Strategic management in Canon Essay
Strategic management is considered to be an art as well as a science in which activities of formulating, implementing, and finally, evaluation of strategies is carried out. These are carried out with an intention of enabling an organization to achieve both its long range and short range goals. In the course of establishing an organization’s strategies, an organization will come up with the mission and vision that will guide its business operations.
The process of strategic management, therefore, seeks to establish ways in which the various functional activities of an organization will be carried out, in a coordinated and integrated manner so as to achieve the goals and objectives. In most occasions, a number of tools are used by organizations to evaluate the general performance of the organization, and one such technique is the balanced scorecard technique (Bryson, 2004, pp30-50). Source: (Campbell et al 2002, p31-50)
Most of the business organizations undertake a number of activities in the business environment, which enables them to derive a competitive advantage in their operations. In carrying out such activities, the process of strategic planning is involved that enables the organization to structure its business strategies. A business strategy in that respect involves, the determination of the actual direction that an organization would wish to move towards over the short term or in the long term.
Through the business strategies, organizations are able to establish operational advantages as they utilize their scarce resources when compared with their competitors in the business environment. In doing so, they meet the needs and expectations of their customers in the business environment. In an organization like Canon, strategies are carried out at different levels, and strategies are defined according to the level of management that was involved in establishing that strategy.
Some of the most common levels to which an organization’s strategy can be defined include the corporate strategy, the business unit strategies and finally, functional strategies (Campbell et al 2002, pp31-50).
In Canon, the corporate level strategies involve those activities that the organization is undertaking that are aimed at the general operations of the organization. These kinds of strategies are established by the top level management, and they have a high influence on the various stakeholders of the organization.
In Canon, the corporate strategy has been stated in terms of its mission and goals, which has encompassed the values of the organization and its market position. One of the activities of its vision has been to reach out to the global photocopying market through technological differentiation moves (Bryson, 2004, pp30-50). Business unit strategies These are the strategies that are carried out to create a competitive position for the organization in the business environment.
Such kind of strategies have been used in Canon to making the choice of various products and services that the company is rendering to the market, the satisfaction of their customers and exploiting emerging business opportunities among many other activities. Canon has managed to utilize the technological advances in the business environment, whereby it has used the technology to develop products and services like the photocopiers that are unique as compared to those of its competitors.
In the case of Canon, customer satisfaction has been the guiding principle in its business operations, whereby the company has sought to create value for its customers by ensuring that its products and services are maintained to be of a high quality (Bryson, 2004, pp30-50). Functional strategies They deal with how the departments of the organization can be coordinated and managed, so as to create value for the various stakeholders of the company.
Such kind of strategies, therefore, deal with issues to do with allocation of resources, the business processes and the management of the human resources among many other issues within the organization’s environment. At Canon, the product divisions are in charge of establishing contingency plans for the short and long term production plans, whereby each division is in charge of preparing its budget plans and eventually the budget plans get consolidated at the top management level (Campbell et al 2002, pp31-50).
Some of the strong points of Canon Company are that it has managed to adopt a flexible management structure, which allows the members of the organization to interact freely with each other. Through this kind of management structure, the organizational members have managed to interact freely, share knowledge that has stimulated innovations, which have to lead to its strong competitive advantage. The members of the organization have been very supportive in carrying out the various business activities.
In its operations, Canon has managed to achieve a sustained growth in its competitive position, whereby it has been able to record a sales growth of more than 20 billion USA dollars since it started its business operations in the year 1950. The company has also developed a large market share for its products like the laser beam printer, cameras and photocopiers among many others and services that has enabled it to achieve the growth in its profit position (case study).
Cannon has managed to take advantage of the developments in technology in developing its unique products features, which are able to meet the needs and expectations of their customers. The use of technology has also enabled the company to achieve the position of a market leader in the most of its products, especially the photocopiers and laser printers.
The urge to satisfy its customers has also driven the business activities of Canon, whereby customer satisfaction has been encompassed as part of the strategic plans of the organization (case study). Johnson and Scholes model In explaining the ideas involved in strategic management a number of models have been suggested, and one such model is the Johnson and Scholes model. In the Johnson and Scholes model, a presentation is made on the various strategic options an organization like Cannon can choose in carrying out its business operations.
According to this model there are three main factors that an organization can use to assess its success in the business environment and these factors are suitability which tries to explain if a given strategy can be able to work as anticipated, the second factor in assessing the business strategies is feasibility factor that is concerned with if a given chosen strategy can be able to work if an organization implements it.
Finally, the third criterion is the acceptability criteria, that questions on if the members of the organization will be at a position of accepting the business strategies that the management of the organization will carry out (Dess et al 2004, p4-118). Sustainability as one of the criteria that is assessed in Johnson and Scholes model in the organizational context, involves the general rationale of a given organizational strategy.
