Hidden Flaws in Strategy - 4558 Words

Hidden flaws in strategy Charles Roxburgh The McKinsey Quarterly, 2003 Number 2 After nearly 40 years, the theory of business strategy is well developed and widely disseminated. Pioneering work by academics such as Michael E. Porter and Henry Mintzberg has established a rich literature on good strategy. Most senior executives have been trained in its principles, and large corporations have their own skilled strategy departments. Yet the business world remains littered with examples of bad strategies. Why? What makes chief executives back them when so much know-how is available? Flawed analysis, excessive ambition, greed, and other corporate vices are possible causes, but this article doesnt attempt to explore all of them. Rather, it looks†¦show more content†¦Participants are asked to offer not a precise figure but rather a range in which they feel 90 percent confidenceÂâ€"for example, the Nile is between 2,000 and 10,000 miles long. Time and again, participants walk into the same trap: rather than playing safe with a wide range, they give a narrow one and miss the right answer. (I scored 0 out of 15 on such a test, which was one of the triggers of my interest in this field!) Most of us are unwilling and, in fact, unable to reveal our ignorance by specifying a very wide range. Unlike John Maynard Keynes, most of us prefer being precisely wrong rather than vaguely right. We also tend to be overconfident of our own abilities.5 This is a particular problem for strategies based on assessments of core capabilities. Almost all financial institutions, for instance, believe their brands to be of above-average value. Related to overconfidence is the problem of overoptimism. Other than professional pessimists such as financial regulators, we all tend to be optimistic, and our forecasts tend toward the rosier end of the spectrum. The twin problems of overconfidence and overoptimism can have dangerous consequences when it comes to developing strategies, as most of them are based on estimates of what may happenÂâ€"too often on unrealistically precise and overoptimistic estimates of uncertainties. One leading investment bank sensibly tested its strategy against a pessimistic scenarioÂâ€"the market conditions of 1994, when a downturn lastedShow MoreRelatedThe Hidden Flaws Within Strategy847 Words   |  4 PagesEight Hidden Flaws in Strategy This article explores human omission by identifying the eight hidden flaws within strategy that we know from behavioral economics, which explains bad strategy. Our brain is normally overconfident about our abilities. We are usually overconfident about our personal abilities. This causes problems when our strategy is rooted through assessments of personal capabilities. For example, many financial institutions believe their brands are better than average. This mentalRead MoreA Book Drive By The Great Malcolm X1099 Words   |  5 Pages Strategy allowed myself to identify those flaws that may make me unsuccessful as mentioned by Pink in his book Drive. According to Pink, motivation involves internal and external factors that we harbor within our lives that drive our path for success and motivate us to do all we know and want to do. I allowed myself to enter this challenge and was very aware of the road that I chose to fulfill my destiny, for it is after all that no road bears dif ficulty. It’s those obstacles of which I haveRead MoreTaxing Multinational Corporations, U.s. And Foreign Governments862 Words   |  4 Pagesand find the hidden advantage in any tax law. For example it â€Å"attempts to limit the use of complex financial instruments to minimize tax bills† as well as having more focus on loans and how it can provide a deductible for more interest payments. 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ZeffirelliRead MoreA Book Drive By The Great Malcolm X814 Words   |  4 Pages Choosing a strategy allowed myself to identify those flaws that may make me unsuccessful as mentioned by Pink in his book Drive. According to Pink, motivation involves internal and external factors that we shelter within our lives that drive our path for success and motivate us to do all we know and want to do. I allowed myself to enter this challenge and was precisely aware of the road that I selected to fulfill my destiny, for it is after all that no road bears difficulties. It’s those obstaclesRead MoreWindows 10 : A Technological Innovation922 Words   |  4 Pagesgreatest improvements in the history of Microsoft Software. Windows 10 is totally a lifesaving technological innovation. Microsoft has strived to perfect a program that people want and it seems to have worked very well. Windows 7 and 8 had quite a few flaws with their systems and people were unhappy about it. The older software does not allow you to fully personalize the computer to your style. The worst part of it is that much of the software does not function well due to the operating system. WindowsRead MoreBehavioral Economics Deck1345 Words   |  6 PagesSource: â€Å"Predictably Irrational: The hidden forces that shape our decisions†, Dan Ariely, 2010 â€Å"Market Perceptions†, Harvard Business School, 2001 2 OVERCHOICE PARALYSIS SOLUTION: CHOICE REMOVAL CREATE CHOICE FILTERS To prevent the risk of overwhelming customers with options and hence, delaying a purchase, the strategy is to leverage a type of filter and narrow the list of choices. REFRAME CONVERSATIONS TO REMOVE CHOICE For parity products, the strategy used seems to reframe the problem inRead MoreThe Crucible by Arthur Miller993 Words   |  4 Pageswas not an option. Even though their harsh actions severely affected many people, they chose to forever stick to their story of dark desires and a hidden strategy. Every character has a flaw. There is always one simple imperfection in any character, even a story’s tragic hero. John Proctor was The Crucible’s tragic hero who had but one flaw, a fatal flaw. The secret sin between Abigail and John was the cause of his fatality. Abigail says, â€Å"I look for John Proctor that took me from my sleep and putRead MoreSexual Harassment At The Civil Rights Act1746 Words   |  7 Pagesarbitrarily defined timetable, but whenever the circumstances demand† (Ohm, 2010). This is to say that tech-specified laws should be constructed around the evolving nature of technology so as to find some amount of consistency otherwise abuse and flaws are subject to arise. â€Å"The modern surveillance state needs information, and left without proper oversight the analysis and agents in the field always seem to chose the path to more information and fewer administrative hurdles† (Ohm, 2010). 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Clothes and Fashion Free Essays

