Strategic Choice

1.Introduction

In today’s marketplace, businesses are constantly under to maintain profitability and competitiveness and their success or failure can depend on the quality of the strategic thinking and strategic management undertaken by the business (Campbell et al 2002). Thus in order to participate any level of strategic thinking or strategic management and undertake a strategic evaluation it is essential to understand exactly what a strategy is. Mintzburg (1987 cited by Campbell et al 2002) suggests the ‘five Ps of strategy;

• A plan;

• A ploy;

• A pattern of behaviour;

• A position in respect to others

• A perspective.

Adding that it is not possible to see any of these P’s in isolation. However, this is a very simplified view of strategy and perhaps a much better definition from a business perspective is given by Johnson and Scholes (1999);

“the direction and scope of an organisation over the long term: which achieves advantage for the organisation through its configuration of resources within a changing environment to meet the needs of markets and to fulfil stakeholder expectations.”

Thus in essence a strategy is deciding what way is best and what tactics will be employed to achieve the business goals.

Naoum (2001) suggests that developing a business strategy can take seven stages;2.1Five Issues For Improvement By Draper Engineering Ltd.

A Warehouse Management System (WMS) fully integrates warehouse management operations with the rest of the business, such as sales, purchase and accounts and subject to the installation the warehouse operations can be world class. However, this technology is not cheap and suitability can be dependant upon the type of solution sought, such as to build or buy (Frazelle, 2002)

Draper should not consider implementing a WMS with no guarantees of the final contract as this would mean that although they would experience the benefits of the system, they would also have to shoulder the full burden of the costs with possibly no contract from either of these companies. In order to improve this situation and produce the best business solution for Draper Engineering they need to have a Service Level Agreement (SLA) with each of the companies.

An SLA is “an explicit statement of the expectations and obligations that exist in a business relationship between two organisations: the service provider and the customer” Verman (1999, p1). Were Draper to agree an SLA with the other parties this could ensure that not only would they be guaranteed the contract, but that they would also have a written document of the expectations of each of the parties involved in advance of implementing the