assignment
TRANSCRIPT
Assignment-01/02
Student Name: Pankaj Prasun
Registration No: 511111577
Learning Centre: IBMR, Wilson Garden
LC Code: 02717
Course: MBA
Subject: Strategic Management and Business Policy – MB0052
Semester: Fourth Semester
Module No.: MB0052
Date of Submission:
Marks awarded:
Director of distance Education
Sikkim Manipal Education
II Floor, Syndicate House
Manipal- 576 104
Signature of Coordinator Signature Of Center Signature Of Evaluator
1. What is meant by „Strategy‟? Differentiate between goals and objectives
Answer: Strategy is the method by which an organisation systematically achieves
its future objectives. A business cannot progress-for a long term without a reliable
strategy. In this unit, you will learn meaning of business strategies, its conceptual
evolution,scope and its importance, distinction between goals and objectives,
analysing strategic intent through vision and mission statements and finding out
the significance of core competencies of business and critical success factors.
2. Define the term “Strategic Management”. What are the types of strategies?
Answer:
Strategic management
Strategic management is a systematic approach of analysing, planning and
implementing the strategy in an organisation toensure a continued success.
Strategic management is a long term procedure which helps the
organisation in achieving along term goal and its overall responsibility lies
with the general management team. It focuses on building a solid foundation-
that will be
subsequently achieved by the combined efforts of each and every
employee of the organisation.
Types of Strategies
Corporate level:
The board of directors and chief executive officers are involved in
developing strategies at corporate level. Corporate levelstrategies are innovative,
pervasive and futuristicin nature.
Business level
Business level strategy relates to a unit within an organisation. Mainly strategic
business unit (SBU) managers are involvedin this level. It is the process of
formulating the objectives of the organisation and allocating the resources among
variousfunctional areas. Business level strategy is more specific and action
oriented. It mainly relates to how a strategy functionsrather than what a strategy is
in corporate level.
Tactical of functional level
The functional strategy mainly includes the strategies related to specific functional
area in the organisation such asproduction, marketing, finance and personnel
(employees). Decisions at functional level are often described as tacticaldecisions.
Operational level
Operational level is concerned with successful implementation of strategic
decisions made at corporate and business level.The basic function of this level is
translating the strategic decisions into strategic actions.
3. Describe Porter‟s five forces Model.
Answer:
Porters Five Force model Michael
E. Porter developed the Five Force Model in his book, Competitive Strategy.
Porter has identified five competitiveforces that influence every industry and
market. The level of these forces determines the intensity of competition in
anindustry. The objective of corporate strategy should be to revise these
competitive forces in a way that improves the positionof the organisation.
Forces driving industry competitions are:
Threat of new entrants
New entrants to an industry generally bring new capacity; desire to gain market
share and substantialresources. Therefore, they are threats to an established
organisation. The threat of an entry depends on the presence of entry barriers and
the reactions can be expected from existing competitors. An entry barrier is a
hindrance that makes it difficult for a company to enter an industry.
Suppliers
Suppliers affect the industry by raising prices or reducing the quality of purchased
goods and services.
Rivalry among existing firms In most industries, organisations are mutually
dependent. A competitive move by oneorganisation may result in a noticeable
effect on its competitors and thus cause retaliation or counter efforts.
Buyers
Buyers affect an industry through their ability to reduce prices, bargain for higher
quality or more services
Threat of substitute products and services Substitute products appear different but
satisfy the same needs as the originalproduct. Substitute products curb the
potential returns of an industry by placing a ceiling on the prices firms can
profitably charge.
Other stakeholders - A sixth force should be included to Porters list to include a
variety of stakeholder groups. Some of these groups include governments, local
communities, trade association unions, and shareholders. The importance of
stakeholders varies according to the industry.
4. What is strategic formulation and what are its processes?
Answer:
Strategy Formulation
Strategy formulation is the development of long term plans. It is used for the
effective management of environmental-opportunities and for the threats which
weaken corporate management. Its objective is to express strategic-al information
to-achieve a definite goal.
The main processes involved in strategy formulation are as follows:
Stimulate the identification Identifying useful information like planning for strategic
management, objectives to achieve thegoals of the employees and the
stakeholders.
