ldr 6140 strategic leadership reflection paper
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Running Head: Strategic Leadership Reflection Paper
Strategic Leadership Self-Reflection Paper
A Personalized Journey in Understanding Business Strategy
Ardavan A. Shahroodi
Northeastern University
LDR—6140 Developing the Strategic Leader
Professor W. Joseph Condon
Tuesday, December 2, 2014
Strategic Leadership Reflection Paper
Introduction
This Self-Reflection Paper begins with an exploration of the initial elements in my
understanding and practice of strategic leadership. Next, this paper reflects on the foundation of
competitive advantage through an analysis of the strategies that organizations utilize in order to
improve efficiency, quality, innovation and responsiveness to customers in their work
environments. Pursuant to this analysis, this paper reviews and analyses all the readings in this
course that had a particular impact on this writer. A detailed personalized SWOT analysis of
this writer forms the last section of this paper. This paper argues that leadership in for-profit
organizations requires a deep knowledge of business and corporate strategy far beyond a
rudimentary understanding of efficiency, quality, innovation and responsiveness to customers.
As important as these foundational elements are in producing the products and services of an
organization, they must be combined with a deeper and wider knowledge of the forces that effect
the cost structure of the company, the nature of industry or industries that the firm is competing
in, the needs of the customers that the company is intending to serve and Michael Porter’s Five
Forces Model concerning competitiveness and strategy.
The Initial Elements in My Understanding and Practice of Strategic Leadership
I was separated from my divorced parents in my teenage years and I lost my father to
cancer shortly thereafter. Through her ideals and conduct, my mother who was a respected and
well known educator, teacher and school principal has left a lasting impression on my character.
I remember vividly that in her work and relationship with others, my mother placed a heavy
emphasis on truthfulness, fairness, hard work and empathy for those in society who are faced
with challenges or hardship. A further source of continuous inspiration in my life has been my
wife whose kind heart, moral disposition and concern for the underprivileged is rooted deeply in
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her Christian beliefs. As I have developed my strategic leadership thought process and skills, I
have been heavily influenced by the example of these two individuals.
Stakeholders
The most pronounced qualitative attribute that defines the lives of both my mother and
my wife is a commitment to serve others in one’s family, occupation, community and the larger
society. As I have travelled in my own leadership journey, I have been witness to the magnitude
that self-awareness and self-actualization are energized and enriched through a service inspired
purpose and strategy. In essence, I have been extremely fortunate that the overwhelming portion
of my career have been spent in the Hospitality and Tourism Industry. Here, my work related
experiences, allowed me to be my true self and find fulfillment through customer service
whether that customer is an internal client such as an organizational employee or an external
client such as a guest or a patron. These were the stakeholders that I understood as being the
“most important from the organization’s perspective” (Hill & Jones, 2012, p. 28).
Hill & Jones (2012) describe an organization’s stakeholders as “individuals or groups
with an interest, claim, or stake in the company, in what it does, and in how well it performs” (p.
28). Within the boundaries of my limited “functional-level” (Hill & Jones, 2012, p. 7) authority,
I viewed the internal stakeholders of our places of employment as my co-workers, those whose
performance I was responsible for and my superiors. I saw the external stakeholders of our
organization as our “customers…suppliers…governments…local communities…general public”
(Hill & Jones, 2012, p. 28) (I have never been employed in a unionized organization although I
have studied their structure extensively during my undergraduate and graduate education).
These I understood as “individuals and groups outside the company that have some claim on the
company” (Hill & Jones, 2012, p. 28).
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Hill & Jones (2012) state that “all stakeholders are in an exchange relationship with the
company…Each stakeholder group supplies the organization with important resources (or
contributions), and in exchange each expects its interests to be satisfied (by inducements)” (p.
28). I have had an extremely high sense of awareness of the aforementioned dynamic throughout
my career and saw as my personal responsibility the performance of all that I am able to do in
order to provide our organizational internal and external stakeholders with all potential
inducements in exchange for their contributions. Hill & Jones (2012) observe that an
organization must take the “claims” (p. 29) of its stakeholders “into account when formulating its
strategies…If it does not stakeholders may withdraw their support” (p. 29).
On the basis of my functional-level responsibilities, when performing a “stakeholder
impact analysis” (Hill & Jones, 2012, p. 29), I would consistently select “customers [and]
employees” (p. 29) as the most essential stakeholders of our organization, “identify… [their]
interests and concerns” (p. 29) and focus my energies into removing any obstacles and “strategic
challenges” (p. 29) that would compromise the experience and relationship of these stakeholders
with our organization. Hill & Jones (2012) argue that “customers provide a company with its
revenues and in exchange want high-quality reliable products that represent value for money” (p.
29). Consequently, at the most fundamental level, I felt a fiduciary responsibility towards
satisfying the expectations of our guests on the basis of the trust that they had placed on the
products and services of our organization. However, specifically with respect to our guests, I
also felt that I will be a better human being or even a better citizen when I deliver quality service
to the patrons of our establishments. My ability to fulfill this latter almost spiritual interpretation
of responsibility was a continuous source of inspiration to me throughout my career in the
Hospitality and Tourism Industry.
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In relation to our employees and colleagues, those whose performance I would be
responsible for, I would be very much aware that our associates “provide labor and skills and in
exchange expect commensurate income, job satisfaction, job security, and good working
conditions” (Hill & Jones, 2012, p. 29). First and foremost, I was always cognizant of the very
fact that these employees have families who love them and would want them to be treated with
the outmost respect and deference. Secondly, I believed deeply that our employees are indeed
entitled to job satisfaction and good working conditions and therefore would promote a team
oriented and egalitarian work environment where power oriented relationships would be de-
emphasized while simultaneously greater concentration would be placed on the achievement of
performance related standards.
Thirdly, in regards to providing commensurate income to those whose performance I was
responsible for, I faced many hurdles that were partly related to the limitations of my
organizational power and authority. I recall that on numerous occasions, I would compensate
our employees from my own compensation and income due to the responsibility that I felt for
their welfare. I also believed that they are as much responsible for the performance of our teams
and therefore I must do my share in helping them reap the rewards of their dedication. This
particular conduct would be faced with a level of surprise and raised eye brows in our
organizations. In one particular ceremony, a senior executive of our organization stated that he
did not completely understand why I shared my income with those I was responsible for or
worked with. Nevertheless, I felt that engaging in this practice would significantly improve our
success rates in accomplishing the strategic focus of our organization which was delivering
exemplary customer service to our guests.
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I also felt a strong sense of duty with respect to the communities that hosted our
hospitality properties. Here, I endeavored to share the service oriented hospitality competencies
that we practiced in our organization with the host community together with other related
subjects. In one such urban setting, for a number of years, I voluntarily trained entering service
providers as part of a municipal program in topics such as customer service, hospitality, conflict
resolution, ethical conduct and elementary/basic principles of running a business. In relation to
this volunteer service, together with other instructors, I was able to contribute to the training of
numerous service providers thereby making available to the host community the personal
competencies that I had accumulated as a result of my career in the Hospitality and Tourism
Industry. That volunteer service has been one of the most rewarding experiences of my life (Due
to my particular schedule, I am no longer involved with the above program).
The Mission Statement
Due partly to my theoretical training in the disciplines of political Science and
philosophy, I have always placed great importance on my employers’ mission statements as
representing “the starting point of the strategic planning process” (Hill & Jones, 2012, p. 30).
Here, I would always memorize the mission of our organization as being a “customer-oriented”
(Hill & Jones, 2012, p. 30) guiding principle that would give purpose and definition to the
performance of our daily tasks. Regardless of the particularities of our products and services, I
have always interpreted our strategic mission as being in the business of hospitality and going
beyond the call of duty in satisfying the needs of our guests and patrons. In regards to the needs
of our guests, they would have had to possess legal, moral and ethical characteristics. In regards
to my future career in the field of Human Resources, I see our mission as facilitating the type of
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work environments that would be conducive in releasing the most productive and creative
energies and expressions of our employees.
In bringing to fruition the vision of our hospitality or tourism organizations, I always
understood the “desired future state” (Hill & Jones, 2012, p. 31) as when our operational
reputation is unique and exemplary in the industry and when the reputation of our team is a
model of best practices within the given organization. This indeed would have been an
“attainable future state” (Hill & Jones, 2012, p. 31) that would “help to motivate employees at all
levels and drive strategies” (p. 31) in line with the hospitality oriented mission of our
organization.
Due to the aforementioned limitations of my power and authority, I could never
systematically shape the values or culture of any of my employers. However, within the
confines of performance teams, I would continuously insist on adhering to certain ethical norms
that I thought would be indispensable catalysts in accomplishing the strategic objectives of our
organizations. First among these ethical norms would have been to implement a fair distribution
of work schedules empty of favoritism in order for all the employees to have the opportunity to
be compensated equitably. This would have been especially pertinent in regards to gratuity
based employees whose income would have been affected negatively in the event of being
assigned to less lucrative shifts. The demoralizing effect of practicing nepotism in scheduling or
even a lack of attention to matters involving equitable treatment of employers would consistently
carry devastating performance related consequences for the organization.
Secondly, I would never tolerate any discriminatory practices or harassment of any kind
in any of our performance teams. Anti-social behavior that occurred extremely infrequently also
faced similar sanctions. I appreciated that as humans we are prone to make mistakes, however
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the adoption of a proactive educational approach while emphasizing the severity of such conduct
would have been usually a sufficient strategy in preventing their occurrence in the workplace.
Third, our teams attached great importance to our ability to provide exceptional service to those
guests that needed special and extra attention such as the elderly, families and the disabled. A
service failure or shortcoming in these situations would have been regarded as an extremely
serious matter.
The ultimate goal of our hospitality teams was to create extraordinarily pleasant and
memorable encounters/experiences for our guests. This we believed would lead to a decision to
return to our property in a future visit. Indeed, throughout the years many of our guests were
returning patrons who due to the frequency of their visits had actually become our friends and
acquaintances. This goal was a “precise and measurable desired future state” (Hill & Jones,
2012, p. 32) that could have been evaluated or verified quantitatively by our organization. The
decision to return to a given hospitality organization is usually a function of room rates,
convenience, location, physical attributes of a given property and the quality of the service that
the guests would receive in that particular entity. As there are different hospitality products in
the marketplace, each endeavors to concentrate on different segments of the industry. As an
example, all other attributes being approximately similar, in the economy segment, the
competition among hotel establishments mostly involves the variable of room rates.
On the other hand, in the luxury sector, the physical attributes of a given entity and the
particular service quality of the establishment create the product differentiation that determines
the competitive position of the property with respect to its competitors. In evaluating this precise
and measurable goal, our organization could also rely on guest comment cards that were an
important metric communicating to us potential service failures or strengths of the operation.
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Guest comment cards/surveys/evaluations would help the establishment “assess the performance
of the company” (Hill & Jones, 2012, p. 32) and subsequently establish strategies that would
“address crucial issues” (p. 32) and attempt to rectify service failures and shortcomings. These
corrective measures such as mentoring, coaching, training, allocation of added labor/material
resources and disciplinary actions may be considered “challenging but realistic” (Hill & Jones,
2012, p. 32) giving “all employees an incentive to look for ways of improving the operations
of… [the] organization” (p. 32). These measures could also be implemented in a given “time
period” (Hill & Jones, 2012, p. 32) establishing “time constraints” (p. 32) and injecting
a sense of urgency into goal attainment and act as a motivator” (p. 32) for employees. The
aforementioned discussion includes some of the specific ideas and concepts that I arrived with
analyzed within the context of what I have learned in this course.
The Foundation of Competitive Advantage
The foundation of competitive advantage rests on the ability of companies, organizations,
groups or teams to execute superior performance with respect to “efficiency, quality, innovation,
and customer responsiveness” ((Hill & Jones, 2012, p. 86).
