Business Strategy BT

Development Strategy for Business Resilience and Sustainability through an Incremental Strategy – A Study of British Telecom

This report discusses the comparative analysis of three strategies namely incremental, renovate and inventive within the context of the internal as well as the external environment of a company such as BT (British Telecommunications Limited) which is a multinational telecommunications services company headquartered in London. It also evaluates a change management programme that can bring about strategic change within this organisation. BT has a global services as well as a retail division. Its operations span 170 countries throughout the world.

Company’s Internal and External Environment and Its Strategy Type

In the current business scenario, intense competition, integration across global markets, changes in technology and the advancement of the telecommunications sector are some of the external factors that influence the change management program of BT. the Company’s managerial talent and the level of the motivation of its workforce are some of the internal factors influencing strategic management. In order to improve the effectiveness of the organisation, strategy is the key because it leverages the capabilities of the individuals and the institution in a cohesive manner. The ideal development strategy for a company like BT that seeks business resilience and sustainability throughout its line of operations is an incremental approach.

Strategic Capabilities

Incremental strategies are effective within the current dynamic environment. Regulatory convergence is a key factor in the selection of incremental strategy for handling change and sustaining profits. The challenges of global competition have to be seen within the broader regulatory framework for effective strategic management. The incremental approach to strategic management is in response to the complex and ever changing corporate environment. Consequently, the strategic process moved in an incremental manner adapting to changes in the internal and external environment of the company. Decisions will then be driven by multiple goals. BT has low levels of business resources with respect to its telecommunications services though it is steadily expanding in the field of broadband communications. BT has reported a fall in sales though it experienced a healthy profit in 2013. Moderate or high business resources imply greater strategic capabilities which enable the company to excel using innovation or denotative strategic management. Annual pre-tax profits of BT were up by more than 40% but sales fell by 4%.

Business Strategy BT Competitive Analysis

The major feature of the incremental strategy is that it is decentralised and it responds to dynamic environmental challenges. BT is facing a changing socioeconomic milieu wherein the incremental approach accounts for this variable. An incremental strategy enables the organisation to fulfil its mission by closing the divide between long as well as short term goals within a changing environment. Organisational design followed a contingency approach since landmark research was conducted by Emery and Trist (1965) as well as Lawrence and Lorsch (1967). When a company faces a challenging environment, incremental strategy is far better than inventive or renovate strategies on account of the challenging environment faced by the company. As a British MNC which has to face global competition, BT should opt for an incremental strategy to boost its prospects and sales.  The degree to which the environment of a company is globalised also influences its development strategy. Porter has proposed the five force model for analyses of competition presented below:

Porters 5 Force Model
Porters 5 Force Model

Figure 1: Porter’s 5 Force Model from Michael Porter, “Competitive Strategies”

Porter’s model elucidates how competition from different sources can create industry rivalry. Competitive analyses in the context of an incremental strategy is suitable for organisations such as BT which want to cope with competition from different sources, as discussed in Porter’s model.

Business Strategy BT Competitive Advantage

BT needs to consider the complete gamut of competitors through an incremental approach to change management. Porter (1980) has argued that organisations should consider the behaviour of firms that are producing same/similar products as well as the action of suppliers, competitors producing substitute products and the customers themselves. An incremental strategy enables companies such as BT to develop a holistic view of the market to promote business resilience and boost profits. Competitive advantage has been discussed through a model proposed by Porter discussed below:

Porters Generic Strategies Model
Porters Generic Strategies Model

Figure 2: Porter’s Generic Strategies Model (Porter, 1980)

Ansoff (1985) has discussed how companies should also develop the strategy keeping in mind the flow of critical resources for production. They should also consider how they will impact non-market actors. Nonmarket actors or strategic interest groups also have an important role to play in influencing the development strategy of a firm. BT should follow a cost leadership strategy for low cost rather than aiming for product uniqueness as there are many rivals offering advanced services in this sector.

Culture

The culture of an organisation also plays a key role in influencing the strategy it adopts. The company’s abilities revolve around the resource, skills and procedures as well as its competencies. Attitudes and other cognitive factors reflect an organisation’s culture. The work culture at BT is unique. It focuses on completion of projects and garnering of crucial contracts. The organisational culture of a company influences its success in current times. BT needs to follow an incremental strategy whereby it adapts to changing global and domestic environment so that it can keep up with its competitors. The choice of a strategic management approach is based on several critical considerations such as an organisation’s strategic capabilities, competitive analyses, competitive advantage and culture.

An organisation must have a strategy that can meet the challenges of its internal or external environment (Ashby, 1961). Therefore, an incremental strategy would be ideal for enhancing the sustainability of business practices and the resilience of British Telecom. Consider the personnel, structure, systems and financial resources to be important factors in any strategy for change management. An incremental strategy follows a contingency approach which is ideal for British Telecom.

