Forces and Trends in Business

The corporate ecosystem is characterized by a number of variables: competition, dynamism, turbulence, complexity and change. All organizations must develop ability to continuously and consciously transform themselves and their settings. Such settings include restructuring for optimum effectiveness, reengineering meaningful processes and streamlining roles that are able to provide a source of competitive advantage. The aim is to adapt, regenerate and most important, survive. (McLean, 2006).

For a company to thrive today, strategists must find ways to increase the organization’s ability to read and react to industry and market changes. They must know their goal to raise the company’s strategic flexibility by recognizing disruptions earlier and responding faster.

Strategic flexibility or adaptability can be defined as the organization’s capacity to clarify major changes in its external environments, quickly commit resources to new courses of action in response to such changes, and to recognize and act promptly when it is time to stop or reverse existing resource commitments. Being adaptable method leaders must not get stuck in a too-stiff way of looking at the world. The organization must view change as an unavoidable and basic part of an organization’s growth, in order to unprotected to this adaptability.

When there is uncertainty or unpredictability in the ecosystem, managers tend to focus almost all their energy on successfully executing the current strategy. What they also should be doing is preparing for an unknown future. Flexibility stems from the ability to learn; managers tend to overlook the negative and press the positive. They need to understand not only what led to the positive outcomes but also what led to the negative ones. This will optimize their learning experience. According to Ford (2004) four points to foster and continue adaptability include challenging complacency, giving all employees a voice, encouraging participative work and driving fear out of your group.

The companies chosen for this task vary by industry: a famous automobile manufacturer (Ford) a bank going by a merger (Compass) and a start-up software company (DawningStreams). Ford and Compass have been in business for a long time; it is likely they have changed their strategic plan based on changing forces and trends. DawningStreams is new (established in 2005 and incorporated in 2007). already though they have not had their first sale and have no staff, the owners have devised several iterations of their strategy.

There is a varied of stakeholders all that are interested in the activity of business organizations. Emphasis must be placed on their adaptability in strategic examination and their adaptability in strategic management of business organizations. The organization must have a strategic management form.

Each company might examine the same areas, but for different reasons. Considering technological advances, Ford would prepare itself to rule the market by having various electronic equipment in their vehicles, in addition as robotic equipment with which to build them and the supply chain technology to keep all in check. Compass Bank is going by a merge and expanding globally; consequently they will need to keep abreast of communication technology. DawningStreams is a software company; they will need to monitor those companies who would be their competition to ensure their product offers better functionality. All three companies would make sure possible customers would be able to get good information from internet websites and advertisement, which encompasses however another area of technology the organizations may need/want to examine. In this example, many members of the organization must be enrolled: upper management and finance, who will determine budgetary factors; the IT department, who will be responsible for the implementation and maintenance of some of the technology; the staff who must be trained to use the technology; a sales force who will sell the technology.

To the outside observer, it may seem unnecessary for any but Ford to examine the (actual) ecosystem when it comes to issues such as emission control, fuel efficiency and hybrid cars. That is true however; Compass Bank and DawningStreams can plan a strategy to be friendlier to the ecosystem (and their pocketbooks) by practicing paper reduction (by the aforementioned technology). Lastly, DawningStreams’ product may be useful as a file sharing service to environmental groups.

With regard to the legal ecosystem, all three must be acutely aware of laws, which affect their respective industry among others. To Ford, legal applies, among other areas, to environmental protection laws and department of transportation safety laws. To Compass Bank, they would to comply with the rules of the Federal save (www.federalreserve.gov) and the Federal Insurance and place Corporation (www.fdic.gov). DawningStreams must follow laws as they pertain to the move of files, which have intellectual character and also the export of products, which have algorithms. All three companies are global and will need to monitor those laws in other countries, which could effect the strategic planning.

At one company after another–from Sears to IBM to Hewlett-Packard to Searle, strategy is again a major focus in the quest for higher revenues and profits. With help from a new generation of business strategists, companies are pursuing novel ways to hatch new products, expand existing businesses, and create the markets of tomorrow. Some companies are already recreating complete-fledged strategic-planning groups. United Parcel Service expects to spin out a new strategy group from its marketing department, where strategic plans are now hatched. Explains Chairman Kent C. Nelson: “Because we’re making bigger bets on investments in technology, we can’t provide to use a whole lot of money in one direction and then find out five years later it was the wrong direction.”

