Strategic Management – Article Reviews (4)
Review Set 1 – Review and Critique of the Following Articles: “How to Thrive in Turbulent Markets” by Donald Sull (2009) “Are Managers Obsolete? ” by Thomas M.
Hout (1999) “What is Strategy? ” by Michael E. Porter (2000) “Knowledge-Worker Productivity: The Biggest Challenge” by Peter F. Drucker (1999) Strategic Management Professor Smith Eugene Bogart 01/26/2012 Article review and critique: “How to Thrive in Turbulent Markets” by Donald Sull (2009) Synopsis: In the article “How to Thrive in Turbulent Markets” by Donald Sull (2009), the author discusses the similarities between the duties required by management and the matchups between boxers.Managers and the complex market in which they do business are compared to the uncertainty of a boxing match. A few examples touched upon by the article include the dot-com bubble burst, the terrorist attacks, and concern about global warming.
All of these issues came as a surprise to our economy, just as a left hook from Muhammad Ali might surprise an opponent. The article also states that a company must have operational agility, much like their example of a Brazilian brewing company, who kept costs low in anticipation of market competition.The article continued by saying a company must be like a boxer and be able to take a punch – that is – to be able to withstand a loss or setback and still have the character to prevail. The report also gives details about how to have both economical agility and absorption as a company. Likes: I enjoyed this article because the ways the author uses to compare boxing and management seem very understandable.
For a company to ‘float like a butterfly, sting like a bee’, the article tells us that “a company’s ability to consistently identify and capture business opportunities more quickly than its rivals do” (pg. 0). The article also makes this connection towards corporate absorptions. In order for a company to ‘take a licking and keep on ticking’ they must rely on diversification and size, and an ample amount cash in order to keep the company prosperous until their big break. Another thing to like about this article is the way the author, Donald Sull, gave distinctive ways in which an organization could become agile and able to absorb economic blows.
Companies can become agile through 3 different techniques.Operational, portfolio, and strategic methods are discussed, including what a company must have, and what the leaders need to do, in order to be agile in an ever changing economy. There are also 10 ways in which a company could build their absorption. Some notable ones include low fixed costs, tangible resources, and the vast size of a corporation. These techniques, from agility and absorption, are good ways to have a broadened view of what is required to run a successful business operation.
I also like the way this article concluded.The author makes not of Muhammad Ali and his effectiveness over his entire career. His career started with high agility, and as he progressed, he learned to manage punches upon him by building up his absorption. However, by the end of his career, his agility had diminished and he was able to do little but absorb the hits that were dealt upon him. The same can be true with corporations. A company must balance their agility and absorption over time as to not become bloated and too set in their ways.
Dislike:Although this article was well thought out, I believe the author spent too much time discussing material that, to most people who are interested in the content, would be considered common knowledge. The topic of being agile and assessing every situation in order to make the most profitable decision, and to react to potential positive situations as quickly as possible is a no-brainer when it comes to business judgments. Also absorption is not a new theory. Although it may be named something new, the resistance of a company to fall under hard times is known to anyone who has an interest in management.Essay Question: How can a company buffer itself against difficult economic times? (give 3 examples) Article review and critique: “Are Managers Obsolete? ” by Thomas M. Hout (1999) Synopsis: In the article “Are Managers Obsolete? ” by Thomas M.
Hout (1999), the author discusses the effect that managers have on our ever-changing economy. The article debates the position held by many that believes managers have always been to blame for a corporation’s downfall. Instead, they argue that the economic climate will make all companies find the same fate in death no matter how good, or bad, the management is.This is attributable to the fact that today’s markets are much less linear and much more complex than they used to be. Managers in this era’s economy are less likely to blame for the shortcomings of their company, as more is to blame on the way the market behaves on its own.
