Analysis of Strategic Management Approaches: Starbucks, Apple, Ikea

This report provides an analysis of strategic management approaches used by modern organizations. It focuses on three key approaches: the stakeholder approach, dynamic capabilities approach, and sustainable approach. The report delves into each approach, explaining their core principles and practical applications. To illustrate these concepts, the report uses real-world examples of companies implementing these strategies, including Starbucks, Apple, and Ikea. The analysis covers how Starbucks utilizes the stakeholder approach by incorporating customer feedback, how Apple leverages dynamic capabilities through financial strength and innovation, and how Ikea integrates sustainability into its operations. The report highlights the benefits and limitations of each approach, offering a comprehensive understanding of strategic management in today's business environment.

Running head: ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
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1ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
Executive Summary
The report is based on the analysis of the various approaches to strategic management that are
used by the modern organizations. The three approaches that are taken into consideration are,
stakeholder approach, the dynamic capabilities approach and sustainable approach. The
approaches are further explained with the help of the examples of three companies which are
using the three approaches. The organizations which are taken into consideration are,
Starbucks, Apple and Ikea.

2ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
Table of Contents
Introduction....................................................................................................................3
Analysis of the different approaches..............................................................................4
Examples of organizations using these approaches...................................................6
Conclusion......................................................................................................................9
References....................................................................................................................10

3ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
Introduction
The concept of strategic management is mainly based on the analysis of the process of
managing the resources of an organization so that the objectives and goals can be achieved in
an effective manner. This thereby involves the outlining of various strategies which have to
be developed for the effective management of the organizational processes. The main
objectives that are based on the implementation of strategies are related to the culture of the
company and the competencies that are possessed by the employees (Hubbard, Rice and
Galvin 2014). The organizational structure on the other hand also affects the achievement of
the goals. The companies require to manage the changes that take place in the company and
the different strategies that can be applied in the changing environment of business (Hill,
Jones and Schilling 2014).
The top level managers are responsible for the effective implementation of the
strategies which can help in achieving objectives. The employees of the company need to
dedicate themselves towards the formation of successful strategies. The process of strategic
management also involves the effective communication of the goals of the company to the
employees and the other stakeholders as well (Wheelen et al. 2017). The process of strategic
management in the companies need to be fulfilled with the help of various approaches. The
three different approaches based on the management of strategy that will be used in the
analysis are, dynamic capabilities approach, stakeholder approach and sustainable approach
(Meyer, Neck and Meeks 2017).
The analysis in the report will be further based on the detailed discussion about these
approaches and the ways by which they are used in different companies. The three
approaches will be further explained based on the examples of real-life companies that use
them in different situations.

4ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
Analysis of the different approaches
The three approaches to strategic management that have been chosen for the analysis
are, the stakeholder approach, dynamic capabilities approach and sustainable approach.
Stakeholder Approach – The first approach is mainly based on the ways by which
the managers of the companies can use the various stakeholders for the purpose of effective
strategy formulation. The company in this case aims at satisfying the needs of stakeholders
for ensuring the long-term success of the company in the industry. The imperfections that
exist in the market can be used by the organizations according to the degree of participation
of various groups (Bettis et al. 2016). The approach thereby emphasizes on the management
of the various organizational processes like, promotion, business environment and
relationships that are created with the stakeholders in an active manner. The approach based
on stakeholder management is considered to be a part of the stakeholder theory. The
approach helps in increasing or restoring the value of the firm among the stakeholders. This
further leads to the creation if competitive advantage by the firm in the market (Morschett,
Schramm-Klein and Zentes 2015).
This approach to the management of strategies is related to the management of the
goals that are set by the organizations for its future improvement in the industry. The
decisions that are taken by the companies based on this approach of strategic management are
related to the interests of the various groups which are a part of the organizational processes.
The different groups which are considered for the analysis in this case are, the suppliers, the
employees, the customers of the company. This approach has therefore been implemented by
the organization with assistance of stakeholder theory (Frynas and Mellahi 2015).
Dynamic capabilities Approach – The approach of dynamic capabilities is mainly
related to ability of the company to adjust with the amount of resources that are present with

5ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
the company. This term is thereby based on the ways by which the company can react in
timely and adequate manner to changes that have taken place in the external environment.
This concept is mainly based on the various operational capabilities which the firms have in
the modern working environment. The framework that is related to the implementation of
dynamic capabilities was developed by Amy Shuen who is a writer and researcher of the
various strategies that are used by the companies (Durand, Grant and Madsen 2017).
The main assumption which is made by this framework is related to the formation of
short-term based competitive positions that are thereby developed into long-term based
competitive advantages. The dynamic capabilities of the organizations are based on their
survival in the competitive business environment. The improves framework of the dynamic
capabilities are further based on the changes that have taken place in the external
environment based on the use of modern technologies. The firm-level strategies are also
analysed with the help of this approach (Chen, Delmas and Lieberman 2015). This is mainly
based on the creation of wealth by the organizations and their ways of operating in the
environment. The wealth creation process is related to the cushion or shield that is created by
the companies so that they are able to survive in the fast changing environment. The changes
in the technologies are mainly based on the ways by which the firm can survive in the
environment by improving its processes (Trigeorgis and Reuer 2017).
Sustainable Approach – The third approach is mainly related to the sustainable ways
of operations of the firms. This approach of strategic management helps the firms to create a
position in the industry and supports their long-term operations as well. Sustainable strategy
thereby deals with the integration and the development of the detailed vision of the firms that
is related to the sustainable long-term operations. This also leads to the increase in the
productivity of the companies by using less amount of resources (Engert, Rauter and
Baumgartner 2016).

6ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
The sustainability based concept provides the total perspective based on development
of companies with respect to the integration of the goals. The idea based on sustainability is
thereby used by the companies so that they are able to formulate effective long-term
strategies that are helpful in fulfilling the external environment based objectives. The
sustainability approach thereby helps in creating a discipline in the various organizational
processes. The different aspects of the company are related to the sustainable approach of
strategic management (Theriou 2015). The first aspect is based on the corporate values that
are developed by the firm, the second part is based on the employees and the areas which is
important for the proper operations of the firm and the third part is based on the relationship
between the employees and the resources of the company. The attitudes of the managers also
play an important role in the successful implementation of the sustainable strategy. The last
and fourth aspect is thereby based on the relationship of sustainability with the strategic level
of the company (Hubbard, Rice and Galvin 2014).
Examples of organizations using these approaches
Example 1 – The first example is of an organization which has implemented the
stakeholder approach for strategic management. The company which is taken into
consideration for this is Starbucks. This is an American multinational coffee producing
organization which has its stores in different locations of the world. The company mainly
implements this strategy with the help of the feedback or reviews that is provided by the
customers who visit the stores of the company. The company takes the opinions of the
customers for the purpose of deciding the ways by which they can source coffee beans from
different locations in the world (Starbucks Coffee Company. 2018). The approach that was
used by Starbucks was named as “The Guidelines and Program” which helps the
management to decide the products that will be offered to the customers. This process
thereby involves the customers and the other stakeholders in the decision making of the

7ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
company. The company has thereby gathered feedback from the customers based on the ways
by which the products can be offered to them. This approach was launched by the company
in the year 2001 (Popkova et al. 2015). Starbucks has acquired the position of the topmost
coffee brand in the world which been created with the help of the services that it provides to
the customers. The company thereby aims to include the growers and the farmers in the
processes and the ways of manufacturing the products. The main benefits that will be
provided to Starbucks in with the help of this approach is based on the increase in the base of
loyal customers and satisfaction that is provided to the stakeholders as well. The limitations
are based on the hindrance that can be provided by the employees in the implementation of
changes on a frequent basis (Sakas, Vlachos and Nasiopoulos 2014).
Example 2 – The second approach of strategic management can be explained with the
example of Apple which is an American multinational company that operates in the
technology industry. Apple has been famous in the market for the innovative products that
are offered to the customers all over the world. The huge financial strength of the company
has been major reason behind its ability to maintain an advantage in the industry. The
dynamic capability of financial strength of Apple has been used for making investments in
the research and development based capabilities of the company (Apple. 2018). The
appointment of highly skilled staff has also been possible with the help of the financial status
that is held by Apple in the industry. The financial capabilities have thereby provided Apple
with a cushion which has helped the company to survive in the highly demanding and fast
changing technological environment. The premium position that has been developed by
Apple in the market is also based on the high levels of dynamic capability of the firm. The
benefits that are provided to Apple by these capabilities are huge as the company is able to
create its position in the market easily with the help of this. The company is also able to
invest in the various operations due to the financial strength (Apple. 2018). The main

8ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
limitation is based on the pressure that is put on the resources due to the usage in the various
research activities. This can also cause a lack of resources for the company in the future
(Kenworthy and Verbeke 2015).
Example 3 – The sustainable approach to strategic management can be explained
with the example of Ikea which is a furniture based multinational company.
Ikea has used this strategy for the purpose of building the competitive advantage of the firm
in the industry. Sustainability has become a major part of the processes and operations of Ikea
in the industry. The strategies of Ikea are formed based on three major concepts that are,
planet, people and positive. The company also aims at operating in a resource and energy
independent manner. Ikea further plans to use the various processes based on the usage of
renewable resources for production of the goods (IKEA. 2018). The company has leading the
process of creating a better life for the people or the communities that are a part of the
external environment in which the company operates. The sustainable approach of the
company thereby helps Ikea to operate profitably on a long-term basis. Ikea has taken the
lead in the process of creation of better life for people and communities in the local areas
where they operate. Ikea also operates in the industry with the help of sustainable processes.
The development of better places for working is also a part of the sustainable strategy of the
firm in the market. The focus of the company is thereby based on the compliance of activities
that are related to sustainability of operations (IKEA. 2018). The concept of shared values
also has been used in the organizational processes of Ikea so that the company can implement
sustainability in the operations. The management of Ikea has gone beyond the reach of supply
chain for the purpose of achieving the shared values. The main benefits that are provided by
the sustainability approach is related competitive advantage that has been gained by the firm
in the various operations. On the other hand, the company can also formulate strategies for its
long-term operations in the market in a sustainable manner (Chen, Delmas and Lieberman

9ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
2015). The limitations or the issues that are related to the implementation of sustainable
approach to strategic management is based on the participation levels of the employees who
are considered to the most important part of the strategic process.
Conclusion
The report can be concluded by stating that the modern organizations need to apply
innovative methods for the formation of strategy. The various approaches that are used by the
organizations are thereby based on the ways by which the companies operate in the modern
environment. The three approaches that have been analysed in report are, stakeholder based
approach, dynamic capabilities based approach and the sustainable approach. The
implementation of the strategic processes is based on the types of organizations and the areas
in which they operate. The three organizations that are taken into consideration for this
analysis are, Apple, Starbucks and Ikea. Starbucks has used the stakeholder approach to
manage the employees and the customers. Apple uses the dynamic capabilities approach to
maintain the competitive advantage in the market with the help of its strong financial backup.
Ikea uses the sustainable strategy for the purpose of creating a different position in the
industry and increasing its customer base. The usage of the three different strategies are
thereby based on the needs of the company and the ways by which they operate in the market.

10ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
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