In order for a business to not only grow, but gain success at a more global scale, it requires an effective and coherent marketing campaign which will not only aid in getting their business ideas across to a new clientele; but also help gain valuable business leads. A business can thrive and grow at a great rate within its native area with the help of an effective and high quality marketing campaign, but in order to successfully carry their message overseas, the use of a translation company is a must. Translation companies have helped a wide range of businesses make that crucial break to other countries and markets as it allows the ability to communicate coherently, without the confusion which can often be caused due to language barriers. Often when attempting to break into a different regional market, businesses may look to a Limited Liability Partnership to aid in their overall growth. A Limited Liability Partnership, or LLP, is similar to an ordinary business partnership where businesses can collaborate and join forces with a number of different companies. This can be extremely advantageous for a company as there is no sole responsibility on the company’s side as all risks, costs, responsibilities and profits of the business are shared by all involved. The difference with an LLP is that the liability is limited to the amount of money a specific company has invested in to the business, meaning that the members have some sort of protection of their assets if the business unfortunately runs into trouble.
An opportunity such as this can be extremely advantageous for a company as it not only helps increase their overall profits, but also aids them in gaining business leads which can help make the transition to marketing to a large audience all the more easier. In some cases, this partnership may be with more local companies, but in order for a business to be able to expand at a great rate, a partnership with overseas companies can help propel their business into the spotlight of a much larger market. For those businesses that are looking into joining a LLP with companies overseas, the use of a translation company is imperative in ensuring that all aspects of the deal runs smoothly with no mixed messages and no embarrassment or confusion for all parties involved. A technical translation service can provide technical terminology translations which are required in order for documentation to still be valid and legal, as well as ensuring all members of the agreement have similar copies of documentation. Having shareholders and outside support for your company can be crucial for many who are looking to expand and see their business grow. These shareholders can assist your company in a variety of different fields of the business world whether it is marketing, financial or otherwise, but with a language barrier, getting ideas and opinions across can be extremely difficult, thus making the transition to a global scale all the more difficult. With the use of a translation service, a partnership with outside companies is more likely to succeed as all members can communicate with one another, and work on the best way in which to market the company depending on your specific target markets. Without some form of outside expertise and help, a company may lose it chance to grow into the company it is destined to become.
For many businesses who strive to become a global success, communication is key in all phases of their growth. However, when communication is halted due to language barriers, this can create more harm than good due to confusion. In order for a company to grow to a large scale, external shareholders can be a must, and with a translation service, these shareholders can provide you with the knowledge you need, no matter where in the world you may be.
When running a business, every aspect of its growth and success is imperative and should be planned out accordingly. Projects which work on beginning a new marketing campaign, looking at partnering with an outside business, or looking for a way in which to develop a new product or service. All phases of beginning and executing any of these tasks should be investigated to the letter to ensure that they are as successful as possible. If you are able to communicate effectively to the consumer, a business lead or otherwise, it is much easier to be successful in doing this, as speaking the same language as your listener makes it an easier task to put your ideas across. However, if you are looking to branch out to a more global scale, marketing your company and product/service, you will require the use of an expert translation service. The use of a translation service is vital for any business looking to make a leap into a much larger market. A launch such as this can go terribly wrong if the marketing campaign is incorrect, which more often than not can be due to badly translated literature material, etc. When promoting yourself and your service, you will have planned every aspect of your campaign to a very fine detail, and the same must be done when looking to take your company overseas.
Translation companies ensure that your message is never lost and that both potential customers and potential business leads are well informed about your business, your services and what you are looking to provide them with. If a marketing campaign is poorly translated, this may confuse those who are interested in your business, thus losing sales and therefore making your launch unsuccessful. In order to help properly launch your business to a more global scale, an expert translation company will oversee all aspects of translating the necessary information to help maximize the chances of your business’ success. A Professional and effective translation company will look at what you need their services for, and devise a step by step plan to ensure that every phase is thoroughly planned and executed. Firstly, your needs will be thoroughly analyzed, looking at who you are trying to target, and in what context, looking at the different terminology which is required in order to optimize the level of translation. Here, the terminology you require will also be taken in consideration if specific business, medical or legal terminology is required. Next, a suitable translator of the native tongue from their team will translate the required documents, ensuring that the quality of terminology is of the highest possible standard. The best translation companies will have a team with a wide range of language skills from different areas of the world. But having team members of a native tongue, this aids in increasing the accuracy as reading, writing and speaking a language are completely different from one another. Once this initial translation has been completed, the document will be examined and proof read to ensure it is of the highest standard for the native tongue in which it is required in and that it reads smoothly, without any visible signs which show it is a translation. It will then be checked by the industry specialists before being approved by the Managers before being sent back to the client.
