Individual Assignment 1
The three key activities of the strategic management process are governed by the mission and the values of the organization. The key activities in the strategic management process include analysis of the threats and opportunities, the decision on the goals to be achieved, and strategic actions (Steiss, 2019). Carrying an analysis is a critical step in the strategic management process, which helps the organization managers to determine the performance of an organization. Organizational analysis forms the basis of the values and the goals of an organization. The strategic actions follow the goals where a program on the orientation of employees and resources is developed to achieve the set goals. The managers require to understand the interdependent nature of the three key activities of the strategic management process to develop the control strategy to accomplish the plans and objectives of the organization.
All firms are affected either positively or negatively by the outside environment. The external environment affects how an organization runs; therefore, the managers need to understand the aspect of the external environment to avoid strategic mistakes. (Prajogo, 2016). The external elements of the external environment include the customers, competitors, economic forces, technological forces, political factors, and social forces. Managers need to understand the cultural practices of their customers so that the firm can provide goods and services in line with the cultural practices of the customers for health competition of an organization in the market.
The external environment forces determine the average expected profitability in an industry. Each of the five forces determines how the firm competes in the market (Noe, 2016). For instance, a firm that offers after-sale services attracts more customers in the market. Therefore, the external forces affect the profit potential of an organization, and inventive methods are required for an organization to compete favourably.
In the automobile industry, the power of subsidies is medium. Modes of transportation, such as the use of bicycles, subways, and public buses, are other available modes of transport in the automobile industry (Newman, 2015). In geographic regions where public transportation is not accessible, there are no substitutes to the automobiles. Some substitutes modes of transport are cheaper and offer better services than the automobile industry itself, which forms the basis of the existence of the substitutes. Therefore, substitutes contribute to a medium threat in the automobile industry.
References
Newman, P., & Kenworthy, J. (2015). The end of automobile dependence. In The End of Automobile Dependence (pp. 201-226). Island Press, Washington, DC.
Noe, R. A., Hollenbeck, J. R., Gerhart, B., & Wright, P. M. (2017). Human resource management: Gaining a competitive advantage. New York, NY: McGraw-Hill Education.
Prajogo, D. I. (2016). The strategic fit between innovation strategies and business environment in delivering business performance. International Journal of Production Economics, 171, 241-249.
Steiss, A. W. (2019). Strategic management for public and nonprofit organizations. Routledge.