A Strategic Audit Of A Corporation IV Internal Enviro

A Strategic Audit of a Corporation IV. Internal Enviro

A P P E N D I X 1.A Strategic Audit of a Corporation IV. Internal Environment: Strengths and Weaknesses ( SW OT) A. Corporate Structure 1. How is the corporation structured at present? a. Is the decision-making authority centralized around one group or decentralized to many units? b. Is the corporation organized on the basis of functions, projects, geography, or some combination of these? 2. Is the structure clearly understood by everyone in the corporation? 3. Is the present structure consistent with current corporate objectives, strategies, policies, and programs, as well as with the firm’s international operations? 4. In what ways does this structure compare with those of similar corporations? B. Corporate Culture 1. Is there a well-defined or emerging culture composed of shared beliefs, expectations, and values? 2. Is the culture consistent with the current objectives, strategies, policies, and programs? 3. What is the culture’s position on environmental sustainability? 4. What is the culture’s position on other important issues facing the corporation (that is, on productivity, quality of performance, adaptability to changing conditions, and internationalization)? 5. Is the culture compatible with the employees’ diversity of backgrounds? 6. Does the company take into consideration the values of the culture of each nation in which the firm operates? C. Corporate Resources 1. Marketing a. What are the corporation’s current marketing objectives, strategies, policies, and programs? i. Are they clearly stated or merely implied from performance and/or budgets? ii. Are they consistent with the corporation’s mission, objectives, strategies, and policies and with internal and external environments? b. How well is the corporation performing in terms of analysis of market position and marketing mix (that is, product, price, place, and promotion) in both domestic and international markets? How dependent is the corporation on a few customers? How big is its market? Where is it gaining or losing market share? What percentage of sales comes from developed versus developing regions? Where are current products in the product life cycle? i. What trends emerge from this analysis? ii. What impact have these trends had on past performance and how might these trends affect future performance? iii. Does this analysis support the corporation’s past and pending strategic decisions? iv. Does marketing provide the company with a competitive advantage? c. How well does the corporation’s marketing performance compare with that of similar corporations? d. Are marketing managers using accepted marketing concepts and techniques to evaluate and improve product performance? (Consider product life cycle, market segmentation, market research, and product portfolios.) e. Does marketing adjust to the conditions in each country in which it operates? f. Does marketing consider environmental sustainability when making decisions? g. What is the role of the marketing manager in the strategic management process? 2. Finance a. What are the corporation’s current financial objectives, strategies, and policies and programs? i. Are they clearly stated or merely implied from performance and/or budgets? ii. Are they consistent with the corporation’s mission, objectives, strategies, and policies and with internal and external environments? b. How well is the corporation performing in terms of financial analysis? (Consider ratio analysis, common size statements, and capitalization structure.) How balanced, in terms of cash flow, is the company’s portfolio of products and businesses? What are investor expectations in terms of share price? i. What trends emerge from this analysis? ii. Are there any significant differences when statements are calculated in constant versus reported dollars? iii. What impact have these trends had on past performance and how might these trends affect future performance? iv. Does this analysis support the corporation’s past and pending strategic decisions? v. Does finance provide the company with a competitive advantage? c. How well does the corporation’s financial performance compare with that of similar corporations? d. Are financial managers using accepted financial concepts and techniques to evaluate and improve current corporate and divisional performance? (Consider financial leverage, capital budgeting, ratio analysis, and managing foreign currencies.) e. Does finance adjust to the conditions in each country in which the company operates? f. Does finance cope with global financial issues? g. What is the role of the financial manager in the strategic management process? 3. Research and Development (R&D) a. What are the corporation’s current R&D objectives, strategies, policies, and programs? i. Are they clearly stated or merely implied from performance or budgets? ii. Are they consistent with the corporation’s mission, objectives, strategies and policies and with internal and external environments? iii. What is the role of technology in corporate performance? iv. Is the mix of basic, applied, and engineering research appropriate given the corporate mission and strategies? v. Does R&D provide the company with a competitive advantage? b. What return is the corporation receiving from its investment in R&D? c. Is the corporation competent in technology transfer? Does it use concurrent engineering and cross-functional work teams in product and process design? d. What role does technological discontinuity play in the company’s products? e. How well does the corporation’s investment in R&D compare with the investments of similar corporations? How much R&D is being outsourced? Is the corporation using value-chain alliances appropriately for innovation and competitive advantage? f. Does R&D adjust to the conditions in each country in which the company operates? g. Does R&D consider environmental sustainability in product development and packaging? h. What is the role of the R&D manager in the strategic management process? 