MGT302: Strategic Management Approaches - Analysis & Viability

This report provides an analysis of three strategic management approaches: stakeholder, dynamic capabilities, and sustainable. It discusses each approach, including its viability, implementation issues, and limitations. Examples of organizations like Starbucks, Apple, and Ikea are used to illustrate these approaches in practice. The stakeholder approach focuses on meeting the needs of stakeholders for long-term success. The dynamic capabilities approach emphasizes a firm's ability to adapt to changes in the external environment and maintain a competitive edge. The sustainable approach integrates sustainability principles into organizational strategies. The report concludes by summarizing the key aspects of each approach and their relevance to modern organizations. Desklib offers more resources for students.

Running head: ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
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1ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
Executive Summary
This report is grounded on the examination of the approaches based on strategic management
that are used by establishments. The three main approaches that have been selected for this
study are, stakeholder approach, the dynamic capabilities approach and the sustainable
approach. The three approaches are further analysed with the assistance of the examples of
companies like, Starbucks, Apple and Ikea. The benefits of the approaches are also conversed
in the analysis. The limits of the approaches and the issues are also analysed in the report.

2ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
Table of Contents
Introduction....................................................................................................................3
Analysis of the different approaches..............................................................................4
Examples of organizations using these approaches...................................................7
Conclusion....................................................................................................................10
References....................................................................................................................11

3ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
Introduction
The process of managing the resources of a company with the aim to achieve the
objectives and goals is known aa the strategic management. The strategies that are to be
developed for managing the organization successfully are outlined with the help of strategic
management. The major objectives that are a part of the strategic management process are,
the culture of the business, the skills and the competencies that are possessed by the
employees. The companies can further manage the various strategies and the make relevant
changes in them based on the needs that can occur due to the changes that have taken place in
the business environment (Andreeva and Kianto 2016).
The top level of the management is mainly held responsible for strategy formulation
for the various activities that lead to the successful formation of strategies. Employees of the
organization dedicated towards the strategy that is mainly based on various actions and ideas
which are suggested by employees belonging to the lower level of the management (Barkema
and Chvyrkov 2017). The ways of communicating the different goals and the objectives of
the company to the employees belonging to all the levels is a major part of the strategic
management process. The process of strategic management is further based on the different
approaches that are implemented by different organizations. The approaches that will be a
part of the analysis in this report are, dynamic capabilities approach, the stakeholder approach
and sustainable approach (Baumgartner and Rauter 2017).
The analysis in the report will be related to the ways by which these approaches are
used by the different companies for the management of strategies. The use of these
approaches in the modern organizations will be analysed with the help of three real life
examples of the modern organizations.

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 – This approach in the management of strategies is based on
the ways by which the managers of modern organizations need to implement different
processes which can fulfil the needs of its stakeholders. This approach helps the companies to
ensure their long-term based success in the industry in which they operate. The imperfections
that are present in the market can be used by the organizations in relation to the degree of
participation of various groups (Durand, Grant and Madsen 2017). The approach thereby
provides emphasis to the active process of managing the business environment and promoting
the shared interests and relationships. The approach thereby arises from stakeholder theory
which is considered to be a counterpart of a dominant way of understanding the organization.
The value that is held by the firm is mainly reinforced with the help of implementing the
stakeholder based approach and the creation of competitive advantage in the process (Engert,
Rauter and Baumgartner 2016).
The approach based on the stakeholders in the strategic management of the
organization deals with the various ways by which the stakeholders of the firm can be
managed with the help of the strategic goals that are set by managers. The stakeholders of a
firm play an important role in successful operations in business environment. The
stakeholders in this case are considered to be the most important part of the entire business
operations. The stakeholder approach thereby states that the decisions which are taken by the
firms are mainly guided with the help of the concerns that are raised by the various groups
(Frynas and Mellahi 2015). The major stakeholders of the company are, the suppliers, the
employees, the customers and the major shareholders. This approach is thereby based on the
stakeholder theory which is considered to be a major area of the strategic management.

5ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
Dynamic capabilities Approach – This approach is related to the capability of the
firm with the help of which it can adapt to the base of its resources. The term of dynamic
capabilities has been used for the purpose of explaining the ability that the organizations have
in order to react to the major changes that have taken place in the external operating
environment. The dynamic capabilities named concept is considered to be similar to
operational capabilities that the organizations possess. The framework that is based on the
approach of dynamic capabilities has been successfully designed by Amy Shuen who is a
writer and researcher of various strategies which deal with the success of the organizations
(Hill, Jones and Schilling 2014).
The most important assumption which has been a part of this framework is related to
the formation of short term positions in a competitive scenario that can be developed and
changed into the long-term advantages of the firm on a competitive basis. The dynamic
capabilities based view of the firms is related to the issue which deals with the survival of the
business firms for changing the contemporary business world. The improved framework of
the dynamic capabilities is related to the ability of the organization to reconsider the various
capabilities which are related to the technological changes in the modern business
environment (Kenworthy and Verbeke 2015).
The various dynamic capabilities of the organizations are related to the analysis which
is performed of sources based on the creation of the wealth with the capturing of the firms.
The approach is thereby based on the analysis of the strategies that are formed by the
companies with the aim of safeguarding the competitive edge that has been maintained by the
firms in the industry. The approach of dynamic capabilities is quite promising in nature with
respect to the prospects of the future research that is provided (Meyer, Neck and Meeks
2017). The companies which use this approach are able to gain a profitable position in the
market with help of its competitive advantage in the modern business environment. The

6ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
global approach that is based on the various competitive battles in the industries based on
high-technologies are related to the usage of the modern technologies by the operations of the
organization. The approach that is related to the process of strategic management is based on
the modern technologies and the various information services as well (Michael, Storey and
Thomas 2017). The approach or process of strategic management is helpful for the
organizations for the achievement of the competitive advantages. This process helps the
organizations to create a unique position in the market.
Sustainable Approach – This approach of the strategic management mainly deals
with the different principles and the practices which are based on the sustainability in various
strategies of the organization. The sustainable type of strategy is thereby based on
development and the integration of the vision that is related to the long-term plans of the
company. The sustainable strategies are executed with the help of a complex process that is
based on the sustainable development of the company in the industry in which it has the
operations. This also leads to the increase in productivity of the company and the
effectiveness of various organizational processes (Morschett, Schramm-Klein and Zentes
2015).
The sustainability based concept is further based on the holistic perspective that is
related to the development of an organization with the help of integration of organizational
goals. The main idea that is related to the process of sustainability is implemented by many
modern organizations to help in the formulation of the long-term based strategy with respect
to the expectations of external environment. The sustainable approach that is related to the
strategic management has also led to resolution of various risks and the realization of the
different strategies. The main concept that is related to the sustainability of the environment
is based on the ways of operations of the modern companies (Popkova et al. 2015). The

7ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
approach based on sustainability is thereby related to the process of bringing discipline in the
process of the strategic management.
The first major aspect of an organization that is related to the sustainable approach ae
the corporate values of the company. The second factor is thereby based on the necessity that
is based on the attention that is provided to objectives that are accomplished by an
organization. The sustainable approach that is used by the companies is thereby dependent on
the outcome of the organization rather than financial gains (Sakas, Vlachos and Nasiopoulos
2014). The employees of the firms are thereby involved in the decision making process at the
time of the usage of the sustainable approach for the management of the strategies. The third
factor is related to the link which is established among the resources and the employees of the
firm. The various attitudes which are showed by managers with respect to sustainable
strategy plays an important role in execution. The fourth and the most important aspect is
related to the association of sustainability with strategic level (Simon, Fischbach and Schoder
2014).
Examples of organizations using these approaches
The first example is based on the organization which uses the stakeholder approach of
strategic management. The example is thereby based on the operations of Starbucks. The
different strategies that are developed by Starbucks are based on opinions which are provided
by the customers and the other stakeholders. The feedback of the stakeholders are gathered
with the help of various processes. The approach of the Guidelines and Program is an
innovative method that has been designed and implemented by the company in its various
stores (Starbucks Coffee Company. 2018). The organization has further used this feedback
for deciding the products that they wish to offer to the customers. The approach named “the
Coffee Sourcing Guidelines” was also launched in 2001 by Starbucks. These guidelines were
based on the opinions that were provided by the stakeholders and the customers which has

8ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
been used for the proper sourcing of coffee and the coffee based products as well (Popkova et
al. 2015). The business related policies and practices of the company are thereby based on the
principle of the company. The major aim of the company has always been to provide the
highest standards of the coffee and coffee based products to the customers. The benefits that
will be provided to the company with the help of this approach is related to the formation of
the loyal base of customers. The issues can be further based on hindrance that can be
provided to the changes and the implementation of this approach (Steinbach et al. 2017).
The second example is based on an organization which has been using the dynamic
capabilities approach for the purpose of operating in the modern environment of business.
The various capabilities that are held by the organization are a part of the dynamic
capabilities approach. The example of such an organization is Apple. The company is known
in the market for the various innovative technology based products that are manufactured and
offered by them in the market. The financial strength and the resources of the company are
the most important part of its operations in the industry. The financial backup of the company
has been able to provide Apple with a cushion that can help in the long-term operations in the
fast changing technology industry Apple. (2018). The strategies that have been developed by
the company are based on the capabilities related to the successful implementation of the
plans. The company has also been able to make huge amounts of investments in the activities
that are related to the research and development. The main approach based on the dynamic
capabilities of the company is related to the successful operations of the company in the
industry (Michael, Storey and Thomas 2017). The organization has thereby been successful
in creating a different position in the market which is made possible with the help of the huge
investments made by the company in the development and research based activities. The
benefits that will be provided to the company with the help of this approach is mainly related
to the increased capability of investing in the research based activities. This will further lead

9ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
to the creation of more innovative products. The limitations or the issues that are related to
this approach is based on the pressure that is being made on the capital that is owned by the
business organization in the industry. This pressure can further lead to the lack of the
financial health of the company in the future (Durand, Grant and Madsen 2017).
The third example is based on the sustainable approach that is implemented by an
organization in the industry. The company that has been considered as an example in this
case is Ikea. This company has its operations in the industry of furniture production. The
organization has announced a strategy that is based on the sustainability of its operations in
the market. The company has always aimed at maintaining the sustainability in the operations
which has been made an integral part of the operations of the business. The three main areas
which are the major focus of the strategy formed by Ikea are, positive, planet and people
(IKEA. 2018). The organization has also been formulating strategies that have led to the
formation of the strategies to provide the highest quality of products to the customers
worldwide. The organization has been applying various sustainable strategies in its
production process to integrate the sustainable approach to the strategic management. Ikea
has also aimed at making its operations resource and energy independent. The company has
also taken the lead among many others in the industry in the creation of a better life for the
people and communities of the areas in which it operates (IKEA. 2018). This includes
development of better places for work which is an important part of the supply chain of the
company. The compliance of the sustainability based policies and the upholding of the shared
values are an important part of this approach. The company has also gone much beyond the
supply chain for achieving the shared values. The use of the sustainability approach has been
successful for Ikea and has been able to provide many benefits to the company. The long
term operations and the sustainable position of the company has been strengthened with the
help of the implementation of this approach. The major issues that can occur in the

10ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
implementation of this approach is based on the non-compliance of the employees with the
various sustainable approaches that are implemented by the company (Durand, Grant and
Madsen 2017).
Conclusion
The report can be concluded by stating the three different types of approaches are
suitable for the companies that operate in the different industries. The usage of these
approaches are thereby based on the ways by which the organizations operate in the
environment. The needs and the demands of the customers are important for deciding
approach to the management strategies which needs to be chosen by the management. The
implementation of the right approach will thereby lead to the increase in the profitability of
the organizations in different sectors.

11ANALYSIS OF STRATEGIC MANAGEMENT APPROACH
References
Andreeva, T. and Kianto, A., 2016. Does strategic management of knowledge matter for
organizational performance? An empirical test. In Academy of Management
Proceedings (Vol. 2016, No. 1, p. 17898). Briarcliff Manor, NY 10510: Academy of
Management.
Apple. (2018). Apple. [online] Available at: https://www.apple.com/ [Accessed 23 May
2018].
Barkema, H. and Chvyrkov, O., 2017. What sort of top management team is needed at the
helm of internationally diversified firms?. Strategic Entrepreneurship: Creating a New
Mindset, pp.289-305.
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.
Durand, R., Grant, R.M. and Madsen, T.L., 2017. The expanding domain of strategic
management research and the quest for integration. Strategic Management Journal, 38(1),
pp.4-16.
Engert, S., Rauter, R. and Baumgartner, R.J., 2016. Exploring the integration of corporate
sustainability into strategic management: a literature review. Journal of cleaner
production, 112, pp.2833-2850.
Frynas, J.G. and Mellahi, K., 2015. Global strategic management. Oxford University Press,
USA.