A woman speak with a man about fashion and clothes. The man says than the fashion is a invention from clothes factories. The woman says that the fashion is necessary to people feel well The man prefers to wear the same clothes rye day The woman feel better when she wear a beautiful suit, and in each situation you must wear a different clothes. We will write a custom essay sample on Clothes and Fashion or any similar topic only for you Order Now The man things different clothes distinguish between poor people and rich people. I’m going to talk about clothes and fashion. There are two aspects which I want to highlight: the comfort and the appearance. The comfort is the main purpose of dress because the human race began to wear clothes when went out from the hot Africa and spreader over the World and colonized cold lands. They used lots of materials to do their dresses but in the beginning with the only objective that warm the body. On the other hand clothes has a mission, it is to show the personality, the humor, the owner to a certain social status or collective. For instance the uniform of the police, the robe of lawyers, prosecutor or Judges, or the Army. These are very import to distinguish or discriminate this people from others. When you are going to a party you must put on clothes different than you dress when you are working. The more happy you are the better clothed you wear. We used to wear dark clothes in funerals. If you had to facing in your work you should wear a suit. If you were a politician or a famous person you should dress up everyday well cause you could have a photo taken. I regretted very much don’t have known dress up in a very important situation when a was a young girl I had gone to a party but I didn’t liked to go there, I wearing a awful suit because my friends persuaded me to go there, and I didn’t want. When the party began to be boring, I was thinking going home, suddenly a stunning boy appeared, he was wearing a denim trousers, a beautiful blue cotton shirt with a denim collar ND he was tall and handsome; he seemed very kind with his friends but I couldn’t to approach him because I was wearing a awful loadstone’s suit from the times of my mother, I felt very angry with me, I thought â€Å"it is impossible that this person look at me†. How to cite Clothes and Fashion, Essays

Challenges of Outsourcing Business Function-Samples for Students

Question: Analyze the benefits and challenges of outsourcing the functions of the business to the third party. Answer: Introduction Outsourcing is considered as a process that is adopted by many organizations to minimize their expenses by transferring the business functions to the third party, instead of performing the functions internally. This strategy is taken into consideration by many companies so that operating costs can be reduced and also profitability can be enhanced. There are many business functions like manufacturing parts, human resources, marketing, and call centers. The companies that outsource their business functions are IBM, Hewlett package, and Kingston. This report will give focus on IBM regarding the advantages and disadvantages of outsourcing a business function to another company. Project Objective The aim of the report is to analyze the benefits and challenges of outsourcing the functions of the business to the third party. IBM gives focus on outsourcing the business functions to another company so that the cost of operations can be reduced. It is seen that outsourcing business functions can result in loss also. The company outsourcing its business function can give negative outcome on the management and also the company can face the risk of data leak and also reduces the satisfaction level of customers. The main object of the report is to evaluate the advantages and disadvantages of outsourcing by taking into consideration IBM Company. Project Scope This report will discuss about the outsourcing done by IBM and many companies. The discussion is made about the failure and success of outsourcing. Also, the emphasis will be given to the benefits and drawbacks that company faces at the time of outsourcing the business functions. The strategies considered by the Company to outsource the business functions will also be discussed. This report will evaluate different concepts of outsourcing given by the market experts to determine the rewards and limitations. Literature Review Outsourcing is considered as a practice that is used by the companies so that efficiency can be enhanced by shifting tasks and jobs. The functions that are contracted out can be conducted by the third party onsite or offsite of the business. The functions are transferred to the third party organizations also. It is an important method that minimizes the cost that is considered by the companies globally and also developed countries considered this in an effective manner (Glaser, 2017). IBM is known as American international technology organization that is established in 1911. The company conducts the activities in computing, cloud programming and also in information technology industry. The company outsourced the business function to the third party company from India and Singapore that helps to enhance the core values. IBM has more than 40 data center that conducts the activities of the IT sector. Reasons for outsourcing Outsourcing is related to transfer the work and the duties to other organization. It also helps the companies to enhance their attention to the business activities and also guide them to gain a competitive advantage by minimizing their cost of operations. It is seen that companies have many options to outsource the activities. Example: By taking into consideration the Dhar paper (2012), it is seen that IBM transfers the whole