Organizational Decision-Making: Overlooking Internal Factors Affecting Strategy - Essay Sample

Introduction

It is true that the internal and external environment of any organization will have a greater effect on the important decision that company leaders has to consider. It cannot however, be denied that in most situations, only external environment is considered. Therefore, ignoring internal factors that affect the company leads to reduced strategies employed by the management to fully exploit strategic actions. It is true because some important aspects are often overseen while they are equally important to the company. Therefore, to be able to fully exploit these strategies, both internal and external environmental factors will have to be considered.

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Internal Environment

In giving a response to this discussion, it is true that internal environment is very vulnerable to the experience of entropy. In this situation, organizations tend to move towards internal destruction when it is not well managed (Rumelt, 2011). This has been observed where organizations focus less on lines which can include setting prices at low so that sales department can be pleased among others.

It can also be confirmed that the main focus for the strategist is to ensure good planning to undue the effects of entropy while evaluating the internal environment. For example, it is true that a strategist would want to evaluate the size of human capital available in the organization as part of the overall internal environment evaluation (Rumelt, 2011). Here, the number of staff can also be evaluated.

Strategic Thinking

As a discussion response, it cannot be denied that organizing the various organizational operations is a source of a great power. Gamble, Peteraf and Thompson confirm that any business has to meet the challenge organizing two main areas of the organization to be able to grow power and preserve (Gamble, Peteraf & Thompson, 2019). In a response to this, it is true that attending to ongoing recalibration of the existing resources as well as casting a watchful view for any opportunity to develop new capabilities that would help in delivering better services.

It is therefore true that the strength of constant review as well as adjusting the organization of the company alongside understanding the seven structural functions which include the value for customers, effective communication, understanding the target market as well as process for sales and income, anticipating profits and costs, developing strategy to gain competitive advantage and know how income is procured (Gamble et al., 2019). It is essential to mention that by understanding these concepts, the strategist will be able to ensure that a comprehensive evaluation of the internal power of the company takes place.

Decision Model

In the model provided by Krogerus and Tschappeler (2018), it helps in providing a clear way of evaluating the external and internal factors of a given organization. These factors are summarized in the SWOT decision model that looks at the strengths, weaknesses, opportunities and threats to the company. It should be understood that under SWOT, strengths and weaknesses fall under internal environment while opportunities and threats are external factors (Krogerus & Tschappeler, 2018). In summary, it cannot be denied that SWOT decision model does not give the full outline that can be used to evaluate all the mentioned elements. However, this is captured in the Business Model Canvas.

How Decision Model Aid/Hinder This, Why?

It has been confirmed that the canvas helps in the complex evaluation process of the internal environmental effects considering the various categories as well as examining the content that is required by the organization. However, it should be understood that canvas has some disadvantages like less focus given to the individual personal investment of the company staff.

Decision Models Considered and Why

It should be noted that Canvas is one of the best decision models that is used when an individual who is completing the strategic action plan wants to divide the business model of a company. This is confirmed from the word of Wringley, Bucolo and strake (2016). As a result of the difficulties associated to understanding the personal investment of an individual alongside associating that to Canvas, the strategist may want to include staff evaluation process through the use of Maslach Burnout Inventory and then further include the results into Canvas. This will give a good result (Tanaka, et al., 2015).

References

Gamble, J., Peteraf, M., & Thompson, A. (2019), Essentials of strategic management, McGraw - Hill Higher Education (6th ed.), New York, NY. ISBN: 9781259927638.

Rumelt, R. (2011), Good strategy/bad strategy: The difference and why it matters., Crown Business, New York, NY. ISBN: 9780307886231.

Krogerus, M., & Tschappeler, R. (2018), The decision book: 50 models for strategic thinking., W. Norton & Company, Inc. (Revised ed.), New York, NY. ISBN: 9780393652376.

Tanaka, K., Iso, N., Sagari, A., Tokunaga, A., Iwanaga, R., Honda, S., Nakane, H., Ohta, Y. & Tanaka, G. (2015). Burnout of long-term care facility employees: Relationship with employees' expressed emotion toward patients. International Journal of Gerontology, 9(3), Elsevier B.V. doi:10.1016/j.ijge.2015.04.001

Wrigley, C., Bucolo, S., & Straker, K. (2016). Designing new business models: Blue sky thinking and testing. Journal of Business Strategy, 37(5), 22-31. doi:10.1108/JBS-04-2015-0041