In such a world we need a planning form that allows us to anticipate the future and to use this anticipation in conjunction with an examination of our organization–its culture, mission, strengths and weaknesses–to define strategic issues, to chart our direction by developing strategic vision and plans, to define how we will implement these plans and to specify how we will estimate how well we are implementing these plans. The fact that the world is changing as we move forward in the future demands that the time of action be an iterative one.

Ford Motor Company – Socio-cultural

Ford Motor Company embraces the socio-cultural changes taking place to allow the company to move in the right direction with respect to attitudes in the society. Two areas that stand out in terms of socio-cultural attitudes would be that of fuel economy and smaller cars. The growing concern by the public for better fuel economy has influenced the company’s introduction of the Ford Escape Hybrid and Mercury Mariner Hybrid. The organization is committed to the hybrid to enhance fuel economy as a global strategy to meet customer demands. The increased need in society for such environmentalism has assisted in the decision for Ford Motor Company to look forward to adding the hybrid characterize to the Ford Fusion and Mercury Milan and continue in such a strategic planning direction.

The customers that use these vehicles get a substantial break on their insurance in many states and a tax credit in addition while enjoying the increased mileage of a means that runs on gasoline and capabilities for 100 percent electric strength. The environmental scanning by Ford Motor Company has allowed the company to be knowledgeable of the fact that the people in the United States are buying more small cars today than any other kind of means part. The lifestyles changes have been observed and there is good data that shows that such a trend will continue in this direction and the expected growth in this part will continue. The company has redesigned the inside and outside of the Ford Focus to set the car except the competitors in the small car part while increasing upgrades and features to experience positive outcomes. The direction that the company is taking is based on a competitive advantage and being a leader in the industry. The means line has both a sedan and a coupe to attract targeted markets including younger buyers at an entry level to build upon brand loyalty and customer retention. Ford Motor Company will continue to use the socio-cultural factors to excursion the business and enjoy future success.

Ford Motor Company – Legal –

Ford Motor Company with regard to the Environmental Protection Agency adheres to the legal aspect of environmental scanning. Ford Motor Company accepted an award in March 2007 from the Environmental Protection Agency called the Energy Star 2007 Partner of the Year Award in Energy Management. The company is the first automaker to have ever been awarded the award two years in a row. The award has come to be presented due to the commitment made by the company to increase energy efficiency and to reduce the greenhouse gas emissions from all of the facilities in the company.

The organization is committed to the responsible use of resources and energy efficiency. The leadership realizes that the environmental protection laws are of great importance and use the environmental scanning to move in the right direction to acquire future success in the company. In 2006 alone the company has improved the energy efficiency in the United States operations by five percent and saving approximately $25 million with enough energy saved to equal 220,000 homes. The effective energy management protects the ecosystem and reduces the greenhouse emissions. Some of the actions taken by the company include replacing lighting fixtures that use 40 percent less energy and using different low-energy, long-lasting compact fluorescent lamps in the similarities to include the plants, corporate offices, dispensing centers, and research and development campuses. Due to the environmental scanning that takes place at Ford Motor Company the company will use the information that is collected and continue in this direction. New projects for the company include Fumes-to-Fuel that is a system that converts paint fumes into electricity that is being performed with Detroit Edison along with attempting to consolidate the application of primer, base and clearcoat paint applications into a single application to eliminate the need for separate applications and ovens. In addition to the paint booth emissions Ford Motor Company will continue to rely on different energy supplies such as landfill gas and wind and solar technologies to strength their manufacturing facilities.

Ford Motor Company – Technology –

Another environmental scanning tool that Ford Motor Company monitors and uses would be the technological portion. The company has invested $1 billion in the latest technology for flexible manufacturing. The technology that is involved is in many forms to include wireless technology that is installed on the delivery trucks with supplies to the plant as a monitoring position and improved efficiency to reduce inventory. The flexibility of products in the same plant allows the organization to use the same machinery and course of action for all areas from body assembly, paint facility, and final assembly. The improved efficiency at the manufacturing facility allows for several means platforms to be built on the same line to produce multiple models and quickly change the means mix, the quantity, and options based on customer need.

The technological changes that are being embraced by Ford Motor Company by environmental scanning enables the company to experience huge cost savings by new product launches and 50 percent reductions in cycle changeovers along with waste reduction. Robots are among the technological changes that are being experienced within the organization to include the 400 from the project that are used to weld and assemble the metal body of the means for stamping and assembly. Artificial intelligence in the form of progressive visions systems and laser tracking systems are used to ensure quality by accuracy and size abilities. A multi-million dollar training facility is used to ensure that the workforce has the knowledge, skills, and ability to reap the benefits from the new technology that is being used by the company. The training that is administered includes the new servo-electric weld gun system that identifies the perfect center for welding that has replaced the older and loud air-powered system that used a less complex spring system. The environmental scanning of technology that is performed by Ford Motor Company has allowed the company to have positive outcomes in efficiency while remaining a competitive company in the industry by cost savings and continuous improvement.