Efficiency
Efficiency is described as the ability to utilize “fewer…inputs” (Hill & Jones, 2012, p.
87) in the process of producing “a given output” (p. 87). Inputs are “basic factors of production
such as labor, land, capital, management, and technological know-how” (Hill & Jones, 2012, p.
87) and outputs are the “goods and services that the business produces” (p. 87). Most
importantly, “the more efficient a company is, the fewer the inputs required to produce a given
output” (Hill & Jones, 2012, p. 87). Employee productivity and capital productivity are “two of
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the most important components of efficiency” (Hill & Jones, 2012, p. 87). Due to my limited
power and authority, on an organizational level, I have never been responsible for managing the
capital productivity of an establishment which is described as the level of “output per unit of
invested capital” (Hill & Jones, 2012, p. 87). However, my own performance or the performance
of the teams or tasks that I was responsible for have implicitly influenced the capital productivity
of our organizations.
A significant portion of my work was devoted to improving the productivity or “output
per employee” (Hill & Jones, 2012, p. 87) of our team members. This effort was mostly a
process oriented endeavor that would be initiated at the hiring stage. With close attention to
equal opportunity standards I would begin with searching for those internal employees, vendor
staff or candidates that had a reputation for decency, honesty, conscientious, even temperedness
and kindness towards others. These were qualities that would add significant value in team
oriented situations. These candidates would subsequently be introduced or referred to the
particular manager who would have final say in the hiring of these individuals.
There existed extensive training, mentoring, coaching and proactive supervising that
would be focused on improving the quality of our service. I also provided this type of
hospitality, service, quality and dispute resolution training in other properties in our organization
in cities such as Philadelphia, Baltimore and Dallas. Once the team was composed of
conscientious associates, I would consistently emphasize quality standards and de-emphasize
power oriented relationships. Here there also existed a very high level of pride in the quality of
our service and the spirit of camaraderie that existed in our teams. These factors would
repeatedly bring a significant improvement to the performance and productivity of our
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employees. In general, I would never take any actions without extensive prior consultation with
other colleagues, co-workers, supervisors, managers, and executives.
Hill & Jones (2012) observe that productivity of capital may be enhanced by “driving
down unit costs by mass producing output” (p. 94) that is referred to as pursuing economies of
scale. This is partly achieved by distributing “fixed costs over a large production volume” (Hill
& Jones, 2012, p. 94). These fixed costs “are costs that must be incurred to produce a product
whatever the level of output” (Hill & Jones, 2012, p. 94). A further aspect of economies of scale
is witnessed in the specialization of labor that “enables employees to become very skilled at
performing a particular task” (Hill & Jones, 2012, p. 94) mostly observed in “mass production”
(p. 94) operations. This work arrangement leads to a “greater division of labor (…split assembly
into small, repeatable tasks) and specialization” (Hill & Jones, 2012, p. 94).
On the other end of the philosophical spectrum, efficiency may also be improved through
the adoption of “flexible manufacturing technology—or lean production” (Hill & Jones, 2012, p.
96) that facilitate the production of “a wider variety of end products at a unit cost that at one time
could be achieved only through the mass production of a standardized output” (p. 96). The
benefit of flexible manufacturing techniques is in improving efficiency and lowering “unit costs
relative to what can be achieved by the mass production of a standardized out-put, while at the
same time enabling the company to customize its product offerings to a much greater extent than
was thought possible” (Hill & Jones, 2012, p. 96). Here the term mass customization is intended
to convey the two goals of “low cost and differentiation through product customization” (Hill &
Jones, 2012, p. 96) achieved with the adoption of flexible manufacturing techniques.
Efficiency may also be improved through the maximization of learning effects that are
“cost savings that come from learning by doing” (Hill & Jones, 2012, p. 94) that allows
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employees to learn by “repetition how best to carry out a task” (p. 94). This work pattern
enhances employee productivity “over time, and unit costs fall as individuals learn the most
efficient way to perform a particular task” (Hill & Jones, 2012, p. 94). The learning effects are
not confined to line employees, and management too over a period of time learns “how best to
run the…operation...Hence, production costs decline because of increasing labor productivity
and management efficiency” (Hill & Jones, 2012, p. 95). The phenomenon of learning effects is
observed in a number of fields such as manufacturing, “service industries…health care industry”
(Hill & Jones, 2012, p. 95) and the Hospitality/Tourism Industry.
Efficiency may also be improved through adopting particular marketing strategies that
would benefit the organization from economies of scale through an intensive emphasis on
“pricing, promotion, advertising, product design and promotion” (Hill & Jones, 2012, p. 96). In
this light, economies of scale and learning effects may be achieved by resorting to “aggressive
pricing, promotions, and advertising, all of which build sales volume rapidly and allow for the
cost reductions that come from scale and learning effects” (Hill & Jones, 2012, p. 96). A further
marketing strategy that may enhance efficiency is in reducing customer defection rates. Hill &
Jones (2012) observe that “defection rates are determined by customer loyalty, which in turn is a
function of the ability of a company to satisfy its customers” (p. 96). In the case of service
oriented contractual agreements between a company and its clients, defection rates may also be
lowered by establishing time sensitive parameters that if violated would lead to the automatic
imposition of certain monetary penalties on the customer.
Hill & Jones (2012) state that “acquiring a new customer entails certain one-time fixed
costs for advertising, promotions, and the like, there is a direct relationship between defection
rates and costs” (p. 96). In such an environment, companies that are able to retain their
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customers for an extended period of time are able to generate a higher amount of sales “that can
be set against customer acquisition costs” (Hill & Jones, 2012, p. 96). Consequently, companies
are able to lessen their “customer acquisition costs and achieve a lower overall cost structure”
(Hill & Jones, 2012, p. 96) when they diminish the number of customers who defect to their
competitors.
Efficiency and “profitability” (Hill & Jones, 2012, p. 97) may also be improved by
lowering a company’s expenditures on materials management. In one particular analysis it was
determined that, “in a typical competitive market, reducing materials cost by 3% is usually much
easier than increasing sales revenues by 30%” (Hill & Jones, 2012, p. 97). One strategy that
companies may utilize in lowering their materials management cost is adopting a “just-in-time
(JIT) inventory system, designed to economize on inventory holding costs by having components
arrive at a manufacturing plant just in time to enter the production process or goods at a retail
store only when stock is almost depleted” (Hill & Jones, 2012, p. 97). Here, the reduction in
inventory emanates from “increasing inventory turnover, which reduces inventory holding costs,
such as warehousing and storage costs, and the company’s need for working capital” (Hill &
Jones, 2012, p. 97). Nevertheless, companies that do adopt a JIT inventory system may stand
vulnerable with respect to not being able to “respond quickly to increases in demand” (Hill &
Jones, 2012, p. 97) which may be alleviated by resorting to “source inputs from multiple
suppliers” (p. 97).
Human resources strategy may also contribute towards enhancing an organization’s
efficiency through facilitating improvements in employee productivity thereby benefiting the
“cost structure, and profitability” (Hill & Jones, 2012, p. 97) of the organization. The linking of
human resources strategy to improving efficiency must begin at the recruitment and hiring stage.
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Hill & Jones (2012) observe that “many companies well known for their productive employees
devote considerable attention to their hiring strategy” (Hill & Jones, 2012, p. 97). I was very
much cognizant of this relationship during my own career in the Hospitality and Tourism
Industries. As stated previously, in spite of my limited power and authority, I would insist on
having only those employees, vendor staff or outside employees join our work teams who were
conscientious, decent, ethical, kind hearted and who possessed the ability to contribute
effectively and constructively to our group’s mission.
There existed significant resistance to my organizational posture in our places of
employment. In a number of properties or tourist oriented operations, due to the rigidly
hierarchical nature of the organization, I was unable to structurally influence the productivity of
our work teams. As an example in one particular hotel property, in order to improve
organizational productivity, I concentrated on working with those specific individual employees
who were dedicated, conscientious and would consistently perform beyond the call of duty. This
level of team oriented camaraderie improved the morale of these specific employees although it
did not significantly affect the productivity of our team.
In a different hotel property, due to my influence, I was able to more structurally improve
the productivity of our team members although even here I would be consistently criticized by
other team leaders for not adhering to the traditional hierarchical practices of that particular
organization. Nevertheless, this resistance to our team oriented work methods was mostly muted
due to the incredible feedback of our guests and the moderate support of the senior executives of
the organization. However, it must be emphasized that I was never offered any additional power
or authority that would allow me to systematically introduce my ideas on improving employee
productivity on an organizational level. In one particular hotel property when I was offered a
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promotion with a marked increase in power and authority I had to voluntarily terminate my
employment in order to concentrate on a personal matter requiring a significant level of
attention.
An example of a company that places emphasis on their hiring practices in order to
increase employee productivity is Southwest Airlines that searches for prospective employees
who have a “positive attitude and work well in teams because it believes that people who have a
positive attitude will work hard and interact well with customers, therefore helping to create
customer loyalty” (Hill & Jones, 2012, p. 97). A further example is Nucor who hires employees
who are “self-reliant and goal oriented, because its employees work in self-managing teams
where they have to be self-reliant and goal oriented to perform well” (Hill & Jones, 2012, p. 97).
Hill & Jones (2012) hold that the hiring strategy of any organization must be aligned with its
own “internal organization, culture, and strategic priorities” (p. 97) and possess “attributes that
match the strategic objectives of the company” (p. 97).
As much as a given hiring strategy is an important contributor to improving productivity,
it is actually the culture of the organization that sustains and may potentially elevate that level of
performance. On one particular occasion, upon voluntarily terminating my employment in a
hotel property, I faced an inquiry from the most senior executive of that establishment who asked
if everyone has been adequately trained in lieu of my departure. Here, I responded in the
affirmative, however I also added that adequate training must be accompanied with
motivational, uplifting and empowering management in order to sustain and improve employee
performance. This particular senior executive who was extremely competent in business
strategy had some familiarity with my ideas on improving employee productivity having
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supported my work and facilitated a meeting where I had the opportunity of presenting my ideas
on these performance oriented matters to other executives and managers of the company.
During my employment in the Hospitality and Tourism Industries, whenever or wherever
it would be organizationally possible, I proceeded to create a “self-managing team” (Hill &
Jones, 2012, p. 98) within the limits of my minimal authority where employees could
“coordinate their activities, which might include making their own hiring, training, work…
decisions” (p. 98). Due to my limited power and authority I was never able to influence any
“reward” (Hill & Jones, 2012, p. 98) oriented decisions although as stated previously I
consistently shared my own compensation and income with other team members or those whose
performance I was responsible for in order to create a more equitable and egalitarian work
environment. This particular personal strategy on my part, which I felt also improved employee
productivity was met with continuous surprise in certain quarters of our organizations.
In self-managing teams, employees,
“Produce an entire product or undertake an entire task…learn all team tasks and rotate
from job to job…Because a more flexible work force is one result, team members can fill in for
absent coworkers and take over managerial duties such as work and vacation scheduling,
ordering materials, and hiring new members…People often respond well to being given greater
autonomy and responsibility” (Hill & Jones, 2012, p. 98).
A further human resources oriented strategy that my enhance employee productivity is
the establishment of “pay for performance compensation systems” (Hill & Jones, 2012, p. 98)
that are uniquely effective when they “link pay to group or team (rather than individual)
performance” (p. 98). Such a group related connection “creates a strong incentive for individuals
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to cooperate with each other in pursuit of team goals; that is, it facilitates teamwork” (Hill &
Jones, 2012, p. 98).