With a detailed structure such as this, you will be safe in the knowledge that you translation is of the highest possible quality and will remain a professional and efficient piece of documentation for your business needs. Communication in business is everything, and with the help of a translation company, you can make that leap with your company into the global business world.
Actualmente las noticias relatan innumerables historias de empresas medianas y pequeñas con dificultades considerables que podrían llevarlas a la quiebra. Existe una tensión general que afecta a diversas esferas; ¿cómo se ve afectada la industria de las traducciones?
El área de traducción/interpretación había estado inmune a los diversos reveses de los ciclos económicos. Pero me pregunto: ¿En realidad existe una crisis grave o simplemente es un caos conscientemente planeado, analizado y ejecutado por los poderosos de las finanzas? La respuesta es dual: Sí, porque hay ciertas flaquezas en la economía mundial y No, porque los medios masivos han creado un monstruo aterrador exagerado para convencer a los incrédulos de que hay que hacer lo que los poderosos dicen.
Es innegable que la crisis global afecta absolutamente a todos porque las relaciones comerciales son interdependientes. El efecto dominó es evidente. No obstante, a pesar de lo severa que pueda resultar una crisis, siempre habrá ese amanecer promisorio y optimista para salir adelante y no desfallecer ante el pánico que esta palabra “crisis” infunde tanto en la gente adinerada como en cualquier otro ciudadano de a pie.
Muchos abrigamos la esperanza de que en el nuevo año se generen y propaguen masivamente nuevas oportunidades de trabajo.
Analicemos objetivamente
¿Ha recibido menos trabajos en esta época de crisis?
¿Las agencias han expuesto excusas para demorar los pagos?
¿Le han propuesto reducción de sus tarifas usuales?
¿Las agencias aducen tener presupuestos limitados, pero con intención de establecer una relación a largo plazo?
Si bien es cierto que hay muchos traductores/intérpretes, también lo es que muy pocos son verdaderamente profesionales. Porque cualquier persona bilingüe no puede considerarse traductor/intérprete, si no ha recibido una capacitación idónea. Además, esta oferta excesiva solamente se presenta en algunos pares de idiomas y en algunas áreas. Muchas agencias pagan tarifas bajas porque hay “profesionales” mediocres que las aceptan.
Factores influyentes a considerar
* Globalización: los avances tecnológicos (Internet y las comunicaciones), no permiten que los profesionales igualmente eficientes, pero trabajando desde países económicamente opuestos, puedan competir con las mismas tarifas.
* La calidad. Muchas agencias asignan los proyectos al licitante que ofrezca la menor tarifa, ignorando la experiencia o las calificaciones.
* Herramientas CAT: Algunas compañías de traducción utilizan las herramientas CAT para justificar la reducción de las tarifas por las repeticiones totales o parciales. Otras, les restan importancia a estas poderosas ayudas creyendo que una aplicación puede traducir con la misma precisión de un ser humano eficiente.
* Tecnología: El avance de Internet, las herramientas CAT, los diccionarios en línea, entre otros, han contribuido al incremento de los traductores y por ende a la productividad del campo de las traducciones. La tecnología fomenta la reducción de precios.
¿Qué deben hacer los profesionales de la traducción/interpretación?
No existe una solución mágica a este problema pero una aproximación generalizada es la forma como las empresas reaccionen ante la crisis y otra alternativa es el efecto salvador que los paquetes de ayuda internacional puedan tener para contribuir a apoyar a las pequeñas y medianas empresas.
Pero a nivel de traductores/intérpretes independientes y si el volumen de trabajo se ha reducido y tiene más tiempo libre, hay varias opciones para manejar esta situación:
* Si ha pensado en reducir sus precios, considere el impacto a largo plazo. Un cliente que está acostumbrado a una tarifa, no aceptará fácilmente un incremento.
* Actualice sus conocimientos. Tome un curso que ofrezca certificación para mejorar sus habilidades como traductor/intérprete. Con los programas certificados puede comprobar sus conocimientos organizados y al mismo tiempo mantenerse al día.
* Aprenda nuevas habilidades informáticas o actualice las que ya tiene (programas gráficos, vídeos, audio, redes, herramientas CAT, etc.)