process by analyzing the management of an IT system and also they conduct the support for the end users internally. The strategy of outsourcing in the IBM gives emphasis on attaining the improved customer service quality and also reduces the operation cost. It assists the company in creating permanent and temporary provisions for employment, skilled labor and also enhances the product designs. At the time of formulating the strategies for outsourcing, the company should analyze the potential grounds and should also give focus on the functions of the business that are outsourced. IBM outsources the following functions like Human resource management, service management, technical process, call centers and legal procedures. Advantages Outsourcing is one the function which gives benefit to the business and also assists them to gain competitive advantage. In the recent scenario, there are many large companies that have taken into consideration outsourcing as an important part of conducting the activities of the business. There are also many advantages that are availed by the company through the process of outsourcing the business activities or functions of the organization (Childress et al., 2014). Focus on the core business By outsourcing the activities, IBM gives focus on the elements of their business. The outsourcing helps the company to implement all the resources in an effective manner and also enhance the functions of the business. According to Han and Mithas (2013), The Company gives emphasis on manufacturing the computer hardware and also transfers the information technology services to the other company. This helps IBM to conduct the activities in an effective manner. IBM attained the same benefit by outsourcing the business function like IT Services globally. It has enhanced the hardware quality as the activities are not interrupted by the activities conducted on the daily basis. Cost saving There are many operational costs that are minimized by outsourcing the business functions like salary expenses, workplace expense and also many expenses that are concerned with the workplace. It assists the company in gaining the cost advantage by giving focus on the competitors (Harmon, 2015). Skill Acquisition The companies outsource their business activities to other companies who have specialization in a particular field. The employees of the organization have proper skilled and technical knowledge that helps to perform the task in a proper manner. It directly gives impact on enhancing the efficiency and also the quality of the functions or the activities that are outsourced. The company also attained the benefits by outsourcing the IT services to the 40 data services globally (Mukherjee, 2017). In the research Sekaran and Bougie (2016), it is seen that Tesco outsourced the work instead of giving training to the employees of the organization regarding the latest technology. It helps the company in minimizing the time and expenses to conduct the operations and also to gain competitive advantage. Customer satisfaction The advantage of outsourcing gives impact on enhancing the satisfaction level of the customers as it is evaluated that the work is outsourced by the experts of the company. When the company outsourced the activities it is seen that the company faced the problem of conducting the activities with the high quality of the products. If the Employee is not able to conduct the activities due to any reason then it is seen that company has to appoint someone else so that the work can be finished properly (Eggert et al., 2017). It is evaluated that IBM has more than 3, 80,000 employees who are conducting their day to day operations. There are a number of employees who are working in the call centers situated in India and Singapore. It helps the company to offer 24 hours services to its customers. The organization takes into consideration high rate of customer satisfaction with the help of data centers. Operational efficiency Outsoaring helps the company to enhance the efficiency at the workplace. This allows in maintaining proper quality in the organization. The emphasis is also given by the employees so that the activities can be conducted properly. IBM has given proper infrastructure that helps to give emphasis on the objectives and also to supervise the data centers of the organization. Risk sharing When the company takes into the process of outsourcing it is evaluated that company allows sharing the business risks with other companies. Outsourcing is a contract the force the companies to offer good quality products and services to its customers. When the charge is given to other company to operate the activities and if they fail to conduct the activities properly then the company who outsources the operations can charge or can sue them in court. This assists the companies to share risks and also compels the company to offer good quality products and services. IBM takes into consideration this policy so that the quality can be maintained and also the risk can be shared with the other organization (Field, 2013). Drawbacks By giving focus on advantages it is evaluated that there are many drawbacks also in outsourcing the process. By outsourcing the activities, it can give negative impact on the company or the companies face various problems at the time of outsourcing the business activities (Spohrer, 2017). Hidden Expenses At the time of outsourcing the functions of business, it is seen that the company take into consideration various rules and policies of the various organizations and countries. Of the activities are outsourced then it takes a charge of outsourcing but the organization can also face various issues related to hidden expenses. For verifying the outsourcing agreement there are many rules and policies that the organization has to consider so that the activities can be conducted smoothly. By giving emphasis on market regulations of India it is evaluated that the company consider the new rules and policies and also implement in the organizational structure (Drucker, 2017). Replication It is seen that outsourcing is one of the easy replicates by the companies. One company can attain a competitive advantage by outsourcing the activities by its competitors