Strategic Management Case Study Essay Example for Free

Strategic Management Case Study Essay Introduction.   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Strategic management is one of the most challenging but important element that defines the success of both private and state owned organization. The fundamental issue of defining and clearly stipulating an organizations strategy is to enable the institution have a distinct sense of direction, vision and strategy that will enable the institution deliver efficient services and/or products to its clientele and add value to its customers, achieve sustained a market niche or market share, and thus position the company strategically in the market in order to gain and maintain competitive advantage over its rivals (Dobson, Starkey Richards, 2004).   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   In state owned enterprises or generally institution where the government is the major stakeholder, one of the biggest problems is balancing between social and commercial objectives in defining the mission statement and policies governing the general direction and brand name or the organization. TVNZ as an organization has had a relatively positive growth in the long run and is still one of the major broadcasting organizations in New Zealand. From the given case, analyzing TVNZ’s historical performance reveals several strength, opportunities weaknesses and threats that the organization is facing given its nature as a broadcaster, form of organization (I.e. public organization) and its line of operation market (Spicer, Powell Emanuel, 1997). This paper is an in depth evaluation into TVNZ a state owned New Zealand broadcasting institution using the strength weakness, opportunity and threat analysis, the paper will analyze the dilemma of managing the company as a revenue generating entity and a medium of furthering social objective for the government and further recommend policies that can be used in defining strategic management objective that can the company meet both objectives. Strength of the organization.   The company was able to invest in latest technology namely digital media making it more competitive and hence retaining its market share. A good example can be illustrated by the Alvan TV center which had the latest equipment that enabled the company to outsource its services to other production firms and diversify its operation to teleccomunications (Hanson et al, 2008). Another feature that made the organization grow is monopoly, the organization enjoyed a monopoly thus had ample time to set up a good base and acquire a large market share. Therefore, though the organization has not enjoyed monopoly from 1980, the company was able to retain and maintain 70% of the market share thus with good strategy it will be able to consistently work to improve and provide good services (Hanson et al, 2008). Weaknesses of the organization. Among the major weaknesses TVNZ has include the fact that it has to balance between social objective and commercial ones. Looking at the companies history, balancing between commercial oriented operation and pursuing social oriented objectives as stipulated by regulations (given the fact that it is a government owned institution) has led to different approaches that have even led to pursuance of different contradicting strategy which have proved to be counterproductive and detrimental to the organizations well being and growth. For example, in 2002 when the charter was introduced, some politician expected the company to adopt social objective but still remain profitable and self sustaining as a business entity. In most cases, social and commercial objectives normally contradict and hence it would be a very difficult and almost impossible for TVNZ to fully adopt social oriented programs and still remain at the same level or increase advertising revenue (Hanson et al, 2008). Reviewing the programs being aired to conform to values that are in tandem or will further the growth of social standards and the integrity of the country means that entertainment department will have to change its program line up to conform to acceptable cultural standards. This can consequently lead to a fall in ratings given that many viewers prefer to watch explicit entertaining channels rather than informative programs.   Therefore, the company will loose a lot of advertising revenue since ratings might significantly drop given the loss of market share to privately owned broadcasters who will continue airing what the majority of viewers want to watch (Hanson et al, 2008). Opportunities in the organization. The organization as a government institution has had various features that led to the organization growth and stability to become a giant internationally recognized broadcasting house. One of the opportunities that act as a driving force for the company is, being a state owned institution, it has abundant resources and relatively cheap source of funding that can be used to further its objectives and attain optimality. For example, the company has the capability of diversifying its market to capture the international market and this can help it strategically in that in the event of loosing a significant share of the local market, the company can still remain profitable from its international focus (Hanson et al, 2008). Threats.   