Utilisation and transfer of useful information as per the business
strategies - A number of questions arising during utilisationand transfer of
information have to be solved The questions that arise during utilisation and
transfer of information are thefollowing:Who has the requested information?What
is the relationship between the partners who holds the requested
information?What is the nature of the requested information?How can we transfer
the information.
5. Explain strategic evaluation and its significance.
Answer:
Strategy Evaluation
The core aim of strategic management succeeds only if it generates a positive
outcome. Strategic evaluation and control-consists of data and reports about the
performance of the organisation. Improper analysis, planning or implementation of
the-strategies will result in negative performance of the organisation. The top
management needs to be updated about the-performance to take corrective
actions for controlling the undesired performance.
The strategic-evaluation process with constantly updated corrective actions results
in significant and long-lastingconsequences. Strategy evaluation is vital to an
organisations well-being as timely evaluations can alert the managementabout
potential problems before the situation becomes critical. Successful strategists
combine patience with a willingness totake corrective actions promptly, when
necessary.The process of evaluating the implemented strategy is explained in
Figure 5.2
6. Define the term “Business policy”. Explain its importance.
Answer:
Business Policies
Business policies are the instructions laid by an organisation to manage its
activities. It identifies the range within which thesubordinates can take decisions in
an organisation. It authorises the lower level management to resolve their issues
andtake decisions without consulting the top level management repeatedly. The
limits within which the decisions are made arewell defined. Business policy
involves the acquirement of resources through which the organisational goals can
be achieved.Business policy analyses roles and responsibilities of top level
management and the decisions affecting the organisation inthe long-run. It also
deals with the major issues that affect the success of the organisation.
Importance of Business Policies
A company operates consistently, both internally and externally when the policies
are established. Business policies shouldbe set up before hiring the first employee
in the organisation. It deals with the constraints of real-life business.It is important
to formulate policies to achieve the organisational objectives. The policies are
articulated by the management.Policies serve as a guidance to administer
activities that are repetitive in nature. It channels the thinking and action indecision
making. It is a mechanism adopted by the top management to ensure that the
activities are performed in thedesired way. The complete process of management
is organised by business policies.Business policies are important due to the
following reasons:
Coordination
Reliable policies coordinate the purpose by focusing on organisational activities.
This helps in ensuringuniformity of action throughout the organisation. Policies
encourage cooperation and promote initiative.
Quick decisions
Policies help subordinates to take prompt action and quick decisions. They
demarcate the section withinwhich decisions are to be taken. They help
subordinates to take decisions with confidence without consulting their
superiorsevery time. Every policy is a guide to activities that should be followed in
a particular situation. It saves time by predictingfrequent problems and providing
ways to solve them.
Effective control
Policies provide logical basis for assessing performance. They ensure that the
activities are synchronisedwith the objectives of the organisation. It prevents
divergence from the planned course of action. The management tends todeviate
from the objective if policies are not defined precisely. This affects the overall
efficiency of the organisation. Policiesare derived objectives and provide the
outlinefor procedures.
Decentralisation
Well defined policies help in decentralisation as the executive roles and
responsibility are clearly identified.Authority is delegated to the executives who
refer the policies to work efficiently. The required managerial procedures canbe
derived from the given policies. Policies provide guidelines to the executives to
help them in determining the suitableactions which are within the limits of the
stated policies. Policies contribute in building coordination in larger organisations.
Assignment -2
1. What is meant by “Business Continuity Plan” (BCP)? Discuss the steps
involved in BCP.
Answer:
A document containing the recovery timeline methodology, test-validated
documentation,procedures, and action instructions developed specifically for use
in restoring organisation operationsin the event of a declared disaster. To be
effective, most Business Continuity Plans also requiretesting, skilled personnel,
access to vital records, and alternate recovery resources including facilities.BCP is
a collection of procedures which is developed, recorded and maintained in
readiness for usein the event of an emergency or disaster.
The BCPs senior management committee is responsible for the initiation, planning,
approval, testingand audit of the BCP. The BCPs senior management committee
also implements the BCP,coordinates its activities, supervises its creation and
reviews the results of quality assurance activities.These steps are discussed below
The senior management initiates the project and conducts the meeting to review
the following:Establish a business continuity planning committee The senior
management identifies a team anddiscusses the business continuity planning
project with them. The management forms a team andclearly defines the roles of
project team members.