* Investigue las áreas del conocimiento de alta demanda para traducciones/interpretaciones y luego especialícese en una. Recuerde que siempre hay alguien que busca lo que usted tiene, así como también hay alguien que tiene lo que usted busca.
* Cree un nicho. El solo hecho de haber traducido varias veces sobre un área particular, no lo convierte en un experto. Porque la especialización no se obtiene de la noche a la mañana sino que demanda años de estudio organizado y persistente.
* Una vez que se haya vuelto un experto en un área, contacte a empresas/agencias que puedan necesitar sus conocimientos en esa especialidad. Recuerde que los profesionales no aceptan trabajos que no pueden llevar a cabo con eficiencia.
* Combine recursos. Asóciese con colegas cuando tenga proyectos de grandes volúmenes.
* Complemente sus ingresos con trabajos de medio tiempo. Asista a talleres de capacitación sobre varias herramientas CAT. Esto le permite ayudar a otros y de esta forma recuperar parte de la inversión hecha para aprender dichas aplicaciones.
* Currículum Vitae. Vuelva a diseñarlo y dele prioridad a la calidad y no a la cantidad.
* Ofrezca sus servicios voluntarios a organizaciones filantrópicas o sin ánimo de lucro. Puede practicar sus habilidades lingüísticas y al mismo tiempo cooperar con una buena causa.
Conclusión
Las oportunidades nunca se pierden: otros aprovechan las que uno deja escapar. Pero esto no sucede al azar. Los que aprovechan dichas oportunidades son los que realmente las merecen, es decir, están preparados académicamente, hacen esfuerzos permanentes y nunca, pero nunca se dan por vencidos.
Los psicólogos más prominentes durante toda la historia de la humanidad, siempre han coincidido en que los fracasos o problemas hay que mirarlos como oportunidades para reflexionar y luego actuar haciendo los cambios respectivos. Los fracasos son otra forma de hacer las cosas y aunque nadie busca los errores, ellos son inevitables y por ende debemos prepararnos para afrontar con valentía, visión de futuro y entusiasmo cualquier vicisitud que tengamos, en vez de quejarnos por los golpes que recibamos.
Es innegable que las cosas suceden por causalidad y no por casualidad. Efectivamente: los accidentes o la suerte (vista como algo incontrolable) no existen. Cada quien recoge de lo que siembra y muchas veces en cantidades multiplicadas. Cada quien forja su suerte dependiendo de lo que piense y, obviamente, de lo que haga con dichos pensamientos.
El área de la traducción/interpretación no escapa a esta realidad y por consiguiente es más sensato sentarse a hacer un análisis profundo para empezar a avanzar por un camino diferente, pero hacia el mismo destino. Es cuestión de lógica simple considerar el hecho de que si “continuamos haciendo lo que siempre hemos hecho, podremos mantener lo que ahora tenemos.”
Expanding your MLM recruiting efforts into international markets with books and products will mean that language and translation will be one of many challenges. As well you will need to do market research, finding ways to distribute and perhaps even dealing with legal and banking problems. Regardless of all these things, don’t make translation unimportant or you won’t get very far.
Reports out of the U. S. State Department say that in general U. S. businesses may lose $50 billion in possible sales due to poor translations. This number could include your MLM business. If you are trying to market with a translation that is inaccurate or culturally unsuitable, you will be dead in the water. By using accurate translations you will communicate a high quality representation of your products or services and leverage your marketing message.
So just how do you get accurate translations? Not with computer-generated translations. It’s not smart to use computer-generated translations for your marketing messages as they just don’t do a good enough job and your information looks unprofessional to native speakers.
Finding a competent translation service can be difficult because there are literally thousands of them and the industry is unregulated. As well, unless you speak the language yourself you won’t be able to judge the quality of the translation.
Expanding you MLM marketplace through translation does need not to be limited to your local area. Translations can be sent by e-mail, and usually you can contact the translator by phone. You might find it easier to work with a company based in your own country however. Most translation services will give you a free price quote for your situation.
Check list for finding competent translation:
1. Will your project be handled by a native speaker? Someone fluent in the language may do fine but only those native to the language have the exact feel for it. Translations done by native speakers make your translations sound natural to your market.
2. Will your project be handled by someone who knows your industry? If the translator does not understand terms the outcome could be incorrect.
3. Will your project be handled by someone who works from their native country? If you work with a translation company that has people located in your country of choice, your translations will be up to date and linguistically and culturally correct.