The organisation’s culture as reflected by collective values, experiences and beliefs of its members also has a critical role to play in its success. An incremental strategy for development and change management incorporates this effectively, making it the viable and effective choice for BT which has skilled employees. An incremental strategy is ideal for bringing about small but important changes in the organisational functioning compared to inventive or renovate strategies which focus on large scale change.

In order to possess business resilience and sustainability in its operations, BT needs to follow an incremental strategy to bolster its current organisational culture. Companies need to be proactive to cope with changes such as economic slowdowns, increased global competition and massive amount of technological advancement. BT would do well to adopt an incremental, contingency oriented approach to strategic management to cope with this.

Critical Evaluation of the Incremental Strategy

Incremental strategy is ideal for British Telecom.  An incremental strategy enables the company to have flexibility in coping with uncertainties in the field of policy regulation and governance.

People

There is a need to bargain with stakeholders and integrate human and organisational capabilities to catapult the company to the path of success. Renovate and innovative strategies can only be effective in environments where there are less regulation uncertainties (Lindblom, 1979). Each of the different resources within a company plays a critical role in its success. Through an incremental approach, British Telecom can impact its employees in a positive way. By instilling coping skills and out of the box thinking to manage dynamic and changing situations, BT can boost its profits.

Employees also differ in terms of their personal knowledge, perception, limitations, and it is due to this inherent complexity that incremental strategy can be the perfect tool for change. Diversity is one of the chief features of the workforce at BT. Therefore; development strategies followed here should take advantage of this versatility. Incremental approaches to strategic management can accomplish this.  Top managers within the same company can approach the same problem with different solutions (Bower & Doz, 1979).

Operations

Operations system provides guidance regarding how work procedures must be carried on and provides the framework for performing the work People are the key resources of any company. They are the prime assets which spur the growth and development of the organisation. Operations are a key area where rapid changes have to be kept pace with. The internal as well as external stakeholders also play a central role in the company’s success (Lindblom, 1959; Mintzberg, 1919). Balancing the goals and interests of stakeholders is the key to organisational success (Ansoff, 1985). BT should adopt an incremental strategy to improve operations.

Finance

Financial resources are necessary to accomplish goals and provide rewards. Money is one of the primary motivators for obtaining optimal performance from employees in the work setting. Annual pre-tax profits were up 42% to £2.4bn, last year for BT while sales were down 4%. An incremental strategy is ideal for a company such as BT which has ample financial resources.

Technology

Technology sets the stage for the company to maximise its capabilities if it keeps pace with it. Effective utilisation of resources is a must if a company has to progress and make healthy profits. An organisation’s culture is maintained and transmitted by its workers. Leaders of internal stakeholder groups are the key assets to instil positive change within an organisation. For companies such as BT that are facing moderate to heavy environmental turbulence, an incremental strategy for strategic management is needed (Mintzberg, 1973).

Several comprehensive reviews have been conducted by leading researchers in the field of strategic management (Hofer, 1976; Vancil, 1976; Armstrong, 1982). Research has found that degree of formality centralisation, hierarchical structure and comprehensiveness of any company is influenced by its environment, and complexity (Armstong, 1982, Hofer, 1976). In current scenario, an incremental strategy is optimal for BT.

Change Management Programme

A change management programme for British Telecom must incorporate an incremental approach. This is because its external and internal environment is more suited to an approach that makes allowances for sudden and rapid changes. Whether it is people, financial aspects, technological advancements or  organisational culture, all aspects of an organisation’s functioning need to be taken into account for effective change management. A conventional approach towards change management will not be successful. In 1995, John Kotter published his landmark paper “Leading Change: Why Transformation Efforts Fail”. This paper cited how only 30% of change programs are successful.

The biggest advantages of a change management programme for British Telecom through an incremental strategy is that it will make allowances for the rapid changes in technology and competition that are taking place in the Indian telecommunications sector. Colin Price and Emily Lawson (2003) suggested that the conditions which must be met for employees within an organisation to embrace change include their agreement to the change, effective role modelling for inculcation of change oriented behaviours, and reinforcement systems that encourage the behaviour and the skills required for change. The structures, systems, processes and incentives within a change management program should be conducive towards a positive transformation of the company into a reliable and sustainable business.

