Convergence of Business Policies and Strategies

Success in business is primarily determined by the management policies and strategies. Business policy is categorized into two features. First, it involves the adoption of sound decision making, and second, it entails the integration of key business knowledge domains including but not limited to the legal framework, Human resource, information technology, sales and marketing, operations and financial accounting. Business policies and strategic management present decision-makers with the knowledge and skills necessary for making decisions that promote business performance. However, the vast body of knowledge involved in business policy and strategy presents decision makers with the challenge as it is paramount that they integrate a wide range of ideologies in management. A business operating on an ongoing principle should be guided by long-term trajectory. Strategic planning which is a component of business policy aid in the development of a long-term vision of an enterprise. T. Friedman in the book, “The world is flat” outlines a strategic roadmap of the direction the world is taking. Friedman argues that the business, economic, social and political rules are changing. Business policies and strategies are significant in averting the dynamism in the world, (flattening the world)

The business world has evolved through a series of cycle’s overtime. Around the year 2000, the business people s concerns were teaming up to flatten the world. A key focus was on the ten flatteners. With time, businesses and individuals started adopting new processes, skills, and habits with the objective of gaining competitive advantage. As a result, business operations shifted from vertical value creation to a more horizontal approach. However, the new way of doing business was not different in totality from the original framework. Rather only improvements that led to a further flattening of the business playing field were incorporated in the new approach. As the flattening process was ongoing, new investors from the former Soviet empire, Japan and China entered the market with. Owing to the already flattening word, integration into the system was possible where new tools introduced by the new entrants played a critical role in necessitating the collaboration. In the present business environment, the three convergences affect business operations in different ways.

Convergence I

Since the 1990s, the ten flatteners have been in application in business management. However, integration of the flatteners was not optimal thus flattening was not automatic but rather a process. Paul Romer an economist from Stamford University pointed out that complementary goods were not a mystery to economists. All economists know that if two products A and B are complementary, the value of commodity A is more valuable when B is available in the business. For example paper and pencil. Simultaneous improvement of complementary commodities is a key component of promoting business operations. The improvement in quality and quantity of a commodity A demands a commensurate improvement of commodity B. According to Thomas Friedman (2015), in-forming, insourcing, offshoring, outsourcing, workflow, open- sourcing, Netscape, supply chaining, the opening of the Berlin wall and the amplifying steroids all operated in a complementary form (81).

The convergence of the different factors of flattening resulted in the establishment of a flat field with the impact felt worldwide. The collaboration enhanced knowledge sharing and operation of work in real time without consideration of the language, geography, and distance. The platform is not available to everyone today but comparing with the convergence history; more people have access to the factors. The playing field is also flat in many places in many ways unlike in the past. The complementary convergence of the ten flatteners has played a critical role in ensuring a more flat and unified playing filed that people are exposed to today (Friedman, 2005).

In computer design, manufacturing and sales company, the first divergence is significant as it creates a platform that allows for acquisition of new ways of doing businesses in the industry. The global business platform provides an organization with the opportunity to acquire innovations in the technology industry. The first convergence ensures that management has access to information regarding the business environment thereby forming the basis of sound decision making. Innovations happen every day in the technology industry and to gain competitive advantage; management is tasked with the development of competitive demand that will attract customers. Due to the flattening of the business playing field, managers can benchmark with other players in the industry. The benchmarking allows managers to identify areas of improvement thereby promoting business performance. As a manager in computer design, manufacturing and sales company, the convergence of different market policies and strategies helps me make informed decisions regarding the current trends in the market. The challenge of redundancy and obsolescence of computer programs and designs is of critical concern. On several occasions, my decisions to outsource some technical expertise related to new technology has proven beneficial in the past.

Convergence II

The technological leap was expected to revolutionize the world and especially in the business sector. However, the process was without hitches as it takes time for a new phenomenon to be fully positioned. The flattening of the business playing field was found to be deficient with time as the business environment was a dynamic, demanding change in policies and strategies to adapt to the emerging trends. The second convergence relates to the converging of the different processes, practices, skills, and habits to ensure high productivity levels in the already flat world. Availability of a flat business field as a result of the convergence of the ten flatteners is not enough in guaranteeing success in any given sectors. Different production techniques are required to work in harmony an aspect that Friedman referred to as second convergence.

