Unit 10

Question 1

What is strategic drift?

Answer 1

Occurs when a business’ strategy is no longer appropriate for its business environment ( because it’s changing).

Question 2

What causes strategic drift?

Answer 2

PESTLEC.

Question 3

What is the model used for strategic drift?

Answer 3

Johnson and Scholes model.
- Shows the amount of environmental change (Y-axis) to time (X-axis).
- The bigger gap between the environmental change and business change the bigger the strategic drift.

Question 4

What are the four phases of the Johnson and Scholes model?

Answer 4

Phase 1: Incremental changes
Phase 2: Strategic drift (environmental change has increased)
Phase 3: Flux - The business has recognised the issue but has no solution to solve it. This leads to loss of competitive advantage due to failure to keep up with trends.
Phase 4: Either transformational change or demise. Business either finds a solution or goes out of business. E.g Blockbuster, Nokia, Kodac.
Or Netflix.

Question 5

What is Handy’s organisational culture model and what are the types?

Answer 5

It’s a way to understand and categorise the different types of culture that can exist within an organisation.
- Power Culture
- Role culture
- Task Culture
- Person culture

Question 6

What is power culture?

Answer 6

• A centralised culture, decisions made by a select few
• Employees seek guidance and report to them
• Quick decision-making
• In a fast-growing business communication may breakdown

Question 7

What is role culture?

Answer 7

• A hierarchal structure
• Formalised roles, jobs and procedures
• People in a role culture have specific roles and responsibilities, and there are clear expectations and job descriptions. It’s about following procedures and getting things done systematically.
• Medium/large businesses with a stable environment may benefit

Question 8

What is task culture?

Answer 8

A matrix structure
- Focus on specific tasks/projects
- Individuals are brought in to solve issues in different departments
A task culture is focused on getting the job done. It’s more team-oriented, with people working together in groups to solve specific problems. There’s an emphasis on expertise and competence rather than hierarchy or rigid roles.
- E.g in advertising agencies
- May be a good response to strategic drift