The company itself evolves with the changing economic climate, sometimes even right under the management’s nose. This article, however, does point out that proper management within an organization is vital to success, but with minimal interactions between employees.These days, employees tent to work out problems within a group, and strive for the best of their company without the direct supervision of a manager. The manager’s role has shifted to a role of building a team that can work independently and to promote a company’s goals, and no longer to supervise every action of their employees. Likes: This article was very informative as to the role of managers in the present market. I believe this is a valuable tool to anyone who intends on becoming a manager in the future, as it outlines the new procedures companies and managers are using to better utilize their employees.
The article also states that managers must have a minimal role, yet have the acuity to “see further ahead than others about how courses of action might play out”. (pg. 166) Thomas Hout also gives a good definition of the employees of this day and age. They are working together more closely to a common goal than they would have in the past. Employees realize that it is only though the help of others that they can achieve success Another thing I liked about this article is the examples given of Thermo Electron, and Chrysler Corporation.
These two companies, in two vastly different fields, utilized managerial initiative in order to stay prosperous. Thermo Electron started up in a very volatile market of biomedical instruments, and only through the clairvoyance of their founder, succeeded in continuing a profit. Instead of resting on its laurels, assets were reinvested and the organization was split into different sectors. Chrysler, on the other hand, realized they were in need of integration within the organization, and changed the roles that their upper level management was in charge of.The company brought together many subdivisions and created a more unified company.
This is important because it shows the vast differences we might face when having to make an economic decision for the best of our company. The last think I enjoyed about this article was how ‘real-world’ it made the issues seem. Through the word usage and real life examples, I felt like these issues would be something I might face in the future. With proper management techniques and the use of skilled and adaptable employees who work well as a team. Even with the examples of big companies, as stated bove, the challenges faced by those managers seemed as though they could happen to any enterprise, and therefore any manager.
Dislike: My dislike of this particular article stems from the fact that the author does not go into detail about a solution to the question: are managers becoming obsolete? The viewpoints addressed are through two schools of thought, but neither can be a definite. This article states that managers are important, yet contradicts itself when saying that “a company’s fate is determined by forces outside the management’s control” (pg. 61). I would have like to see the author give his opinion on the current and future prospects of becoming a manager. Essay Question: Explain why market turbulence is a major challenge for new managers. Article review and critique: “What is Strategy? ” by Michael E.
Porter (2000) Synopsis This article, entitled “What is Strategy? ” by Michael E. Porter, goes in-depth on the topic of strategy within a company. It begins by telling us that the overall operational effectiveness of an organization is not enough to withstand competition.In these complex and often volatile markets, managers and corporations in general need to stay strategic in order to remain competitive. One such method is to utilize unique activities to stay prosperous. Instead of looking identical to other companies in their industry, organizations must find a niche and rely on bringing something new to the plate.
Products or services that are too similar to the competitions will likely fail or at the very best, be flat and under producing. This article also shows that thinking strategically defines the future of a company.Their example, the Japanese manufacturers, depicts a market bound without strategy. These companies relied heavily on quality management and continuous improvement, and while they initially saw low cost and high quality, they eventually fell due to the lake of thinking strategically. Also in this article, the author talks about the strategic positioning managers must have in order to react to change, whether it is bad or good. Have a forward thinking approach allows managers and companies to react quickly to changing business climate so opportunities are not lost.
These strategic issues do not come without a price, however, and do require tradeoffs. This is essential for business growth because it requires a company to choose between alternatives and limit what they can physically offer. This is beneficial because it requires management to become active in their economy. Likes: The first thing that I liked about this article was the various charts given to the reader. These charts, while entertaining to look at, also gave valuable information about the different systems that are being used in today’s markets.
Ikea has a chart reflecting their business model that revolves around self-help and low cost for the consumer. Given the 20 bubbles of design, we can see exactly how the structure of Ikea is played out. Another system shown is useful for examining and strengthening strategic fit. Yet another depicts Southwest Airlines activity system. I believe that these charts give a good visual understanding of how a corporation finds a niche and what business practices it uses to get there. Yet another thing I enjoyed about this article was the impact is has regarding the topic of strategy in general.The author does a great job of relating real world issues with the student. The viewpoints suggested a clear understanding of what it takes to be a good manager, and the strategy that one must use in which to lead their organization down a path of profitability.