For full flattening to take place, the convergence of the ten flatteners need to be supplemented with management, innovation, consultancy, education, designs specialty and workers mix. Convergence of the different business functions through horizontal collaboration ensures value addition in the production processes and development of habits that adapts to the flattening world more responsively. In the technology sector, for example, availability of the right equipment’s is not enough to lead to more productivity. Innovative business processes are vital in ensuring the value of information technology. In a majority of businesses, value creation function is more related to horizontal command collaboration of teams and departments in organizations all over the world (Friedman, 2005). Second convergence, however, is more of horizontal connecting and collaboration.

Convergence II affect me in my decision making since the organization I manage to have different departments that interrelate. The design department deals with the establishment of the products that are manufactured. Once a design is agreed upon, it is taken to the manufacturing section for mass production. The marketing and sales then present the manufactured items to the market. The three departments cannot work in isolation since the activity of one department depends on the outcome of another. Decisions related to the departmental operations in the organization are forged towards ensuring harmony between the personnel and departments through collaborations. The convergence aids in developing strategies and policies that the supply chain function in the company is effective as a failure of one section of the chain results in failure of the entire operations of the organization.

Convergence III

The third convergence proposed by Thomas Friedman relates to the integration of a previously alienated population from the business sector. Flattening of the world led to an introduction of three billion people who were previously frozen out of the business field. The people were from different nations, and due to globalization, it was possible to bring them together and compete and collaborate in the business field. The flat world which was previously characterized by hierarchical economic and political structures and closed economies opened up leading to a convergence of people from different parts of the world. The global convergence led to competition and collaboration of people from central Asia, Latin America, Eastern Europe, Russia, India, and China (Friedman 2005)

The third convergence affects my decision-making process since the current business environment is global and both suppliers and customers of the company products are from foreign states. The global customers and suppliers create a vast customer base who contribute to the profitability of the organization. Since technology is marred by time to time improvements and innovation, the convergence of different people from various countries provides a source for innovations that facilitate high-quality service provision to customers. The convergence also brings foreign customers leading to improved productivity. The stiff competition brought about by the third convergence demands management decisions that are innovation based to gain competitive advantage.

Question 2

Management issues including designing financial systems and business process re-engineering play a significant role in determining the strategies that an organization should adopt to achieve a set of projected outcomes. Technical matters like network configuration and product design also supplement the business performance. The persons charged with the objective of making decisions in an organization should employ both the management and technical aspects of policy and strategy to meet organizational goals both in the short term and the long term. Friedman’s nine rules form the basis of decision making in organizations to determine the direction an organization should take. The nine rules established by Friedman helps the direction the company should take.

Rule 1: When the world is flat everything will be done but to whom it will be done is the question

The rules state that, when the world is flat, it is possible to do everything, but the question of the recipient should equally be addressed. The rule is an indication that possessing an idea is not enough. The owner of the idea should ensure that the implementation phase is done within the shortest time possible to avoid incidences of piracy (Friedman, 2005). When an idea is incubated for a long time, there is a higher probability of other people copying the idea and benefitting at the expense of the original owner. As a head of a consultancy firm, acquisition of legal protection for the company business practices through patents, copyrights and other forms of protection would be a priority. Protection of sensitive information about the company would also be ensured by erecting programs and processes that prohibit unauthorized persons from accessing private information.

Rule 2: Go global

Globalization is a key element in the flat world where competition in the market is global (Friedman, 2005). The technological advancement in the world today has made the world a global village sophisticating then platforms for doing business. The rule becomes of concern when the management seeks to find means, policies, and strategies that promote competitive advantage. When an organization lacks competitive advantage, the market share reduces leading to a decrease in the profitability. Consultancy firm management should, therefore, ensure customer satisfaction in the efforts to protect the firm’s market share. Healthy International relations with overseas customers should also be maintained to protect the foreign market from a takeover from other entities in the consultancy industry.

Rule 3: The small shall act big

The rule relates to the preferred conduct of small entities in the market. Businesses operate with the objective of making the profit that would help in the growth of the business. It is therefore important for businesses to have the growth concerns that includes expansion to new markets either domestic or international. Collaborations with international companies are one of the strategies that the consultancy firm should adopt to gain access and competitive advantage overseas. The overseas market entry strategies include but not limited to joint ventures, licensing, partnerships and buying of foreign firms in the industry. Foreign collaborations widen the scope of the organization’s resources necessary for brand promotion, technology enhancement and general operations of the firm.