Draw up business continuity policies The team establishes the basic principles and
frameworknecessary to ensure emergency response for resumption and recovery,
restoration and permanentrecovery of the organisational operations and business
activities during a business interruption event.
Business impact analysis (BIA)
BIA is the most important element of the continuity plan. BIA reveals the financial
and operationalimpact of a major disruption. BIA report describes the potential
risks specific to the organisation. It willprovide the organisation with the following
details:
The identification of time sensitive business operations and services.An analysis of
the organisations financial status and operational impacts.The time-frames in
which the time-sensitive processes, operations and functions must resume.An
estimation of the resources necessary for successful resumption, recovery and
restoration.The BIA will provide a basis and cost justification for risk management,
response, recovery and restoration.
Disaster readiness strategies
The disaster readiness strategies include the following activities:Define business
continuity alternatives Using the information from BIA, the project team
shouldassess the alternative strategies that are available to the organisation and
identify two or threestrategies that are more credible.Estimate cost of business
continuity alternatives Based on these strategies, the organisation developsthe
budgetary plan. The resumption timeframe plays an important role in examining
which elementsmay require pre-positioning.Recommend disaster readiness
strategy - Based on the needs of the business and evaluation ofalternatives, the
project team should develop recommendations of strategies to provide funds
forimplementation. Prepare a formal report based on the findings of the BIA for the
strategy alternatives that were developed and analysed Take approval from senior
management to proceed with theproject
Develop and implement the plan
Develop and implement the plan includes the following activities:Emergency
response and operations It establishes a crisis management process to respond to
theseincidents.Develop and implement a business continuity plan The plan
describes specifically how to deal withthe incidents. It should focus on the priorities
of overall business continuity strategy.Apply business unit plans for each
department Describe the roles that each department has toperform in the event of
an emergency. Example It should detail the actions that the IT department willhave
to carry out if IT services are lost.
Maintenance and testing
Maintenance and testing includes the following activities:Establish a plan exercise
program BCP should develop and schedule the exercises to achieve andmaintain
high levels of competence and readiness. Document the objectives of each
exercise and itshould include the measurement criteria. Evaluate the results of
each exercise against pre-statedvalues and document the results along with
proposed plan enhancement.Awareness and training plans It should ensure that
the personnel is aware of the importance ofbusiness continuity plan and can
operate effectively in case of an event .Review the effectiveness ofawareness
training and identify the need for further training.Sample emergency response
exercises Emergency response exercises should be ongoing. The exercises can
be repeated using alternate setup and it should involve whole organisation within
aparticular facility that may be affected by a system disaster.Audit and update the
plans regularly It should regularly audit the plans to check if it meets the needsof
the organisation and ensures that the documentation remains accurate and
reflects any changesinside or outside the business.
Q2. What is meant by “Business plan”? Describe the strategies to create a
business plan.
Answer:
A business plan is a complete internal document that summarises the operational
and financialobjectives of a business. It also contains the detailed plans which
show how the objectives are being accomplished.
An accurately made business plan helps to allocate resources properly, to handle
unforeseen complications like financial crisis and to make good business
decisions.
On the other hand, business venture is a start-up enterprise which is formed with
expectations andplans of achieving financial gain. Once the need of the
organisation is identified, it can be started by asmall investor that has valuable
resources and time. Other investors involve themselves by providingsupport for
further development of the venture once the business is created. In the case
ofestablishing a business venture, a formal business plan is written to outline the
purpose and missionof the business for the future use.
Strategies for creating a business plan
Strategies for creating a business plan. Every entrepreneur creates a business
plan and itscompletion will determine the feasibility of the plan. The strategies for
creating a business plan are as follows
Q3. What are the benefits of MNCs?
Answer.
MNCs have certain unique advantages in their operations that are not benefited by
domesticoriented companies. The international success of MNCs is mainly
because of the ability to capitalisethe advantages. The advantages widely depend
on the nature of individual corporations and the typeof their business. Benefits are
1. To the companySuperior technical knowledge The most important advantage of
MNCs is the patented technicalknowledge which enables them to compete
internationally. Large MNCs have access to advancedlevels of technology which
are either developed or acquired by the corporation. These technologiesare
patented. It can be in the areas of management, services or production. Extensive
application ofthese technologies gives a competitive advantage to the MNC in
international market, as it results inefficient, low-priced, hi-tech products and
services that dominate a large international market. This results in efficient
production and services like that of IBM or Microsoft.Large size of economy
Generally, MNCs are large like Wal-Mart and Exxon Mobil which has saleslarger
than the gross national products of many countries.
