Strategic Essay Example | Topics and Well Written Essays - 2500 words

Strategic - Essay Example Porter argues that strategy is about ‘positioning’ – not about ‘operational effectiveness’. This essay is a critical discussion of this view. It also offers a comparison between Porter’s views and other perspectives such as those of Mazzucato’s, Mintzberg, Waters and Grant. Porter (1996 p. 62) attributes lack of sustainable profitability in an organization to the inability of management to differentiate between strategy and operational effectiveness. Under such circumstances, the tools for management such as benchmarking, outsourcing, and total quality management among others usually displace strategy, which lowers the chances of improving organizational performance through strategy. The operational effectiveness and strategy are significant for the organizational performance, but according to Porter, they are supposed to be treated differently as they operate in diverse ways. In his view, position accompanied by pattern, plan and standpoint are core to strategy. Porter’s dissatisfaction with the management that focuses on operational effectiveness rather than strategic positioning is represented in figure 1.0, whereby the total of all the available best practices within the organization or the value generated by the organization at a certain charge, available machinery, expertise, management practices, and procured inputs is represented by the productivity frontier (p. 63). This curve indicates that an improvement in the operational effectiveness leads to the advancement of the organization in the direction of the frontier. The frontier on the other hand is continuously budges outward as the company acquires new skills and machinery. In order to maintain this shift of the frontier, managers largely invest in organizational learning, career development and such activities that enhance organizational improvement. Organizational competitiveness is not