Business

Question

Answer the following questions
1) How does the current economic crisis impact strategic thinking in today’s corporation?
2) How does a corporation Quantity (estimate) Risk Analysis in today’s crisis environment (swot-strength, weaknesses, opportunities, threats)?

Answer

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1. How does the current economic crisis impact strategic thinking in today’s corporation?

In the hypercompetitive global market of today, the current economic crisis has far-reaching effects on the business environment. Corporations are being forced to review their strategic thinking strategies, and their managers are required to be smarter thinkers as well as faster actors.

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   Corporations that made the best use of strategic planning when the economic crisis was at its peak became more successful in the pursuit of their growth opportunities and they were more confident of short-term growth prospects. This is on the basis of a study of 190 firms in 2009, whose sponsor was the Association of Strategic Planning. A brief review reveals that strategic management is fast rising to the challenge at this time of economic uncertainty.

   By driving strategic management much further into today’s corporation, managers are optimistic that there are many new growth opportunities that are waiting to be unearthed. The corporations only need to start operating in a context-setting mode at all times. Many of these corporations have begun equipping their middle managers with various strategic management tools and training. These tools include financial planning, business planning, project flow charts, and risk analysis. The aim of these tools is to identify and execute various strategic growth initiatives.

Corporations are increasingly putting their emphasis on pragmatic risk analysis. This essentially entails the pulling of the ‘ripcord’ whenever growth initiatives start going bad instead of continuing throwing good money long after the viability of the ongoing projects has been questioned. Additionally, today’s corporation is keen on creating optimal levels of friction for profitability to increase. It is also keen on putting strategic measures for sustainability and growth.

• How does a corporation Quantity(estimate)Risk Analysis operate in today’s crisis environment(SWOT-strength, weaknesses, opportunities, and threats)?

For any corporation of today to survive in the current crisis environment, it is difficult for success to be realized without an environmental scan been carried out. Sometimes, the term SWOT analysis is used to describe this environmental scanning undertaking. SWOT analysis is a perfect way of refuting any perceptions existing in a business landscape. In times of economic crisis, such perceptions are commonplace.

The quantity-risk analysis makes it possible for corporations to establish successfully the level of understanding that is needed for planning initiatives to be undertaken at the most opportune moments. In fact, the need for SWOT analysis emerged as a result of the need by corporations to determine the reasons why corporations failed in their investment initiatives.

Even in today’s crisis environment, corporations have much to hope for, if the indications of SWOT analysis are anything to go by. The main strengths that exist today include special marketing expertise, patents, location choice for the business, exclusive access to various natural resources, and quality processes and procedures.

The main weaknesses that corporate leaders need to watch out for include undifferentiated products and service in relation to a corporation’s competitors, damaged reputation, and poor quality of products and services.  There are many opportunities as well, notably the developing market such as the internet and China. The current economic crisis also necessitates joint ventures, mergers, and strategic alliances. Moreover, corporations are looking forward to new international markets, removal of various barriers to international trade, and loosening of trade regulations. The main threats for a corporation operating in today’s competitive, crisis-ridden global economy include new regulations, a new competitors in the home market, increased trade barriers, the potential for new taxation and price wars.