Compass Bank- Political –

On February 16, 2007, Compass Bancshares, Inc., the parent company of Compass Bank, announced the signing of a definitive agreement under which Banco Bilbao Vizcaya Argentaria, S.A. (NYSE: BBV Madrid: BBVA) (“BBVA”) will acquire Compass for a combination of cash and stock. Compass will become a wholly owned U.S. subsidiary of BBVA and will continue to function under the Compass name. The transaction is expected to close during the second half of 2007, pending customary closing conditions, including necessary bank regulatory approvals in the U.S. and Spain and the approval of the stockholders of both Compass and BBVA.

BBVA, which operates in 35 countries, is based in Spain and has substantial banking interests in the Americas. The transaction will ease BBVA’s continued growth in Texas and will create the largest regional bank across the Sunbelt. Upon completion of the transaction, Compass will rank among the top 25 edges in the United States with approximately $47 billion in total assets, $32 billion in total loans and $33 billion in total deposits. In addition, the combined company will rank fourth in place market proportion in Texas with $19.6 billion in total deposits and 326 complete-service banking offices.

Compass is a $34 billion Southwestern financial holding company that operates 415 complete-service banking centers in Alabama, Arizona, Colorado, Florida, New Mexico and Texas. Compass provides a general range of products and sets by three dominant lines of business – Corporate Banking, Retail Banking and Wealth Management. Compass is among the top 30 U.S. bank holding companies by asset size and ranks among the top earners of its size based on return on equity.

Under the terms of the definitive agreement, which has been approved by the board of directors of Compass and the applicable bodies of BBVA, Compass will become a wholly owned subsidiary of BBVA. After closing, BBVA intends to merge its U.S. based banking affiliates – including the former operations of Texas Regional Bancshares, State National Bancshares and Laredo National Bancshares – with Compass.

The aggregate consideration is composed of a fixed number of approximately 196 million shares of BBVA shared stock and approximately $4.6 billion in cash. The merger is unprotected to customary closing conditions, including necessary bank regulatory approvals in the U.S. and Spain and the approval of the stockholders of both Compass and BBVA. The transaction is expected to close in the second half of 2007.

The merger between both companies will be determined by the political factors ranging from implications of laws and regulations to the state of world politics including the consideration of wars which may be going on in different parts of the world. New laws, regulations, tax programs and public policy create forces and trends, which may provide challenges and barriers or opportunities for any company or organization.

Compass Bank – Technology –

Ford is in the time of action of implementing a laser marking system on its production line to ensure the highest standard on each transmission assembled. The system will be checking for quality on different points on the assembly line. Ford is teaming up with a company called MECCO to implement this course of action and a trial run of the new system will last for 3 months. MECCO is a leader in its industry when it comes to laser technology. The decision to implement this new laser marking system came because it is more cost- effective and safer than past ways of marking checkpoints for quality.

Although this course of action at Ford has not officially been implemented however, Compass Bank can learn a few different things. It may be a good idea for Compass Bank to do a short trial of online cell phone banking to see how popular it becomes and if it worth all the time and effort, being spent to get it launched. Compass Bank should also consider investing into a company who is the best at what they do, is in the same time zone, and can meet their demands in a timely manner, not simply because they may be cheaper. Finally, Compass Bank can learn that they need to consider what will be most cost-effective and in the best interest of the company over time. Organizing a time line and a list of costs and possible risks would also be advantageous to Compass Bank so they know what to expect and when with the implementation of online cell phone banking.

When completing the global examine one looks for emerging new technologies which may impact any business in any industry. At one time the emergence of the Internet was a technology that was becoming an emerging trend across all industries. Today very new technologies are used to develop information systems at a fraction of the cost and time of processes that were used five years ago. Wireless is a telecommunications technology that may have moved from a trend to a force in reforming the way information is stored, accessed and used across all industries around the world. Some, if leveraged by a company within an industry before competitors use it, may already provide a competitive advantage.

Compass Bank – Competition –

Although mergers may be costly and rather difficult, the value it creates in the end is the desired outcome companies seek. The eagerness to merge is based on several beliefs, those beliefs are, that the performance gains are greater, expenses are reduced, market strength is increased, and shareholder’s wealth is also greater than before. The value of a merger is enhanced when the overall assistance is more valuable than the aggregate of two separate pre-merger companies.