These are highlighted by the fact that companies utilized the implicit strategy model over the past decade, and that useful strategy can lead to a sustainable competitive advantage. This article also delves into what might happen if a manager chooses not to use foresight and strategy.Another like that I found within this article is the authors collection of sources that define strategy. Utilizing examples from Ikea to Southwest Airlines, the author Michael E. Porter, points out that these companies, although already established and well known, are able to devise a business plan that deviates from the norm just enough to give them a competitive edge. Furthermore, the author continues using these examples in other aspects of his report, which give the reader a chance to focus on how strategy has helped just a few companies in particular.
Dislike The one thing I did not like about this article was how the author refuses to take into account the effectiveness of a company. If an organization is not profitable or effective in their market, there is no sense in a company being strategic if they have no future. I believe that the author is correct in saying that strategy will promote longevity and continued success, but without the initial prosperity of a company, there can be no prospective accomplishments. Essay Question: Explain why trade-off are important in strategic positioning.Article Review and Critique: “Knowledge-Worker Productivity: The Biggest Challenge” by Peter F.
Drucker (1999) Synopsis This article, entitled “Knowledge-Worker Productivity: The Biggest Challenge”, addresses the historical significance of the different types of employees. During the 20th century, the workforce was predominantly populated by employees known as manual workers. Today, the workforce is becoming more and more populated with knowledge workers. The difference in workers is attributable to their certain skills. Manual workers are those who are normally told what to do and use their hands to get things done.
Opposite to this are the knowledge workers, who are required to think outside the box, and for themselves, in order to complete tasks. Companies used to view manual workers as a cost, regarding them as a disposable way to lower budget and increase profitability, but today, companies must view their employees as assets that are vital to the ongoing business of the organization. Historically, companies have had an easier time of increasing the productivity of manual workers than they have knowledge workers. The issue facing many corporations is how to increase this productivity.This article also shows the vast history of employment, going back to the eighth century B.
C. Knowledge workers are discussed in contrast to manual workers in the effect that they are responsible for making their own contribution, requiring innovation, and continually learning and teaching throughout their career. This article also addresses the employed workers who fall under both categories, such as surgeons, and their effect on a regions competitive advantage. Finally, this article gives insight into the means necessary to promote productivity in knowledge workers, specifically through changes in attitude.Likes: The first thing I liked about this article was the historical differences between today’s workers and those of the past.
It is interesting to learn how management has changed over the course of history, and how it has affected employees. This article shows the extreme change in the type of employees that are sought after, and gives understanding towards the employees that a manager is likely to choose. No longer is experience the only sought after trait, as employees now need to have an understanding of the market and the forces that work upon it.Another thing I enjoyed about this article is how the author breaks down the knowledge workers procedure into simple steps. First you must ask yourself what the task consists of to concentrate on the specific job and eliminate everything else.
After the task is defined, the next requirement is to establish responsibility from the workers, through their own contribution. Finally a knowledge worker must be able to define quality. The final thing I found interesting is how the author relates this topic globally. Peter F. Drucker spends some time discussing the notion of ‘no nationality’.That is to say – even third world countries have the ability to produce and train knowledge workers.
The costs associated with training these individuals are also often quite low. Examples of this are show in India, where there have been training top notch physicians and computer programmers despite high poverty levels. Training manual labor will increase production, but the establishment of highly trained knowledge workers will give the country as a whole a competitive edge. Dislike: The one dislike I had about this article is how it lightly downplays the importance of manual workers.I believe that manual workers are still required to keep a strong economy, with the assistance of the knowledge workers. For instance, the growing trend for companies is to outsource manual work to countries with lower labor costs.
This may lead to lower cost seen at the corporate level, but on an economic level this impacts even the largest corporations. It is true that intellectual minds are necessary for growth and prosperity, but without the manual labor behind them, the production line could, and sometimes does, shut down Essay Question: Give two reasons stating why knowledge workers in high demand.