Strategic Management Report: Analysis of National Express' Strategy

This report provides a comprehensive analysis of strategic management principles, techniques, and their application within the context of National Express, a UK-based public transport operator. The report begins by defining strategic management and its core concepts, including goal setting, strategy formation assessment, implementation, and monitoring. It explores key principles such as expediency, systems approach, strategic choice, creativity, and strategic change. The report then delves into strategic evaluation, focusing on National Express's launch of its Bus Alliance and analyzes the competitive landscape. It examines various strategic alternatives for gaining a competitive advantage, including cost, differentiation, and focus strategies. The report recommends the implementation of an ownership relationship, specifically a joint venture, and outlines persuasive action plans. The report utilizes Porter's Five Forces framework for competitive analysis and concludes with a summary of findings and recommendations. The report also analyzes the types of strategic alliance for National Express, and evaluates the advantages and disadvantages of each.

STRATEGIC MANAGEMENT
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Table of Contents
Introduction......................................................................................................................................3
Comprehensive understanding of strategic management, chief concepts, techniques and
principles..........................................................................................................................................3
Strategic evaluation concerning various National Express as well as competitive situations.........5
Reasoning concerning various available strategic alternatives to gain a suitable competitive
advantage.........................................................................................................................................7
Implementation of a selected strategy.............................................................................................7
Reasons regarding action plans that seems persuasive and professional to others..........................7
Porter’s Five Force, a convenient theoretical framework................................................................8
Conclusion.......................................................................................................................................9
Reference List................................................................................................................................10
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Introduction
Strategic management basically refers to the various types of strategic methods which are
adopted and implemented by managers in order to manage various kinds of operation within an
organization in a better way. All the decisions which are taken related to management in order to
accomplish better management system and performance can be termed as strategic management.
All organizations in order to establish developed functional systems need the tool of strategic
management. It is actually a kind of continuous process which controls and evaluates the
operational aspect of industries various industries and organizations.
The chief objective of the conducted assignment is to introduce the readers to the concept of
strategic management and the way it brings organizational improvement through its application.
A discussion is conducted, describing its key concepts, techniques and principles. Strategic
evaluation of this tool in competitive circumstances is also presented, followed by different
strategic alternatives available. A suitable explanation regarding selected strategy enforcement is
also given, that can be useful in persuasion in the professional field. Lastly, Porter's five forces
concerning the topic are explained.
Comprehensive understanding of strategic management, chief concepts,
techniques and principles
In order to conduct effective strategic management methods and means, it is important for every
organization and company to have basic concept along with principles and varied techniques
related to strategic management. The basic concept of strategic management refers to the various
decisions, methods which the organization makes in order to accomplish a specific set of
objectives. The first factor of management strategy is goal setting. Without setting a specified
goal, it is not possible for the organization to operate properly. Hence, establishing a clear set of
the goal is the core part of strategic management. Creating a goal helps the organization to set a
target to achieve the former, which in turn gives a clear picture of required operation style to
employees. This measure also helps in creating a broader mission statement for the organization
(Marshall, 2013, p.216). Strategy formation assessment is another important aspect. This
suggests the organization needs to conduct a proper analysis regarding its strengths and
shortcomings concerning the external and internal system of the organization and develop
decisions accordingly. Strategic implementation refers to the stage when the organization is
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implementing the decisions and measures which the managerial member of the company has
decided to enforce in order to accomplish business goals. The chief idea regarding the concept is
collecting the necessary available resources needed in order execute the strategic plan in reality.
Organizations enforce strategies while making programs, budget plans, different policies
(required in the field of human resources, management, and finance along with various
operational goals) (Ajagbe et al. 2015, p.2).
The last concept is strategy monitoring. This means monitoring and controlling the strategies
which are being executed and trying to evaluate the utility of the decisions which are enforced
for the functional operation of the organization. The organizations with the help of monitoring
get a clear evaluation regarding modification and adjustment of the enforced management
decision.
Principles related to strategic management involve a large range of guidelines, policies, along
with related practices. With the application of these principles, an organization is able to achieve
better results, quicker development, gaining good market position in the process. There exists a
wide variety of principles; among them, some of the principles are explained in the assignment.
Principle related to expediency suggests to the making of objectives, establishing goals, as per
the values of the organization approved by its management section and its owners (Hill et al.