4. Operations and Logistics a. What are the corporation’s current manufacturing/service objectives, strategies, policies, and programs? i. Are they clearly stated or merely implied from performance or budgets? ii. Are they consistent with the corporation’s mission, objectives, strategies, and policies and with internal and external environments? b. What are the type and extent of operations capabilities of the corporation? How much is done domestically versus internationally? Is the amount of outsourcing appropriate to be competitive? Is purchasing being handled appropriately? Are suppliers and distributors operating in an environmentally sustainable manner? Which products have the highest and lowest profit margins? i. If the corporation is product oriented, consider plant facilities, type of manufacturing system (continuous mass production, intermittent job shop, or flexible manufacturing), age and type of equipment, degree and role of automation and/or robots, plant capacities and utilization, productivity ratings, and availability and type of transportation. ii. If the corporation is service oriented, consider service facilities (hospital, theater, or school buildings), type of operations systems (continuous service over time to same clientele or intermittent service over time to varied clientele), age and type of supporting equipment, degree and role of automation and use of mass communication devices (diagnostic machinery, video machines), facility capacities and utilization rates, efficiency ratings of professional and service personnel, and availability and type of transportation to bring service staff and clientele together. c. Are manufacturing or service facilities vulnerable to natural disasters, local or national strikes, reduction or limitation of resources from suppliers, substantial cost increases of materials, or nationalization by governments? d. Is there an appropriate mix of people and machines (in manufacturing firms) or of support staff to professionals (in service firms)? e. How well does the corporation perform relative to the competition? Is it balancing inventory costs (warehousing) with logistical costs (just-in-time)? Consider costs per unit of labor, material, and overhead; downtime; inventory control management and scheduling of service staff; production ratings; facility utilization percentages; and number of clients successfully treated by category (if service firm) or percentage of orders shipped on time (if product firm). i. What trends emerge from this analysis? ii. What impact have these trends had on past performance and how might these trends affect future performance? iii. Does this analysis support the corporation’s past and pending strategic decisions? iv. Does operations provide the company with a competitive advantage? f. Are operations managers using appropriate concepts and techniques to evaluate and improve current performance? Consider cost systems, quality control and reliability systems, inventory control management, personnel scheduling, TQM, learning curves, safety programs, and engineering programs that can improve efficiency of manufacturing or of service. g. Do operations adjust to the conditions in each country in which it has facilities? h. Do operations consider environmental sustainability when making decisions? i. What is the role of the operations manager in the strategic management process? 5. Human Resources Management (HRM) a. What are the corporation’s current HRM objectives, strategies, policies, and programs? i. Are they clearly stated or merely implied from performance and/or budgets? ii. Are they consistent with the corporation’s mission, objectives, strategies, and policies and with internal and external environments? b. How well is the corporation’s HRM performing in terms of improving the fit between the individual employee and the job? Consider turnover, grievances, strikes, layoffs, employee training, and quality of work life. i. What trends emerge from this analysis? ii. What impact have these trends had on past performance and how might these trends affect future performance? iii. Does this analysis support the corporation’s past and pending strategic decisions? iv. Does HRM provide the company with a competitive advantage? c. How does this corporation’s HRM performance compare with that of similar corporations? d. Are HRM managers using appropriate concepts and techniques to evaluate and improve corporate performance? Consider the job analysis program, performance appraisal system, up-to-date job descriptions, training and development programs, attitude surveys, job design programs, quality of relationships with unions, and use of autonomous work teams. e. How well is the company managing the diversity of its workforce? What is the company’s record on human rights? Does the company monitor the human rights record of key suppliers and distributors? f. Does HRM adjust to the conditions in each country in which the company operates? Does the company have a code of conduct for HRM for itself and key suppliers in developing nations? Are employees receiving international assignments to prepare them for managerial positions? g. What is the role of outsourcing in HRM planning? h. What is the role of the HRM manager in the strategic management process? 6. Information Technology (IT) a. What are the corporation’s current IT objectives, strategies, policies, and programs? i. Are they clearly stated or merely implied from performance and/or budgets? ii. Are they consistent with the corporation’s mission, objectives, strategies, and policies and with internal and external environments? b. How well is the corporation’s IT performing in terms of providing a useful database, automating routine clerical operations, assisting managers in making routine decisions, and providing information necessary for strategic decisions? i. What trends emerge from this analysis? ii. What impact have these trends had on past performance and how might these trends affect future performance? iii. Does this analysis support the corporation’s past and pending strategic decisions? iv. Does IT provide the company with a competitive advantage? c. How does this corporation’s IT performance and stage of development compare with that of similar corporations? Is it appropriately using the Internet, intranet, and extranets? d. Are IT managers using appropriate concepts and techniques to evaluate and improve corporate performance? Do they know how to build and manage a complex database, establish Web sites with firewalls and virus protection, conduct system analyses, and implement interactive decision-support systems? e. Does the company have a global IT and Internet presence? Does it have difficulty with getting data across national boundaries? f. What is the role of the IT manager in the strategic management process? D. Summary of Internal Factors (IFAS Table: IFAS (Internal Factor Analysis Summary) table A table that organizes internal factors into strengths and weaknesses and how well management is responding to these specific factors. ) Which of these factors are core competencies? Which, if any, are distinctive competencies? Which of these factors are the most important to the corporation and to the industries in which it competes at the present time? Which might be important in the future? Which functions or activities are candidates for outsourcing?

