In a perfect world, a strategy planned by the management will proceed according to plan and be implemented. Unfortunately

Write a 9 pages paper on business policy concepts. In a perfect world, a strategy planned by the management will proceed according to plan and be implemented. Unfortunately, any belief that strategy can be formulated on the basis of intended and deliberate actions to result in commercial success is far from the truth. This concept rules out any opportunity to adapt to a changing market situation. In a number of cases, a situation may develop where incremental changes in the strategy may result in a more advantageous position for the company. This is a positive example of strategic drift.&nbsp.In a perfect world, a strategy planned by the management will proceed according to plan and be implemented. Unfortunately, any belief that strategy can be formulated on the basis of intended and deliberate actions to result in commercial success is far from the truth. This concept rules out any opportunity to adapt to a changing market situation. In a number of cases, a situation may develop where incremental changes in the strategy may result in a more advantageous position for the company. This is a positive example of strategic drift.&nbsp.A preplanned and formulated strategy also assumes an organization to be homogeneous where management decisions from the top can be implemented in full. In practice, the decisions are affected by power behavior, cultural and political factors. Quinn [cited in Peppard et al, 1996] argued that strategy develops incrementally as a result of the decision made due to developing market situations and other organizational experiences. This strategic drift results in a course which is often significantly different from formal planning. Drift in strategic planning is a fact of organizational strategy. It does not mean that strategic policy making is a useless process as it will eventually drift into something new. It only recognizes that changes often become necessary due to extraneous factors and require adjustments to the strategy to keep the broader strategy on course. Porter’s 5 ForcesPorter’s five forces is a useful tool for analyzing the factors impacting on strategy formulation. [Porter, 1980] identified the forces that impact every business. The objective of the strategy is to use these competing forces to result in a positive impact on the business. These forces identified by Porter are the driving forces of the industry. The strategy analysis thus analyses the impact of these forces on a particular business and how to minimize the impact of the negative forces and maximize the benefits of the positive forces. The five forces are 1. The threat of new entrants2. Bargaining power of suppliers3. Bargaining power of customers4. The threat of the substitutes5. Competitive rivalries within the industry suppliers of inputs to business have bargaining power. This power depends on the number of suppliers in the market, availability or lack of availability of substitutes, the ease or difficulty of replacing the suppliers.&nbsp.&nbsp.If the business has high profitability, can place large orders to give the supplier the advantage of economy of scale and if the business does not have many restrictions on the entry of new suppliers than it can reduce the bargaining power of the suppliers.&nbsp.The customers bargaining power is high if substitute products are easily available in the market, the product is not of critical importance to the customers, customers have low margins and are price sensitive. The threat of easy substitution reduces profitability.

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