Assessment 2

Topic: The effectiveness of the Strategic Management Practices of the Organization.

Company Name: Heineken

1. Introduction:

Competitive advantage is a common word in business world. Organizations practice Strategic Management, which consists analysis, decisions & actions to create & sustain competitive advantages. It contains two essential sides to get in to the main perspective of Strategic Management.

First, strategic management is an ongoing process, which are analysis, decisions & actions. It is mainly focused on analysis of strategic goals- vision, mission & objectives with the internal & external environment of the organization. Afterward, comes the decision making process. The higher authority needs to take all the strategic decisions. In this level, two important questions arise. What industries should we compete in & how should we compete in those industries? After sort out these questions, action must be taken accordingly.

Second task is to analyse why & how some firms outperform others. Managers need to focus on gaining the competitive advantages, which must be sustainable. That means focusing on two fundamental questions: How should we compete in order to create competitive advantages in the marketplace?

Michael Porter argues that sustainable competitive advantage cannot be achieved through operational effectiveness alone. Most of the popular management innovations of the last two decades-total quality, just-in-time, benchmarking, business process reengineering and outsourcing-all are about operational effectiveness. Operational effectiveness means performing similar activities better than rivals. Each of these is important, but none lead to sustainable competitive advantage, for the simple reason that everyone is doing them. Strategy is all about being different from everyone else.