Business Environment MBA Assignment Example (GC01012)

Table of Contents

1.0 Introduction.

2.0 What is strategic drift?.

3.0 The causes of strategic drift?.

4.0 Stages of strategic drift.

4.1 Strategies change incrementally.

4.2 The tendency towards strategic drift

4.3 A period of flux.

4.4 Transformational changes or death.

5.0 Influence of history and culture on strategy development.

5.1 Importance of history in strategy development.

5.3 Influence of organizational history on current and future strategy development.

5.3.1 Path dependency

5.3.2 Effects of path dependency on organization strategy.

5.3 Importance of organizational culture in strategy development.

5.3.1 Geographically based cultures.

5.3.2 Organisational field.

5.3.3 Organisational culture.

5.3.4 Organisational subcultures.

5.4 Influence of organizational culture on strategies.

7.0 Managers’ roles to tackle strategic drift?.

7.1 Analysing organizational history.

7.2 Analysing culture: the cultural web.

8.0 Conclusion.

9.0 References.

1.0 Introduction

Understanding strategic drift is an important issue for organizations in current business words. Bonnici (2015) defines strategic drift as slowly deterioration of competitive actions which results in the failure of organizational success to respond and acknowledge business environmental changes. Johnson, et al. (2014) stated that strategic drift is used to define a sense of cognitive sloth to meet organizational aims and objectives. According to Johnson et al. (2014) notes, many organizations have been failed to gain their organizational goals and objectives due to strategic drift. For example, MySpace has been facing challenges to survive in competing with Facebook. The key reason for this failure is immediate responses to the changes in its external environment. In addition, it has failed to innovate and offer better services in comparison to Facebook, for instance, failed to meet customers’ changing needs and expectations. MySpace has also lost its vision, leadership, and focus (IAMA, 2015).

This report has described the terms of strategic drift and several related issues. In the first section, the report has explained the phenomenon and causes of strategic drift. In the second part, the report has illustrated the stages of strategic drift and the importance of understanding the strategic drift. Following this, the report has highlighted the significance of organizational cultural and historical issues related to businesses’ current and future strategy development. Then, the report has focused on the organizational culture web and its influence on organizations’ strategies. Finally, the report has emphasized how the organization can overcome strategic drifts in gaining organizational goals and objectives.

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2.0 What is strategic drift?

Bonnici (2015) defines strategic drift as slowly deterioration of competitive actions which results in the failure of organizational success to respond and acknowledge business environmental changes. As Brooks (2014) notes, strategic drift is disclosed when organizations respond very slowly to the changes in the business external environment. According to Johnson, et al. (2014, symptoms of strategic drift are homogeneous mindsets at organizations’ management levels, the decline in performance, lack of focus on the external environment, and presentation of the status quo. Strategic drift is found in organizational culture and cognitive mapping. Consequently, strategic decisions made by organizations focus on organizations’ cultural and historical issues, which ultimately emphasize organizational structure, hierarchy, symbols, internal controls, routines, and shared narratives. As a result, paradigms of managerial assumptions are important to provide an effective organizational culture and have a significant impact on business decisions making.

3.0 The causes of strategic drift?

According to Johnson et al. (2014) notes, several issues can be liable for strategic drift. Kotler et al. (2014) revealed that rapid changes in the business external environment and customer changing demands are the key cause of strategic drift because many organizations are failing to adapt their business in these situations. For example, Tesco Plc has been suffering from strategic drift since 2010 because it is facing difficulties to adapt itself to external environmental factors, competitive marketplaces, and customers changing needs and expectations. Kotler et al. (2014) also stated that technological development and changes are happing very rapidly in the current digital world, where many companies are failing to bring changes in their businesses in rapid changes technological development. Thus, companies’ business models are being older and inappropriate, and businesses are facing difficulties to compete with future trends and survive in competitive marketplaces……………………