In improving efficiency, technology and information systems may prove to be one of the
most important factors that enable companies to utilize “web-based information systems to
reduce the costs of coordination between the company and its customers and the company and its
suppliers” (Hill & Jones, 2012, p. 98). In this light, with respect to both types of
relationships/encounters (customers or suppliers) when adopting and utilizing “web-based
programs to automate customer and supplier interactions, the number of people required to
manage these interfaces can be substantially reduced, thereby reducing costs” (Hill & Jones,
2012, p. 98). An example of this type of efficiency improving information systems strategy are
web-based “bank or financial services” transactions that are able to “substantially reduce costs
by moving customer accounts and support functions online” (Hill & Jones, 2012, pp. 98, 100).
Hill & Jones (2012) contend that “a company’s infrastructure—that is, its structure,
culture, style of strategic leadership, and control systems—determines the context within which
all other value creation activities take place” (p. 100). Consequently the aforementioned
organizational characteristics also have a direct impact on steps to “increase efficiency and
lower…cost structure” (Hill & Jones, 2012, p. 100). In regards to organizational leadership and
its system-wide “commitment to efficiency” (Hill & Jones, 2012, p. 100) the “task is to articulate
a vision that recognizes the need for all functions of a company to focus on improving
efficiency” (p. 100). Here, it is most important that all the individual units of the organization
are equally committed to improving efficiency. In addition, the goal of increasing efficiency also
necessitates and is depended upon “cross-functional cooperation” (Hill & Jones, 2012, p. 100)
among the different units of the organization.
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Quality as Excellence and Reliability
Hill & Jones (2012) observe that “a product is said to have superior quality when
customers perceive that the attributes of a product provide them with higher value than attributes
of products sold by rivals” (p. 88). There are two types of quality oriented features that may
characterize a product or service that are referred to as quality as excellence and/or quality as
reliability. In the realm of quality as excellence, “the important attributes are things such as a
product’s design and styling, its aesthetic appeal, its features and functions, the level of service
associated with the delivery of the product” (Hill & Jones, 2012, p. 88). In relation to the
Hospitality and Tourism Industry, the quality as excellence attribution refers to the superior
physical and service oriented characteristics of a given operation, property, cruise line, etc. In
the healthcare or hospital industry, the quality as excellence attribution in addition to the physical
and service oriented characteristics also refers to such features as advanced technology enabled
diagnostic or life-saving equipment utilized in the particular establishment.
Within the parameters of quality as reliability characteristic, a product or service “can be
said to be reliable when it consistently does the job it was designed for, does it well, and rarely, if
ever, breaks down” (Hill & Jones, 2012, p. 88). The quality as reliability also “increases the
value a customer gets from a product, and thus the price the company can charge for that
product” (Hill & Jones, 2012, p. 88). This practice of increasing prices on the basis of quality as
reliability is very much evident in the Hospitality and Tourism Industry where those luxury
operations that are consistently able to deliver superior customer service reliably are also
charging a premium for that ability. Nevertheless, the adoption of quality as reliability is not
necessarily confined to the luxury or the higher end of any industry, rather being reliable in
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delivering to the customer what has been promised or advertised is an added value that markedly
improves the competitive position of any business.
All in all, there are a number of benefits associated with improving the quality of services
and products. First, improved quality “increase the value those products provide to customers
which gives the company the option of charging a higher price for them” (Hill & Jones, 2012, p.
89). Secondly, when products and services enjoy a higher quality “less employee time is wasted
making defective products or providing substandard services and less time has to be spent fixing
mistakes, which translates into higher employee productivity and lower unit costs” (Hill & Jones,
2012, p. 89). Consequently, improved quality allows companies to effectively “differentiate its
product from that of rivals” (Hill & Jones, 2012, p. 89) while simultaneously being able to
“lower costs” (p. 89).
In order to improve the reliability of products and services, organizations resort to
adopting and implementing Total Quality Management (TQM) practices with the basic belief
that “improved quality means that costs decrease because of less rework, fewer mistakes, fewer
delays, and better use of time and materials” (Hill & Jones, 2012, p. 101) facilitating the
improvement of “productivity” (p. 101) and “higher market share” (p. 101) allowing the
company to raise prices” (p. 101) leading to increased “profitability” (p. 101) and the ability to
“stay in business” (p. 101). Hill & Jones (2012) observe that the effective implementation of a
quality improvement strategy necessitates that “senior managers buy into a quality improvement
program and communicate its importance to the organization” (p. 101). Secondly, effective
campaigns in quality improvement are managed by employees who are designated to lead these
programs operating as “internal consultants and project leaders” (Hill & Jones, 2012, p. 101)
who eventually “are promoted and given more responsibility” (p. 102).
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Thirdly, quality improvement approaches “preach the need to identify defects that arise
from processes, trace them to their source, find out what caused them, and make corrections so
that they do not recur” (Hill & Jones, 2012, p. 102). In manufacturing processes, in
environments “with short production runs, defects show up immediately” (Hill & Jones, 2012, p.
102). A further example may be found in “JIT inventory systems” (Hill & Jones, 2012, p. 102)
where “defective parts enter the manufacturing process immediately” (p. 102) and thereby “can
be quickly spotted” (p. 102). Fourth, quality improvement programs also need corresponding
and context sensitive metrics or criteria “that can be used to measure quality” (Hill & Jones,
2012, p. 102). Fifth, pursuant to the adoption of metrics, organizations must “set a challenging
quality goal and create incentives for reaching it” (Hill & Jones, 2012, p. 102).
Sixth, organizations must acknowledge and realize that “shop floor employees can be a
major source of ideas for improving product quality” (Hill & Jones, 2012, p. 102). Seventh,
companies must work closely with their suppliers and vendors in order to improve “poor-quality
component parts” (Hill & Jones, 2012, p. 102). Eight, companies must endeavor to design
“products with fewer parts” (Hill & Jones, 2012, p. 102) in order to lower “opportunities…for
making mistakes” (p. 102). Lastly, quality improvement programs need “organization wide
commitment and substantial cooperation among functions” (Hill & Jones, 2012, p. 102).
Hill & Jones (2012) state that in addition to reliability a product is also defined by its
“form, features, performance, durability and styling” (p. 103). In pursuit of improving quality as
excellence, organizations must begin by collecting “marketing intelligence indicating which of
these attributes are most important to customers” (Hill & Jones, 2012, p. 103). Next, companies
must “design its products, and the associated services, so that those attributes are embodied in
the product, and it needs to make sure that personnel in the company are appropriately trained so
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that the correct attributes are emphasized” (Hill & Jones, 2012, p. 103). In addition, companies
must focus their marketing strategy on magnifying certain attributes of their products or services
thereby emphasizing a “consistent image in the minds of customers” (Hill & Jones, 2012, p.
103). Finally, in order to maintain competitive advantage, companies must maintain and support
a “strong R&D function” (Hill & Jones, 2012, p. 103) that would work cooperatively with
“marketing and manufacturing” (p. 103) units.
Innovation
Hill & Jones (2012) observe that “innovation refers to the act of creating new products or
processes” (p. 89). The launching of product innovation “is the development of products that are
new to the world or have superior attributes to existing products” (Hill & Jones, 2012, p. 89).
The adoption of process innovation on the other hand “is the development of a new process for
producing products and delivering them to customers” (Hill & Jones, 2012, p. 89). In the case of
product innovation or improvements to “existing products” (Hill & Jones, 2012, p. 89), value is
created “thus giving the company the option to charge a higher price” (p. 89). However, process
innovation generates “value by lowering production costs” (Hill & Jones, 2012, p. 89). Most
importantly, Hill & Jones (2012) contend that product and process innovation “is perhaps the
most important building block of competitive advantage” (p. 90). Here, successful and effective
innovations offer the “company something unique—something its competitors lack…Uniqueness
can allow a company to differentiate itself from its rivals and charge a premium price for its
product or, in the case of many process innovations, reduce its unit costs far below those of
competitors” (Hill & Jones, 2012, p. 90).
As mentioned previously, innovation is the “most important source of competitive
advantage” (Hill & Jones, 2012, p. 103) because it leads to the creation of “new products that
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better satisfy customer needs, can improve the quality (attributes) of existing products, or can
reduce the costs of making products that customers want” (p. 103). A company that is able to
introduce innovative products to the market successfully or launch/adopt innovative processes
effectively is able to gain “major competitive advantage that allows it to (1) differentiate its
products and charge a premium price and/or (2) lower its cost structure below that of its rivals”
(Hill & Jones, 2012, p. 104). However, this is a dynamic and not a sedentary exchange with
other companies/competitors also potentially offering innovative products or infusing innovative
processes into their supply chain or production facilities. As a result, gaining and subsequently
preserving “competitive advantage requires a continuing commitment to innovation” (Hill &
Jones, 2012, p. 104).
As much as innovation is a major source of competitive advantage “research evidence
suggests that only 10%-20% of major R&D projects give rise to commercial products” (Hill &
Jones, 2012, p. 104). First, product innovations “fail to generate an economic return…because
the demand for innovations is inherently uncertain…It is impossible to know prior to market
introduction whether the new product has tapped an unmet customer need” (Hill & Jones, 2012,
p. 104). Secondly, new and innovative products may fail “because of factors such as poor design
and poor quality” (p. 104). Thirdly, new product could fail because of deficiencies in the
“positioning strategy” (Hill & Jones, 2012, p. 104) that are the particular marketing
characteristics of the product such as “price, distribution, promotion and advertising, and product
features” (p. 104). Fourth, new product offerings fail because of inadequate “customer demand”
(Hill & Jones, 2012, p. 105). Fifth, innovation strategies fail when companies are “slow to get
their products to market” (Hill & Jones, 2012, p. 105) and consequently another firm will “beat
the company to market and gain a first mover advantage” (p. 105).
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In order to prevent innovation failures, companies must establish “tight integration
between R&D, production and marketing” (Hill & Jones, 2012, p. 105). The purpose of this
“tight cross-functional integration” (Hill & Jones, 2012, p. 105) is to make certain that the new
product offerings are “driven by customer needs” (p. 105), they are “designed for ease of
manufacture” (p. 105), “costs are kept in check” (p. 105) and the “time to market is minimized”
(p. 105). Effective cross-functional integration also requires the creation of “cross-functional
product development teams” (Hill & Jones, 2012, p. 105) headed by a “heavyweight project
manager…who has high status within the organization and the power and authority required to
get the financial and human resources that a project team needs to succeed” (p. 105). These
cross-functional teams must also include highly competent and influential team members from
each function that are “100% dedicated to the project for its duration” (Hill & Jones, 2012, p.
106), “be physically co-located to create a sense of camaraderie and facilitate communication”
(p. 106) and have an established system for “communication and conflict resolution” (p. 106).
Customer Responsiveness
Competitive advantage may also be accomplished when companies are able to “do a
better job than competitors of identifying and satisfying its customers’ needs” (Hill & Jones,
2012, p. 90). This will lead to customers attaching “more value” (Hill & Jones, 2012, p. 90) to a
product through establishing “differentiation” (p. 90). Here, “superior quality and innovation”
(Hill & Jones, 2012, p. 90) are important factors in improving a company’s customer
responsiveness. In addition, a company’s ability to tailor (customize) its goods and services to
the “unique demands of individual customers or customer groups” (Hill & Jones, 2012, p. 90)
also enhances its customer responsiveness. Furthermore, a company’s ability to execute a
competitive “customer response time” (Hill & Jones, 2012, p. 90) by shortening “the time it
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takes for a good to be delivered or a service to be performed” (p. 90) is an illustration of its
customer responsiveness. Lastly, companies may also “differentiate” (Hill & Jones, 2012, p. 90)
their products thereby improving their customer responsiveness through “superior design,
service, and after-sale service and support” (p. 90).