In the end, both John and Bernard should consider this before finalizing a decision. When Zion’s purchased Stockmans, there overall value increased by 43 branches. These branches will help performance and brings much more strength to the financial market. In the Journal of Money article, Pilloff states “Companies are more willing to acquire others to avoid being acquired themselves.” Keeping this in mind, companies must figure out a cross border strategy.

As part of the general environmental examine, it is important to clarify the internal capabilities of the organization. There are various models for defining capabilities. Most focus on the general set of intangible assets such as brand, human capital, organizational capital and already relationship capital. Others include the more concrete assets such as obtainable capital, the organization structure, current technologies and information technology infrastructure. In addition to doing a general environmental trend, Compass Bank needs to do a more detailed capability assessment using any of the models obtainable.

DawningStreams – Competitors –

Business activities are becoming more and more complicate to manage, because of distance, time zones, number of parties involved in projects, number of responsibilities to unprotected to, multiple prioritizations, without of general synchronization, insufficient obtain and secret communication channels and growing complexity of IT infrastructures. The use of task list managers has become very shared. It is becoming more difficult to keep teams synchronized, to follow and to implement new business processes and to exchange sensitive information confidentially. The DawningStreams software application is aiming at increasing the practicality of daily executive activities. The types of business, which will most probably be interested in our product, are construction (size of network), consulting (need for synchronization), pharmaceutical research (obtain exchange of information) and the software industry (complexity of manufacturing).

Many companies have already developed software applications that permit secured communications and file sharing. However, most, if not all, are relying on Microsoft technologies, which prevent them from expanding to Mac or Unix users. DawningStreams is developed in Java, which can be used on any platform, including Mac and Unix. Microsoft has acquired the Groove Company and has released a new version of the product, which can perform many of the functionalities of DawningStreams, but not generic activities (http://office.microsoft.com/en-us/groove/default.aspx). This is our closest competitor by far. More recently, we found, merely by accident, a company called Shinkuro (www.shinkuro.com), which offers the file sharing aspects of DawningStreams but lacks other capacities.

Although DawningStreams will confront competition from many existing players, the fact that it will combine a super-set of functionalities in one application, for a very reasonable price, will give it some leading edge over other competitors. If the US patent is granted, the position of DawningStreams will become a niche. already if the patent were not granted, it would take a profound architectural redesign of Groove (or other competitors) to include generic activities and match the offer of DawningStreams. As a strategy we will monitor the activities of those companies’ websites and understand what they offer in terms of similar functionality and try to ensure we match or best those functionalities to the best of our ability and resources

DawningStreams – Political –

Maintaining the secrecy of information is the basic function of encryption items. Persons oversea may use such items to harm US law enforcement efforts, in addition as US foreign policy and national security interests. The US Government has a basic interest in ensuring that persons opposed to the United States are not able to conceal hostile or criminal activities, and that the authentic needs for protecting important and sensitive information of the public and private sectors are met. Since 2000, US encryption export policy has been directed by three basic practices: technical review of encryption products prior to sale, streamlined post-export reporting, and license reviews of hypothesizedv transactions involving strong encryption to certain foreign government end-users and countries of concern. US encryption policy also seeks to ensure that American companies are not disadvantaged by the European Union’s “license-free zone.” (Bureau of Industry and Security, 2007).

DawningStreams will contain cryptographic roles. Any reliable and efficient cryptographic system requires a central authority to avoid identity theft. Cryptography is a meaningful functionality of DawningStreams. All specialists insist on designing systems using well-studied algorithms and fully tested protocols; novelty is considered a source of risk. The cryptographic inner of DawningStreams will rely on a dual public-private meaningful system. The private meaningful encryption system will implement Rijndael, the progressive Encryption Standard (http://csrc.nist.gov/CryptoToolkit/aes/rijndael/), the public meaningful system will implement RSA (www.rsa.com) and the hashing function will implement the 256 bits version of the obtain Hash Algorithm (http://obtain-hash-algorithm-md5-sha-1.co.uk/ ).

Encryption products can be used to conceal the communications of terrorists, drug smugglers, and others intent on harming U.S. interests. Cryptographic products and software also have military and intelligence applications that, in the hands of hostile nations, could present a threat to U.S. national security. The national security, foreign policy, and law enforcement interests of the United States are protected by encryption export controls. These controls are consistent with Executive Order (E.O.) 13026, which was issued on November 15, 1996, and the Presidential Memorandum of the same date. (Bureau of Industry and Security, 2007).

