Strategic Management

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   1. Identify some of the shortcomings and challenges of UPS’s strategy process?   

        Strategy process has conventionally been divided to a formulation and implementation. We can conventionally assumed that strategy process of any organization is inevitably incomplete. Should understand that during formulation of strategy planning there have to be take account about conditions of implementation.

        Strategy process is consist of environment scanning, setting the objective, understanding capabilities, identifying the gap, planning activities to close the gap, executing the projects, monitoring and evaluation.

• UPS’s strategy process used different approaches to create company’s strategies such as Scenario analysis, Road map, Centennial Plan (each of them have strengths and weaknesses);
• UPS’s strategy process wasn’t on regular strategic planning process continuously and there absent strategic planning cycle;  

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• UPS’s strategy process not include the dialog through which knowledge is shared and ideas communicated;
• UPS’s strategy not include a changes in organizational structure of company. In order to shifting from one type to another type of strategy have to change mindset, corporate culture and organizational structure.

        In UPS case not mentioned about budgeting process as part of the strategic planning system through establishing of both top-down and bottom-up processes.

        Strategic process in UPS seems like work in progress and need the elements necessary for a mature strategy process.

(199 words)

1. What can you infer about P&G’s global strategy from its restructuring initiative, Organization 2005?

By launching Organization 2005, P&G moves within International corporate level strategy from a Multi-domestic strategy to a Corporate strategy. In order to implement the new type of strategy, for P&G it was a necessity to change corporate culture, processes and organizational structure. By this changing of organizational structure P&G create internally competitive advantages. The results was:

• Reorganizing organizational structure from four geographically-based business units to seven product-based global business units (GBU);
• Reconstituted seven market development organization (MDO);
• Creating global business units (GBS) to coordinate transactional activities such as accounting, human resources, payroll and much of IT;
• Responsibility for developing and rolling out new products, increasing efficiency by standardizing manufacturing processes, simplifying brand portfolios and coordinating marketing activities.

Organization 2005 represents framework of integrating resources into capabilities (Tangible, Intangible, Human resources) and creating competitive advantages.

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By using Pankaj Ghemawat’s AAA triangle framework we can compare structure units with response to the challenges of global strategy:

• Adaptation – in that case company try to improvement their revenues and maximizing local market share;
• Aggregation – company able to take advantage of scale economies, experience curve effects and reduce costs by standardizing products;
• Arbitrage – company coordinated transactional activities such as supply chain, sources and etc.

        Implementing global strategy allow P&G develop globally and create competitive advantage internationally.

(215 words)

1. Is Google’s investment in “Moonshort” projects such as “Google X Drones”, “Project Loon” and diabetes – tracking contact lenses strategically justifiable?   

Motives for diversification driven by two key objectives: growth and risk reduction. In Google case this company have sustainable growth and revenue from core business. Meanwhile Google go into global business and diversify their business by acquisition and creating new businesses.