Assignment Question

I’m working on a management question and need support to help me learn. The Assignment must be submitted on Blackboard (WORD format only) via the allocated folder. Assignments submitted through email will not be accepted. Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling in your information on the cover page. Students must mention the question number clearly in their answers. Late submissions will NOT be accepted. Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions. All answers must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism). Submissions without this cover page will NOT be accepted. Course Learning Outcomes (CLOs): 1.Recognize the basic concepts and terminology used in Strategic Management- CLO1 2.Describe the different issues related to environmental scanning, strategy formulation, and strategy implementation in diversified organizations- CLO2 3.Demonstrate how executive leadership is an important part of strategic management- CLO5 4.Communicate issues, results, and recommendations coherently, and effectively regarding appropriate strategies for different situations-CLO6 Assignment Questions: Discuss the following questions: 1.How can value-chain analysis help identify a company’s strengths and weaknesses? 2.According to Porter, what determines the level of competitive intensity in an industry? Of Porter’s Five Forces, which force has the greatest influence on whether an industry would be profitable? Why? Give examples for the local market. 3.When does a corporation need a board of directors? Distinguish between the roles of the board of directors, shareholders, top manager, and CEO. What is the relationship between corporate governance and social responsibility? 4.Briefly explain the statement, “Settling accounting standards is a political process”. Notes: -Every question is out of 2.5 marks -Maximum number of words for all questions: 1500 words. -Using the terminology developed in the course of strategic management will be highly valued. -Your answers MUST include at least 7 outside references (other than the slides and textbook) using a proper referencing style (APA). -Using references from SDL will be highly valued. Good Luck ______________________________________________ Answers

Answer

The relationship between corporate governance and social responsibility is a complex and dynamic one, often subject to scrutiny in today’s business landscape. This analysis delves into the intricate interplay of these two crucial aspects of modern corporate management, providing insights into their implications for strategic decision-making.

Introduction

Corporate governance, a system of rules and practices, is integral to ensuring transparency, accountability, and fairness in corporate operations. At the same time, corporate social responsibility (CSR) reflects a company’s ethical commitment to addressing social and environmental concerns. This paper explores the intersection of corporate governance and social responsibility, highlighting their interconnectedness and the impact on strategic management.

Question 1: How can value-chain analysis help identify a company’s strengths and weaknesses?

Value-chain analysis is a valuable tool in strategic management for assessing a company’s strengths and weaknesses by examining the various activities and processes involved in delivering a product or service. This analysis involves breaking down a company’s operations into primary and support activities.

Primary activities include inbound logistics, operations, outbound logistics, marketing and sales, and service. By evaluating these primary activities, a company can identify strengths and weaknesses. For example, if a company excels in its marketing and sales activities, it may have a competitive advantage. Conversely, if its inbound logistics are inefficient, it may be a weakness.

Support activities include procurement, technology development, human resource management, and firm infrastructure. Examining these support activities helps identify areas where a company can improve or leverage its strengths. For instance, if a company invests in cutting-edge technology development, it can gain a competitive edge, but if its human resource management is weak, it may face workforce challenges.

In summary, value-chain analysis helps identify strengths and weaknesses by breaking down a company’s operations into specific activities. It enables a company to focus on enhancing its strengths and addressing its weaknesses, ultimately improving its overall competitiveness.

Question 2: According to Porter, what determines the level of competitive intensity in an industry? Of Porter’s Five Forces, which force has the greatest influence on whether an industry would be profitable? Why? Give examples for the local market.