DawningStreams also plans to be an international company, as offices now exist in the Netherlands and the US. As part of the strategy, we will ensure we keep compliant by registering our product with any necessary agency and allowing those agencies access to the processes if they feel there is a threat. We will be responsible to monitor (as best as we can) our client base and to put the proper verbiage in our contracts that illegal activities will not be tolerated. We will continue to monitor the BIS site mentioned in past paragraphs and also sites in the European Union such as the Crypto Law website of legal expert Bert-Jaap Koops (http://rechten.uvt.nl/koops/)

DawningStreams – Technology/Intellectual character –

The management of organizational strategy requires a comprehensive assessment of the macro ecosystem of the business. Intellectual character (IP) refers to the original ideas and innovations evolved by an organization in order to haul up its systems and processes. Creation of ideas requires large investments. This necessitates the protection of IP. Benchmarking is the continuous course of action of measuring products, processes, and systems of an organization against those that are rated best in the industry. It helps in uncovering weaknesses and flaws in the organizational systems, processes, and products. (Watson, 2003)

The study of the global research conducted by McAfee Inc. and MessageLabs Ltd. on security threat in small businesses in the U.S. discloses that 80 percent of small-and-medium-sized businesses (SMB) believe that an information technology (IT) security failure would be damaging in attaining their business priorities. however, only few are courageously making steps to fight against infringements due to resource limitations from other business related priorities. The research implies that company size plays an basic part in the way senior management views security. Among the challenges that SMBs confront include keeping up-to-date with security solutions and keeping costs low. Small-to-medium businesses’ behavior towards security is very tactical and meets only immediate requirements. (unknown, 2007)

DawningStreams’ relevance to these forces is two-fold. We are a software company—there is an opportunity for us to lose the intellectual character by those who would download and attempt to modify the code. We have competitors who offer functionality similar to ours, however we offer an additional functionality the others do not. It is this ‘specialty functionality’ for which we applied for a patent the United States Patent and Trademark Office. If the patent is granted, there is less likelihood of software piracy or the loss of our IP. Environmental scans should show us if there are other companies trying to do this.

The functionality, which most resembles our competitors’, is the ability to proportion files. That brings in a different concern with intellectual character- the possibility someone else’s IP could be sent from one of our users to another, as this could seriously damage our reputation, as what happened with Napster. (www.napster.com).

Conclusion

At one company after another–from Sears to IBM to Hewlett-Packard to Searle, strategy is again a major focus in the quest for higher revenues and profits. With help from a new generation of business strategists, companies are pursuing novel ways to hatch new products, expand existing businesses, and create the markets of tomorrow. Some companies are already recreating complete-fledged strategic-planning groups. United Parcel Service expects to spin out a new strategy group from its marketing department, where strategic plans are now hatched. Explains Chairman Kent C. Nelson: “Because we’re making bigger bets on investments in technology, we can’t provide to use a whole lot of money in one direction and then find out five years later it was the wrong direction.”

In such a world we need a planning form that allows us to anticipate the future and to use this anticipation in conjunction with an examination of our organization–its culture, mission, strengths and weaknesses–to define strategic issues, to chart our direction by developing strategic vision and plans, to define how we will implement these plans and to specify how we will estimate how well we are implementing these plans. The fact that the world is changing as we move forward in the future demands that the time of action be an iterative one.

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Author Unknown, Strategic Planning, After a decade of gritty downsizing, Big Thinkers are back in corporate vogue. (2006) Retrieved from the Internet at http://www.businessweek.com/1996/35/b34901.htm

Unknown (2007) 80% of Small-to-Medium Sized Firms Fear a Security Threat. Computer Security Update 8 (4). Retrieved March 30, 2007 from EBSCOHost Database.

Unknown (2006) Strategic Planning, After a decade of gritty downsizing, Big Thinkers are back

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US Department of Commerce (2007), Encryption (ch.10, section 742.15). Retrieved March 27, 2007 from the Bureau of Industry and Security Website at http://www.bis.doc.gov/news/2007/foreignpolicyreport/fprchap10_encryption.html

Watson, G. (2003) Business Environmental Scans for Intellectual character Strategy (PowerPoint Presentation). Retrieved March 28, 2007 from the Oklahoma State University website at http://www.okstate.edu/ceat/msetm/courses/etm5111/CourseMaterials/ETM5111Session3Part2.ppt#260,1,Business Environmental Scans for Intellectual character Strategy

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