Companies and organizations may improve their customer responsiveness and
“differentiating” (Hill & Jones, 2012, p. 106) their products and services by “achieving superior
efficiency, quality, and innovation” (p. 106). Customer responsiveness largely depends on the
level of “customer focus” (Hill & Jones, 2012, p. 106) that is prevalent in an organization
generated and energized by the organizational leadership through the effective system-wide
execution of the “mission statement” (p. 106), an organizational culture that is customer focused
and employees who “see the customer as the focus of their activity” (p. 106). Customer
responsiveness may also be expressed through “satisfying customer needs” (Hill & Jones, 2012,
p. 107) through “customizing” (p. 107) products and services to the “requirements of individual
customers” (p. 107) and “reducing the time it takes to respond to or satisfy customer needs” (p.
107).
Two additional concepts have been very important in my understanding of competitive
advantage learned in this course. The first concept is the characteristic of “distinctive
competency” (Hill & Jones, 2012, p. 108) which is a “unique firm-specific strength that allows a
company to better differentiate its products and/or achieve substantially lower costs than its
rivals and thus gain a competitive advantage’ (p. 108). The second concept is labeled the
“barriers to imitation” (Hill & Jones, 2012, p. 110) which describe “the factors that make it
difficult for a competitor to copy a company’s distinctive competencies; the greater the barriers
to imitation, the more sustainable are a company’s competitive advantage” (p. 110). These
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barriers to imitation may be a company’s “brand name” (Hill & Jones, 2012, p. 110), “marketing
and technological know-how” (p. 110) or “capabilities” (p. 110). Hill & Jones (2012) observe
that “intangible resources and capabilities” (Hill & Jones, 2012, p. 111) are “more secure…as
opposed to tangible resources” (p. 111). The aforementioned discussion is a further exploration
of the most important foundational concepts that I have learned in this course.
Additional Important Lessons and Concepts in Strategic Leadership Learned in this
Course that Had a Particular Impact on Me
The Strategy Making Process
One of the most important lessons that I have learned in this course that had a particular
impact on me emanated from the question posed by an extremely intelligent student colleague
from Professor Condon. This student who is a public employee or in other words is employed in
the non-profit sector, needed to know how the concepts of profitability, profit growth or
organizational competitiveness emphasized widely in this course would shape the nature of her
studies in the subject matter of strategic leadership. In response, Professor Condon stated that in
regards to individual competencies, competitiveness and effectiveness, one has to take into
consideration the larger “macro-environment” and evaluate if ones “skills and abilities…are...in
great demand”.
Next, one has to take into consideration the availability of these jobs in “other industries”
in addition to appraising “some of the issues facing someone with” similar “background in
general”. Professor Condon added that a strategic analysis must also take into consideration
ones “aspirations”, “career goals…and how…to get there” and how to secure more “training”
and “knowledge” in one’s profession. Furthermore, strategic analysis takes into account “the
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issues/concern/hurdles” that are faced by employees in performing their “jobs effectively”. With
respect to organizations, Professor Condon observed that strategic analysis offers the ability to
“optimize…strengths and weaknesses”, evaluate if “goals” have been met, and understand
“how” these goals were accomplished and any improvements that may be made on “these stated
goals”. In addition, Professor Condon stated that strategic analysis allows individuals and/or
departments/divisions to appraise how they are able to “improve productivity and service
delivery” in their section of the organization or be more “strategic” in their “approaches”.
As much as, I have never been employed in the public or the non-profit sector, Professor
Condon’s excellent observations and recommendations allowed me to better understand the
purpose and mission of strategic analysis and leadership. In this light, I understood that strategic
leadership is concerned with increasing/improving individual and/or organizational performance,
effectiveness, productivity and resiliency. In addition, in order to accomplish those
aforementioned goals, organizations or individuals for that matter must integrate efficiency,
quality, innovation and customer responsiveness into their everyday modus operandi. In this
dynamic, of particular importance is the central role of expenditures or operational costs that due
to the limited nature of all resources if not processed efficiently may lead to organizations not
achieving their mission or goals or for that matter ceasing to exist permanently.
Hill & Jones (2012) observe that “a strategy is a set of actions that managers take to
increase their company’s performance relative to rivals…If a company’s strategy does result in
superior performance, it is said to have a competitive advantage” (p. 2). In regards to for-profit
companies, performance is measured in terms of profitability (ROIC/Return On Invested Capital)
that is defined as “profit over the capital invested in the firm (profit/capital invested)” (Hill &
Jones, 2012, p. 2). Here profit translates into “after tax-earnings” (Hill & Jones, 2012, p. 2) and
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capital indicates the “sum of money invested in the company, that is, stockholders’ equity plus
debt owed to creditors” (p. 2). The available capital allows a company “to buy…resources…to
produce and sell goods and services” (Hill & Jones, 2012, p. 2). An important element in this
dynamic is the efficient usage of “resources” (Hill & Jones, 2012, p. 2) in order to produce a
“positive return on invested capital” (p. 2). Consequently, the magnitude of the efficiency of a
firm is one of the most important determinants of “its profitability and return on invested capital”
(Hill & Jones, 2012, p. 2).
Those companies where “profitability is greater than the average profitability for all firms
in its industry” (Hill & Jones, 2012, p. 4) are considered to have a competitive advantage. In
these situations, when firms possess a much higher degree of profitability than the average
profitability in the industry, “the greater is its competitive advantage” (Hill & Jones, 2012, p. 4).
In addition, companies who have been able to “maintain above-average profitability for a
number of years” (Hill & Jones, 2012, p. 4) are labeled as having a “sustained competitive
advantage” (p. 4). Companies are led by general managers who are responsible “for the overall
performance” (Hill & Jones, 2012, p. 5) of the firm or one of its divisions. In addition,
companies are managed by functional managers who are “responsible for supervising a
particular function—that is, a task, activity, or operation, like accounting, marketing, Research &
Development, information technology, or logistics” (Hill & Jones, 2012, p. 5).
In my own career in the Hospitality and Tourism Industry, I filled the role of a very low
level team leader whose job description offered him an extremely limited amount of official
power and authority. In spite of this scant power and authority, due to a consistent level of
support from guests whose numerous letters of praise I still retain and cherish, I acquired a much
higher level of influence than normally rendered with the general managers of the organization.
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The depth and magnitude of this influence usually varied depending on the culture of the
organization and the world view of the particular executive. During the same period, I was also
fortunate to be the recipient of numerous service and quality oriented awards and
commendations from my employers. All this enabled me to speak to organizational general
managers regarding employee empowerment and how an environment of genuine respect is
conducive to improving employee productivity and the quality of our service.
As time passed and I was able to secure added organizational influence, I was also
allowed to experiment more freely with employee empowerment and a number of other ideas
intended to enhance the level and quality of our service and customer responsiveness.
Simultaneously, there also existed a relatively high level of resistance from certain sections of
the organization concerning our particular approach and philosophy. All in all, I was never
offered sufficient power or authority organizationally that would allow me to introduce or for
that matter implement the aforementioned ideas system-wide. In the end when I was offered a
significant promotion in one of these organizations, I was compelled to take a leave of absence
for personal reasons. The above career related experiences are the reasoning behind my decision
to transfer to the Human Resources field in order to make a more meaningful, systematic and
sustainable contribution to organizational productivity, service/product quality and customer
responsiveness.
Hill & Jones (2012) observe that strategic planning must begin with creating the “mission
and major…goals” (Hill & Jones, 2012, p. 7) of the organization. Next, an analysis must be
made of the “organization’s external competitive environment to identify opportunities and
threats” (Hill & Jones, 2012, p. 7). In addition, an analysis of the internal environment must be
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performed in order to “identify…strengths and weaknesses” (Hill & Jones, 2012, p. 7). At this
stage, the type of strategies must be chosen that,
“build on the organization’s strengths and correct its weaknesses in order to take
advantage of external opportunities and counter external threats…These strategies should be
consistent with the mission and major goals of the organization…They should be congruent and
constitute a viable business model” (Hill & Jones, 2012, p. 7).
An integral aspect of this stage of the process is the conduct of the SWOT analysis which
is a “comparison of strengths, weaknesses, opportunities, and threats” and whose “central
purpose is to identify the strategies that will create a company-specific business model that will
best align, fit, or match a company’s resources and capabilities to the demands of the
environment in which it operates” (Hill & Jones, 2012, p. 10). Here, in order to “create and
sustain a competitive advantage” (Hill & Jones, 2012, p. 10) managers must first devise a
“functional-level strategy” (p. 10) that is aimed at “improving the effectiveness of operations
within a company” (p. 10). Secondly, managers must create a “business-level strategy” (Hill &
Jones, 2012, p. 10) that involves “different positioning strategies” (p. 10) such as “cost
leadership, differentiation, focusing on a particular niche or segment of the industry, or some
combination of these” (p. 10).
Thirdly, on the basis of the particular goals of the company, a “global strategy” (Hill &
Jones, 2012, p. 10) may have to be adopted in order to establish competitive advantage outside
the home country. Fourth, a “corporate-level strategy” (Hill & Jones, 2012, p. 10) will have to
be created in order to decide the “business or businesses” (p. 10) the company may enter in order
to “maximize the long-run profitability and profit growth of the organization” (p. 10) and how it
should “enter and increase… [its] presence in these businesses to gain a competitive advantage”
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(p. 10). In the last stage of the process, these strategies must be implemented in the organization.
Managers must be cognizant of the fact that strategic planning is an “ongoing” (Hill & Jones,
2012, p. 11) process and once strategy has been implemented, “its execution must be monitored
to determine the extent to which strategic goals and objectives are actually being achieved and to
what degree competitive advantage is being created and sustained” (p. 11).
An important element that is frequently neglected in strategy planning, implementation
and analysis is that apart from the top leadership, “individual employees deep within an
organization can and often do exert a profound influence over the strategic direction of the firm”
(Hill & Jones, 2012, p. 12). This “autonomous action of lower-level managers” (Hill & Jones,
2012, p. 12) may be critical in improving the competitive position of a company. In general,
numerous,
“managers usually rise to preeminence by successfully executing the established strategy
of the firm…As such, they may have an emotional commitment to the status quo and are often
unable to see things from a different perspective…In this sense, they are a conservative force that
promotes inertia” (Hill & Jones, 2012, p. 12).
This is indeed what I encountered in the Hospitality and Tourism Industry, where the
functional-level strategy was committed to a hierarchical command and control model of
leadership and supervision. This could be best described by Douglas McGregor’s (1960) Theory
X style of management by “close supervision” (as cited in Whetten & Cameron, 2011, p. 330)
whose “basic assumption…is that people really do not want to work hard or assume
responsibility…Therefore, in order to get the job done, managers must coerce, intimidate…and
closely supervise their employees” (p. 330). On the basis of my training and readings in political
science, philosophy and history, I could clearly see that such an approach to leadership is
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inherently inadequate in sufficiently motivating our employees to “enthusiastically” go beyond
the call of duty in the performance of their duties.
The word “enthusiastically” was a key emphasis in the mission statement of one my
former employers in the Hospitality and Tourism Industry. Consequently, I believed that the
actual mission of the company is not being fully and effectively implemented due to the
hierarchical nature of the organizational culture thereby harming our competitive advantage.
There were of course a number of extraordinary service providers and managers in this
organization whose level of task oriented knowledge, performance and dedication was simply
amazing. Here again, I felt that a command and control model of management is hampering the
professional growth of these employees where they could reach their fullest potential. I could
also observe that over the long term a state of demoralization would creep into the individual
psyches of these employees ending with their eventual departure from the particular organization
or resignation into a state of unremarkable service or performance delivery.
As stated previously, on the basis of the consistent support and feedback of our
customers/guests, I was able to secure some influence with a number of the general managers of
a particular hospitality organization thereby allowing me to introduce some innovative strategies
aimed at improving the motivation, morale and productivity of our employees and thereby
enhancing the quality and customer responsiveness of our products and services. These practices
were not introduced elsewhere in the company, although a number of our employees who I had
personally trained were promoted to other sections of the organization. Unfortunately, every
single member of this group of employees eventually left our organization having been
disappointed with their new work environment. I felt a personal sense of responsibility for their
departure.