Rule 4: The big shall act small

Friedman intends to imply that aspirations and size of any firm should not lure management to forsake the primary focus of customer orientation. As management of a consultancy firm, the right strategies that ensure that the customers’ needs are satisfied is a priority (Friedman, 2005). Big corporations should come down to the level of customers and design products not based on their level of capacity but by the needs of the customer at heart. When the customers are satisfied, chances of unfavorable competition, negative feedback from customers and reduced sales are abated. When the already existing customers are satisfied, they are likely to practice repetitive buying and also refer other likely customers attracting an extra customer base. The strategies of protecting and attracting customers ensure the continued profitability of the firm.

Rule 5: Best companies are best collaborators.

The rule implies that organizations cannot operate in isolation but require other firms to survive. Collaboration ensures access to perquisite resources, and skills necessary for promoting business activities. The need for collaborations between different firms in the same industry is motivated by the technological changes and operational shifts that has swept the business environment today. For the consultancy organization, domestic market dominance is not sufficient and as manager, coming up with feasible planning for global positioning by use of foreign market entry strategies are critical. Collaboration with international firms helps a business organization to attain global acceptability and international quality standards.

Rule 6: Best companies get chest X- rays regularly

Freedman also argued that ”best companies get chest X- rays regularly.” The rule implies that a periodic overview of business operations is fundamental as a means of identifying areas of weakness in the organization’s chain (Friedman, 2005). The overview help management in decision making by unearthing possible areas of improvement and in the formulation of the best course of action. For the case of the consultancy firm, time to time overview of the daily operations should be analyzed and areas of operations requiring a reinforcement discovered. The rule ensures that the organizations operate within the confines of the goals and objectives set.

Rule 7: Best companies outsource to win

No individual or organization possess the monopoly of information, resources or expertise. As such, business organizations seek for goods and services not available internally but vital to business operations from external sources. Outsourcing is a complex function, and if not well managed, it can lead to negative implications for the organization (Friedman, 2005). Cost considerations should be analyzed to ensure that outsourcing activities do not exceed the cost of making the required products available internally. It is therefore advisable to ensure that management only outsources the non-critical functions whose failure could not affect the business operations in totality. The consultancy firm should, therefore, outsource for employees and services to promote efficiency through boosting the internal resources of the organization and innovation.

Rule 8: What a company does matter today the most

The future of a given business is shaped by the present day decisions (Friedman, 2005). The rule reinforces the need for strategic planning that provides a roadmap of where a business purpose to go; the goals and objectives intended to be accomplished. Management of the consultancy organization is tasked with the role of ensuring that the policies and strategies adopted by the organization are in line with the long-term goals and vision to ensure long-term survival. Day to day operations of the consultancy firm should, therefore, be kept in check through monitoring. The firm should also ensure that the long-term strategic plan is available to all employees to inform them of the best course of action in any given situation at any given time.

Rule 9: Not trying to build walls in operations

Competition in business should be handled with care. In most of the businesses in the contemporary world, competition is a common phenomenon as businesses operate in a free market where there is a free entry into a given market. Organizations should, therefore, seek to gain a competitive advantage by devising strategies that ensure customer satisfaction. Service delivery should, therefore, be of high standards and employ innovative techniques. Ordinary operations that are too obvious denies a firm the competitive advantage. For the consultancy firm, management should ensure that service delivery to clients is done with caution and in a unique manner to be different with competitors in the market.

Question 3

In his work; the world is flat, Friedman constantly refers to Hewlett- Packard as an example of a high tech organization with a record of doing things right to survive and thrive in a flat world. His occasional prime focus is on HP’s CEO who he describes as an ideal CEO for the flattened world. However, the CEO’s record plunged which led to their firing by the board of directors, upon hiring a new CEO, the company regained its lost glory raising concerns of high-level management of large companies. The events raise questions about Friedman’s assessment and conclusions. During her tenure as HP Company CEO, Fiorina was faced with challenges related to technological advancement that jeopardized his managerial performance and consequently her dismissal from HP Company.

What it Takes to Manage a Large Company at the Highest Levels

Management strategies, strategies, and skills in big companies like HP play a fundamental role in ensuring high-level performance. For a business entity to grow from a small or medium-sized entity to international standards heavily relies on sound strategic management techniques. The management team is tasked with the objective of formulating a clear guideline that the organization must follow to attain long-term goals. The HP’s CEO, Carly Fiorina applied the strategies that used the available resources optimally to accomplish the set objectives. Her strategy made HP Company grow to international standards making it competitive globally.

