MGT302 Strategic Management: A Critical Evaluation of Approaches

This report provides an overview of various strategic management approaches, including the sustainable approach, stakeholder approach, and dynamic capabilities. It discusses the history, benefits, and limitations of each approach, providing examples of organizations like Starbucks that have implemented them. The sustainable approach focuses on managing environmental impact and promoting long-term welfare, while the stakeholder approach emphasizes satisfying the needs of all stakeholders for organizational success. Dynamic capabilities involve adapting to changing environments and maintaining a competitive advantage. The report evaluates the effectiveness of these approaches in enhancing business growth and overall organizational performance. Desklib provides access to this report and many other resources for students.

Management 1
Strategic Management

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Executive Summary
This report includes a description of the various approaches that are used for the proper
development of the organization. The approaches discussed in this report are a sustainable
approach, stakeholder approach and dynamic capabilities. All these approaches provide several
benefits to the business and increase the productivity of the organization. The history of the
approach, benefits of the approach and limitations of the approach has been described in this
assessment. These approaches are used by several business organizations and they enhance their
growth by using these approaches in their marketing and management process. A sustainable
approach is used for the proper management of sustainability in the marketing process so that the
environment can be managed in a proper manner in business activities. Another approach used in
this process is the stakeholder approach that involves the stakeholders in the organizational
activities and functions. Dynamic capabilities are also used in this assessment as an important
approach for the business. These approaches are too important for business management as they
improve the overall growth of the business. Dynamic capabilities used to manage the changing
environments of the organization and maintain all the process of the company.

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Contents
Introduction......................................................................................................................................4
Sustainable Approach......................................................................................................................5
History.........................................................................................................................................5
Benefits........................................................................................................................................6
Limitations...................................................................................................................................6
Organization for example............................................................................................................8
Stakeholder approach.......................................................................................................................9
History.........................................................................................................................................9
Benefits........................................................................................................................................9
Limitations.................................................................................................................................10
Organization for example..........................................................................................................12
Dynamic Capabilities.....................................................................................................................13
History.......................................................................................................................................13
Benefits......................................................................................................................................13
Organization for Example..........................................................................................................14
Conclusion.....................................................................................................................................15
References......................................................................................................................................16

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Introduction
The report outlines several strategies of the business environment and their proper management.
As the business uses different strategies and approaches that provide several benefits to the
business and these approaches will be briefly described in this assessment. The approaches used
in his report are sustainable approach, stakeholder approach and dynamic capabilities. The
sustainable approach is used for the proper growth and development that manages the natural,
produced and social capital for the welfare of the future generations of the business (Iyigun,
2015). The other approach used in this report is the stakeholder approach that is used to achieve
the satisfaction of the stakeholders which provides long-term success for the firm.

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Sustainable Approach
History
Sustainable development is essential for growth and development. This is also used to manage
the natural and social capital for the proper welfare of future generations. The concept of
sustainable development made on the basis of the United Nations conference on the development
and environment. This helps in the process of action plans and strategies that move towards
sustainable development. This approach is used for the betterment of the organization as per the
environmental sustainability (Franca, et al., 2017). The sustainability concept comes in the
process about 30 years ago and it appeared in 1987 for the first time so that it manages the
overall growth of the business. The conservation of nature comes under the sustainable approach
as nature needs to be saved in the business activities and functions. The sustainable approach
includes social system innovations, technological system innovations and knowledge system
innovations (Collins and Junghans, 2015). By the sustainable approach, the awareness is growing
regarding the ecological crisis and it driving the forces of world history in the period of the end
of the 20th century.

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Benefits
The sustainable approach provides various benefits for the organization as it includes the
different process. The sustainable approach provides different practices to the organization and it
is all used for the proper growth and development of the organization (Prause, 2015). This
approach is much more beneficial for the overall process of the business. The major benefits
provided by the sustainable approach are discussed below-
 The sustainable approach improved brand image and competitive advantage
 It increases productivity and reduces costs.
 It increases the business ability to manage with the several regulations
 The shareholders become happy by using the sustainable approach
 It reduces waste occurred in the business.
 Attract employees and investors
All these benefits are essential for the overall organization as it improves the different parts of
the management and increases the growth of the business. The brand image is too important for
the business and it affects the overall growth of the business (Taghian, et al., 2015). The
competitive advantage also increased by making the business sustainable. The financial
investment gets improved by using a sustainable approach. The sustainable approach is all about
the environmental concept and it increases employee retention and recruitment (Harrison, et al.,
2015). The energy efficiency also gets increased by the sustainable approach.
Limitations
Apart from the benefits of the sustainable approach, there are several limitations occurred in the
use of the sustainable approach. These limitations decrease the interest of the companies to use a
sustainable approach. Some of the limitations of the sustainable approach are discussed below-
 Increased several regulations
The use of sustainable approach increases several rules and regulations. Sustainable
approaches increase several regulations on construction and the daily operations of the

