Last Updated 26 Jan 2021

Strategic business management and planning

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1. Milton Friedman and profit maximisation:

“The Business of Business is Business”

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Employees are very use full tool in any organisation, they are the one who have the direct contact with the consumers / customers and through their skills (which are provided by the organisations) they communicate with customers by providing them the end product or services, who bring the cash flow and profit in the organisation. So then the organisation can accomplish its goals and objectives in order to flourish. Organisations facilitate people with job opportunities then these people become the employee of that particular organisation, and then again organisations provide their employees the other relevant facilities like wages and job security, and in return these employees work hard and full fill the organisational responsibilities and help organisations to grow. This all process helps the society to retain its social balance. We can say organisations and businesses are helping the society by providing the job opportunities for the people so they can participate in their social responsibilities.

But the main reason for any organisation to exist is to make profit and then more profit, by providing tangible or intangible products to their customers according to their needs, if the customers are satisfy with the products or with the services, the organisations or businesses will make profit. But if the customers are not satisfied with it they will go somewhere else in order to satisfy their needs and to get the better value for their money. Same thing apply to the employees of any organisation, if employees are very satisfy with the organisational facilities, they will become the loyal employees, work hard and feel like motivated and they help to achieve the organisational goals and objectives. But if the employees are not satisfied with facilities provided by any organisation or business, they will leave it and work somewhere else in order to be satisfy.

2. Charles Hendy’s Stakeholder view:

Organisations use the shareholder’s (investors) money to start it or to do any business then it involves the suppliers who provide the raw materials, employees who work within the organisation and then the customers who buy the end product and bring the cash flow in the business. We can say it a cycle of investing, selling and bringing profit. So the shareholders can receive their money back with dividend. Shareholders always want the big chunk of the profits in dividends but the board of directors want to keep the most of the profit and pay less in dividends, so they enhance the organisation and reinvest in the business and try to become the leader or try to do better in future.

Anybody who has any kind of interest with any organisation is called a stakeholder. It could be the individuals, groups or the different organisations as well if they are affected by it or affect the actions and decisions of the organisation. In very simple way we can say that, shareholders, employees, suppliers, customers, financial institutes, Government and society, all are stakeholders.

Shareholders are always very interested in any kind of decision which effect that dividends that they receive from the profits, but any other decision which reduce the dividend even by a fiction, will not be popular with the shareholders. Employees are the best tool in any organisation in order to generate the profit, so the organisational views, goals and objects should be very clear to them. Suppliers always want to get the regular orders with punctual payment and it can easily effected by the decisions made by the organisations. Customers always want the better value for their money, they always be concerned by the organisational decisions which affect the quality and price of the end products. Financial institutes will try to influence the organisations to get big loans for long periods of time. Government will make new laws and passes the legislations which effects the business and also play a role in decision making. Societies and communities can be effected in many ways by the decision making for an organisation.

3. The new capitalists:

There are many organisations and businesses around the world which are funded by the pensioner’s money. Government invest tax payer’s money in many different organisations, businesses and companies all over the world in order to support the pensioners in the society. In this way many times government play a part as a shareholder, when these companies make profits government take its dividend as a shareholder and pay to the pensioners.


In first view, the employees are use full tool for generating and maximising the profit for organisations. Stakeholders are very important for any organisation in order to invest or run an organisation and to keep a balance within the society. But in my views an organisation should really serve the stakeholders, they are the one who invest in it, run it and then bring back the cash flow in the form of profit.

Q. What are the implications of these differing views for Manager’s development of organisational strategy?

A: managers are the agents of stake holders. They represent the stake holder’s needs, expectations, and values. Managers are the basic aspect of an organisation. The basic conflict raises the organisation when the agents, managers put their own views and values ahead of the stakeholder’s values and views and they try to demolish or violate their basic rights.

If we keep in mind any of the view mentioned above , in any of the view the stakeholders might be different but they play and have an important role in an organisation, so their needs and expectations needs to be accomplished for the success and progress of the organisation. But some time these rights are violated when the managers put themselves ahead of the stakeholders. Organisations goals and objectives must be coordinated with the stakeholder’s needs and expectations, so that no conflict must rise and every one must be given priority according to their place in the company.