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I always felt that once an effective recruitment and hiring strategy is in place,
organizations may be well served to introduce some version of McGregor’s (1960) Theory Y
style of leadership into their functional-level strategy thereby assuming that “workers basically
want to do a good job and assume more responsibility; therefore, management’s role is to assist
workers to reach their potential by productively channeling their motivation to succeed” (as cited
in Whetten & Cameron, 2011, p. 330). I placed a great level of emphasis on respect, fairness and
performance and as mentioned previously, even compensating other employees and team
members from my own income in order to improve productivity. Hill & Jones (2012) observe
that many companies regard their strategic planning process as an,
“exclusively top management responsibility…This ivory tower approach can result in
strategic plans formulated in a vacuum by top managers who have little understanding or
appreciation of current operating realities…Consequently, top managers may formulate
strategies that do more harm than good” ((p. 16).
In this light, in many service oriented industries, the mission and the goal of the
organization calls for rendering exceptional performance, quality and customer responsiveness
however during the execution stage these aspirations are often unfulfilled due to inadequate
motivation, demoralization and empowerment of the service provider.
Competent and effective strategic leadership begins with the type of leaders who are able
to express a,
“clear and compelling visions of where their organizations should go, are eloquent
enough to communicate their visions to others within their organization in terms that energize
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people, and consistently articulate their visions until they become part of the organization’s
culture” (Hill & Jones, 2012, p. 19).
These leaders must “demonstrate their commitment to their vision and business model by
actions and words, and they often lead by example” (Hill & Jones, 2012, p. 20). In addition,
strategic leaders need to “develop a network of formal and informal sources who keep them well
informed about what is going on within their company” (Hill & Jones, 2012, p. 20).
Furthermore, “high performance leaders” (Hill & Jones, 2012, p. 20) are very cognizant of the
reality that they must “delegate effectively” (p. 20) and empower their employees in order to
sufficiently motivate them in the execution of their tasks and responsibilities. Hill & Jones
(2012) contend that decisions that are of “critical importance…such as articulating the vision and
business model” (p. 21) of the organization must not be delegated by these leaders.
Effective strategic leaders are also “astute in their use of power” (Hill & Jones, 2012, p.
21) and “build consensus for their ideas rather than use their authority to force ideas through;
they act as members or democratic leaders of a coalition rather than as dictators” (p. 21). Lastly,
strategic leaders must exercise “emotional intelligence…self-awareness…self-regulation…
motivation…empathy…social skills” (Hill & Jones, 2012, p. 21).
Ethical Strategic Leadership
Effective leadership must additionally place a heavy emphasis on understanding the
“roots of unethical behavior” (Hill & Jones, 2012, p. 46) in individuals and organizations. This
awareness must begin with the understanding that “an individual with a strong sense of personal
ethics is less likely to behave in an unethical manner in a business setting, and in particular, they
are less likely to engage in self-dealing and more likely to behave with integrity” (Hill & Jones,
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2012, p. 46). Secondly, ethical strategic leaders must “incorporate ethical considerations into
business decision making” (Hill & Jones, 2012, p. 46).
Thirdly, ethical strategic leaders must prevent the emergence of an “organizational
culture that deemphasizes business ethics, reducing all decisions to the purely economic” (Hill &
Jones, 2012, p. 46). Fourth, ethical strategic leaders must refrain from establishing “performance
goals that are unrealistic” (Hill & Jones, 2012, p. 46) that may “only be attained by cutting
corners or acting in an unethical manner” (p. 46). Most importantly, strategic leader must be
perpetually aware that they set the example for their employees in ethical conduct.
The ethical character of any business operation or organization is directly influenced by
its “hiring and promotion” (Hill & Jones, 2012, p. 47) policies and practices. Here, organizations
must endeavor to create and promote an ethical culture by “drafting a code of ethics” (Hill &
Jones, 2012, p. 47) and having their leaders “give life and meaning to those words by repeatedly
emphasizing their importance, and then acting on them” (p. 48). In addition, the preservation of
an ethical culture also necessitates “incentive and promotional systems that reward people who
engage in ethical behavior and sanction those who do not” (Hill & Jones, 2012, p. 48).
In order to make ethical decisions, managers must make certain that they do not violate
the “values and standards that typically apply in the organizational environment” (Hill & Jones,
2012, p. 48), be able to communicate these decisions to “all stakeholders affected by it” (p. 48)
and evaluate if those who have a “significant personal relationship” (p. 48) with them “approve
of the decision” (p. 48). On an organizational level, the preservation of an ethical organizational
culture also requires the existence of “ethics officers” (Hill & Jones, 2012, p. 48) who will be
responsible for evaluating the ethical characteristics of action and decisions in addition to
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“handling confidential inquiries from employees, investigating complaints from employees or
others, reporting findings and making recommendations for change” (p. 48).
One of the most essential traits of ethical organizations is the existence of a “strong
corporate governance” (Hill & Jones, 2012, p. 49) culture and practices that prevents managers
to engage in “self-dealing and information manipulation” (p. 49) and maintains an “independent
board of directors” (p. 49). Ethical organizations also include managers and leaders who
exercise “moral courage” (Hill & Jones, 2012, p. 49) by declining to make a “decision that is
profitable, but unethical” (p. 49), refuse to adhere to instruction from superiors that are unethical
and inform outside agencies and the public when faced with “persistent unethical behavior in a
company” (p. 49).
External Analysis: Opportunities and Threats
In order to initiate the external analysis process, the “industry that a company competes
in” (Hill & Jones, 2012, p. 56) must first be identified. This analysis must pursue a “customer-
oriented view” (Hill & Jones, 2012, p. 56) that would accept the organizing principle that the
“basic customer needs that are served by a market define an industry’s boundary” (p. 56). In the
next stage of the process, Michael Porter’s Five Forces Model will facilitate an understanding of
the opportunities and threats that the organization will encounter as it competes within the
boundaries of the aforementioned industry. Michael Porter contends that,
“the stronger each of these forces, the more limited the ability of established companies
to raise prices and earn greater profits…Within Porter’s framework, a strong competitive force
can be regarded as a threat because it depresses profits…A weak competitive force can be
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viewed as an opportunity because it allows a company to earn greater profits” (Hill & Jones,
2012, p. 57).
Porter calls the first competitive force, the “risk of entry by potential competitors” (Hill
& Jones, 2012, p. 58) that takes into consideration “companies that are not currently competing
in an industry but have the capability to do so if they choose” (p. 58). The capability of these
potential competitors to compete effectively in a given industry is compromised when they are
faced with formidable “barriers to entry” (Hill & Jones, 2012, p. 58) that will make it too
“costly” (p. 58) for them to operate in those environments. In essence, the risk of entry by
potential competitors is rather minimal when barriers to entry are high.
Here, an important barrier to entry is the economies of scale that signifies “reductions in
unit costs attributed to a larger output” (Hill & Jones, 2012, p. 58). These economies of scale are
gained through “mass-producing a standardized output” (Hill & Jones, 2012, p. 58), reduction of
expenditures related to “bulk purchases of raw material inputs and component parts” (p. 58),
reduction of expenditures associated with “spreading marketing and advertising costs over a
large volume of output” (p. 58) and the distribution of “fixed production costs over a large
production volume” (p. 58).
A further barrier to entry is brand loyalty to a given product “when consumers have a
preference for the products of established companies” (Hill & Jones, 2012, p. 58). In addition,
barrier to entry is strong when established companies enjoy an absolute cost advantage
emanating from “superior production operations and processes due to accumulated experience”
(Hill & Jones, 2012, p. 59), “control of particular inputs required for production, such as labor,
materials, equipment, or management skills, that are limited in their supply” (p. 59) and “access
to cheaper funds” (p. 59) due to being considered as representing “lower risks” (p. 59).
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Customer switching costs also represent a barrier to entry “when it costs a customer time, energy,
and money to switch from the products offered by one established company to the products
offered by a new entrant” (Hill & Jones, 2012, p. 60). Finally, in some industries, government
regulation may act as a barrier to entry.
Porter’s second competitive force is referred to as “rivalry among established companies”
(Hill & Jones, 2012, p. 61). This rivalry and “competitive struggle between companies in an
industry” (Hill & Jones, 2012, p. 61) is partly shaped by the industry’s competitive structure. In
fragmented industries, a “large number of small or medium-sized companies” (Hill & Jones,
2012, p. 61) compete with each other, “none of which is in a position to determine industry
price” (p. 61). In consolidated industries, “a small number of large companies” (Hill & Jones,
2012, p. 61) compete with each other and they “often are in a position to determine industry
price” (p. 61). In fragmented industries competition is intense consequently this “constitutes a
threat rather than an opportunity” (Hill & Jones, 2012, p. 61). In consolidated industries,
“companies are interdependent, because one company’s competitive actions or moves…directly
affects the market share of its rivals, and thus their profitability” (Hill & Jones, 2012, p. 62).
An additional determinant of the intensity of rivalry among established companies is the
nature of industry demand. In business environments where the demand is growing and strong,
the intensity of competition decreases “because all companies can sell more without taking
market share away from other companies” (Hill & Jones, 2012, p. 62) while “declining demand
results in more rivalry as companies fight to maintain market share and revenues” (p. 62). Cost
conditions prevalent in an industry also structures the rivalry among established companies
where potentially high fixed costs and stagnant demands can lead to “intense rivalry and lower
profits” (Hill & Jones, 2012, p. 62). Lastly, exit barriers may lead established companies to
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remain in an “unprofitable industry” (Hill & Jones, 2012, p. 63) with “excess productive
capacity, which leads to even more intense rivalry and price competition as companies cut prices
in an attempt to obtain the customer orders needed to use their idle capacity and cover their fixed
costs” (p. 63).
Porter’s third competitive force is titled “the bargaining power of buyers” (Hill & Jones,
2012, p. 63) which is concerned with “the ability of buyers to bargain down prices charged by
companies in the industry or to raise the costs of companies in the industry by demanding better
quality and service” (p. 63). Buyers who are powerful enough due to a variety of reasons will be
able to demand lower prices and thereby “squeeze profits out of an industry” (Hill & Jones,
2012, p. 64). These buyers maybe in a position of power due to the fact that they “purchase in
large quantities” (Hill & Jones, 2012, p. 64), operate in an industry where “switching costs are
low” (p. 64), be able to “purchase an input from several companies” (p. 64), operate in an
industry with “many small companies” (p. 64) and small number of buyers, “threaten to enter the
industry and produce the product themselves” (p. 64) or other reasons.
Porter’s fourth competitive force is labeled as the “bargaining power of suppliers” (Hill
& Jones, 2012, p. 64) which evaluates “the ability of suppliers to raise input prices, or to raise the
costs of the industry in other ways—for example, by providing poor-quality inputs or poor
service” (p. 65). When suppliers are powerful they demand higher prices for their input and
thereby raise expenditures. Here, suppliers maybe powerful due to the fact that their products
have “few substitutes” (Hill & Jones, 2012, p. 65), “when the industry is not an important
customer” (p. 65), “switching costs” (p. 65) are high, “threaten to enter their customers industry”
(p. 65) or when buyer are unable or unwilling to “enter their suppliers’ industry” (p. 65).
Strategic Leadership Reflection Paper
Porter’s fifth competitive force is the “threat of substitute products…that can satisfy similar
customer needs” (Hill & Jones, 2012, p. 65).
