Concept of strategic choice

Change is making things different.It is departure from status quo.Environment forces change.The effects of change are widespread.Organizations that fail to change,die.Change is a fundamental part of organizational survival.Ability to adapt to change is the essence of organizational effectiveness. Strategic changes implies change in strategy through diagnosis and management of change needs.It consists of rethinking reviewing,and changing strategy to adapt to environmental changes and the changing resources and competencies. Types of strategy change

Adaptation :This change in strategy occurs incrementally.It can be accommodated within the current paradigm.Paradigm refers to rules boundaries,behaviors and the way of doing things.It involves realignment.This is the most common form of change in strategy. Reconstruction :This change is strategy occurs rapidly.But it does not lead to fundamental change in paradigm.For example,structural change or cost-cutting program. Evaluation :This change in strategy occurs overtime.It requires paradigm change.It is transformational change.Learning organizations continually change their strategies to environmental changes. Revaluation :This change in strategy occurs very rapidly with a big bang.It requires fundamental change is paradigm.For example,significant decline in profit may require revolutionary change in strategy.So can of focus from selling to customer satisfaction.

the strategy formulation process

location). The model defines four cells for the present market geography. The top-left of these cells represents the present status of the business. The possible future choices about products and markets can be represented as movements within or away from this cell. One set of choices is possible within the existing product/market set. _ Do nothingthat is, continue present strategies. This strategy is important as it is usual to compare any proposed change with the do nothing option as a baseline. The do nothing option is rarely viable for the long term as it is likely that competitors will gradually take the market by improving their products, their processes, or their relationships. _ Withdrawleave the market by closing down or selling out. This appears to be a negative option but may be necessary to focus available resources into areas

of greater strength. It is common in declining markets to see some of the competitors selling out to others who can operate the combined operation more cheaply. _ Consolidateattempt to hold market share in existing markets. This is a defenBox 11.1 Example of options and a strategic choice
In April 1999, Ford announced the agreed acquisition of Kwik Fit. Ford had therefore made a strategic choice. Ford has a strategic intent to move into automotive services. A strategic assessment of Ford should show that its existing resources of large plants and skills in design, marketing, finance, and assembly of new cars are inadequate to support a service business. The decision to acquire Kwikfit would then be made from options about: _ what types of services to offer and in which markets; _ what resources and capabilities are needed to support these services; _ how to acquire or build these resources. Clearly there are multiple options in response to each question and there are links between the question. A strategic option for Ford would be a set of options that seem to make sense together. Without any detailed knowledge of the deliberations within Ford, it would seem that Figure 11.3 could be used to illustrate the structure of the decision. It is important to notice that in practice the decision will also have been influenced by irrational elements not illustrated in Figure 11.3. For instance, it happens that Alex Trotman, the recently retired Chairman of Ford, and Tom Farmer, the Chairman and majority shareholder of Kwik Fit, are both natives of Edinburgh. It is likely that they have known each other for some time. We have no evidence that this had any relevance to Fords decision in this case. The point is that people and events often influence strategic choices. Structured diagrams such as Figures 11.2 and 11.3 only show part of the truth.