An incremental approach to strategic management can bring about this transformation for British Telecom. But change management processes should have an appeal for employees. Businesses that want to do more than survive have to remodel themselves to match up to competitors. Change management programmes have incorporated various methods such as total quality management, rightsizing, restructuring, cultural change and turnarounds in a bid to improve their profit margins. British Telecom needs to follow a change programme that pursues innovation in a way that is flexible and keeps in line with the incremental strategy of adapting to changes. Too many companies fail to progress beyond a certain point when it comes to garnering market share because they do not anticipate change due to factors such as advances in technology and industrial competition. Even a change management programme based on the incremental approach can have a few pitfalls though. Anticipating change is not easy. Many times, market analysts may be predicting a trend which is short-lived. Kotter’s 10 year study of more than 100 companies found unsuccessful change management programmes failed to generate the urgency or formulate a vision that could be communicated well to bring about a complete transition.

Companies need to be practical and realistic in their aspirations. Only then can change management programmes succeed in a complete sense. Obstacles to the change management programme suggested in this paper include rapid changes in the regulatory framework, unforeseen innovations and advancements in the field of technology and lack of market foresight. Genuine transformations require game changing ideas which can bring about creative solutions to problems. A change management programme based on an incremental strategy can only succeed if company personnel have the objectivity to view successes and failures in accurate ways.

References

Armstrong, 1. S. (1982). The value of formal planning for strategic decisions: Review of empirical research, Strategic Management Journal, 3: 191-21 1.

Barnard, C. I. (1938). The Functions of the Executive, Cambridge, Massachusetts:  Harvard University Press

Baumol, W. (1968). Entrepreneurship in economic theory, American Economic Review, 581 64-72.

Freeman, R. E. (1984). Strategic Management: A Stakeholder Approach, Boston: Pitman.

Hofer, C. W. (1975). Toward a contingency theory of business strategy, Academy of Management Journal, l8: 784-810.

Hofer, C. W. (1976). Research on strategic planning: A survey of past studies and suggestions for future efforts, Journal of Economics and Business, 28: 261-286.

Isern, Joseph and Pung, Caroline, “Organizing for successful change management: A McKinsey global survey”, 4.The McKinsey Quarterly, June 2006.

Kotter, John, “Leading Change: Why Transformation Efforts Fail”, Harvard Business Review, March–April 1995, p 1.

Jensen, M. C., and Meckling, W. H, (1976). Theory of the firm: Managerial behavior, agency, costs and ownership structure, Journal of Financial Economics, 3:305-360.

Lawrence, P. R., and Lorsch, J. W. (1967}. Organization and Environment: Managing Differentiation and Integration, Graduate School of Business Administration, Harvard University, Boston.

Lorsch, J. W. (1986). Managing culture: The invisible barrier to strategic change, California Management Review, 23: 95-109.

Mintzberg, H. (1973). Strategy making in three modes, California Management Review, I6: 44-53.

Mintzberg, H. (1977). Policy as a field of management theory, Academy of Management Review, 2: 88-103.

Mintzberg, H. (1978). Patterns in strategy formation, Management Science, 24: 934-948.

Mintzberg, H. (1979). The Structuring of Organizations, Englewood Cliffs, New Jersey: Prentice-Hall.

Mintzberg, H. (1987). Crafting strategy, Harvard Business Review, 65: 66-75.

Mintzberg, H., and Walters, J. A. (1985). Of strategies, deliberate and emergent, Strategic Management Journal, 6: 25?-272.

Pettigrew, A. M. (1977). Strategy formation as a political process, International Studies on Management and Organization, 7: 78-87.

Price, Colin and Lawson, Emily, “The Psychology of Change Management,”7.The McKinsey Quarterly, 2003, Number 2, Special Edition: Organization.

Schumpeter, J. A. (1934). The Theory of Economic Development, Cambridge, Massachusetts: Harvard University Press.

Vancil, R. F. (l 9? 6}. Strategy formulations in complex organizations, Sloan Management Review, I7: 1—13.

Quinn, J. B. (1977). Strategic goals: Process and politics, Sloan Management Review, 18:21-27.

Williamson, 0. E. (1975). Markets and Hierarchies: Analysis and Antitrust Implications, New York: Free Press.

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How To Write A Business Management Essay

How To Write A Business Management Essay

Title: Business Management Essay. This blog post is an systematic guide on how to write an effective business management essay, it outlines some of the frequent pitfalls of management essay assignments. It also provides management students with a factorial program to business management essays and research papers. This is also intended for business related courses like human resource management, marketing, accounting, economics, systems consultancy, and others. I hope you get a better understanding on how to write a business management essay.

People read management essays to acquire valuable current information that is timely. Moreover, management essays connects theoretical knowledge to concepts prevalent in the market. Management essays offer students an opportunity to apply theoretical information in the field.

After all, management is a soft skill that requires development outside of the class setting. The essays enable students to reflect on the theories and various management frameworks applied in class. Writing a business management essay can be a daunting essay and a management student almost always requires support in meeting all the challenges related to the task.