The key issue to be considered under this criteria, is if a given strategy will be able to account for the core strategic issues highlighted by the given organizations position at the business environment. A sustainable strategy is the one that is considered to make economic sense, where if an organization engages in that strategy it will be able to derive the advantages of large-scale operations when the environmental and organizational capabilities are taken into consideration.
Some of the techniques that can be used to determine the suitability of a strategy include decision trees, what if analysis among many other techniques like ranking (Bryson, 2004, pp30-50). Feasibility is strategic criteria that encompass the determination of the kind of resources that will be needed to carry out the strategy, and in this case, the resources are in terms of funds, human beings as well as time and information.
The relevant tools which can be used to carry out the feasibility of a strategy include cash flow analysis combined with forecasting and break-even analysis among other techniques like resource deployment analysis. Finally, acceptability criteria deal with the expectations that various stakeholders of the company held in the company, that relates to levels of performance results that are analyzed in terms of the level of risk and return, as well as the reactions of the various stakeholders of the organization (Dess et al 2004, p4-118).
Strategic management approaches
Some of the approaches that organizations use to carry out strategic planning activities include among many others, the industrial-organizational approach which is founded on the principles of economics that relate to the competition and allocation of resources among others. This is the approach that Canon is applying in its business operations. The second approach undertaken by firms in establishing strategic management programs includes the sociological approach, which entails the human interactions within organizations and other issues to do with assumptions, which are based on rationality as well as satisfaction (Bryson, 2004, pp30-50).
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Some of the challenges that Canon has faced in the business environment include attempting to fully understand their customers at the market place, especially when it comes to assessing their dynamic needs, preferences, and expectations. On the other hand, conducting business environmental analysis is another challenge that Canon has had to endure as it has tried to establish and sustain its unique competitive advantage. There are challenges that deal with coordination, resource allocation as well as sustaining the commitment of the management and the employees of the organization towards its business strategies.
Amongst other many challenges that Canon has had to face includes sustaining and establishing an effective communication system, that has been a tool of initiating change in its business operations that has enabled it to acquire its strong competitive advantage (case study). Debate whether companies outside this industry sector can draw any useful lessons from the strategies used by Canon in this industry. Provide examples of strategic areas that might be of interest to other industries and any limitations of using such information.
In assessing the acceptability proposition in relation to business strategies techniques like what if analysis amongst other like stakeholder mapping is used. From Canon’s strategies, the other companies in the business environment need to learn how to establish high levels of employee morale, in order to achieve employee satisfaction that is important in the creation of value for both the customers and the stakeholders of the organization. The low-cost structure of Canon is another good example that needs to be emulated by the other companies, as they struggle to achieve their goals and objectives.
In that respect, the establishment of economies of scale is another aspect to be emulated by organizations that seek to practice strategic management. Canon has managed to conduct superior management techniques, that improve the quality of its products and services, one such technique is the Total Quality Management concept among other quality control techniques (Campbell et al 2002, pp31-50). On the other hand, Canon has for the as long period of time established and sustained good business relationships in its business operations with the government, whereby it has complied with the government policy.
This compliance has enabled the company to enjoy high levels of acceptability for its business operations, which has enabled to create a good public image for the benefit of its goods and services. In relation to managing the change element, organizations need to learn from Canon on the need to take into consideration the strategic planning process. One of the key ingredients for success is continuous improvement strategies, which encompass a number of changes in the management structure of the organization.
Some of the changes include the developments in technology that an organization should adopt (Campbell et al 2002, pp31-50). In trying to establish flexible management structures which will enable the organization to encompass the change in their management, organizations should be ready to deal with resistance to change, given that human beings are more comfortable in their current status as compared to the new status that they know little of. Canon’s management structure has adopted a more flat hierarchy, which has enabled the members of this organization to communicate feely.
In carrying out their business activities, Canon has always tried to focus on its customers by understanding well their needs, expectations, as well as their preferences, which forms a basis for their achievement of goals that relate to profitability and growth (case study) Canon, has managed to focus its attention on the use of modern technological devices in developing most of its products that are of high quality. In the use of these devices, the costs of production have been cut down a great deal enabling the company to benefit from the economies of large-scale production. This is a good example that other organizations need to emulate.
In addition to that, the company has managed to carry out its activities in a coordinated manner thus benefiting from the synergistic advantages that enable it to create its strong core competencies (Dess et al 2004, p4-118). Although some of the strategies of the organization are created at the business division level of the organization, and then they receive the top management level approval, the management structure of the Canon is very flexible as to adopt change since it involves an open form of the communication system which is friendly as well as challenging.
Finally, Canon perceives strategic planning process as a business opportunity that it needs to take advantage of as well as a challenge. It does not take it as just any other activity. Thus the other organizations need to encompass strategic planning process as a continuous process, which is important in establishing a competitive position for the organization. The reason is that it enables them to identify their strengths and weaknesses and how to deal with them, as well as the opportunities and threats that an organization will need to handle as it tries to establish its competitive position. (Campbell et al 2002, pp31-50).