The large size gives the advantage ofsignificant economic growth to the MNCs.
The higher volume of production leads to lower fixed costsper-unit for the
companys products. Competitors, whose volume of production of goods is smaller.
must raise the price to recover the higher fixed costs. This situation implies to
capital-intensiveindustries like steel, automobiles etc., in which fixed costs form a
major proportion of total costs.Example MNC like Nippon Steel of Japan can sell
its products at lower prices than those ofcompanies with smaller plants.
Lower input costs due to large size The production levels of MNCs are large and
thus the purchase ofinputs is in large volumes. Bulk purchases of inputs enable
the corporation to bargain for lower inputcosts and obtain considerable amount of
discount. Lower input costs means less expensive and morecompetitive products.
Example Nestle, which buys huge quantities of coffee from the market, canbargain
for lower prices than small buyers can. Wal-Mart sells products at lower prices
relative to itscompetitors due to bulk purchasing and efficient inventory control. By
identifying which product selleffectively, Wal-Mart combines low-cost purchasing
with efficient inventor to achieve competitiveadvantage in retail market.
Ability to access raw materials overseas By accessing raw materials in foreign
countries, many MNCslower the input and production costs. In many cases, MNCs
supply the technology to extract rawmaterials. Such access can give MNCs
monopolistic control over raw materials because they supplytechnology in
exchange for monopolistic control. This control enables them to supply or deny
rawmaterials to their competitors.
Ability to shift production overseas Another advantage of MNCs is the ability to
shift the productionoverseas. MNCs relocate their production facilities to take
advantage of lower labour costs, rawmaterials and other incentives offered by the
host countries. They take advantage of the lower costsby exporting lower-cost
goods to foreign markets. Many MNCs have set up factories in low-cost areaslike
China, India, Mexico, etc.
Brand image and goodwill advantage Most of the MNCs possess product lines that
have created agood reputation for quality, value and service. This reputation
spread to other countries throughexports and promotion and adds to the goodwill
or brand image of the company. MNCs are able toinfluence this brand image by
standardizing their product lines in different countries. Example SonyPlayStations
do not have any modifications for different countries and the parent factory
producesstandardised products for the world market. Brand names like Sony help
the company to chargepremium prices for its products, because the customers are
ready to buy quality products at premium prices.
Information advantage MNCs have a global market view with which it collects,
analyses, andprocesses the in-depth knowledge of worldwide markets. This
knowledge is used to create newproducts for potential market niches and expand
the market coverage of their products. The MNCshave good information gathering
capabilities in all aspects of their operations. Through thisinformation network, the
MNC is able to forecast government controls and gather commercialinformation.
The network also helps in providing important information about economic
conditions,changing market trends, social and cultural changes that affect the
business of MNCs in differentcountries. With these information MNCs can position
themselves appropriately to contingencies.
Managerial experience and expertise The MNCs function in large number in
different countries simultaneously. This enables them to integrate wealth for
valuable managerial experience. Thisexperience helps them in dealing with
different business situations around the globe. Example AnMNC located in Japan
can attain knowledge of Japanese management techniques and apply
themsuccessfully in a different location.
2. To the nations where it operates (domestic nations)MNCs bring advantage to the
countries in which they operate. The benefits of MNCs to the nationswhere it
operate are:
Economic growth and employment An MNC comes to a country with more
amount of money to investthan any local company. The countries from where the
MNCs operate are also called host countries.It brings inward investment to the
host countries. This helps in boosting the national economy.Example Constructing
new plants requires resources like land, capital and labour. It providesemployment
to a large number of people which helps in dealing with the unemployment
problem inthe host countries. The inward investment can help in generating wealth
in the local economy because it increases the spending ability of the people by
providing them employment. As the MNCsprovide employment to the people, they
pay taxes to the local government. The people have moremoney to spend which
provides market for local companies to sell their goods. The MNCs alsoattracts
other smaller firms to the area where it is located. These firms provide different
services to theMNCs.