A management essay writer should design an essay that tests existing knowledge and develops it. The act of preparing the essay should be aimed at developing particular subject knowledge on management – Enhancing your know in a familiar subject is recommended. Your management essay should bear in mind that the instructor is interested in determining the level of knowledge of the student, thus the flow of reason is crucial. You should build logic arguments just like in a debate.

In other words, you should be able to make the readers of your essay think logically, and do not just expect them to believe the statements made by the essay. The method of justifying your claims is quite crucial. One of the best ways to do this is to offer evidence for every claim made. An evaluation of the evidence will also come in handy.

While writing management essays, it is always crucial to provide theoretical backing to claims and arguments. Connecting current affairs to conceptual ideas enables your readers to connect current information to past scholarly ideas. This provides room for critical thinking and the reader is left to be the judge of what they read. Some essays demand that you do more than a single task.

For instance, some require that you provide an outline of the main organizational theories underneath modern management spheres. They also require a discussion of their importance to professional career situations. Such questions usually require that you do more than just describe the theories. The most usual written comment on management essays by examiners is something similar to “you have not responded to the question set”. Marks are never awarded in such instances because you have answered a question the examiner did not set.

Business Management Essay Topics
Business Management Essay Topics

Before writing a business management essay, it is crucial to have a plan. There are two types of plans that are crucial in writing management essays. Firstly, it is crucial to plan for the time you will need. Secondly, you need to come up with an essay plan. The amount of time is hard to determine as it depends on a number of elements. However, the most vital factor to consider while making a time plan include the level of knowledge you have on the topics that you intend to write about.

If you intend to write on a topic you have little knowledge, chances are high that you will spend so much time. Management writers are always advised to focus on topics that they profess so much knowledge. These could include your most favorite topic or even topics you studied through case studies and field trips.

Before writing the essay, make a plan of the possible visits. This could include visits to lecturers and tutors, social events, or field trips to management professionals. At this juncture, make a point of availing possible textbooks, journals, newspapers, articles, and other relevant materials on management issues.

The internet can also offer vital information for the management essay. Making an ample data collection process is a crucial step in coming up with a management essay. This is because this stage can offer current and past information that can be used to contextualize the topic you are planning to write about. The nature and length of planning depend on the amount of information collected and length of the management essay.

Before writing a business management essay, it is crucial for you to analyze the expectations that your audience are likely to have. Moreover, you should strive to ensure that the tone of your paper is formal and on point. Most management essay readers are elites and researchers seeking the underlying idea in every statement.

Business Management Essay Structure

Determining the structure of the essay is crucial before embarking on the writing process. Most management and academic writing present the structure to include the introduction, the body, and the conclusion. The introduction is the most vital part of the essay as it sets the pace for both you as the writer of a management essay, as well as the reader. The introduction is used to captivate the attention of the reader, thus it should be as interesting as possible. The introduction contains the synopsis of the management essay, and introduces various theoretical frameworks. The last part of the introduction should have a thesis statement. A thesis is a statement of claim made by an essay writer. The thesis statement offers the threshold on which the writer measures all other arguments and claims in the essay. A thesis statement provides the direction and tone of the essay hence should be constructed rationally.

The introduction is followed by the body of the essay. This is the section where you present various claims, arguments, positions and knowledge. All the data collected are analyzed and their deductions presented for analysis. The body of a management essay should be able to connect past knowledge with current knowledge. For instance, when writing about organizational behavior, you should connect current organizational behaviors rampant in existing businesses and connect to classical management trends.

It is also crucial to relate organizational practices to outside factors. Some organizations behave the way they do because of external elements like government policies and competition. The body of a management essay provides an explanation of the points introduced at the introduction stage and should reflect a clear flow. You should present your points in a systematic pattern of presenting your points from the strongest to the least strong. Before writing the essay, you should create an outline of the main points as this will facilitate a systematic flow.

Highlighting the points will also ensure that you maintain your word count. It is always important to adhere to typographical and other guidelines provided by your university lecturer. This will help secure marks lost through simple mistakes. Another important reason for highlighting the main points before embarking on the real writing process is to ensure that the essay observe consistency. A good management essay should stick to explaining and developing specific points of view rather than offering a discussion of every management aspect. Showing a clear connection of the arguments with the topic throughout the research is crucial.

The body should offer an analysis of data and measure them with respect to the thesis statement. Usually, data is collected with the objective of determining the validity of the thesis statement. After presenting an in depth argument in the body section, the next important step after the body is the conclusion. This stage is crucial as it consolidates what has already been debated. The tone of the conclusion is vital as it offers more persuasion for your readers. This section should not introduce new knowledge but should just reinforce what has already been discussed. The concluding stage presents the end of the paper and should offer an ending tune.

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