Managers are the middle people, they stand in between the goals and objectives of the organization and the needs and expectations of the stakeholders. So the responsibility is on the shoulders of the managers to keep the balance in any of the view mentioned above.

Q. “Stakeholders represent more challenges than opportunities”. Appraise the conflicting needs, power and influence of stakeholders.

A: Stakeholder groups are not usually homogeneous, but contain a variety of subgroups with some-what different expectations and power. Most stakeholder group consist of large numbers of individuals (such as customers and stakeholders) and hence can be thought of largely independently of the expectations of individuals within the group. In some cases it consist of a small number of individuals or even single individual (the chairman of the company or minister of the government department). {Exploring corporate strategy; Text and Cases}

Any individual or a group of individuals have any kind of interest in any organisation or business is called Stakeholder. These all stakeholders can have a very deep impact on the organisations through their different needs, demands, power and interest, organisations exists to make profits by satisfying the stakeholders.

i.Shareholders ii. Employeeiii. Suppliers

iv. Customersv. Financial Institutes vi. Government

vii. Society

Conflict and Influence:

These all different groups of stakeholders have different kinds of interest in the organisations sometimes it could be common and sometimes it could be different. For example in common interest employees and shareholders both have the common interest, which is the success of the organisation and profits which leads to the high dividend for the shareholders and job security for the employees, in the same way suppliers have the interest in expansion and success of the organisation. And in conflicting interest, if an organisation is making profits, wages will rise and it is an expense of dividend but shareholder will not like it. Sometimes organisational growth could be expense of the local community or the environment in general.

Organisations have to do the strategic planning for their better future so they can void most elements that can affect it in the future. For example External Pressures (competitors, customers, suppliers, pressure groups and government) and Internal Pressure (managers, managerial commitments, employees and unions). Government can influence the organisations by bringing the new laws, high taxation or by changing the existing laws.


Internal stakeholders has a great influence on the organisations because of the authorities and power they have. If the internal stakeholders are satisfy with the facilities and organisational environment/atmosphere , where they work the conditions are good, they will enjoy being working in this kind of environment, but if it is not they can disrupt the organisational plans. Sometimes they can bring uncertainty in the plans and all the organisations needs and depends on the stakeholders. Internal stakeholders have power to delay the performance of strategy and they can threaten the organisational actions or they might refuse to work somewhere else. Shareholders rights to vote and selling their share can make an organisation very vulnerable to make progress. Financial institutes can refuse credit because of organisation’s bad credit history, they can charge high interests or even can take some legal actions for non-payment and in very extreme conditions initiate moves to liquidate the organisation. Suppliers can demand for high prices in future or even can refuse credit. Customers, who brings the cash flow in the organisations and keep it alive, can go somewhere else where they can get better value for their money, which is not a good sign for any organisation. Government has the power to change any law or to bring the new laws which can affect the progress of an organisation, increasing the taxation, government spending and more legal action can disrupt the future strategies of any organisation. Environmental pressure groups has power to motivate the external stakeholders refusing to buy products/goods or services or by publicising organisational activities as unacceptable.

Q. How can organisations manage shareholder conflicts and handle issue of ethics, corporate governance and regulation?

A. Corporate Governance:

“Corporate Governance refers to the influence and power of stakeholders to control the strategic direction of the organisation in general and more specifically, the chief executive and other senior officers of the organisation”; {Corporate Strategy. Richard Lynch}

“Corporate Governance is a key element in enhancing investor confidence, promoting competitiveness, and ultimately improving economic growth”.

(James Wolfensohn, president of World Bank)

Corporate governance have a very close relationship with strategy arises from the opportunities given the senior level management to influence the future goals, objects and purpose of the organisation. This senior level management or managers are generally the directors of the organisations.

Sometimes public bodies can also have structures of corporate governance and it helps to cover the major issues of any non-profitable sector including the monitoring of the public services, quality and the value for the money achieve by tax payer and charity givers.

