Organizationalcircumstances affect a strategic leader’s choice
Traditionally, leaders make decision by virtue of their own knowledge, experience and will. Whether it will success depends on their wisdom and experience judge. Whether the decisions are scientific depends on the level of making decisions. Leaders make decisions under a certain subjective and objective circumstances.
Company culture and company environment decide a leader’s decision (Barber & Springle, 2010). Every organization has its own culture and limits on the environment. The elements include organization (whether the task is to be finished individually or by the organization), lead (which way is the best to lead, whether employees’ content to the job is concerned by the manager and whether the disagreements are eliminated in work) and control (whether the employees control themselves by their own or according to management institutions, what is the core part of employees’ performance standard, etc). Any company should learn to create a competition culture, but there is no unified standard of culture. Generally, the culture should adapt to a dynamic environment and is to encourage leaders to undertake risks and creativeness, values outcome rather than method, adds employees decision-making power, strengthens the inter- cooperation in the company and react more quick to the changing environment. Microsoft sets a good example. It values top talents, constructive debates, risk, awareness, effectiveness, Bill Gates, eligible managers and wise management mode, self-criticize and learning and productivity. There is no grade among employees. All the employees are on a business trip by plane of tourist class and they all have their own office. Such kind of environment gives full freedom to the employees so that they can display their creativeness. These cultures are all conductive to the effective competitiveness of an organization. Whether the culture is positive or negative depends on the how well culture matches with the organization environment. A relatively stable organization may have a right culture, the vise versa (Hatc & Schultz, 2008).
Features of environment affect the choice of organizing activities. For an enterprise, it needs to adjust its running direction and content regularly. For an enterprise in monopoly market, it should focus on the improvement on internal manufacturing conditions, expansion of manufacturing scale and lower manufacturing cost. For an enterprise in competitive market, it should keep a frequent eye on its competitors and launch new products constantly, try to improve marketing and promoting and build a perfect marketing network (Salem Press, 1999).
Habitual reaction pattern affect the choice of organizing activities. Even in the same environment, different organizations can react differently. Once the mode of relationship between adjusting organization and environment is formed, it will limit people’s choice of action plan. The leader who is used to thinking in teaching method is hard to make decisions, for they like to quantify the problem and think that in this way they can come up with the answer. Another example, the author knows an entrepreneur, when the sale is not good, and his habitual way of dealing with it is to lower the price. Every time he confronts questions, lowering price is his first choice and consideration (Salem Press, 1999).
Michael Porter and Gary Hamel are the leaders of theory on business. This essay conducts a critical thinking on their theories concerning differentiation strategy, innovation strategy, cost leadership strategy, strategic group analysis and business cluster. It thinks that strategic group analysis is very necessary for a company to compete with others, innovation strategy is the means to realize differentiation strategy, and cost leadership strategy contradicts with operational strategy when using them together. Moreover, it also richens core competitiveness brought up by Gary Hamel by demonstrating the category of core competitiveness, elements which influence core competitiveness and ways of improving core competitiveness. The last part is about organizational circumstances which influence leaders to make decisions. It explains in three approaches: culture of an organization, features of environment and leaders’ habitual reaction pattern.