The major threats facing TVNZ as an organization are political interference and government regulations that are imposed on the company given the fact that it is a chartered company. Over the past 35 years of its existence, there has been a major strategic shift of the company due to government regulation which brought about to be indecisiveness and lack a clear long term vision and hence compelled the institution to dilly dally between pursuing   social objectives and commercial objectives. According to Spicer, Powell Emanuel (1997), there has always been pressure from treasury to TVNZ a revenue generating entity while other politicians feel that commercial objectives are secondary to social objective. This has led to dilution of the company’s mission statement and vision which are core elements in charting the long term growth and sustainability of any organization whether private or public, profitable or not-for-profit. Entrance of other players in the market and fragmented clientele might lead to loss of revenue if the company keeps on changing its tactical strategy due to inconsistency which brings about unreliability. For example, according to Hanson et al (2008), each of the five CEO’s introduced a different strategy of management with diverse views for example Brent Harmont (1991 – 1995) in an attempt to make entry in the international market introduced a very complex organizational structure which was realigned by Chris Anderson (1995 – 1998) in attempt to reclaim the companies core business. Solutions. Strategic management involves analyzing the institution by looking at the nature of business with regards to the customers needs or defining the nature of your market and your competitive advantage, financial obligation and needs required to satisfy your clientele needs, other stake holder’s needs and external environment and the learning and growth of the company (Dobson, Starkey Richards, 2004). According to Beiman (2006), Establishing a clear, repeated, and ongoing strategy management process more than doubles the chances of becoming a winner†¦.. And helps companies establish clear strategies that, when used effectively, serve as a foundation for an effective strategy management process. Analyzing the threats and weaknesses facing TVNZ as an institution, it is obvious that the loss market share due to pursuance of social objective is imminent. Given that this is externally based and hence out of control of management in relation to strategic management and formulating of policies, management has to formulate strategies to mitigate and redefine their strategy in order to maintain or compensate the loss that can be instigated by the conditions stipulated by the charter (Sexty, 1983 Spicer, Powel Emanuel, 1997). Firstly, TVNZ has to redefine its objective and evaluate their strategies in terms of mission, vision and objectives spelled out by the charter. This entails looking at the customer needs and market niche as restricted by the set out conditions. The charter postulates that the broadcaster needs to promote New Zealand’s cultural value’s among other objectives, these introduces a new aspect thus TVNZ needs to focus on the clientele who fit this criteria. Therefore, instead of approaching it as a threat the company should focus on ways that will turn this into revenue generating by applying strength – opportunity techniques (QuickMBA, n.d. Beiman, 2006). After formulating the company’s policies, it is very important that management considers the change process. Given the volatility in the market, efficient change management entails formulating chronological implementation policies that will gradually introduce stakeholders to the changes that will take place, effective and consistent communication between the customers, management and other stakeholders and setting up a good feedback mechanism techniques that will ensure that both implementers (TVNZ), and the market understand and appreciate the change process (Schein, 2004). Thus management should continue to play the stewardship role by consistently briefing the employees, customers and other stakeholders to minimize resistance and possibly loss of revenue, effective communication vertically ensures that the employees understand the need for change and these leads to smooth and successful change in two ways. Firstly, employees will be motivated due to involvement and understanding of the change, secondly, they will act as agent in conveying the message to the external environment thus facilitate smooth and successful implementation (Schein, 2004). TVNZ as a charter company compared to other stations has the capability of acquiring funds hence one strategy would be to diverse the business and expand their market internationally. In addition, the business can capitalize on telecommunication given its resources hence increase revenue that will cushion potential loss of advertising revenue. The strength-opportunity approach can be illustrated by the examples below: Tourism sector can benefit from TVNZ if they adopt strategies to sell New Zealand’s heritage, rich culture and geographical wonders globally. Similarly, given the level of globalization in the business world, investors are always looking for new areas to invest their funds, therefore TVNZ can be used as a medium to sell the country as a good investment destination. This move will enable the company attract a new type of clientele worldwide in the business and tourism sector e.g. hotels, airlines, banks among others who can benefit from services offered by the station given its new approach and objectives.         REFERENCES: Beiman, I.   (2006). Chapter 6: Managing SOE’s for improved performance. Retrieved 24th June 2008 from http://www.adb.org/Documents/Books/Balanced-Scorecard/chap6.pdf Dobson, P., Starkey K Richards, J. (2004). Strategic management: Issues and cases. Blackwell Publishing Inc. Hanson, D. et al (2008). Strategic management: Competitiveness and Globalization. Asian pacific 3 Ed. South Melbourne. Thomson Publishing Inc. Spicer,B., Powell, M. Emanuel, D. (1997).   The remaking of television New Zealand 1984 – 1992. Auckland University Press. QuickMBA (n. d.). Strategic Management: SWOT analysis. Retrieved 24th June 2008 from http://www.quickmba.com/strategy/swot/ Schein, E. (2004) Organizational Culture and leadership. Jossey-Bass A Whiley imprint. Inc. Sexty, R. (1983). â€Å" Accountability dilemma in Canadian public enterprises: Social versus commercial responsiveness.†Ã‚   Annals of Public and Cooperative economics. Vol. 45 (1). Pp 19