manufacture of components. For example the logistics problem of
coordinating such operations requires sophisticated control system and management
skills and well decided strategies.
All of these considerations are important and need careful consideration. Company X is
also likely to be diverse in terms of both products and geographical markets. Therefore
major strategic issues for Company X are structured and controlled quite well since it is a
multinational company.
Strategic Choice
Bases of strategic choice are goals of the company such as growth, increase in efficiency,
more Research & Development, increase in market share, profit etc.
SWOT Analysis of the company as a whole and of each plants in different countries can
be taken as bases of further improvements and strategies. Company X takes its strengths,
weaknesses, environmental threats and opportunities into consideration before choosing
the right strategies.
Forecasts are the basis for many decisions. Clearly, the more accurate an organization’s
forecasts, the better prepared it will be to take advantage of future opportunities reduce
potential risks. A worthwhile strategy can be to work to improve short-term forecasts.
Better short-term forecasts will not only enhance profits through inventory levels, fewer
short ages, and improved customer service levels, it also will enhance forecasting
creditability throughout the organizations: if short term forecasts are inaccurate, why
should other areas of the organization put faith in long term forecasts? Also, the sense of
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