Question

For my Business Policy Class:

1- What kinds of advantages and disadvantages are associated with the size of an organization?

2- How do the financial analysis of a firm influence its strategic options?

3- Suggest some specific means by which business can strengthen their positions and develop distinctive competencies.

4- “Business which develops formal strategic planning system will be more effective in achieving their objectives than those which do not”. Explain in detail why this is true.

Answer 1

1- What kinds of advantages and disadvantages are associated with the size of an organization?

• Bigger organisation can tackle any problem with a greater manpower, thus resolving a problem becomes easier
• Bigger organisations can divide the responsibilities by forming several departments for easier flow of information
• Bigger organisations can be difficult to manage as diversity issues might evolve
• Bigger organisations can hinder the streamlining and aligning of processes
• Bigger organisations can tend to form heirarchies which makes decision making difficult

2- How do the financial analysis of a firm influence its strategic options?

• Financial metrics are the standard for assessing a firm’s performance.
• financial analysis establishes measurable financial strategic goals on a coordinated, integrated basis, thus enabling the firm to operate efficiently
• Free cash flow helps in anticipating substantial capital expenditures in the near future
• economic value-added goals can determine businesses’ value contributions

3- Suggest some specific means by which business can strengthen their positions and develop distinctive competencies

• Companies should opt for differentiations of their product so as to beat competition
• Companies should invest in R&D to invent new technologies
• Companies should adrress the customers grievances effectively to satisfy them
• Companies should keep employees happy and motivated so that they work in inclusion towards the companies goals

4- “Business which develops formal strategic planning system will be more effective in achieving their objectives than those which do not”. Explain in detail why this is true.

• This statement is true because a strategic plan gives a company an ambitious goal to achieve
• strategic planning system helps in determining the future difficulties and ways to tackle them
• strategic planning system also aims for sustainable development
• strategic planning system sets specific goals for individuals which in turn fulfils company's goals