Business-Level Strategy and Competitive Positioning
A business-level strategy is the “plan of action that strategic managers adopt to use a
company’s resources and distinctive competencies to gain a competitive advantage over its rivals
in a market or industry” (Hill & Jones, 2012, p. 118). A business-level strategy must take into
consideration the needs of the customer or “what is to be satisfied” (Hill & Jones, 2012, p. 118),
the identity of the customer group, or “who is to be satisfied” (p. 118) and the organization’s
distinctive competencies, or “how customer needs are to be satisfied” (p. 118). Here, the needs
of the customers may be satisfied through “product differentiation” (Hill & Jones, 2012, p. 118)
which may be in the form of low prices or the unique “physical characteristics of the product,
such as quality or reliability, or it may lie in the product’s appeal to customers’ psychological
needs, such as the need for prestige or status” (pp. 118-119).
In addition, a business–level strategy will aim to designate the particular “market
segmentation” (Hill & Jones, 2012, p. 119) or customer group that will be targeted. Here,
companies may decide to offer their products or services aimed at the “average customer” (Hill
& Jones, 2012, p. 119), produce a number of products and services for “all of the different
market segments” (p. 119) or “concentrate on servicing only one market segment” (p. 119). As
mentioned previously, in the next stage of a business-level strategy, companies need to leverage
their distinctive competencies in order to effectively compete with respect to “efficiency, quality,
innovation, and responsiveness to customers” (Hill & Jones, 2012, p. 119).
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A firm’s business-level strategy may be based on a “cost-leadership” (Hill & Jones, 2012,
p. 121) approach where the goal will be to “outperform competitors by doing everything it can to
produce goods or services at a cost lower than those competitors” (p. 121). In this strategy,
“lower costs” (Hill & Jones, 2012, p. 121) will translate into higher profitability. In addition, in
the event companies compete on price, “the cost leader will be able to withstand competition
better than the other companies because of its lower costs” (Hill & Jones, 2012, p. 121). In a
cost-leadership strategy, “the cost leader chooses a low to moderate level of product
differentiation” (Hill & Jones, 2012, p. 121) and “positions its product to appeal to the average
customer” (p. 121). The cost leader must “increase its efficiency and lower its costs compared
with its rivals” (Hill & Jones, 2012, p. 121) through adopting “flexible manufacturing and…
efficient materials-management techniques” (p. 121).
A company’s business-level strategy may also follow a “differentiation” (Hill & Jones,
2012, p. 122) approach that aims to “achieve a competitive advantage by creating a product that
is perceived by customers to be unique in some important way” (p. 122). A company that offers
a differentiated product intends to “charge a premium price—a price considerably above the
industry average” (Hill & Jones, 2012, p. 123). This company’s strategy differs from a cost
leader approach thereby enabling the differentiator to charge a “premium price…usually
substantially above the price charged by the cost leader” (Hill & Jones, 2012, p. 123). In
general, product differentiation may be achieved through “quality, innovation, and
responsiveness to customers” (Hill & Jones, 2012, p. 123).
In certain very efficient production operations, companies may attempt to achieve
competitive advantage in regards to both “cost-leadership and differentiation” (Hill & Jones,
2012, p. 124) by adopting flexible manufacturing techniques that will allow them to introduce
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“differentiation to manufacture a range of products at a cost comparable to that of the cost
leader” (p. 125). Companies who offer differentiated products may also be “able to realize
significant economies of scale…by standardizing many of the component parts used in its end
products” (Hill & Jones, 2012, p. 125). In addition, companies may “reduce both production and
marketing costs…by offering packages of options rather than letting consumers decide exactly
what options they require” (Hill & Jones, 2012, p. 125). The third type of a business-level
strategy is called a “focus approach” (Hill & Jones, 2012, p. 125) that is “directed toward serving
the needs of a limited customer group or segment…concentrates on serving a particular market
niche, which can be defined geographically, by type of customer, or by a segment of the product
line” (p. 125).
Strategy in the Global Environment
Companies may be able to improve their “growth rate by taking goods or services
developed at home and selling them internationally” (Hill & Jones, 2012, p. 148). The
competitive advantage of these companies may not reside only in their ability to sell goods or
service but also “upon the distinctive competencies (unique skills) that underlie the production
and marketing of those goods and services” (Hill & Jones, 2012, p. 148). This international
exposure may enable a company to “realize cost savings from economies of scale, thereby
boosting profitability” (Hill & Jones, 2012, p. 149). In addition, offering a company’s products
and services globally may potentially lead to the utilization of “production facilities more
intensively, which leads to higher productivity, lower costs and greater profitability” (Hill &
Jones, 2012, p. 149). Furthermore, a global expansion strategy expands the “size of the
enterprise, so its bargaining power with suppliers increase, which may allow it to bargain down
the cost of key inputs and boost profitability” (Hill & Jones, 2012, p. 149).
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A global strategy may take into consideration “location economies” (Hill & Jones, 2012,
p. 149) that are the “economic benefits that arise from performing a value creating activity in the
optimal location for that activity” (pp. 149, 151). Introducing location economies to the
company’s global strategy “can lower the costs of value creation, helping the company achieve a
low-cost position, or…it can enable a company to differentiate its product offering…charging a
premium price or keeping price low and using differentiation as a means of increasing sales
volume” (Hill & Jones, 2012, p. 151). An effective global strategy may also focus on creating
value by “leveraging the skills created within subsidiaries and applying them to other operations
within the firm’s global network” (Hill & Jones, 2012, p. 152).
Companies that compete in the global marketplace will face “pressures for cost
reductions” (Hill & Jones, 2012, p. 153) that may be addressed by “mass producing a
standardized product at the optimal location in the world…to realize economies of scale and
location economies” (p. 153) or “outsource certain functions to low cost foreign suppliers in an
attempt to reduce costs” (p. 153). These companies may also face “pressure for local
responsiveness” (Hill & Jones, 2012, p. 154) rooted in “differences in consumer tastes and
preferences, infrastructure and traditional practices, distribution channels, and host government
demands” (p. 154).
Firms may follow a number of different global strategies. Here, a global standardization
strategy concentrates on “reaping the cost reductions that come from economies of scale and
location economies” (Hill & Jones, 2012, p. 156) that depends on not customizing products and
offering a “standardized product worldwide” (p. 156). On the other hand, a localization strategy
will attempt to “focus on increasing profitability by customizing the company’s goods or
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services so that they provide a good match to tastes and preferences in different national
markets” (Hill & Jones, 2012, p. 157).
In competitive environments where a company “simultaneously faces both strong cost
pressures, and strong pressures for local responsiveness” (Hill & Jones, 2012, p. 159), it may
consider following a transnational strategy. A transnational strategy will allow a company to
“simultaneously achieve low costs, differentiate the product offering across geographical
markets, and foster a flow of skills between different subsidiaries in the company’s global
network of operations” (Hill & Jones, 2012, p. 159). In environments where companies face
“low cost pressures and low pressures for local responsiveness” (Hill & Jones, 2012, p. 159)
firms may adopt an international strategy thereby locating “product development functions such
as R&D at home…establish manufacturing and marketing functions in each major country or
geographic region they do business” (p. 159). In entering global markets companies may resort
to exporting, licensing, franchising, joint ventures or wholly owned subsidiaries in order to
distribute and sell their products or services.
Corporate-Level Strategy and Long-Run Profitability
Companies must decide on the type “industry or industries” (Hill & Jones, 2012, p. 173)
they must offer their products or services in order to “maximize…long-run profitability” (p.
173). Here, a company may focus on participating in a single industry by concentrating “its
resources and capabilities on competing successfully within a particular product market” (Hill &
Jones, 2012, p. 173). The benefit of pursuing such a strategy is “that doing so enables a
company to focus all its managerial, financial, technological, and functional resources and
capabilities on developing strategies to strengthen its competitive position in just one business”
(Hill & Jones, 2012, p. 173).
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When companies compete in a single industry, they may pursue a strategy of horizontal
integration that would entail “acquiring or merging with industry competitors in an effort to
achieve the competitive advantages that come with large size or scale” (Hill & Jones, 2012, p.
174). A horizontal integration may be in the form of an “acquisition” (Hill & Jones, 2012, p.
174) or a “merger” (p. 174). The advantages of horizontal integration is that it “lowers operating
costs…increase product differentiation…reduces rivalry within and industry, and /or…increases
a company’s bargaining power over suppliers and buyers” (Hill & Jones, 2012, p. 174).
Companies may also “outsource one or more of its own value creation functions and contract
with another company to perform that activity on its behalf” (Hill & Jones, 2012, p. 178) in order
to improve its competitiveness.
An additional corporate-level strategy is in the form of vertical integration that “involves
a company entering new industries to increase its long-run profitability” (Hill & Jones, 2012, p.
180). A vertical integration strategy entails enlarging “operations either backward into industries
that produce inputs for …core products…or forward into industries that use, distribute, or sell”
(Hill & Jones, 2012, p. 180) the products of a company. Vertical integration may result in
allowing the company to “build barriers to new competition…facilitates investments in
efficiency-enhancing specialized assets…protects product quality, and…results in improved
scheduling” (Hill & Jones, 2012, p. 182). Nevertheless, vertical integration may have some
disadvantages such as forcing companies to “purchase high-cost inputs from company-owned
suppliers despite the existence of low-cost external sources of supply” (Hill & Jones, 2012, p.
184) or it may tie “a company into old, obsolescent, high cost technology” (p. 185).
Companies may also follow a corporate-level strategy of diversification that includes
“entering one or more industries that are distinct or different from a company’s core or original
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industry, in order to find ways to use its distinctive competencies to increase the value of
products in those industries to customers” (Hill & Jones, 2012, p. 187). In order for
diversification to be successful, the “internal governance” (Hill & Jones, 2012, p. 187) structure
must perform efficiently and competently and “operate the company’s different business units so
effectively that they perform better than they would if they were separate and independent
companies” (Hill & Jones, 2012, p. 187).
In addition, diversification may result in “competency transfers” (Hill & Jones, 2012, p.
188) that is able to potentially “lower the costs of value creation in one or more of a company’s
diversified businesses or enable one or more of these businesses to perform their value creation
functions in a way that leads to differentiation and a premium price” (p. 188). Diversification
may also lead to cost savings from economies of scope “when two or more business units can
share resources or capabilities such as manufacturing facilities, distribution channels, advertising
campaigns, and R&D costs” (Hill & Jones, 2012, p. 189). In a related diversification, individual
divisions’ “value chain” (Hill & Jones, 2012, p. 192) enjoy “some form of linkage or
connection” (p. 192) while in an unrelated diversification there is “no obvious value chain
connection with any of the businesses or industries in which a company is currently operating”
(p. 192).
Strategic Change
When companies engage in strategic change they intend to move “away from…present
state toward some desired future state to increase…competitive advantage and profitability” (Hill
& Jones, 2012, p. 201). Here, reengineering is a strategic change methodology “in which
managers focus not on a company’s functional activities but on the business processes
underlying the value creation process” (Hill & Jones, 2012, p. 201). Business processes are
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shared activities in an organization that are “vital to delivering goods and services to customers
quickly or that promote…high quality or low costs” (Hill & Jones, 2012, p. 201). Total Quality
Management (TQM) is the next stage in the strategic change process that attempts to “improve
and refine the new process and find better ways of managing task and role relationships” (Hill &
Jones, 2012, p. 202).
In the first stage of the change process managers evaluate if there is a “gap between
desired company performance and actual performance” (Hill & Jones, 2012, p. 203) utilizing the
SWOT analysis? Next, strategic managers “must identify potential obstacles to change as they
design and implement new strategies” (Hill & Jones, 2012, p. 204). Lastly, strategic managers
must “evaluate the effects of the changes in strategy on organizational performance” (Hill &
Jones, 2012, p. 205). In deciding which “business opportunities to pursue” (Hill & Jones, 2012,
p. 206) companies must first identify their “core competencies” (p. 206). Hamel & Prahalad
(1994) observe that “a core competency is a central value creation capability of a company” (as
cited in Hill & Jones, 2012, p. 206).