Corporate governance’s main priority is to protect the shareholders of any organisation, it also helps to protect the overall status of an organisation and its objects against deceitful activities by its directors and officers. In the best interest of an organisation, its business and its shareholders, the directors must always make decisions without bias. Because they are the one who are responsible of the success of an organisation and bring the maximum profit for its shareholders. It should be done ethically and according to the laws and regulations of the framework of the organisation. Corporate governance gives strong confidence to the shareholders that organisation is being well monitored and directors are performing in the way they should.

“Corporate governance is a broad term that has to do with the manner in which the rights and responsibilities are shared among owners, managers and shareholders of a given company. In essence, the exact structure of the corporate governance will determine what rights, responsibilities, and privileges are extended to each of the corporate participants, and to what degree each participant may enjoy those rights. Generally, the foundation for any system of corporate governance will be determined by several factors, all of which help to form the final form of governing the company”. {}

Corporate governance plans different strategies to achieve the shareholders satisfaction. It helps to build the commitment between the managers and shareholders regarding the organisational goals and objectives. It provides a flow of positive information and disaggregation of financial information. Finally the target of maximizing shareholder’s wealth helps planned a strategy and sets valuable objectives for managerial decisions.

“The value of the organisation need to be reflected in its purpose and possibly its mission statement, even the absence of value in the mission itself about the organisation and its view about its role in society, such matters may well reflect the role that the organisation sees itself playing in society, if any, and the responsibilities that flow from this” {Corporate Strategy, Richard Lynch}

Ethical contemplation may influence corporate strategy at a numbers of levels. For some particular organisations it can be diverse, it doesn’t apply only that how an organisation dealt with its competitors or world at large but it also apply on the many other individuals, who are related with this particular organisation. It can be a customer or a worker. Ethical issues play a key part in the success of any organisation. Any organisation can achieve a good or bad reputation simply the way it behaves with its customers or individuals. Some organisations believe what they are only for making the profits, and ignore their ethical and social responsibilities. They think that the society is quite capable of looking after itself and just concentrate on looking after their shareholders. but on the other hands some believe that they have a responsibilities and role beyond this. This kinds of views in long term are beneficial for the organisation and for the shareholders. These views and mission statement helps for the good provisions for workers, strong ethical beliefs and standards and sponsorship of outside initiatives.

In every society such considerations are sometimes unavoidable. These considerations may be very important to perform in that society such as environmental issues that goes beyond legal limits. Maximising of profits or money making is not wrong but it is the way in which some organisation act, and that brings the problem of ethical responsibility/behaviour. The concern of ethics is part of the professionalization of organisations, like welfare of the staff, job security and good environment for staff and customers.

Ethical issues are very sensitive and should be dealt with in a highly professional manner. By dealing with ethical issues that an organisation is facing, managers are better able to understand and classify their own moral beliefs.

Q: Critically analyse the content and relevance of the mission statements for each of the three different organisations (Pg165), with regards to their goals values and objectives.

Tata steel:

The history to Tata Steel is more than one hundred year old and was the vision and hardship of a single man, “Jamsetji Nusserwanji Tata”. It is also known as TISCO (Tata Iron and Steel Company Limited). It largest steel company in India and it world’s fifth largest steel company. It took a very long and difficult time to Tata steel to reach at this stage as it is now. Over the daces this company has manage to build up different avenues of effective steel exploitation and predictable intelligence in more than one way. In the days of industrial revolution Tata steel was struggling but the modern scientific methods from the west, helps Tata steel a lot to survive and it is now recognised as a leader in steel industry in India.

Vision and mission:

“We aspire to be the global steel industry benchmark for Value Creation and Corporate Citizenship.” Vision

Our people, by fostering team work, nurturing talent, enhancing leadership capability and action with pace, pride and passion.

Our offer, by becoming the supplier of choice, delivering premium products and services, and creating value for our customers.

Our innovative approach, by developing leading edge solutions in technology, processes and products.

Our conduct, by providing a safe working place, respecting the environment, caring for our communities and demonstrating high ethical standards.


Consistent with the vision and values of founder Jamsetji Tata, Tata Steel strives to strengthen India’s industrial base through the effective utilization of staff and materials. The means envisaged to achieve this are high technology and productivity, consistent with modern management practices.