Skills, techniques and quality human capital The MNCs bring with them new ideas
and newtechniques to improve the quality of production. This helps in improving
the quality of human capital inthe host country. The MNCs employ local labour and
train them in new skills to improve productivityand efficiency. Example Sunderland
is one of the most productive car manufacturing plants in Europe.The workers had
to get used to different ways of working that were used in other British firms.
Thiscan be a challenge and can also lead to improvement in productivity. The
skills that the workers buildup can be passed on the other workers which help in
improving the supply of skilled labour in that area.
Availability of quality goods and services Generally, production in a host country is
aimed at theexport market. However, in some cases, the inward investment can
gain access to the host countrymarket to avoid trade barriers. Availability of quality
goods leads to improved quality in other relatedindustries. Example The UK has
access to high quality vehicles at cheaper price; this competition hasled to
improvement in prices, working practices and quality in other related
industries.Improvement in infrastructure The MNCs invest in a country for
production and distribution facilities. Inaddition to this, the company might also
invest in additional infrastructure facilities like road, port andcommunication
facilities. This can benefit the entire country.
Q4. Define the term “Strategic Alliance”. Differentiate between Joint ventures
and Mergers.
Answer.
Strategic alliance is the process of mutual agreement between the organisations to
achieveobjectives of common interest. They are obtained by the co-operation
between the companies.Strategic alliance involves the individual organisations to
modify its basic business activities and joinin agreement with similar organisations
to reduce duplication of manufacturing products and improveperformance. It is
stronger when the organisations involved have balancing strengths.
Strategicalliances contribute in successful implementation of strategic plan
because it is strategic in nature. Itprovides relationship between organisations to
plan various strategies in achieving a common goal.Joint venture is the most
powerful business concept that has the ability to pool two or moreorganisations in
one project to achieve a common goal. In a joint venture, both the
organisationsinvest on the resources like money, time and skills to achieve the
objectives. Joint venture has beenthe hallmark for most successful organisations
in the world. An individual partner in joint venture mayoffer time and services
whereas the other focuses on investments. This pools the resources amongthe
organisations and helps each other in achieving the objectives. An agreement is
formed betweenthe two parties and the nature of agreement is truly beneficial with
huge rewards such that the profitsare shared by both the organisations.
If the organisation enters into joint venture agreement with unprofessional
selfish organisation, thenit increases the risk of hurting business reputation and
devastating customers trust.Example The China Wireless Technologies, a mobile
handset maker is getting into an agreement withthe Reliance Communications Ltd
(RCom) to launch its new mobile. The joint venture between thetwo companies is
to gain profits and provide affordable mobile phones to the market that consists
ofadvanced features and aims to earn eight billion dollars in the next five years.
The new mobileconsists of dual SIM smart phone with 3G technology at a cheaper
rate.
Merger is the process of combining two or more organisations to form a single
organisation andachieve greater efficiencies of scale and productivity. The main
reason to involve into mergers is to join with other company and reap the rewards
obtained by the combined strengths of twoorganisations. A smart organisations
merger helps to enter into new markets, acquire morecustomers, and excel among
the competitors in the market. The participating organisation can helpthe active
partner in acquiring products, distribution channel, technical knowledge,
infrastructure todrive into new levels of success.
With the perception of the organisation structure, here are a few types of mergers.
The different types of mergers are:
Basically, a joint venture is when two or more companies make an agreement to
do business in one specific area. They can share the insurance, shipping and
liability costs and produce higher profits. It is usually a short lived collaboration.
A merger is when two companies come together to form a single company. They
combine their respective resources. Sometimes there are losses of jobs, but not
all. Those decisions are specified in the merger contract well in advance of the
deal.
An acquisition is when one company is buying and taking over another. If it is
friendly, often the seller can stipulate who keeps their job and so forth. If it is
unfriendly, the company taking over gets to make all the final decisions. They
cannot take away benefits already earned.
When you are running a small business, you are often limited by your size. One
way of increasing your capacity is by working together with another firm. Two
methods of doing this are via a joint venture or through a merger. Both options
involve collaboration between firms, but they differ significantly.