In order to improve competitiveness in “existing markets by leveraging existing core
competencies” (Hill & Jones, 2012, p. 207), Hamel & Prahalad (1994) propose that companies
must determine the answer to the following question: “What is the opportunity to improve our
position in existing industries and better leverage our existing competencies?” (as cited in Hill &
Jones, 2012, p. 206). Next, Hamel & Prahalad (1994) contend that in order to ensure future
competitiveness, companies must establish the answer to the following question: “What new
competences will we need to build to protect and extend our franchise in current industries?” (as
cited in Hill & Jones, 2012, p. 206). In addition, Hamel and Prahalad (1994) hold that
companies must also ask, “What new products or services could we create by creatively
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redeploying or recombining our current competences?”(as cited in Hill & Jones, 2012, p. 206).
Lastly, Hamel & Prahalad (1994) argue that in order to evaluate future competitiveness in other
industries, companies may want to ask, “What new competences will we need to build to
participate in the most exciting industries of the future?” (as cited in Hill & Jones, 2012, p. 206).
In order to create a “new business from scratch” (Hill & Jones, 2012, p. 208), companies
may resort to internal new venturing by utilizing “a set of valuable competencies (resources and
capabilities) in its existing businesses that can be leveraged or recombined to enter the new
business area” (p. 208). In order to prevent the failure of internal new venture, companies must
take note to avoid “market entry on too small a scale…poor commercialization of the new-
venture product, and…poor corporate management of the new-venture division” (Hill & Jones,
2012, p. 209). Successful internal new venturing requires close cooperation between R&D,
marketing and manufacturing functions and their respective employees.
Strategic change may also take place through acquisition involving “one company
purchasing another company” (Hill & Jones, 2012, p. 212). Acquisitions often “fail to create
value” (Hill & Jones, 2012, p. 213) due to “difficulties…trying to integrate divergent corporate
cultures” (p. 213), miscalculating “the potential economic benefits from an acquisition” (p. 213),
expensiveness and not sufficiently appraising “acquisition targets” (p. 213). An additional
strategic change strategy may be implemented through strategic alliances that are “cooperative
agreements between two or more companies to work together and share resources to achieve a
common business objective” (Hill & Jones, 2012, p. 215). Strategic alliances allow companies
to enter new markets, “share the fixed costs and associated risks that arise from the development
of new products and services” (Hill & Jones, 2012, p. 217) and bring together “complementary
skills and assets” (p. 217) that are not able to be developed by individual firms.
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Implementing Strategy Through Organizational Design
Organizational design determines the “combination of organizational structure and
control systems that allows a company to pursue its strategy most effectively—that lets it create
and sustain a competitive advantage” (Hill & Jones, 2012, p. 227). In addition, organizational
structure is shaped by the process of differentiation that “allocates people and resources to
organizational tasks in order to create value” (Hill & Jones, 2012, 228). In this light, vertical
differentiation is the manner by which “managers must choose…to distribute decision-making
authority in the organization to control value creation activities” (Hill & Jones, 2012, p. 228).
On the other hand, horizontal differentiation will determine how to “divide people and tasks into
functions and divisions to increase their ability to create value” (Hill & Jones, 2012, p. 228).
Vertical differentiation establishes the nature of hierarchical relationships within an
organization. Here, the span of control is defined as “the number of subordinates a manager
directly manages” (Hill & Jones, 2012, p. 229). A flat organizational structure contains “few
hierarchical levels and thus a relatively wide span of control” (Hill & Jones, 2012, p. 229). A
tall organizational structure holds “many levels and thus a relatively narrow span of control”
(Hill & Jones, 2012, p. 229). Tall organizational structures are prone to experience
“coordination problems…information distortion…motivational problems… [and] too many
middle managers” (Hill & Jones, 2012, pp. 231, 232). When organizational authority is
centralized, “managers at the upper levels of the organizational hierarchy retain the authority to
make the most important decisions” (Hill & Jones, 2012, p. 232). However, in decentralized
organizations, authority is “delegated to divisions, functions, and managers and workers at lower
levels in the organization” (Hill & Jones, 2012, p. 232).
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There are a number of horizontal differentiations that may be found in organizations. In a
functional structure, employees are joined “on the basis of their common expertise and
experience or because they use the same resources” (Hill & Jones, 2012, p. 234). In product
structures, “activities are grouped by product line” (Hill & Jones, 2012, p. 236). In product-team
structures, “task activities are divided along product lines to reduce costs and increase
management’s ability to monitor and control the manufacturing process…However, specialists
are taken from the various support functions and assigned to work on a product or project, where
they are combined into cross-functional teams to serve the needs of the product” (Hill & Jones,
2012, p. 238). In geographic structures, “geographic regions become the basis for the grouping
of organizational activities” (Hill & Jones, 2012, p. 238). In a multidivisional structure, “each
distinct product line or business unit is placed in its own self-contained unit or division” (Hill &
Jones, 2012, p. 240) and the “office of corporate headquarters staff is created to monitor
divisional activities and exercise financial control over each of the divisions” (p. 240).
Managers utilize organizational control in order to “monitor the ongoing activities of an
organization and its members to evaluate whether activities are being performed efficiently and
effectively and to take corrective action to improve performance if they are not” (Hill & Jones,
2012, p. 247). These organizational controls may be in the form of “strategic controls…financial
controls…output controls… [and] behavior controls” (Hill & Jones, 2012, pp. 248-254).
Personalized SWOT Analysis
Strengths
I did not grow up in a wealthy family. My father was a university professor, journalist
writer, poet, artist and an employee of the ministry of culture (also UNESCO) and my mother a
Strategic Leadership Reflection Paper
teacher and a school principal. They were both very dedicated to their respective careers. The
divorce of my parents, the loss of my father and the separation from my family affected me
deeply in my youth. With little support, I understood very early in my youth that I needed to
work very hard in order to survive, contribute to my family’s welfare and help others.
Consequently, one of my most fundamental traits and strengths is that I am a hard worker.
During my career in the Hospitality and Tourism Industry, I was asked frequently why I work so
hard and my response was that I do this for my family. On some level, I also worked hard
because I thought this is my duty to my employer, our guests and the larger community.
I feel the traits of empathy and conscientiousness also define my character and I consider
them to be my strengths. I feel great joy from giving to others rather than receiving. I evaluate
myself on the basis of how much I have contributed to my family, community and the larger
society. I have been advised by family and friends that I should allow for others to also be
giving towards me. I understand these observations however I find this to be very hard to
implement. Consequently, at times I am generous to a fault. As stated previously, in my places
of employment, I shared my income with my co-workers, colleagues and team members. These
acts raised many eye brows among the leaders of the organization.
I also place great emphasis on being honest, transparent and ethical which I consider to
be an indispensable strength. I take great satisfaction from obeying and honoring both the spirit
and the letter of the laws that govern our society. At times I agonize deeply regarding the
minutest details of my actions or life so as not to misrepresent events as they truly transpired. I
am meticulous about giving credit to others for their words, work and actions as it is illustrated in
this very paper and its many citations. As an extension of ethical conduct, I endeavor to always
Strategic Leadership Reflection Paper
be fair to others and place myself in their shoes and exercise the Golden Rule (Do not do to
others what you do not want done to you).
I consider humility as one of the greatest of potential human qualities and strengths. As I
have studied political science, religion, history and philosophy all my life I understand that the
greatest of leaders both men and women have always dealt with adversity and indeed have been
persecuted for their beliefs. In comparison to their achievements and sacrifices, I truly
understand that I am a most insignificant and humble leader. I am also very cognizant of the fact
that my ideas on improving organizational efficiency/productivity, quality, innovation and
customer responsiveness will be resisted by many who are in positions of power. I am very
sympathetic to their point of view and the responsibilities that they shoulder with respect to
profitability and profit growth. This indeed is the reality of the competitive environment of for
profit organizations.
Although the ideas that I have championed all my life on improving organizational
effectiveness and performance where not initiated or exercised in order to improve profitability
and profit growth, I genuinely believe that the implementation of those ideas with the appropriate
strategic competency, positioning and execution will contribute greatly to the competitive
advantage of an organization in the marketplace. Importantly, these ideas were not generated or
created by me nor were they novel, innovative or groundbreaking in their orientation. These
ideas were exercised by all effective leaders since the beginning of human history. The basic
philosophy of these ideas is in respecting, empowering and mobilizing the human resources that
are in a group, team, community and society. As I understood these ideas, they all begin with
this question: How and why do people perform beyond the call of duty?
Strategic Leadership Reflection Paper
The answer for me resided in the need to offer people/employees something larger than
their own self-interest (as important as that maybe). Here, in the context of the Hospitality and
Tourism Industry, the answer was very much related to motivating employees or team members
through service to others. This of course could not act as a very motivating factor for all the
employees as the factors behind human motivation are many. Nevertheless, as a very low level
team leader, I did observe throughout my career, that when employees are dealt with extreme
respect, truthfulness, fairness and humility, leadership acquires the type of needed credibility and
authority in order to press ahead, emphasize and champion matters dealing with efficiency,
quality, innovation and customer responsiveness.
I consider the personal quality of resilience, not giving up on important things in life and
the ability to tolerate adversity and depravation as added strengths in my character. In essence,
as those close to me are aware of the fact that I never give up on a journey although I also do all I
am able to do in order to compromise, de-escalate disputes/conflicts and change direction if
reform is necessary. As stated previously, I am very much aware of the reality that the road
ahead maybe challenging and filled with obstacles. Indeed many leaders never fulfill their true
potential and those who do may be strongly resisted by impenetrable factors in their
environment. Frequently, this resistance is based on the fear and anxiety related to the unknown
and unfamiliar ideas.
As mentioned in the aforementioned paragraphs, I have had wide exposure to concepts
and theories of social sciences (including psychology and sociology), humanities, law, fine arts
and religion since childhood. The poverty of my youth and limited resources due to familial
obligations has prevented me to fully explore career options in the aforementioned fields. I am
also able to understand, analyze and work with the most complex theories and writing in the
Strategic Leadership Reflection Paper
aforementioned disciplines. Simultaneously, my work experience has always been in the for-
profit/private business related fields. These varied backgrounds and experiences have offered
me a unique perspective on creativity and performance matters. Here, I am able to
synergistically connect and relate these theoretical and practical experiences in order to
understand and offer solutions for improving productivity, quality, and innovation/creativity and
customer responsiveness.
In relation to the aforementioned strength, my wife argues that I am a very strong
strategic thinker that continuously looks at the larger picture and is able to relate different and
unrelated topics and disciplines in order to generate meaning. She stated that I am very future
oriented and is always thinking ahead in strategic analysis. She placed particular emphasis on
the strength of being able to place different pieces of the strategic puzzle together with the usage
of seemingly unrelated concepts and theories.
I place an enormous level of importance on loyalty, dedication, being true to my word
and doing all I am able to do for my family, employer, community and society at large. As
much as I took my family related responsibilities very seriously, I never requested an increase in
pay or a promotion from my employers. In retrospect, those close to me have criticized me for
this particular work related posture, because they were witness to my dedication, sacrifices and
hard work. Nevertheless, I have never been motivated by money, profitability or profit growth
as important as they maybe in order to fulfil obligations to our families. Simultaneously, I am
fascinated by the world of business and the energy and enthusiasm that are embedded and are
inherent aspects of entrepreneurship, commerce and free enterprise. Interestingly, the world of
business allowed me to be my true self by serving others. Through that service I also served
myself by becoming a better human being.
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I possess very strong public speaking skills and feel at ease in sharing my ideas with
others. This level of confidence is only evident when I speak on matters that I truly believe in or
I am passionate about. As indicated in the forthcoming section, my lack of confidence and
knowledge in matters having to do with business strategy and competitiveness prevented me to
contact any potential customers or partners and I eventually closed my business. This in spite of
the deep belief and conviction that I still hold for the mission, vision and potential
products/services of the now closed business. Nevertheless, I am very much energized by social
situations and I am always searching to learn from others.
