WK1 Business Policy and Strategy. ORIGINAL WORK ONLY. APA FORMAT WITH ABSTRACT AND REFERENCES. BELOW IS THE ASSIGNMENT AND READING NOTESStrategic Audit (Assignment)The strategic audit system is a diagnostic tool to pinpoint an organization?s strengths and weaknesses. Use the Strategic Analysis Framework and other tools in order to conduct a strategic audit.ÿ You might consider using a SWOT analysis for both companies to analyze each of their situations.For this assignment, a mini strategic audit will be conducted for two companies with an overall goal to compare how each company differs in the strategy management and implementation, while identifying the importance of strategic management.?Conduct a Strategic Audit on two companies of your choice that are within the same industry. During this audit, you will be comparing each company, to do so be sure to create a SWOT analysis for each company.?In addition, visit each company?s website and conduct research to identify key strategies that each company has. List a brief introduction of each company, to include the Mission Statement and compare key aspects of each company.?Be sure to include the concepts identified in the readings for this week’s topics. The requirements below must be met for your paper to be accepted and graded:?Write between 850 ? 1,250 words (approximately 3 ? 5 pages) using Microsoft Word in APA style, see example below.?Use font size 12 and 1? margins.?Include cover page and reference page.?At least 80% of your paper must be original content/writing.?No more than 20% of your content/information may come from references.?Use at least three references from outside the course material, one reference must be from EBSCOhost. Text book, lectures, and other materials in the course may be used, but are not counted toward the three reference requirement.?Cite all reference material (data, dates, graphs, quotes, paraphrased words, values, etc.) in the paper and list on a reference page in APA style.References must come from sources such as, scholarly journals found in EBSCOhost, CNN, online newspapers such as, The Wall Street Journal, government websites, etc. Sources such as, Wikis, Yahoo Answers, eHow, blogs, etc. are not acceptable for academic writing.ÿ READINGRole of StrategyThe focus of this lecture will be on the concepts of strategic management, the framework for strategy analysis and the link between strategy and the industry environment.ÿ The Concept of StrategyKey questions to consider:1.Why are decisions important?2.What is strategic management?3.Why has strategic management become so important to today?s corporations?Strategic Management is described as a set of managerial decisions and actions that determines the long-run performance of a corporation. It includes environmental scanning (both external and internal), strategy formulation (strategic or long-range planning), strategy implementation, and evaluation and control.Importance of Strategic Management:Research indicates that organizations that engage in strategic management generally outperform those that do not. The attainment of an appropriate match or fit between an organization?s environment and its strategy, structure, and processes has positive effects on the organization?s performance. The three most highly rated benefits of strategic management are a clearer sense of a firm?s strategic vision, a sharper focus on what is strategically important, and an improved understanding of a rapidly changing environment. As the world?s environment becomes increasingly complex and changing, today?s corporations use strategic management as one way to make the environment more manageable.The Role of Strategy in SuccessKey questions to consider:1.Does every business have business strategies?2.Should they have a strategy? Why?Every business firm should have a business strategy for every industry or market segment it serves. A business strategy aims at improving the competitive position of a business firm?s products or services in a specific industry or market segment. Firms must therefore have business strategies even if they are not organized on the basis of operating divisions. Nevertheless, it is still possible that some business firms do not have clearly stated business strategies. If they hope to be successful, however, they must have at least some rudimentary (even though unstated) position they take in terms of getting and keeping customers or clients.The following points are the most highly rated benefits of strategic management.Key points:?Long-term performance?Adapt to new and changing markets?Stabilize and increase performance?Clearer sense of strategic vision for the firm?Sharper focus on what is strategically important?Improved understanding of a rapidly changing environmentThe four elements of a successful strategy shown in Figure 1.1The Elements of a Successful Strategy:?Goals that are consistent and long term ? a focused commitment to goals?Profound understanding of the competitive environment ? awareness of the changing economics?Objective appraisal of resources ? awareness of the limitations within available resource.?Effective implementation ? Without effective implementation, the best strategies are of little use.The Basic Framework for Strategy AnalysisThis view of strategy as a link between the ?rm and its industry environment has close similarities with the widely used SWOT framework. A term Strategic Fit refers to the consistency of a ?rm ?s strategy, ?rst, with the ?rm ?s external environment and, second, with its internal environment, especially with its goals and values and resources and capabilities.Strategy Formulation Sections:?Environmental scanning?Strategy formulation?Strategy implementation?Evaluation and controlPhases of Strategic Management?Phase 1?Basic financial planning?Phase 2?Forecast-based planning?Phase 3?Externally oriented (strategic) planning?Phase 4?Strategic managementThe Strategy ProcessKey questions to consider:1.What information is needed for the proper formulation of strategy? Why?2.What is meant by a hierarchy of strategy?3.Why are strategic decisions different from other types of decisions?To properly formulate strategy, it is essential to have information on the important variables in both the external and internal environments of the corporation. This includes general forces in the societal environment as well as the more easy-to-identify groups such as customers and competitors in the task environment. A corporation needs to have this information to identify a need it can fulfill via its corporate mission. It is also important to have information on the corporation?s structure, culture, and resources. A corporation needs to have this information to assess its capabilities to satisfy a customer?s need by making and/or distributing a product or service. Information on both the internal and external environments can also help a corporation to predict likely opportunities and threats. Long-term strategies can be designed with these in mind.A hierarchy of strategy is a term used to describe the interrelationships among the three levels of strategy (corporate, business, and functional) typically found in large business corporations. Beginning with the corporate level, each level of strategy forms the strategic environment of the next level in the corporation. This means that corporate level objectives, strategies, and policies form a key part of the environment of a division or business unit. The objectives, strategies, and policies of the division or unit must therefore be formulated so as to help achieve the plans of the corporate level. The same is true of functional departments, which must operate within the objectives, strategies, and policies of a division or unit.Strategic Decision-Making ProcessUnlike many other decisions, strategic decisions deal with the long-run future of an entire organization and have three characteristics:1.Rare: Strategic decisions are unusual and typically have no precedent to follow.2.Consequential: Strategic decisions commit substantial resources and demand a great deal of commitment from people at all levels.3.Directive: Strategic decisions set precedents for lesser decisions and future actions throughout an organization.SummaryRole of Strategy:?Strategy is a key ingredient of success both for individuals and organizations:?A sound strategy cannot guarantee success, but it can improve the odds.?Successful strategies tend to embody four elements: clear, long-term goals; profound understanding of the external environment; astute appraisal of internal resources and capabilities; and effective implementation.What Strategy is today??Strategy is no longer concerned with detailed planning based upon forecasts?Strategy is increasingly about direction, identity, and exploiting the sources of superior pro?tability.Components of a Strategy:?To describe the strategy of a ?rm (or any other type of organization) we need to recognize where the ?rm is competing, how it is competing, and the direction in which it is developing.?Developing a strategy for an organization requires a combination of purpose led planning (rational design) and a ?exible response to changing circumstances (emergence).Who Should Use Strategic Management??The principles and tools of strategic management have been developed primarily for business enterprises; however, they are also applicable to guiding the development and decision making of not-for-pro?t organizations, especially those that inhabit competitive environments.