Legal Structure
When two firms merge, they cease to exist as independent firms. For example,
when the U.S.-based Anheuser--Busch merged with Beligium's InBev, the two
companies no longer existed and were replaced by Anheuser--Busch In Bev, a
new and separate legal entity controlling the assets of both firms. In a joint
venture, a new separate firm is formed, but the original companies continue to
exist on their own.
Ownership
When a joint venture is created, it is owned by the original firms that created it. For
example, when Microsoft and NBC Universal created MSNBC as a joint venture,
the two mother companies maintained ownership of the new entity. In the case of
a merger, the owners of the newly formed company are the same as the owners of
the original two companies.
Commitment
A joint venture involves a lower level of commitment from the two parties than a
merger. A joint venture can be a good way to test the waters to see how well two
firms work together. It can also be used for a temporary arrangement to work on a
short-term project. A merger, in contrast, involves a virtually permanent
commitment. Although it is possible to break up a company, doing so can be
difficult, costly and disruptive to business.
Scope
A merger is useful when two businesses wish to become fully integrated -- that is,
when two firms have enough overlap that they can perform most of their business
together. A joint venture, on the other hand, typically has a much more limited
scope. A joint venture normally focuses on a specific area where two firms overlap
and can work together, but the bulk of their business remains separate.
5. What do you mean by „innovation‟? What are the types of innovation?
Answer:
Innovation is the production or implementation of ideas. Innovation can be
described as anaction or implementation which results in an improvement; a gain,
or a profit. The National InnovationInitiative (NII) defines innovation as " The
intersection of invention and insight, leading to the creationof social and economic
value.
Innovation is defined as using new ideas to apply current thinking in different ways
that results in asignificant change.
Innovation is often in the eye of the beholder - what may be new and radical for
one person, may be old news for another. Despite this subjectivity in identifying
and classifying innovation, there has been useful work in thinking about the focus
of different innovation processes, guided by the question: what is it that innovation
processes seek to change and improve?
The „4Ps‟ model developed by John Bessant and Joe Tidd provide a powerful tool
for such analysis. It builds on the hypothesis that successful innovation is
essentially about positive change, and puts forward four broad categories where
such change can take place:
'Product innovation‟ – changes in the things (products/services) which an
organisation offers
'Process innovation‟ – changes in the ways in which products and services are
created or delivered
'Position innovation‟ – changes in the context in which the products/services are
framed and communicated
'Paradigm innovation‟ – changes in the underlying mental models which shape
what the organisation does
Product innovation
Perhaps the most commonly understood form of innovation is that which
introduces or improves a product or service – a change in what is offered to end
users. The Bic ballpoint pen is an example of a product innovation, which has also
benefited from a range of incremental innovations since its original invention. The
emblematic humanitarian product is food, which is the dominant form of
assistance. Different forms of food aid might be seen as incremental innovations.
There may also be innovative products which help to achieve humanitarian goals.
For example, the LifeStraw is a portable water filter developed by Vestergaard-
Frandsen which enables individuals to drink clean water from almost any source.
Another example is PlumpyNut, a therapeutic food which is both durable and can
be dispensed outside of traditional medical settings.
Process innovation
Innovations can also focus on processes through which products are created or
delivered. Because so many of the products used in relief settings are initially
developed for non-relief contexts, a natural focus for humanitarian innovation is to
consider how an existing product might be used in resource-poor or rapidly
changing settings. Examples of process innovations that have had a positive effect
on the humanitarian sector are the increasing stockpiling of goods in strategic
locations, or the use of pre-made packs and kits.
Position innovation
The third focus of innovation involves re-positioning the perception of an
established product or process in a specific context. Position-based innovations
refer to changes in how a specific product or process is perceived symbolically and
how they are used. For example, Levi-Strauss jeans are a well-established global
product line, originally developed as manual workers‟ clothing materials, but then
re-branded as a fashion item.
In the humanitarian context, position innovations include changes in the signals
that are disseminated about a humanitarian organisation and its work. This may
relate to the way in which aid is marketed and packaged for potential donors.