Lastly, I feel that one of my most defining strengths is the willingness and ability to work
cooperatively with others in order to improve their performance and enhance their motivation. I
exercise leadership not through command and control rather through the power of ideas and
ideals on behalf of quality and customer responsiveness. As much as I have always
compromised with others concerning my own rights, experience has illustrated that I do not
compromise on the standards that promote quality and responsiveness to customer needs.
Nevertheless, by temperament, I am extremely patient with those I must lead, serve or follow.
The preceding section of the SWOT analysis discussing my strengths is a reflection of what
strategic leadership and execution mean to me. They also present additional ideas on strategic
leadership that I arrived with.
Weaknesses
As much as my wife believes that one of my strengths is being a strategic thinker, my
practical knowledge of business strategy is rather elementary and undeveloped. I may possess
the potential to become a very strong business strategist however I need an intensive regimen in
improving my knowledge of business strategy in the future. This course has been an
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indispensable asset in the road to fulfill that very mission. Indeed, this lack of knowledge of
business strategy recently convinced me to close/shut-down/terminate a business that I had
incorporated in the state of Massachusetts.
Since this business was only in the planning stages with no employees (except me), no
expenditures on marketing/advertising/equipment and I had not reached out or contacted any
prospective customers, the cost and losses were only related to taxes or incorporation
documentation. My intension and vision was to launch a staffing, recruiting and eventually
consulting and human resources company on the basis of the lessons that I had learned in the
Hospitality and Tourism Industry. The above said business was first targeted/meant/intended to
concentrate and compete in the Healthcare Industry.
I eventually realized that in spite of my passion for the mission and vision of this
enterprise, I simply did not possess sufficient knowledge of business strategy nor maintained
relationships with business enlightened partners in order to move further with this venture. In
essence, I was extremely confident regarding the product or service of this business on the basis
of the core competencies that I (the founder) had developed in the Hospitality and Tourism
Industry, however I gradually realized that I also needed to be a business strategist and learn how
to compete in the market place in order to go further with this enterprise.
Specifically, I learned three interrelated lessons from this business closure. First, a
business strategist who intends to compete effectively in the marketplace has to have a
comprehensive and detailed understanding of the cost structure of the enterprise. In the event
that one does not possess those skills and abilities, one has to have partners (banks or business
partners) who assist the founder with those competencies. In this case, I did not possess those
resources. The understanding of the cost structure must help you chose your potential clients in
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addition to deciding how to generate revenues, how much you may charge for your products and
services, how do you pay for your expenditures and how do you adjust your prices in a
competitive environment.
The conduct of the aforementioned analysis will also help in differentiating and
customizing the particular product or service to the needs of the prospective customers or the
marketplace. As I intend to re-launch this business in the future, I will definitely not go forward
with that plan until I comprehensively understand the cost structure of the business as explained
in the preceding paragraph. Indeed, I realized that it is not sufficient to have a passion for an
idea or for that matter possess a product or service oriented competence in order to succeed in a
business venture. Rather, business strategy must also include a thorough understanding of the
competitive environment (Michael Porter’s Five Forces Model) and the manner by which the
company will make money and pay its bills in this process.
The second lesson that I learned in this business closure is the necessity of working with
partners or those who share your passion in order to bring synergistic/added value to the
enterprise. These partners that are not necessarily a cost structure oriented associates will assist
and develop product or service related ideas for the enterprise. I came to call these associates as
intellectual partners of the business whose contributions will add creativity and resiliency to the
enterprise and in exchange will reap an equal reward as the founder in the profitability and profit
growth of the company. The important characteristic of these intellectual partners is the passion
and commitment to the mission, vision and ideals of the enterprise. Nevertheless, I did not
engage in recruiting any intellectual partners for the business because I did not feel completely
confident with respect to my knowledge of the cost structure of the enterprise. As stated
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previously, I also did not possess any partners who completely understood the cost structure of
the business.
The third lesson that I learned in this business closure taught me that successful
enterprises must also possess influential partners who will be able to honestly and confidently
speak on behalf of the services and products of the business. These partners are present or
former customers who are able to truthfully verify the quality of the products and services of
your business. Needless to say, my newly incorporated enterprise did not possess any such
influential partners.
On some level, I did not proceed with moving forward with the aforementioned venture
and failed to contact anyone on behalf of the enterprise precisely due to my lack of confidence
and knowledge of business strategy and competitiveness in the marketplace. These weaknesses
convinced me that I must close/terminate/shut–down the business while in its planning stages in
line with the ethical standards of truthfulness and honesty. In essence, I was unable to proceed
with the business and contact any partners or potential customers unless and until I was
completely, comprehensively and confidently knowledgeable concerning the business strategy
and competiveness of the enterprise.
An additional skill-based weakness that I intend to rectify in the near future is a
deficiency in possessing high level competency in statistics, calculus and quantitative analysis.
This particular skill-based weakness may be addressed through independent study as I have
purchased appropriate textbooks the aforementioned subject matters, Online classrooms/forums
and in-class courses.
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I would like to also add that others including my wife have observed that in my zeal to
help all/everyone I sometimes neglect to exercise tactical judgment. An example of this conduct
maybe the practice of sharing my income with our co-workers/team members in order to bring
equity in the workplace and improve their morale as some failed to understand the rationale for
this act.
As the material learned in this course has broadened my knowledge and thought-
processes, I will rely heavily on the subject matters reviewed in this paper, covered in our class
lectures, commented on during class discussions and taught by professor Condon in order to
competently understand business strategy and competitiveness in the marketplace. These
teachings will also enable me to perform differently in regards to any future entrepreneurial
ventures pursuant to learning more about the concepts and practices of strategic leadership and
competitiveness.
Opportunities
As I am enrolled in the MS in Leadership in Human Resources Management program, I
will be searching for opportunities in HR related fields and professions. In moving forward in
this profession, I must make certain that I am well connected to a community of human resources
professionals that I can learn from or share my ideas with. In this light, I am a member of
Society For Human Resources Management and also intend to join the local chapter of this
organization. I am also currently studying to take some basic competency examinations in the
field of human resources. I am hoping to graduate from the current program at Northeastern
University in July and in the interim I am hoping to apply to a PhD program or law school in this
university.
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In the event that I am not accepted to any of the aforementioned programs, I intend to
continue exploring job opportunities in the human resources profession. I am hoping to enroll in
the Northeastern University sponsored Internship Program in order to further develop my
competencies, skills and abilities in the field of human resources. In regards to entrepreneurial
activity, I will embark on any further commercial ventures only if I completely and
comprehensively understand the discipline of business strategy and its ramifications for the
intended enterprise. As I have stated previously, I found that it is inherently insufficient in a
competitive environment to embark on a business venture solely on the basis of one’s passion
and knowledge of a particular product or service. In order to be successful in enterprise, I have
learned that one has to combine or leverage the aforementioned competencies with a deep
knowledge of business strategy and competitiveness.
Hopefully, in the case that I am hired by a business in the human resources field, or
provided that I will be employed in the HR profession, I am convinced that I will be able to make
a significant contribution to that organization. As indicated in the strengths section of this
SWOT analysis, my work experience, hard work, dedication and knowledge of factors that
improve productivity, quality, and creativity/innovation or customer responsiveness will bring
added value to many organizations. I have always believed in this very simple but rather
enduring quality that if given even a small opportunity I will do all that I am able to do to express
my gratitude with sacrifice and selflessness. In this I am no different than the great multitude of
conscientious others who go beyond the call of duty for their employers.
Threats
In a different edition of our textbook, a study conducted by Kotter & Heskett (1992) on
“organizational values” (as cited in Hill & Jones, 2010, p. 16) observes that “poorly performing
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companies” (p. 16) have a “history of resisting change efforts” (p. 16) and “punishing” (p. 16)
those employees “who showed too much leadership” (p. 16). In such organizations, leaders who
“showed too much leadership and initiative…were not promoted” (as cited in Hill & Jones,
2010, p. 16). Due to may moderate temperament and respect for the quality of politeness, I am
not sure if I am able to utilize the word of “punishing” (as cited in Hill & Jones, 2010, p. 16) in
order to describe this organizational phenomenon. However, as repeated frequently in this paper,
I am able to verify that process innovators and leaders who are in the service of empowering and
motivating their subordinates for superior performance may not fare well in hierarchically
arranged and coordinated organizations.
At least in my case, I do not claim that such a phenomenon is a pre-arranged plan or
policy, rather this is more a result of habit, practice and convenience. In essence, it is more
convenient and less stressful for managers to promote those within the organization that
support/uphold the status quo and support the hierarchical traditions of the firm. As two very
dear friends, one the director of a municipal school for entering service providers and the other a
former professor advised me against working in the public sector because as they stated, “You
always want to do too much in the workplace!”
I have always remembered that advice from those who knew my work in my places of
employment very thoroughly. I also recall that I continuously endeavored to improve our work
processes and the quality of our products and services irrespective of the extremely limited
authority that existed in my position. In one particular occasion, pursuant to writing a paper
titled “The Value of a Simple Comment Card” reflecting on the different organizational
approaches that would improve our guest feedback system, I proceeded to send the
aforementioned manuscript to corporate headquarters. I subsequently received a return letter
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informing me that headquarters has received the report in question and I do not need to contact
them any further. Interestingly, I never received any feedback on that particular paper, although
a very dear friend who was also a senior executive advised me that in the future I should simply
verbally inform him of the matter at hand.
This senior executive also had advised me on a different occasion that my work may
belong to a much larger forum or a different setting. Because he was a very good friend and a
decent human being, I know that he had the best of intentions. When I voluntarily departed from
the Hospitality and Tourism Industry for personal reason, many communicated to me that they
understood this departure although this was not a career move on my part. The challenge
remains that I must locate an organization that is fully dedicated in improving the productivity,
quality, innovation and customer responsiveness of their products and services. Short of this
complete commitment, I will once more be employed in organizations that will consider my
work as an exception or an oddity. I am not at all sure or positive that I will be successful in this
search. Indeed my employment related experiences in the past have indicated that the work of
individuals similar to myself often require too much change for the organization to accept or
reward on a systematic fashion.
Conclusion
A lack of knowledge of business and corporate strategy is almost always fatal in a
competitive environment. Here, it is neither sufficient nor adequate to possess a rudimentary
understanding in matters having to do with efficiency, quality, innovation or customer
responsiveness. Although, these indispensable competencies are indeed the fundamental pillars
in constructing competitive advantage, they must be combined with other sources of business
related enlightenment such as acquiring a thorough understanding of the cost process of the
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enterprise and Michael Porter’s Five Forces Model, . In this light, companies must thoroughly
understand in what industry they must compete in, who is their target audience and how to price
and position their products and services in order to maintain competitive advantage.
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References
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Essentials of strategic management (3rd ed.). Mason, OH: South-Western Cengage
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Hill, C. W. L. & Jones, G. R. (2010). Strategic planning: An integrated approach (9th ed.).
Mason, OH: South-Western Cengage Learning.
Hill, C. W. L. & Jones, G. R. (2012). Essentials of strategic management (3rd ed.). Mason, OH:
South-Western Cengage Learning.
Kotter, J. P. & Heskett, J. L. (1992). Corporate culture and performance. In C. W. L. Hill & G.
R. Jones, Strategic planning: An integrated approach (9th ed.). Mason, OH: South-
Western Cengage Learning.
McGregor, D. (1960). The human side of enterprise. In D. A. Whetten & K. S. Cameron,
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Whetten, D. A. & Cameron, K. S. (2011). Developing management skills (8th ed.). Upper
Saddle River, NJ: Pearson Education, Inc.
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