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business (McCarthy, et al., 2012). The tight controls are provided on the environmental
process and several people disagree these regulations occurred in the business.
 Create Resistance to new methods
The sustainable approach is responsible to create resistance into the new methods applied
in the business process. Some of the resistance in the methods comes in the form of
people who denied the idea of sustainable development (Valanbienoaand Jegelevibinitob,
2014). The new ideas and practice get affected by the resistance occurred in the process
of the sustainable approach.
 Increased costs
Sustainable development relies on newer technologies that take more cost in the process
of production (Derry, 2012). The material costs are too high in the overall process of
developers.
 Lower quality of life for some elements of society
The sustainable development shrinks some job sectors and increases the jobless for some
workers (Ayuso, et al., 2014). So, people experience a lower quality of life and it affects
the various elements of society. The people affect sustainably developed areas.

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Organization for example
The organization selected for this approach is Starbucks that follows the sustainable approach for
the betterment of the environment along with the proper work process. Starbucks manages the
environment by the overall process of a sustainable approach and manages several functions of
the business (Weiss, 2014). It has been analyzed that a sustainable approach is properly followed
by Starbucks by maintaining the sustainability of the environment.

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Stakeholder approach
History
The stakeholder approach suggests that shareholders are one of many stakeholders in a company.
The stakeholder ecosystem involves the person invested and involved. This process is affected
by the company, employees, vendors and several other agencies of government. The company's
real success depends on the satisfaction of the stakeholders not only by achieving profit. The
stakeholder approach helps global economists to make a stronger company. This theory is all
about the stakeholders of the company and not affect any other person in the company. In this
theory, the company only cares about the stakeholders and achieves positive growth in the
market that also provide proper profit (Lawrence and Weber, 2014).
The stakeholder theory can be tracked by the back-management theories from the year 1930s and
it is affected in all over the business world. The approach is also used to decrease the risk of the
organization. It also gives the complex and volatile nature to the corporate structure and several
market forces. This theory made by R. Edward in the year 1984. All the values are easily
managed in the overall process of the organization with the help of this approach (Cooper, 2017).
This approach is related to the several business ethics that placed in the organization. This
approach is mainly used for creating value for the stakeholders.
Benefits
This approach of stakeholders provides several benefits and implement in the business
organization. The organization enhances its growth by the benefits given by the stakeholder
theory. Some of the main benefits of the stakeholder approach are discussed below-
 This theory also includes the ethical and economic aspects into consideration.
 This theory promotes fairness for everyone in the organization and provides better
objectives for the business.
 They provide several benefits to the stakeholders involved in the company.
 This approach is beneficial as it creates social wealth for everyone and maintains the
environment.
 It makes a good combination of economic aspects and ethical aspects.

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 The shareholders are not sufficient for the proper gain of the company so the stakeholders
are also important for the business (Wamba, et al., 2017).
 The stakeholder’s investment directly impacts the overall performance and wealth of the
company.
 The entire company provides several benefits and make a proper frame of mind.
 This approach affected all the customers, suppliers and employees of the company.
Apart from the above benefits, there are several other benefits that provide flexibility in the
working environment and improves the overall value of the shareholders and gain proper and
required profit in the business environment.
Limitations
The stakeholder approach includes various limitations which create several problems in the
overall business environment. The stakeholder approach is used for the betterment of the
stakeholders but at several times it creates several disadvantages. Some of the main
disadvantages are discussed below-
 Standing in the way of progress
The climate change affects the overall process and it affects the relationships and
individuals (Teece, 2014). Change is happening at a breathtaking pace. The process of
labor and management creates several conflicts and key issues that affect the overall
process of the organization.
 Looking out for number one
The human takes their interests on the above and this supports the various claims of
business. Whenever the issues of money and power intersect so the individuals need to
make their decisions to manage their constituents (Helfat and Peteraf, 2015).Several
numbers of decisions create many issues in the overall organization. The support of
people creates many problems in the overall process.
 Fearing Failure
The fear of failure is also one of the greatest disadvantages in the stakeholder approach.
Factors contributing to a party that interfere with business operation and it will not work

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out an issue (Braganza, et al., 2017). This creates a lack of effective communication in
which parties create several developments. Stakeholder management improves the overall
interests and influencing a large number of people.