2014, p.6). Principle related to the system of approach refers to the methodology of approach or
more clearly the way the organization should work. Principle regarding strategic choice refers to
the business decisions, choices which are taken in order to improve the functional stability of the
organization.
The principles related to creativity and thinking indicates the creativity and ideas which are
developed and initiated in order to gain better management results depending on the present
situation. Principle related to strategic change, on the other hand, indicates the various decisions
which are taken and initiated as per modification requirement based on the present market
situation (Ethiraj et al. 2016, p.2192).
However, in order to execute the principles successfully, it is necessary to be familiar with the
varied techniques of strategic management. SWOT analysis tool, for instance, helps to identify
the strengths, weaknesses, opportunities and threats of the company. PESTLE analysis helps to
evaluate the external factors of the organization like political, environment, social, technological,
legal and environmental. The Balanced Scorecard refers to a certain management and planning
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system, extensively employed in the industrial and business sector, also in various kinds of
organizations. (Bettis et al. 2015, p.637). VRIO analysis is a useful analytical technique
employed to evaluate the organization’s resources, striving to calculate the competitive
advantage of the organization. Mintzberg’s theory of 5Ps is another useful strategic technique
which includes plan, plot, pattern, position, perspective. This means an organization before
making a strategic decision must make a plot. Based on the plot, a plan must be made after
careful consideration of market position, the market trend or pattern along with the existing of
the perspective of the market and consumers. One of the techniques which are discussed in the
assignment is Porter’s five forces; it helps in determining the competitive intensity of the
organization (Bettis et al. 2014, p.949).
The organization, based on certain strategic management principles, adopts and enforces suitable
strategic techniques for the development and growth of the organization, after carefully assessing
the existing strategic concepts.
Strategic evaluation concerning various National Express as well as
competitive situations
Various organizations have developed their respective strategic management system as per the
market situation and to tackle the competitive atmosphere. Taking the case scenario into
consideration, an analysis of strategic management can be further explained taking the help of
National Express. It is a UK based leading operator of public transport, based on the case study,
has decided to launch the country’s first Bus Alliance (Simon et al. 2014, p.40). The National
Express has set for itself a structured list of objectives, as per its strategic planning. It aims to
increase the number of bus patronage, strives to offer service during pressure hours, and aims to
facilitate the feature of payment via smart watch and phone, facility of Wi-Fi and so on. Taking
the case scenario into account, the origination has planned to develop the method of alliance
concerning their service; therefore it is better to know the kinds of strategic alliance required for
this partnership venture by the National Express (Chen et al. 2015, p.20).
There are chiefly three types of relationship which can be considered by the organization.
However, the readers before knowing the categories of relationship must also know the essential
influential factors which determine the types of relationship. These are a market, resources
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(management and partner's assets, the risk of asset loss), and expectations (political atmosphere,
economic risk).
If National Express is aiming to go for a loose (Market) relationship, then it has the opportunity
of getting the vast platform of the network. Establishing this relationship helps the organization
to get opportunistic alliances, forming a wide network of the alliance in the process (Trigeorgis
and Reuer, 2017, p.60). This process is helpful for the origination to expand in the market, it can
bring easy change. Resources can be easily achieved. However, the process also has certain
drawbacks. Since the relationship is loose, along with the easy availability of assets, it also poses
the risk of losing assets. Opportunistic alliances, in terms of crisis, can get away, leading to
operation instability and financial crisis. Hence, economic crisis, the unstable political situation
is highly expected.
A contractual form of relationship is a good option for the company; however, this form also has
certain advantages and disadvantages which need to be considered. The change of market can be
taken as moderate in this form of relationship. This form is considered a narrow form of
relationship as it is based on contracts. This mean, the group of alliances cannot go outside the
rules and regulations stated in the concerned contract made during the process of partnership
((Vogel and Güttel, 2013, p.427). The process of licensing, franchising and subcontracting is
needed in this form of relationship. In this process, security of asset is guaranteed; the issue of
asset loss does not arise since conditions related to business are already stated in the contract and
during the process of licensing. However, an alliance is hard to get in this relationship, since
working on the basis of contract means partner companies are bounded for a certain period of
time. However, working as per contractual basis gives work security. This method is quite
helpful to tackle the competitive market situation.
Another form of relationship which the National Express can adopt for launching its Bus
Alliance is the form of ownership. This method means, the organization has a certain individual
or group of people as owners (Goldfarb and King, 2016, p.168). This process is slower if
compared to other two relationship forms. This is because all the operations, functions must be
handled by the specific individual or the respected group. It is quite risky, however asset remains
secured, financial risk can be a major stumbling block. Consortia or joint ventures are applicable.