Tata steel recognizes that while honesty and integrity are the essential ingredients of a strong and stable enterprise, profitability provides the main spark for economic activity.

Overall, the Company seeks to scale the heights of excellence in all that it does in an atmosphere free from fear, and thereby reaffirms its faith in democratic values. {}


In Tata Steel’s vision and mission statement it is very clear that this organisation is not only concentrating on profit maximisation to keep the shareholders happy but it seems to be very promising about the ethical standard, working conditions and facilities for their workers. This is the key point for any organisation to survive and flourish for a long time. Tata steel manage to survive over a hundred years by their great commitment to becoming the first choice as a supplier by providing the best products, services and creating the value for their customers, by using the modern technology to process their products. In all these processes they are concern about the environment and communities too. By keeping a good reputation in industrial territory, they are building a good image of India in all over the world. Tata steel’s main object is to become a leader in steel industry by suing all its available resources in an excellent manor and keep happy to all its existing customers and make new customers to bring the maximum profit by keeping its workers satisfy. It is a very challenging object but not impossible.


Every country and society have their own police officers, they are there to protect the people and their properties. Police works under the government in order to keep a peace and stability in the society. Government make laws for the betterment of the society and police enforce it, so the communities and societies can benefit. It is very challenging job, they have to be ready all the time for anything might happen. They have authority to catch any body if they are breaking the law or making threats for the society. In all police are there to keep a balance in the community so that people can relax. But in my country satiation is completely upside down. There police can arrest anybody criminal or innocent, in order to take bribe.


Working together for a safer London

Increasing public confidence and satisfaction

Preventing and reducing crime, disorder and vulnerability

Increasing safety and security

Improving quality of service

Being efficient and effective


Working together with all our citizens, all our partners, all our colleagues:

We will have pride in delivering quality policing, there is no greater priority

We will build trust by listening and responding

We will respect and support each other and work as a team

We will learn from experience and find ways to be even better {}

Metropolitan Police is a non-profitable organisation and its purpose is to meet the needs of people in the community through their services. Like all other organisations, Met police have its own motivations, goals and objects to achieve, which are stated in their mission statement. A non-profitable organisation means, an organisation which is not concern about distributing the dividends to its owners but doing good work and providing the relevant services within the communities. In this case Met Police is helping to provide the safer living standard to the communities. By providing these services Met police does not ask for anything in return from communities, almost everybody who is working within this organisation get paid by the government, apart from the volunteer workers, who work with this organisation just for their inner satisfaction only.

Villeroy & Boch

Villeroy & Boch is a very old company and its history goes back to 1748. It started in a village of Audun-le-Tiche in Duchy of Lorraine by Francois Boch. In the beginning it stared manufacturing ceramic tableware, plates, cups, pots and tureens, in simple shapes but excellent quality. This company has achieve the international reputation through its commitment and focusing the quality of its products and still focusing on the better quality life style products. This company have its own reputation regarding to its high quality and brand name and generate the annual sale of Euro 715 million in 2009.


Villeroy & Boch’s vision is to “be the leading European lifestyle brand with high competence and trend-setting style for high-end design and living.”

It is very clear that Villeroy & Boch want to be a European leader by providing their customer good quality products. Its focus is to satisfy its customers need and demand.


Its all-inclusive approach and high degree of diversification which are focused on the two concept areas “the single-source bathroom” and “the completely laid table “Error! Hyperlink reference not valid.

Product Innovations

Design competence

Focus on customer’s demands and choice

Leader in lifestyle brand


As it is a European leader it has to be very innovative and creative in order to survive and maintain its position in the market, it has high quality, high purchase products so it has to satisfy its customers. It is a customer valued organisation, the products and the services that are provided to customers or consumers, their needs and expatiations, values and choices are kept in mind. It has very unique resource of research to keep its reputation as a leader in the market and giving priority and keeping focus to its customer’s choices which is kept changing according to the time.


1. Exploring corporate strategy; Text and Cases

2. Corporate Strategy. Richard Lynch

3. James Wolfensohn, president of World Bank




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