4. In what file Format will your project be delivered? Make sure you use a translation service that works with the same file formats you use to avoid a problem. As well be sure that the company’s technology is up to date in wr78$(16case there are revisions at a later time.
5. Ask what the Quality Assurance procedures are and if your project is checked before it’s sent out.
6. Ask for references to others that the company has done work for. Contact references and ask if they were satisfied with the translation company’s services.
After you have chosen a translation service, work closely with them to ensure the quality of your project. However, don’t get into a ‘rush’ situation as this risks project quality. Be sure that your source material is well written and offer as much background material as needed to help the translator understand your product and learn your business terms. As well, it’s good to be available for questions during your MLM translation project. That way there’s no guessing to meet deadlines.
Expanding your marketplace through translation can open new avenues of revenue, but it must be done accurately.
This article introduced three strategies of globalization business and analyzed the relations among them;then offers some essential decisive-related questions for strategy scheme and decision making; and at last summarizes some issues for executives to think about.
The globalization directly affects the competitive situation of the world, it is necessary to make good use of strategies and reduce risks in order to establish and lift the power of business competition.
Because competition is emerging in very different markets, today’s businesses are forced to be globalized in non-traditional ways. Before enterprises make a presence in markets just so that they know what competitors in that market are doing and use it as a window to look into new trends and new competitive strategies. These are just some of the reasons that require businesses today to have a global mindset—it is an essential factor for survival.
Followed are three strategies for globalization business.
The first is to adjust measures according to local conditions of target area, and it’s the essence of all global business strategiesThere are differences in terms of costs for different raw materials, labor power, working skills, and institutional infrastructures. The decision makers with a global perspective have to recognize the differences acrosscountries and account for them in the strategic decisions. Those decisions may have to do with customers, raw materials, manufacturing, capital funds, market capacity or any of the dimensions on which strategic plans are made. Thus, a company in a labor-intensive business that fails to account for labor cost differentials acrosscountries.
On the contrast, the second strategy is to fully use the similarities across countries. Because there are significant similarities, it means that products, skills and investments that are made or developed for one market have the potential to be leveraged in multiple geographic markets. The similarities imply that a product created or developed in some market can be sold in another market without having to be reinvented. What that enables a business to do, for example, is to use its research and development dollars by selling a proven product from one market, usually the company’s home market, to different countries. This advantage is particularly significant in businesses like pharmaceuticals that are research and development intensive.
The above two strategies of similarities and differences across markets are not opposite ends of one scale. Rather, they are complementary dimensions and should both be leveraged. An executive needs to ask what the similarities and differences are across markets. It then becomes a matter of strategic choice whether to exploit similarities first or differences first or both simultaneously, in order to take advantages of the global potential that lies inherent in each business.
The third of globalization business strategy is about the fundamental choices. Typically, these decisions involve four considerations: operations and costs; customers and markets; competition; government policies. Does the product have a committed champion? Can a product sold in multiple markets increase competitive advantage in home market? Are the competitors in that particular market already global and therefore, does the company needs to have a presence in multiple markets to be able to defend against the competitors? Sometimes, answering these questions in the context of a company’s organization is as much an administrative as an economic and strategic process.
Ultimately, an executive must make sure that the company has a presence in multiple markets and view it like a global game of chess. He must coordinate competitive moves across countries; consciously decide in which country to launch a product, where the global competitors are strongest, where the cost structure is lowest, and where the business is likely to get the quickest market feedback. Then he must decide how to launch the product in other markets and how to manage pricing in multiple markets. It is the global chess game rather than individual market share games being played in local area. Unless all elements fit together, it is difficult to develop the competitive global business.
Under the circumstances of globalization, doing businesses on a global scale, recruiting translation talents from all over the world and integrating computer-aided translation technology into the businesses are three important strategic decisions that can bring success to translation companies.
Nowadays, many businesses get onto the track of globalization, so do translation services. In the process of globalization of translation services, if translation companies want to run their businesses successfully, they have to do three things on a strategic level to meet the challenges brought about by globalization.
First, they have to expand the company on global scale; second, they have to recruit translation talents coming from all over the world; third, they have to integrate computer-aided translation technology into management.
