Question 1: Mission, Adverse Selection, Business Tactics and Long Term Objectives
Mission refers to the basic functions of a business in the society with respect to the type of products and services that it produces. A business mission has certain elements such as purpose, values (what the business believes in), strategy and scope, standards (or rules) and behaviors that guide the different operations of the business (Hitt, Ireland, & Hoskisson, 2011).
Adverse selection describes a market situation where buyers and sellers have access to asymmetric or different information in the market leading to ‘bad’ market results (Hitt et al, 2011) -‘bad’ products and services are usually selected in such situations. A situation where people in dangerous or high risk jobs and lifestyles move to get life assurance is one of the best examples of adverse selection. In such cases, those who are likely to receive death benefits are the same people who are buying the policies. This is likely to reduce the profits of the insurance companies (Hitt et al, 2011).
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Business tactics are the different means by which an organization’s strategies are executed. They are the short-term planned activities that are focused at dealing with the organization’s present demands, and are meant to move from a given milestone to the other in pursuit of the overall strategy or goal of an organization (Hitt et al, 2011).
Long term objectives describe the different performance goals that an organization intends to achieve over multiyear period, for instance, a period of 3-5 years or more. Some of the long term objectives of an organization include improvement in the organization’s profitability, employee relations, productivity, competitive position, leadership, technology, and corporate image among other factors.
Question 2: Reporting Violation of Ethics
It is important for organizations to report violations of ethics as an important move towards ethics compliance. However, some employees fail to report cases of ethics violation due to various factors such as protection of a co-worker, a company or himself or herself. To ensure that an organization's efforts to report ethics violation incidences are effective, I will carry out the following:
To begin with, I will ensure that all employees in the organization are free to contact the ethics office, the management, some open line or a legal department with the capability of clarifying different issues related to ethics. I will also ensure that a thorough investigation is done on all the reports made so that any ethical issue in the organization is adequately addressed. In addition, I will ensure that any form of retribution towards the employees does not exist. Therefore, I will encourage employees to shed some light on circumstances where they feel that they are being exposed to certain forms of retaliation because of their responsible report about the company.
Reporting of ethical violation can have both positive and negative impacts on the morale of an organization. Reporting of ethics violation is significant in maintaining an organization's reputation, including its employees' (Mandal, 2010). It also helps in resolving some of the unintentional errors that an organization may commit, providing an opportunity for future improvements.
However, effecting reporting of ethical violation can also impact an organization negatively. Violation or mere news of an organizations involvement in ethical violation can affect its customers, the society, and investors who may decline to support an organization in its future endeavors (Mandal, 2010). Moreover, reporting of ethics violation can increase an organization's costs. This is because the company will cater for the different costs that are associated with a given violation such as court fees and the different penalties imposed by the court or the labor and industry regulators (Mandal, 2010).
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Question 3: Impact of a Company Having Clear Advantage in Cost of Production
SWOT analysis provides significant information that is important in matching the resourcefulness and the capability of an organization to the competitive environment that it operates. Therefore, it is very instrumental in shaping the future strategies of an organization. Having a clear advantage in the cost of production by a company can be termed as the strength of that given company.
Just like any other company's strengths, this strength can be utilized as one of the significant basis for the development of a competitive advantage by the company (Pahl & Richter, 2009). Therefore, this factor or strength can change or reshape the future strategies of a business as the business can adopt different ways of utilizing the advantage. For instance, an important option for such company may be to pursue opportunities that are related to the strength. That is, opportunities that will utilize their clear advantage in cost of production. The organization can also identify the different ways in which it can use the strength. For instance, the strength can be utilized in eliminating the company’s vulnerability to various threats that it is likely to face in the future. According to Pahl & Richter (2009), there are a numerous ways in which a company positively utilizes its strengths. As such, a factor such as a clear advantage in cost of production can be utilized in varied ways and is likely to shape the future strategies of an organization.
Question 4: Influence of Social, Political and Technological Factors in the External Environment of an Organization
The social, political and technological factors in the external environment of a business have the potential to shape the strategic direction of an organization in several ways. These factors impacts organizations differently depending on the nature of the organization's business.
The social factors, for instance, determines the goods, services and the standards that are valued by different societies. Demographics and the values of a given group of customers are some of the significant social forces that are likely to impact the strategic direction of an organization (Hitt, Ireland, & Hoskisson, 2011). Changes on the customers' view of a given product can greatly affect the strategy direction of an organization.
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Political factors include various external regulatory parameters, which dictate the operations of an organization. Organizations are required to abide by the different laws and regulations that are created by the various political bodies of a given country. As such, trade regulations, tax policies, minimum wage regulation are some of the political issues that may greatly impact and change the strategic direction of an organization (Hitt et al, 2011).
Similarly, the technological factors have varied impacts on the different scientific processes that are utilized in changing inputs (money resources, or labor) and outputs (goods, services). Therefore, technological changes have a significant impact on strategic direction of different organizations. According to Hitt et al (2011), the strategic directions of an organization depend on the ways in which an organization identify and respond to the different technological changes.