Michael Porter’s Five Forces framework helps analyze the competitive intensity of an industry, and it consists of the following forces:

1. Threat of New Entrants: This force assesses how easy or difficult it is for new competitors to enter an industry. High barriers to entry, such as high capital requirements or strong brand loyalty, reduce the threat of new entrants.
2. Bargaining Power of Suppliers: It measures the influence suppliers have over firms in the industry. When suppliers have high bargaining power, they can demand higher prices or better terms.
3. Bargaining Power of Buyers: This force evaluates the influence buyers (customers) have in the industry. When buyers have high bargaining power, they can demand lower prices or higher quality products.
4. Threat of Substitute Products or Services: It assesses the availability of substitute products or services that could replace those offered by firms in the industry. High availability of substitutes increases competition.
5. Intensity of Competitive Rivalry: This force examines the degree of competition among existing firms in the industry. High rivalry often leads to price wars and reduced profitability.

In terms of which force has the greatest influence on industry profitability, it often depends on the specific industry and market conditions. However, the intensity of competitive rivalry (the fifth force) frequently has the most significant impact on profitability. When competitive rivalry is high, companies may engage in aggressive pricing strategies and spend more on marketing and innovation to stay ahead. This can erode profit margins.

For example, in the local market, the airline industry is highly competitive. Multiple airlines often compete on the same routes, and price wars are common. This high competitive intensity can make it challenging for airlines to maintain profitability.

Question 3: When does a corporation need a board of directors? Distinguish between the roles of the board of directors, shareholders, top manager, and CEO. What is the relationship between corporate governance and social responsibility?

A corporation typically needs a board of directors from its inception. The board of directors is responsible for overseeing the company’s management and representing the interests of shareholders. Its roles and responsibilities include:

• Governance: The board sets company policies, makes strategic decisions, and ensures that the company is run in the best interests of shareholders.
• Selection of CEO: The board hires and evaluates the CEO, who is responsible for the day-to-day management of the company.
• Fiduciary Duty: Directors have a fiduciary duty to act in the best interests of shareholders.

Shareholders are the owners of the company, and they elect the board of directors. Their primary role is to invest in the company and receive returns on their investments through dividends and stock price appreciation.

Top managers are responsible for executing the company’s strategy and managing its operations. They report to the CEO and the board of directors.

The CEO is the highest-ranking executive in the company, responsible for overall management and strategic direction.

Corporate governance is the system of rules, practices, and processes by which a company is directed and controlled. It ensures accountability, fairness, and transparency in relationships between various stakeholders.

Corporate social responsibility (CSR) is the ethical framework and voluntary initiatives that a company adopts to address social and environmental concerns. The relationship between corporate governance and social responsibility is that effective corporate governance often includes considerations of CSR. A responsible board of directors should consider the social and environmental impacts of its decisions and seek to align the company’s actions with societal expectations and values.

In summary, the board of directors plays a crucial role in corporate governance, balancing the interests of shareholders with the broader responsibilities of the company, including social responsibility.

Question 4: Briefly explain the statement, “Settling accounting standards is a political process”.

The statement “Settling accounting standards is a political process” refers to the fact that the establishment and modification of accounting standards are influenced by various political and economic factors. Accounting standards determine how financial information is reported and presented by companies, affecting how investors, creditors, and other stakeholders assess a firm’s financial performance and stability.

Several key points highlight the political nature of settling accounting standards:

1. Regulatory Bodies: Accounting standards are often established and overseen by regulatory bodies, such as the Financial Accounting Standards Board (FASB) in the United States and the International Financial Reporting Standards (IFRS) Foundation globally. These bodies are subject to political pressures and lobbying by various interest groups.
2. Government Involvement: Governments and regulatory authorities may intervene in the development of accounting standards to align them with national economic and political interests. They may influence the setting of standards to promote economic stability, industry competitiveness, or transparency.
3. Stakeholder Influence: Various stakeholders, including industry associations, corporations, auditors, and investors, often seek to influence the content of accounting standards to favor their interests. Lobbying efforts can shape the standards’ final form.
4. Global Harmonization: In an increasingly globalized world, efforts are made to harmonize accounting standards across countries. However, the political differences between nations can complicate this process.
5. Public Opinion: Public perception and demands for greater transparency and ethical reporting practices can exert pressure on standard-setting bodies to adopt more stringent standards.