Alternatively, it may involve a repositioning of humanitarian assistance within a
particular operational context or for particular users. An example of the former can
be seen in attempts by humanitarian agencies in different complex emergencies to
develop principle based cross-agency positions in relation to belligerent parties in
complex emergencies which amount to a set of conditions under which
humanitarian aid would be delivered, and a clear articulation of the situations
where it would not. Agencies such as Disability International or HelpAge
International are position innovators in that they call for the delivery of
humanitarian products and services to groups that are often excluded.
Paradigm innovation
The final „P‟ relates to innovation that defines or redefines the dominant paradigms
of an organisation or entire sector. Paradigm-based innovations relate to the
mental models which shape what an organisation or business is about. Henry Ford
provides a pithy quote, when talking about the development of the Model T motor
car: „If I asked people what they wanted, they would have asked for a five-legged
horse‟.
Examples of paradigm innovation in the international humanitarian sector include
an increasing emphasis on local ownership and leadership of responses to crises
as an alternative to internationally dominated responses. A greater and more
central role for aid recipients is another example, and finally, perhaps the most
radical innovation is the idea of disaster risk reduction approaches, which if
successful can negate the need for any kind of response.
The development of community-based feeding therapy is one of the most recent
examples of such innovations, with the combination of a product (PlumpyNut), a
process (community-based distribution) , a re-positioning (the idea that aid
agencies do not need to do the feeding themselves directly) and a paradigm shift
(the notion that families and communities can treat malnutrition at home). Similarly,
cash-based programming at its most radical involves a new product (cash), new
processes (means of distributing cash), new position (a change in how aid is
perceived by donors) and new paradigms (a change in how recipients are
perceived by aid agencies).
6. Describe Corporate Social Responsibility.
Answer: Corporate Social Responsibility (CSR) is the continuing obligation of a
business to behaveethically and contribute to the economic development of the
organisation. It improves the quality of lifeof the organisation. The meaning of CSR
has two folds. On one hand, it exhibits the ethical behaviourthat an organisation
exhibit towards its internal and external stakeholders. And on the other hand,
itdenotes the responsibility of an organisation towards the environment and society
in which itoperates. Thus CSR makes a significant contribution towards
sustainability and competitiveness ofthe organisation.
CSR is effective in number of areas such as human rights, safety at work,
consumer protection,climate protection, caring for the environment, sustainable
management of natural resources, andsuch other issues. CSR also provides
health and safety measures, preserves employee rights anddiscourages
discrimination at workplace. CSR activities include commitment to product quality,
fairpricing policies, providing correct information to the consumers, resorting to
legal assistance in caseof unresolved business problems, so on.
Example TATA implemented social welfare provisions for its employees since
1945.
A) Features of CSRCSR improves the customer satisfaction through its products
and services. It also assists inenvironmental protection and contributes towards
social activities. The following are the features of CSR:
Improves the quality of an organisation in terms of economic, legal and ethical
factors CSR improvesthe economic features of an organisation by earning profits
for the owners. It also improves the legaland ethical features by fulfilling the law
and implementing ethical standards.Builds an improved management system CSR
improves the management system by providingproducts which meets the essential
customer needs. It develops relevant regulations through the utilisation of
innovative technologies in the organisationContributes to countries by improving
the quality of management CSR contributes high qualityproduct, environment
conservation and occupational health safety to various regions and
countries.Enhances information security systems and implementing effective
security measures CSR enhancesthe information security measures by
establishing improved information security system anddistributing them to
overseas business sites. The information system has improved by enhancing
better responses to complex security accidents.
Creates a new value in transportation CSR creates a new value in transportation
for the greater safetyof pedestrians and automobiles. This is done by utilising
information and technology for automobiles.The information and technology helps
in establishing a safety driving assistance system.Creates awareness towards
environmental issues CSR serves in preventing global warming byreducing the
harmful gases emitted into the atmosphere during the process of business
activities.B) Roles played in terms of ethical conduct CSR plays a significant role in
maintaining ethical conduct in an organisation. The following are theroles played
by CSR:Improves the relationships with the investment community and develops
better access to capital andrisksEnhances ability to recruit, develop and retain
staffImproves the reputation and branding of the organisationImproves innovation,
competitiveness and market positioningImproves the ability to attract and build
effective and efficient supply chain relationships Improves relationships with
regulatorsReduces the costs through re-cycling processEnhances stronger
financial performance and profitability through operational efficiency gains.