An Analysis of Alternative Strategic Management Approaches Report

This report delves into the realm of strategic management, analyzing three distinct approaches: the sustainable approach, the stakeholder approach, and industry leadership. It begins by defining strategic management as the process of formulating and executing organizational goals and objectives. The sustainable approach emphasizes long-term value creation through economic, social, and environmental responsibility, highlighting benefits such as improved public image and cost reduction, while acknowledging limitations like high implementation costs. The stakeholder approach prioritizes satisfying stakeholders, fostering transparency and building relationships, but it also faces challenges related to conflicting interests. Finally, industry leadership is presented as a strategy to secure market dominance through innovation and high-quality products, with advantages including pricing control and market share, but also potential drawbacks such as the imitation by competitors. The report provides real-world examples of companies implementing these approaches, such as BMW and Amazon, to illustrate their practical application.

Running head: ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
Alternative Approaches to Strategic Management
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2ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
Table of Contents
Executive Summary:..................................................................................................................3
Introduction:...............................................................................................................................4
Approaches to strategic management:.......................................................................................4
Sustainable approach:.................................................................................................................4
Benefits of the approach:.......................................................................................................5
Its limitations:.........................................................................................................................6
Organisation, which has implemented it:...............................................................................6
Stakeholder approach:................................................................................................................6
Benefits of this approach:.......................................................................................................7
Limitation of stakeholder approach:......................................................................................8
Organisation, which has implemented this approach:............................................................8
Industry leadership:....................................................................................................................9
Benefits of industry leadership:.............................................................................................9
Limitations of industry leadership:......................................................................................10
The organisation which has followed the strategy of industry leadership:..........................10
Conclusion:..............................................................................................................................10
References:...............................................................................................................................12

3ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
Executive Summary:
This report focuses on different approaches to strategic management. This is the best way of
framing and applying goal and identify the process, through which the goal can be
accomplished. In this paper, three different approaches like sustainable approach, industry
leadership and stakeholder approach along with its benefits and limitations have been
discussed. The companies that have implemented this approach have also been explored.

4ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
Introduction:
Strategic management is considered as the mode of ongoing preparation, observing,
examining and evaluating all the factors that are needed to be considered by the firms in
terms of meeting their goals and objectives (Rothaermel 2017). In the context of
management, strategic management is regarded as the activity of formulating and executing
goals and objectives, along with the initiatives, which are taken by the higher authority of an
organisation on behalf of the owners. Strategic management gives the leaders with
appropriate direction, by specifying the organisational goals and objectives. In addition,
strategic management also helps the organisations to develop plan and policies that are highly
required for accomplishing the goals and objectives by applying most effective resources
(Ansoff et al. 2018). This is the mode of attaining long term success from business. With the
assistance of this framework, the organisations becomes able to take strategic decision in the
context of highly complicated business environment. The fundamental aim of this paper is to
make in-depth discussion regarding strategic management. Three effective approaches to
strategic management will be evaluated in this paper.
Significant approaches of strategic management:
Strategic management is the major approach of effective organisational decision
making that play a major role in terms of running business in a timely and cost effective
manner (David and David 2016.). Comprehensive approaches of effective strategic
management are as follows:
Sustainable approach:
Sustainability is one of the most effective approaches to strategic management that
intends to create and sustain long term value among the stakeholders by embracing

5ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
opportunities and manage risk in order to derive both economic, social and environmental
wellbeing. Sustainable approach comprises of economic, legal, ethical, and discretionary
responsibilities, which are to be followed by the firms in terms of reducing the negative
impact of business from the environment (Lasserre 2017).
Benefits of the approach:
In the extremely uncertain business environment, strategic management has become
one of the core business practices and has become the integral part in the organisational and
managerial decision making. Sustainability is the defined as the commitment to the
environmental factors, economic factors, through which an organisation acknowledges their
responsibility to the community. Strategic sustainability is defined as the broader strategy,
which intends to protect the environment from the negative effect of busieness.
Improving the public image is one of the fundamental goals of most of the
organisations. This is the reason for which the organisations are putting stress on going green
policy, which is the key of doing best for the wellbeing for the community and thus protect
the organisational corporate image (Hitt and Duane Ireland 2017). Successful implementation
of sustainable approach serves the organisations with the ability to reduce their utility cost by
using energy efficient technology. This is the way, through which the heating and cooling
cost can also be decreased. One of the greatest advantages of sustainable approach is that, it
helps the organisations to reduce the negative impact of their business from the environment.
Through sustainable approach, the firms are using energy efficient technology, which is the
key of reducing the rate of trash from the production and thereby protect the landfill (Hill
2017). In addition, by implementing the sustainable approach, the firms are also becoming
able to use recycled paper and produce long lasting papers and thereby generating less
energy.

6ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
Its limitations:
It is true that through sustainability approach, the firms are practicing “going green”
policy, which is playing a vital role in protecting the natural system of the earth. However,
implementing sustainable approach is a costly process that can create barrier for the firms to
run their business in a cost effective manner. So, it can be said that the switch cost of
implementing sustainability approach is highly costly (Meyer et al. 2017). In addition, usage
of sustainable materials and energy efficient technology requires huge cost in the production
process, which is utterly a great threat for the organisations to operate business in a profitable
manner. This larger cost results in huge company expenses which restricts the companies to
increase their statistics of profit. For most of the companies, going paperless is one of the
major methods in order to reduce the rate of using paper. This can result in huge data risk,
which can hamper the confidentiality and uniqueness of an organisation (Steiss 2019). At the
same time, by implementing the sustainable approach, the firms can also face the issue of
backlashing the customers.
Organisation, which has implemented it:
Climate protection is one of the major goal of BMW, the famous automobile
manufacturer. The company is working continuously in order to progress the proficiency of
their engine with the intension of reducing the rate of emission. The fundamental goal of
BMW is to promote emission free mobility and with the assistance of sustainable 360-degree
approach, the company has become able to secure their position in the market
(Bmwgroup.com. 2020). Now, BMW is considered as the pioneer in the context of electric
mobility.

7ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
Stakeholder approach:
The stakeholders are the biggest asset in an organisation, based on whom, the success
or failure of an organisation are dependent. Stakeholder approach is one of the major
approaches to strategic management, which put stress on the satisfying the stakeholders, This
approach suggests the fact that it is important for the management of an organisation to
develop and implement effective processes and strategies (Aguinis et al. 2017). This can
satisfy the need of stakeholders and thereby help an organisation to ensure the fact that they
can attain long term success from business. This is the view on capitalism, which stresses on
the fact that there is an interconnected relationship in between an organisation and its
stakeholders like customers, suppliers, employees, investors, communities. These people
have distinctive stake in the organisation. According to this approach, the biggest objective
should be maximising the value of stakeholders, which is the key of keeping them loyal and
satisfied (Michael et al. 2017).
Benefits of this approach:
The stakeholder approach is one of the major ways of maintaining openness and
transparency with the stakeholders and build healthy relationship with the stakeholders,
which is very much required in terms of keeping the stakeholders sustainable. By employing
the stakeholder approach, the organisations can attain huge experience. This is the way,
through which the organisations can maintain effective relationship with the stakeholders and
enable the stakeholder to monitor their advice (Baumgartner and Rauter 2017). Through this
way, the organisations can get necessary advice from the stakeholders, that can help in
running the business in a proper way.
In addition, successful implementation of stakeholder can also help the organisations
to anticipate potential problem, through which the business can be operated smoothly without

8ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
any hindrance. As the stakeholders come from different background with different
experience. Thus, the stakeholders can help the firms to perceive any kind of potential issues
and take comprehensive action in order to mitigate the same. In addition to that, by
implementing the stakeholder approach, the firms can execute effective environment related
policy by maintain good rapport with the external stakeholder. Through this way, the firms
can show their commitment towards the community.
Limitation of stakeholder approach:
Stakeholder approach is one of the major ways of building the organisational public
image, which is one of the major ways of attaining long term success from business.
However, sometimes, the stakeholders only put stress on their main interest. This is common
among most of the external stakeholders. These stakeholders are only focused on their own
financial needs and show reluctant attitude towards working on the basis of the need of the
organisation. Thus, application of stakeholder approach can hamper the public image of an
organisation.
The external stakeholders can eventually block the progress of business. This is
another major disadvantage of stakeholder approach. It is the general believe among most of
the external stakeholders that any particular action of a firm will harm their own interest. This
can generate negative attitude among the stakeholders, which is utterly a great threat in the
way of operating the internal functionality of a firm in a sustainable manner (Darling et al.
2019). Thus, it can be said that most of the external stakeholders do not show their concern
towards the business, which can make it difficult for the firms to strengthen the value of their
business.

9ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
Organisation, which has implemented this approach:
The customers are one of the vital external stakeholder in an organisation, based on
whim, the entire rate of profitability is determined. Amazon, the largest multinational e-
commerce company, is putting special stress on meeting the need of customers and thereby
keeping them happy and satisfied. In order to get engaged with customers, Customer
Relationship Management technique has been implemented by Amazon. This is the world
class strategy, implemented by the organisation, which has helped them to build good
relationship with the customers and tailored services on the basis of their need. This strategy
has helped Amazon to attract and retain millions of customers around the globe (Expert
Market. 2020).
Industry leadership:
This is one of the major approaches to strategic management that helps the firms to
attain long term success from business. In the highly volatile business environment, the
approach to industry leadership serves the organisations with the ability to become the leader
in the market. The industry leaders are those companies, who are staying aside from the hard-
core competition in market (Teece 2019). These organisations are innovative and put their
full effort in the way of producing high quality of products that can help in generating
satisfaction among the customers.
Benefits of industry leadership:
Industry leadership is one of the major ways of determining own pricing strategy,
which is the key of securing a strong base of profit margin. By applying this industry
leadership approach, the companies become able to take effective decision regarding their
pricing scheme in order to hold their market share. One of the greatest advantages of this
industry leadership approach is that it helps the firms to secure a strong market share, which

10ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
is the fundamental factor to attain long term success from business. In addition, application of
industry leadership strategy also helps the firms to stay aside from the hard-core competition
in the market as creates potential barrier for the other companies from entering in the market.
The companies, applying this approach always puts stress on offering some unique products
that can easily catch the attention of customers. Thus, by applying the industry leadership
strategy, the companies can avail the opportunity of lower switching cost of the customers.
Through this way, the companies can acquire competitive advantage.
Limitations of industry leadership:
It is true that the approach to industry leadership is one of the best ways of securing a
strong position in the highly competitive market. However, this approach acts as a driving
force behind the other companies to run the business in same way in order to follow the
position of the leaders. If a company chooses to against the policy of industry leaders, it
creates huge disruption in the market, which is utterly a great threat towards maintaining the
sustainability of the position of the leaders. Moreover, the industry leadership strategy also
requires the industry expertise, who must be highly effective in order to take effective
business related decision. It is important for the industry leaders to figure out the specific
trend in the industry, which can serve them with the ability to take effective business related
decision (Dyer 2019). In most of the cases, the approach to industry leadership may hamper
the quality of products, which is a great barrier towards keeping the customers happy and
satisfied. It is the goal of the companies to retain their profit margin. Still, lower quality of
products can hamper their ability to strengthen their statistics of profit.
The organisation which has followed the strategy of industry leadership:
Industry leadership plays a critical role for the firms to secure a strong position in
market. Apple- the largest multinational technology company is considered as the leader in
global technology industry. The company always puts stress on producing unique products in

11ALTERNATIVE APPROACHES TO STRATEGIC MANAGEMENT
order to catch the attention of customers. During 2019, the company has revealed the best app
culture, with the intension of simplifying the lives of millions of customers. In the same year,
Apple has own the winner trophy of the best app and game store (Apple Newsroom. 2020).
Conclusion:
To conclude, it can be said that application of effective approach to strategic
management helps the firms to step back regarding their daily activities and think about
regarding the stage of future organisation. In addition, strategic management also acts as a
guide for the firms and help them to promote sustainable development. This is the way,
through which the organisations become able to execute the process, through which they
become able to accomplish the organisational goals and objectives.

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Ansoff, H.I., Kipley, D., Lewis, A.O., Helm-Stevens, R. and Ansoff, R., 2018. Implanting
strategic management. Springer.
Apple Newsroom. (2020). Apple celebrates the best apps and games of 2019. [online]
Available at: https://www.apple.com/au/newsroom/2019/12/apple-celebrates-the-best-apps-
and-games-of-2019/ [Accessed 22 Jan. 2020].
Baumgartner, R.J. and Rauter, R., 2017. Strategic perspectives of corporate sustainability
management to develop a sustainable organization. Journal of Cleaner Production, 140,
pp.81-92.
Bmwgroup.com. (2020). Sustainability at the BMW Group. [online] Available at:
https://www.bmwgroup.com/en/responsibility/sustainability-at-the-bmw-group.html
[Accessed 21 Jan. 2020].
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Hartley, F., Cinner, J.E., Mora, C., Hicks, C.C., Maire, E. and Puotinen, M., 2019. Social–
environmental drivers inform strategic management of coral reefs in the Anthropocene.
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concepts and cases. Pearson–Prentice Hall.
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