Question

write a report for including 1200 words

Strategy implementation involves translating strategic thought into concrete and measurable action. Choose an organization (addidas) and discuss (with examples) how resources are deployed to achieve its objectives.

  

Answer 1

MEANING OF STRATEGY

The word ‘strategy’ has come in the field of management from military where it refers to apply the forces against an enemy to win a war. Originally, the word strategy has been derived from Greek ‘strategos’ which means generalship. The word was used first time around 400 BC. The word strategy means the art of the general to fight in war.

The dictionary meaning of strategy is, “the art of so moving or disposing the instrument of warfare as to impose upon enemy, the place time and conditions for fighting by one self.” In management, the concept of strategy is taken in more broader terms.

According Glueck, “Strategy is the unified, comprehensive and integrated plan that relates the strategic advantage of the firm to the challenges of the environment and is designed to ensure that basic objectives of the enterprise are achieved through proper implementation process.”

It lays stress on the following:

a)      Unified comprehensive and integrated plan.

b)      Strategic advantage is related to challenges of environment.

c)      Proper implementation ensures achievement of basic objectives.

Another definition of strategy is given below which also relates strategy to its environment. “Strategy is organization’s pattern of response to its environment over a period of time to achieve its goals and mission.”

This definition lays stress on the following:

a)       It is organization’s pattern of response to its environment.

b)      The objective is to achieve its goals and mission.

However, various experts do not agree about the precise scope of strategy. Lack of consensus has lead to two broad categories of definitions: strategy as action inclusive of objective setting and strategy as action exclusive of objective setting.

Strategy As Action Inclusive of Objective Setting

In 1960s, chandler made an attempt to define strategy as “the determination of basic long term goals and objective of an enterprise and the adoption of the courses of action and the allocation of resources necessary for carrying out these goals.”

This definition provides for three types of actions involved in strategy:

i)         Determination of long term goals objectives

ii)       Adoption of courses of action

iii)      Allocation of resources.

Strategy as Action Exclusive of Objective Setting

This is another view in which strategy has been defined. It states that strategy is a way in which the firm, reacting to its environment, deploys its principal resources and marshalls its efforts in pursuit of its purpose. Michael Porter has defined strategy as “Creation of a unique and valued position involving a different set of actives. The company that is strategically positioned performs different activities from rivals or performs similar activities in different ways.”

The people who believe this version of the definition call strategy a unified, comprehensive and integrated plan relating to the strategic advantages of the firm to the challenges of the environment.

After considering both the views, strategy can simply be put as management’s plan for achieving its objectives. It basically includes determination and evaluation of alternative paths to an already established mission or objective and eventually, choice of best alternative to be adopted.

NATURE OF STRATEGY

Based on the above definitions, we can understand the nature of strategy. A few aspects regarding nature of strategy is a follows:

·    Strategy is a major course of action through which an organization relates itself to its environment particularly the external factors to facilitate all actions involved in meeting the objective of the organization.

·    Strategy is the blend of internal and external factors. To meet the opportunities and threats provided by the external factors, internal factors are matched with them.

·    Strategy is the combination of actions aimed to meet a particular condition, to solve certain problems or to achieve a desirable end. The actions are different for different situations.

·    Due to its dependence on environmental variables, strategy may involve a contradictory action. An organization may take contradictory actions either simultaneously or with a gap of time. For example, a firm is engaged in closing down of some of its business and at the same time expanding some.

·   Strategy is future oriented. Strategy actions are required for new situations which have not arisen before in the past.

·    Strategy requires some systems and norms for its efficient adoption in any organization.

·    Strategy provides overall framework for guiding enterprise thinking and action.

The purpose of strategy is to determine and communicate a picture of enterprise through a system of major objectives and policies. Strategy is concerned with a unified direction and efficient allocation of an organization’s resources. A well made strategy guides managerial action and thought. It provides an integrated approach for the organization and aids in meeting the challenges posed by environment.

  

ESSENCE OF STRATEGY

Strategy, according to a survey conducted in 1974, includes the determination and evaluation of alternative paths to an already established mission or objective and eventually, choice of the alternative to be adopted. Strategy is characterized by four important aspects.

·         Long term objectives

·         Competitive Advantage

·         Vector

·         Synergy

Strategies of Adidas

1. Digital and technology

Adidas’s five-year strategy that issued in 2015 has the name “Creating the New”. Describing itself as a digital company, Adidas wants to be the world’s best sporting apparel brand. In order to achieve this, they use subsequent digitalization as the key part of their marketing strategy. For the “Best” means designing, building and selling the best sports goods in the world. The company spends 90% of its marketing budget on digital campaigns and social media

2. Speed

High-speed manufacturing is one of the essential parts of Adidas’ digital marketing strategy. They digitized the production process with 3D printing technology and robotics at Speedfactory in Ansbach. Future craft 4D shoes that crafted with light and oxygen are one successful example of the brand’s advanced technology.

The purpose of the manufacturing process is to deliver the most innovative and personalized running shoes for every athlete. The sporting goods brand always tries to meet the high demand. Created with innovation and collaboration, the fresh and desirable products always ready for customers where and when they want them to purchase.

1. Relationship with consumers

They try to interact with their customers and create premium, connected and personalized experiences. In other words, they create enthusiasm and excitement about sports on a personal level. The brand takes every touchpoint like mobile, social and retail that consumers can interact to provide a consistent experience. By taking insights from digital analysis and Big Data, Adidas tries to be everywhere its consumers are. Adidas promises to deliver multichannel, unified and also unique experiences.

Engine Digital collaborated with the Adidas Digital Future Team to meet the needs of Run Genie’s other audience: the Adidas sales associate. They were tasked with defining an end-to-end customer experience that enables the sales team to guide the purchase decision through data visualization and connected hardware.

1. Open-source innovations and collaborations

Adidas opens its doors and calls all the creative including athletes, consumers and partners to learn, create, share and shape future sports and sports culture. They try to bring cool products to the market. Parley For the Ocean cooperation is a part of that initiative which includes producing 3 new UltraBoost models from plastic waste from the sea.

The brand also collaborates world-famous football players, athletes and singers to inspire. “Calling All Creators” campaign created by 72AndSunny is a great example of that collaboration.

1. Strategic cities

Six cities (London, Los Angeles, New York, Paris, Shanghai, and Tokyo) where shape the consumers’ perception, trends, and buying decisions have strategic importance for Adidas. In Europe, they focus on selling especially soccer products, but the US is a key country for other subsidiaries like basketball and baseball. North America is the biggest market in the sporting goods industry, and its total share is 40%.

1. Portfolio

The company is constantly revisiting its portfolio and concentrating on the core brand Adidas and Reebok. Thus the brand makes more precise targeting and reduces complexities. Footwear and apparel under Adidas Neo and Originals names continue to grow. Adidas has repositioned Reebok for more profitability during 2018. For Reebok, they collaborate with influential women designers like Victoria Beckham and women who want to change the world like Ariana Grande and Gigi Hadid.

Even if Adidas has a strong competitor, they’re trying to be the best sporting goods company in the world and they have no intention to give up the game. Using digital, technology, right targeting, speedy manufacturing processes, innovation and collaborations the brand is getting closer to catch the world’s number one.

With this well-implemented strategy, the company wants to topple its main competitor Nike from the crown. Brand’s e-commerce channel is the fastest-growing revenue channel and all the production processes as digitized as possible. Changing consumer behaviors with digital transformation also changes the way how Adidas works. Technology helps the company to build more direct relationships with their customers.