Strategic ManagementIndividual CaseDr. S.P. Kulkami @02716569 HauChen Ni2015.7.30

3. Tata Group is one of Indias largest companies, employing 203,000 people in many different industries, including steel, motor vehicles, telecommunications, management consulting, and IT, among other industries. Why do you think, such diversification produced superior performance? Justify your answer with data and analysis. (Hint: See Chapter 6 of textbook)Albeit it has becoming a trend that conglomerate firms have all but disappeared in North America and Europe, but they continue to be very important in emerging countries.Tata Group lacks close operational linkages between its businesses they are simply too diverse.

Tata Group adds value through allocating investment funds and personnel between its different businesses, deploying its top management expertise, establishing and developing new businesses. The essential condition for this to work is that Tata needs to be more efficient in managing these processes than are external markets. In the US and UK, conglomerate firms no longer have any general advantage in allocating investment funds, motivating business managers, or starting-up new businesses, all these functions are performed efficiently by the capital markets. In India, capital markets are less efficient, venture capital is less developed, and labor markets for managers and other skilled professionals are less developed. In these circumstances, not only is Tata able to utilize internal information and sophisticated decision-making systems to allocate resources more effectively than can external markets, it may also benefit from lower resource costs (in particular, a lower cost of capital than smaller, more specialized companies).Apart from financial and human resources, other resources that Tata can deploy across its different business are influence and business relationships. In a highly regulated country like India, political influence is critically important. Tatas size and diversity undoubtedly give it considerable power within both state and federal governments. Its international network of relationships also allows it to be a preferred joint venture partner for international companies seeking to invest in India.Tata group made some bold moves for significant global positions across businesses. In beverages, it was the logical extension of the intent shown with Tetley acquisition in late-1990s, and in hotels and software, the deeper penetration into overseas markets. In case of steel, chemicals, commercial and passenger vehicles, the intent was to secure competitiveness as the businesses could become vulnerable very soon, because the markets had integrated globally and there was consolidation world-wide.

The Tata are embodying the 'globaldiversified' strategic configuration, as group-level synergy and resources underpin the moves. No single business, evenTata Steel, could have taken the risks and raised requisite funds. The group-level deal making and managerial skills, the long-term orientation to businesses, the values of professional trust and personal care towards members, and the image of Tata as a socially responsible organization helped the moves.

4. What type of organizational structure and controls would you recommend for General Electric? Justify your answer with data and analysis.An organizational structure is the term used to define how employees of a company work together to support their mission. There are several types of organizational structures, including hierarchy, cross-functional, and matrix etc. The number of managers in the organization typically depends on the number of employees and on the type of structure the company adopts.The purpose of an organizational structure is to clearly define roles and responsibilities. Having a defined structure makes it easier to know who should be doing what and who to bring issues to for resolution when things do not go as planned. Though mostly used by businesses, an organizational structure may also be seen in other groups such as clubs and churches.The structure may also refer to how companies work together. This is true when a large parent company has many subsidiaries in different industries. A well known example of this isGeneral Electric, which started with light bulbs but today is involved in electronics, finance, jet engines, and media. Each of these areas is a subsidiary of the parent company, General Electric, and operates on its own as a stand-alone company but reports into the General Electric organizational structure.General Electric, I believe, is suitable for multidivisional structure. The multidivisional structure centers on the use of separate businesses or profit centers.The M-Form is used by many organizations that compete in the global economy.General Electric would be a great example of a company that uses this structure.Each unit is operated as a separate business with its own corporate staff including President.Some parent companies do little more than provide capital and guide units to an organizational-wide strategy.The overall goal is to maximize the overall organizations performance.In order to accomplish this, managers at theparentuse a combination of strategic and financial controls.Multidivisional structure has three important outcomes: It enables corporate officers to more accurately monitor the performance of each business (simplified the problem of control).It facilitates comparisons between divisions, which improved the resource allocation process.It stimulates managers of poor performing divisions to look for ways of improving performance.And the strengthens of Multidivisional structure include:Allows organizations to greatly expand their operations.Units can work together thus benefiting for synergies.Has the potential to positively influence the firms diversification strategy by encouraging managers to pursue additional market-place opportunities.However, like all other forms of organizational structure, problems can also arise with a multidivisional structure that may need to be addressed: 1. One of the ongoing issues with a multidivisional structure is striking and maintaining the proper balance of authority between the corporate managers and the division managers.Companies may want to centralize decision making in order to reduce costs and prevent division managers from taking actions that are contrary to the long-term goals of the entire company; however, too much centralization deprives division managers of the flexibility and independence they need to operate their specific businesses and can damage the performance of the divisions to the extent that decisions are made slowly by corporate managers not directly involved with a particular issue or problem.On the other hand, if division managers are given too much freedom through decentralization they will no incentive or motivation to operate their divisions efficiently or cooperate with corporate managers and other divisions.2. A multidivisional structure makes it easier for corporate managers to compare the performance of the different divisions for purposes of determining how the company can obtain the highest rate of return on future allocations of capital and other resources.While the resulting competition between the divisions can be healthy up to a point, there is a real possibility that rivalries will eventually become so intense that divisions cease to cooperate with one another by sharing resources and transferring information regarding innovations in technology and business processes that could be used by every division to improve the performance of the company as a whole.