A significant resource that Fiorina harnessed is the human resource. She had strategies that ensured motivation of the employees to enjoy their work (Friedman, 2005). Senior management in small, medium-sized and big business entities should come up with strategies that are employee oriented to motivate them. The strategies include but not limited to the provision of safe working conditions with necessary security and safety measures, flexible working schedules, proper remuneration, employee training among others. Performance appraisal technique should be carried out to ensure that the low performers are identified and re-trained, re-assigned to improve their performance levels. The appraisal also helps in recognizing the high performers and rewarding them as a sign of appreciation for work well done. The performance appraisal program should adhere to high integrity degree and transparency.

The poor performance should be encouraged that there is room for improvement. As such, management should, therefore, ensure policy guidelines that stipulate the training and coaching requirements. The training provides that employees understand their roles, duties, and responsibilities in the organization. The training programs play a significant role in employee’s career development and also promote organizational performance collaborations with other players in the industry is another strategic tactic that management should incorporate in management to gain competitive advantage. Collaborations diversify an organizations source of capital making it possible to keep in line with changes in the business environment, for example, technological changes. The strategy also presents an organization with the opportunity to access necessary production equipment and facilities.

Management of large companies at highest levels is dependent on research and development. The technique helps an organization to acquire a competitive position in the market. Research ensures that an organization only invests in viable projects that are likely to yield high returns. Right investments empower organizations to achieve greater heights in the market. Management should, therefore, provide the department of research and development with the necessary resources and support and also implement the ideas generated by the department. If need be, the management can collaborate with other leaders in the industry in acquiring the right expertise who can help in producing innovative products.

Friedman Assessment of Fiorina’s Capabilities

Thomas Friedman’s assessment of Fiorina was correct as business performance takes place in stages. There are times when business is good and sometimes when the situations are intimidating. A majority of the factors causing a decline in performance are beyond management control. Certain situations in enterprises demand a major overhaul of the organization which is both capital and time intensive. Some of the factors that cause the business performance to vary and there are nothing the management can do about it in the short run include technology advancement. When a new technology is introduced in the market, a shift from the already in place systems to the new version takes time since the organization must be prepared to work with the latest version.

Employee training is therefore prioritized. Employees sometimes resist change transforming a complex function. For change to be effective, all the players in the operations must be in support of the idea posing a challenge to the management. Once the transformation process is over, the company can adapt to the market by averting the problem of competition and customer dissatisfaction. As the organization regains the market share, profitability is enhanced since the management concerns shift from implementing change to service delivery to customers. The events that the technology industry overwhelmed Fiorina and if she were allowed more time, it was likely that she would have led the company to success again. She was a good manager, and her past performance proves of her managerial competency.

Fiorina’s beliefs are highly applicable to management. She believed in good corporate governance that value ethical conduct. Good organizational governance ensures that both the internal and external environments are conducive to all the stakeholders in an organization. The stakeholders include the customers, employees and society members who directly or indirectly contribute to the progress of the company. Good organizational governance ensures that organizations employees work as a team towards achieving the organizational goals. Organisational success is greatly dependent on governance and management acts as the pacesetter. The core principles of corporate governance entail fairness, accountability, transparency, and responsibility.

Friedman’s glorification of Fiorina are not just theories but are concepts that if well managed and implemented, organizations are likely to attain high levels of performance. Accountability principle dictates the personnel’s obligation to give explanations for actions taken and conduct. When employee’s accountability is maintained, the organization is likely more successful. Persons who are found to be in contempt of organizational policies are held accountable making company employees to adhere to the specifications of their roles. When workers understand the boundaries of their duties and privileges, there are little or no overlaps that create conflict promoting business performance. Organisations that implement the principles of corporate governance are more successful since they are the basis upon which companies can achieve growth. The concepts analyzed by Friedman in his book ”the world is flat” can be used to predict which organization will be successful and which will not. The most likely thing that resulted in the poor performance of HP Company under Fiorina’s management was due to factors that could only be managed in the long run and not in the short term. She had to address the challenge of employee resistance to change, and since the employees had adapted to her management style, the introduction of new approaches by the same person was a challenge. It must be the board of directors did not provide enough support to Fiorina through approval of budgets thus frustrating her performance index.

References

Friedman, T. L. (2005). The world is flat: A brief history of the twenty-first century. Macmillan.