The mentioned organization can also adopt this type of relationship. Since this form of
relationship is time-consuming, tackling market competition can become a bit difficult.
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Reasoning concerning various available strategic alternatives to gain a
suitable competitive advantage
An organization can take various strategic measures in order to strive for competitive advantage
(Rothaermel, 2015, p.9). Among many factors, here exist certain generic factors regarding which
appropriate planning must be organized. Taking the mentioned case scenario into consideration,
the National Express needs to give emphasis on certain mandatory factors; these are cost,
differentiation, and focus. Since the organization is planning launch the Bus Alliance which is a
first of its kind in the UK, the organization needs to make a careful assessment regarding the cost
and expenditure of the business. For example, budget, regarding bus expenditure, driver
employment and such needs to be considered. Stress should be given on the product launch and
how it is different from other products/service from the same industry. For example, National
Express has decided to launch Bus Alliance, aiming to provide better transport facility along
with comfort and convenience (for instance the facility of Wi-Fi, payment via smart watch and
cell phones) (E. Dobbs, 2014, p.42).
Implementation of a selected strategy
Taking into view the stated case scenario, National Express can take the strategy of ownership
relationship. This means the method of the joint venture can be implemented. This method can
be a bit problematic to handle, however, it also can be very effective if handled in a proper
manner. Since the organization is a renowned organization; getting resources of assets should not
be a problem. Partnerships are formed so assets of partnership can also be used. Financial crisis
can be expected, however since the National Express is opting for partnership approach, hence
this risk can be avoided if the business is handled properly. The factor of political aspect is an
important issue for this joint venture. Since the organization is forming a partnership with other
transport operators, political instability might become a major issue if the different operators do
not work in cooperation (Rothaermel, 2015, p. 5).
Reasons regarding action plans that seems persuasive and professional to
others
An action plan is presented regarding the assignment.
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ACTIVITIES Week1 to week 2 Week 3 to week
4
Week 5 to week
6
Week 7 to week
8
Goal setting
Analysis
Strategy
formulation
Implementation
of the strategy
Control and
evaluation
Table 1: Gantt chart
(Source: Created by Self)
Porter’s Five Force, a convenient theoretical framework
In order to explain the operation and significance of strategic management, it is better to portray
a suitable theoretical framework. Taking into account the given case scenario, the technique of
Porter's five forces can be used in the given organization, the National Express. Five factors are a
competitive rivalry, the threat of new entry, buyer power, supplier power and the threat of
substitution.
The National Express organization needs to consider the rival competitors which exist in the
market world. The organization needs to make an accurate evaluation regarding the number of
competitive rivals which are present in the same market, trying to offer similar service. The
factor of quality is a major factor in gaining a competitive advantage over other operators. Good
service, round the clock availability, especially in busy work hour acts as crucial factors, useful
in gaining the market advantage, attracting consumers and clients in the process. The factor of
cost indeed acts as a major factor to gain market advantage in garnering customer loyalty which
is the ultimate objective of the organization.
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Figure 1: Porter’s five forces model
(Source: Ethiraj et al. 2016, p.2191).
The organization before service launch must also need to consider possible threats of new
participants or new organizations. The organization needs to make an estimation regarding these
new participations. Economic scale needs to be considered along with the factor of technology
superiority (Marshall, 2013, p.216). Supplier power basically means keeping track of the number
of suppliers. In this case, National Express needs to keep track of the operators which are
providing buses, the transport quality. The cost of changing also needs to be considered by the
organization, along with the organization's ability to provide service. Buyer power is an
important factor. The major objective of the company is to provide service to customers, giving
them satisfaction, as this, in turn, is responsible for making the launch a success. The size of each
customer order needs to considered, along with the issue of appropriate costing and the ability to
provide satisfactory service.
Conclusion
In conclusion, it can be said, implementing appropriate strategic management is essential in
every field of organization. This is because an organization cannot work without the help of
suitable management strategies. The main significance of strategic management is that it helps
the working members of the organization to work in an organized manner, improving the overall
functional system in the process.
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Reference List
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management. Strategic Management Journal, 37(11), pp.2191-2192.
Goldfarb, B. and King, A.A., (2016). Scientific apophenia in strategic management research:
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