Strategic ManagementArticles CritiquesDr. S.P. Kulkami @02716569 HauChen Ni2015.7.30

THE END OF CORPORATE IMPERIALISMBY C.K. PRAHALAD AND KENNETH LIEBERTHALAs they search for growth, multinational corporations will have no choice but to compete in the big emerging markets of China, India, Indonesia, and Brazil. But while it is still common to question how such corporations will change life in those markets, Western executives would be smart to turn the question around and ask how multinationals themselves will be transformed by these markets. To be successful, MNCs will have to rethink every element of their business models, the authors assert in this seminal HBR article from 1998.During the first wave of market entry in the 1980s, multinationals operated with what might be termed an imperialist mind-set, assuming that the emerging markets would merely be new markets for their old products. But this mind-set limited their success: What is truly big and emerging in countries like China and India is a new consumer base comprising hundreds of millions of people. To tap into this huge opportunity, MNCs need to ask themselves five basic questions: Who is in the emerging middle class in these countries? How do the distribution networks operate? What mix of local and global leadership do you need to foster business opportunities? Should you adopt a consistent strategy for all of your business units within one country? Should you take on local partners?The transformation that multinational corporations must undergo is not cosmeticsimply developing greater sensitivity to local cultures will not do the trick, the authors say. To compete in the big emerging markets, multinationals must reconfigure their resources, rethink their cost structures, redesign their product development processes, and challenge their assumptions about who their top-level managers should be.

The Balanced Scorecard: Measures That Drive PerformanceBy Robert S. Kaplan and David P. NortonDrs. Robert Kaplan and David Norton as a performance measurement framework that added strategic non-financial performance measures to traditional financial metrics to give managers and executives a more balanced view of organizational performance originated the Balanced Scorecard. The Balanced Scorecard has evolved from its early use as a simple performance measurement dashboard to a full strategic planning and management system. It transforms an organizations strategic plan from a passive document into the marching orders for the organization on a daily basis.The Balanced Scorecard is a management system (not only a measurement system) that enables organizations to clarify their vision and strategy and translate them into action. It provides feedback around both the internal business processes and external outcomes in order to continuously improve strategic performance and results.Rather than forcing managers to choose between "hard" financial measures and "soft" operational measuressuch as customer retention, product development cycle times, or employee satisfactionthey developed a method that would allow managers to consider both types of measures in a balanced way. "The balanced scorecard includes financial measures that tell the results of actions already taken," Kaplan and Norton explained in the seminal 1992Harvard Business Reviewarticle that launched the balanced scorecardmethodology. "And it complements the financial measures with operational measures on customer satisfaction, internal processes, and the organization's innovation and improvement activitiesoperational measures that are the drivers of future financial performance."

Business Process Reengineering: "Don't Automate, Obliterate! " by. Michael Hammer.Business process reengineering is a powerful and useful tool that can make the difference between success and failure in our highly competitive, globalized business environment. It involves undertaking massive risks but also carries with it the potential of great rewards.Business process reengineering requires process reengineering knowledge as well as the commitment of a large amount of employee time, effort and financial resources to be successful. Executive leadership and vision are critical to success of any reengineering project.In the article, Hammer emphasizes that when we reengineer a process, we should not simply pave the cow path. A basic requirement of reengineering is that we identify all of the paradigms, assumptions and work rules buried in the old process.A decade has now passed, and BPR has matured. It is now recognized that BPR is not simply about new processes and new technology, it is about the transformation of the organization from the traditional vertical, 'stove pipe', departmental based organization, to one that is based around core processes with process owners driving the business. This is not simply a matter of semantics - it is a fundamental change in approach, holding at its core, the creation of customer value as the primary objective for all and any business and organization.

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