Paper For Above instruction

The internal environment of a corporation comprises various interconnected factors that shape its strategic capabilities and operational effectiveness. Analyzing these elements systematically provides insights into the organization's strengths, weaknesses, core competencies, and areas for improvement. This paper offers a comprehensive assessment of a typical corporation's internal environment, focusing on key dimensions such as corporate structure, culture, resources, and support functions like marketing, finance, research and development, operations, human resources, and information technology.

Corporate Structure

The structure of a corporation significantly influences decision-making, communication flows, and operational efficiency. Centralized decision authority often facilitates consistency and unified strategic direction, as seen in large multinational firms where top management retains significant control. Conversely, decentralized structures empower regional or functional units, allowing for flexibility and faster local responses. The clarity of the organizational chart and understanding across all levels ensures alignment with strategic objectives. An effective structure supports current corporate strategies and adapts to international operations by integrating regional nuances. Comparing the organizational design with industry peers reveals whether the structure promotes competitiveness, agility, and innovation.

Corporate Culture

Corporate culture embodies shared values, beliefs, and practices that influence employee behavior and organizational climate. A well-defined culture aligned with strategic goals enhances performance, innovation, and adaptability. Sustainability attitudes within the culture can drive environmentally responsible practices, which are increasingly vital in today’s global business environment. The culture's inclusivity, especially regarding diverse backgrounds and cultural norms across nations, significantly affects multinational operations. A culture that supports productivity, quality, and change readiness fosters resilience and competitive advantage in a dynamic marketplace.

Corporate Resources

Marketing

Marketing resources, strategies, and performance are vital in establishing and maintaining competitive advantage. Clear objectives aligned with mission statements guide market positioning efforts. Analyzing market share trends, product life cycles, and regional sales provides a snapshot of current effectiveness and future opportunities. The dependence on key customers and concentration in specific regions flags potential vulnerabilities or growth areas. Benchmarking performance against competitors and employing accepted marketing techniques ensure continuous improvement and adaptation to local and international markets. Environmental sustainability considerations are increasingly integrated into marketing strategies, emphasizing ethical and sustainable practices.

Finance

Financial health underpins long-term strategic initiatives. Well-defined financial goals, supported by rigorous analysis—such as ratio analysis and cash flow management—reveal the firm's fiscal stability. Benchmarking against industry peers assists in assessing competitiveness. Managing global financial issues, currency fluctuations, and regional economic conditions is crucial for multinational organizations. Financial managers play a strategic role in allocating resources, evaluating investments, and ensuring that financial strategies support overall corporate objectives, providing a competitive edge through prudent financial planning.

Research and Development (R&D)

R&D drives innovation and sustains competitive advantage through technological advancement. Clear objectives aligned with corporate strategy guide R&D investments. Analyzing the return from R&D, technology transfer capabilities, and the capacity for innovation highlights strengths or gaps. The balance between basic and applied research should reflect strategic priorities such as product innovation, process improvements, or technological discontinuity management. Outsourcing R&D activities and forming alliances can optimize resource utilization and accelerate innovation cycles. Incorporating environmental sustainability into R&D ensures compliance with global standards and captures eco-conscious market segments.

Operations and Logistics

Operational capabilities determine cost efficiency, quality, and responsiveness. Analyzing manufacturing and service processes, facility locations, automation, and supply chain management reveals strengths and vulnerabilities, especially concerning external risks like natural disasters or political instability. An optimal mix of human resources and machinery, combined with sustainable sourcing and logistics strategies, enhances competitiveness. Trends in operational performance indicate areas for strategic adjustment, such as adopting lean practices or enhanced automation, which can yield significant cost and service quality benefits.

Human Resources Management (HRM)

HRM strategies influence organizational effectiveness through talent acquisition, retention, and development. Aligning HRM objectives with corporate goals, managing workforce diversity, and ensuring fair labor practices foster a motivated and productive workforce. Evaluating performance metrics, training programs, and labor relations identifies areas for improvement and innovation in HR practices. International HRM considerations, including expatriate management and compliance with local human rights standards, are essential for global organizations. HR managers' strategic role involves planning for future talent needs, leveraging outsourcing, and fostering a positive organizational culture.

Information Technology (IT)

IT capabilities are central to competitive advantage, particularly in data management, process automation, and decision support. Clear IT strategies aligned with corporate goals enable effective deployment of systems, including enterprise resource planning, customer relationship management, and analytics platforms. Performance analysis across stages of development and benchmarking against peers highlight strengths and gaps. A global IT infrastructure enhances operational coordination across borders while safeguarding data with security measures. IT managers contribute strategically by evaluating emerging technologies and fostering innovation, such as deploying advanced cybersecurity, AI, and cloud solutions.

Summary of Internal Factors

The organization’s internal factors comprise core competencies like technological innovation, marketing expertise, and supply chain efficiency that provide competitive advantages. Distinctive competencies—such as patented technology or unique brand positioning—further differentiate the firm from competitors. Evaluating these factors in terms of importance now and in the future guides strategic decisions, including which activities might be outsourced to optimize efficiency and focus on core strengths. Management responses to these internal factors determine the organization’s capability to adapt, sustain growth, and achieve long-term success in a rapidly evolving global landscape.

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