and can also apply the strategy to the business model. Example: It is evaluated that IBM minimized the cost by outsourcing their IT services but the competitors attained the same benefits as well as from Dell. The strategy of outsourcing also introduces the new competition for the companies since it is taken into consideration by various it companies (Tunisini and Sebastiani, 2015). Managerial control By taking into consideration the outsourcing agreement, a company transfers its responsibilities and rights to the third party. The company takes into consideration managerial control that is essential so that the activities can be transferred in a proper manner. The outsourcing company might not conduct the work according to the principle of the organizations and also they have many clients that minimize their emphasis on the organizational tasks. IBM also faced the same issues many times since the data centers of the company are located in Malaysia, India, and Singapore, so proper control is essential to be considered. Safety and confidentiality The data is one of the important elements for the organization and if it is leaked it can create a negative impact on the revenue of the business. According to Kshetri (2014), it is seen that to outsource the activities can be the major drawback for the company. The company has to share their ideas and also the data with the other company. It can result in leakage of the data or the confidentiality information of the company. IBM faces the huge risks related to the confidentiality of the information with the clients and also with the data centers to offer proper services. Poor regulations of one data center can also leak important information of the clients which could give negative impact on the organization (Maglio and Spohrer, 2013). Quality Risk According to Hribar, Kravea, and Wilson (2014), outsourcing is considered as a business that gives direct impact on the reputation and standard of the quality of an organization. Let's consider an example; if the damaged occurs on the faulty part that is manufactured by the outsourced organization, then the direct impact is given to the image of the company. The company could charge outsourcing of the expenses but affects is seen in the image of the company. Language obstacles According to Bickerton (2016) when the company outsources the activities of the call center, then the major issue that takes place is related to the language. If the language barrier takes place then it can enhance the dissatisfaction level of the consumers. There are many consumers who get frustrated at the time of dealing with an operator. IBM outsourced the work to Malaysia and also in Singapore. Lay-offs The research of Bordeman, Kannan, and Pinheiro (2014), states that at the time of outsourcing the business activities the company dismisses the employees who are working in the organization. When the company considers the planned process, then it is seen that layoffs are unavoidable. This can give negative impact on the employees who are working in the organization. By considering IBM it is evaluated that 5,000 employees in the next few months are dismissed. The decision that is taken has given effect on the image of the company also the productivity level is reduced. Impact of Outsourcing It is seen that IBM has attained a great advantage over its competitors by outsourcing the activities to the third party. IBM has given effect to the customer's services and resources to make proper decisions. IBM conducted a proper investigation through their scientists over more than 56 competitors and also with the 38 Non-IBM clients. The study evaluated that there should be the proper relationship between outsourcing of the IT services and also the business functions should be improved (Kotlarsky et al., 2016). According to the research, there are many advantages of outsourcing that has given impact on the following elements of the business. Future advantages: The outsourcing of activities has given impact on the benefits. It is seen that the outsourcing of agreement enhance the profits and also the positive impact is analyzed on the income and growth of the company. Income before interest and taxes: There are many companies in which the growth is analyzed in the income as a comparison is made with the competitors. According to Schniederjans, Schniederjans, and Schniederjans (2015), the research showed that the benefit of outsourcing the IT functions of the business. IBM has attained success in outsourcing the activities by introducing the proper strategies and considering the latest technology. IBM gives focus on enhancing the image and productivity level in a proper manner. If the comparison is made with the competitors then it is evaluated that customer satisfaction is important and high in IBM. The strategy of the IBM considered has given success and enhance the market share of the company. It is also evaluated that it assists to enhance the efficiency globally. Conclusion By analyzing the report it is seen that there are various companies that outsource the activities. This offers them many advantages and also enhances the customer service. IBM is one of the successful companies in outsourcing the activities to other company. Before outsourcing it is important to create clear guidelines so that the process of outsourcing can be successful References Bickerton, D. (2016).Roots of language(p. 284). Language Science Press. Bordeman, A., Kannan, B., Pinheiro, R. (2014). Intra Industry Contagion Effects of layoff Announcements.Unpublished Manuscript. Childress, R. L., Crawford, C. H., Kumhyr, D. B., Magnone, P. F., Pennell, N. (2014).U.S. Patent No. 8,917,744. Washington, DC: U.S. Patent and Trademark Office. Drucker, P. F. (2017).The Theory of the Business (Harvard Business Review Classics). Harvard Business Press. Eggert, A., Boehm, E., Cramer, C. (2017). Business service outsourcing in manufacturing firms: an event study.Journal of Service Management, (just-accepted), 00-00. Field, A. (2013).Discovering statistics using IBM SPSS statistics. Sage. Glaser, B. (2017).Discovery of grounded theory: Strategies for qualitative research. Routledge. Harmon, P. (2015). 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