In the past, many translation companies delivered services only to some local customers. Since the local translation market was not very big, translation companies were always forced to attract some other businesses like printing, card making, advertising, etc. By doing so, they could make small money, but they could never expect to run their business in a more professional manner and on a large scale. However, with the development of globalization, translation has become one of the most popular industries across the world, which may include projects from small ones like translation of driving licenses, score lists of the students to big ones like providing interpreters to international conferences, preparing various negotiations, translating scientific materials in many fields, and so on. As the market is growing，running the business locally can not meet the requirements of globalization any more. In order to expand the translation company on a global scale, the company has to narrow its business scope, enlarge its business platform, build offices in cities across the world and manage its business in the direction of specialization.
In addition to running translation business professionally on a global scale, translation companies also need to recruit employees from all over the world. In the past, since translation companies only receive clients at home, the language types they engage in are limited to only several most popular languages in the world, such as English, French, Russian, Japanese, etc. Under the circumstances of globalization, whereas, the language translation may involves many native language conversions in the world, so translation companies have to recruit proficient translators from all over the world.
Last but not the least, when the market is globalized, it is also very important for integration of computer-aided translation technology into translation management and control process of the company. Decades ago, most translators did translation sentence by sentence only with the help of their brain. Although they often met with very similar expressions in one project running hundreds of pages, they had to translate those expressions again and again since they didn’t have any computer-aided translation software. In recent years, the usage of software such as TRADOS, CAT, transit, etc. has improved the working efficiency of the translation greatly. Usually, these kinds of translation assistant software have memory function, electronic glossary bank and search engine. With the help of them, the translators can search and make a comparison of the translated sentences in a fast manner so that they never need to translate those identical expressions which appear on different pages of the same article repeatedly, they can save the time which was used to repeatedly consult dictionaries thus improve their translating speed by a large margin.
Of course, in the globalization process, if translation companies want to run its business successfully, doing the above-mentioned things is not enough and many new problems may also come forth, but these three things mentioned above do play a very important role for development strategy of a translation company and ensure the business success.
Under the circumstances of globalization, doing businesses on a global scale, recruiting translation talents from all over the world and integrating computer-aided translation technology into the businesses are three important strategic decisions that can bring success to translation companies.
Nowadays, many businesses get onto the track of globalization, so do translation services. In the process of globalization of translation services, if translation companies want to run their businesses successfully, they have to do three things on a strategic level to meet the challenges brought about by globalization.
It is important to mention that it is the size of the organization matters more than for-profit or non-profit status in determining the objectives, steps and activities in the Strategic Planning process. Small non-profit and for-profit organizations have a similar manner of conducting business and planning activities that are different from larger non-profit and for-profit organizations.
However, there are certain characteristic distinctions between non-profit and for-profit organizations in relation to focus of the planning activities. Unlike for-profits, which tend to focus primarily on profit-maximizing activities, the non-profit organizations generally are more focused on matters of board development, fundraising and volunteer management. Hence, Non-Profit Strategic Planning concerns keeping in mind the interests of the board, its development and the well-being of its units. It is also aimed at laying stress on raising funds, while the other aspects of planning take a backseat.
New non-profit organizations need to take down strategic plans on paper and create a formal plan, including all the number of considerations a starter non-profit organization needs to take care of.
In case of old or pre-existing non-profit organizations, Strategic Planning requires preparing a long-term map delineating the sequence of activities over several years, from where one is today to where one aims to be in the future. Usually, a period of 3 to 5 years is covered by a strategic plan. The following are to be presented in the plan:
•Mission statement of organization, stating the reason for its inception and activities.
•Vision statement throwing light on what the organization is hoping to become.
•Values to be adhered to by the organization in the conduct of its activities.
•Assessment and description of the needs to be fulfilled by the non-profit organization.
•The organization’s immediate goals.
•An assessment of the organization’s present status.
•Strategies adopted to meet the goals and objectives.
Originally derived from the military context of a general deploying troops in battle, the concept of strategy has been applied to the centralized planning adopted by a CEO in formulating and achieving business goals of a firm. This is well illustrated by the writings of Alfred Sloan, the charismatic boss of the American car giant General Motors in its heyday. During the pioneering period of Anglo-American capitalism of the early twentieth century, such a classical view of strategy, rationally planned from the top of a pyramid-like structure with full command over the resources of an organization, made perfect sense. However, over the years, scholars began to unearth limitations of a totally planned strategy in an increasingly turbulent and competitive marketplace. They also observed that the distinction between strategy formulation and implementation could only occur within a planned strategy of the classical type and not within the more prevalent and credible process strategies of today. Increasingly, strategy formulation is undertaken more by teams rather than one charismatic and powerful individual.
There is a necessary connection between strategy and resources available to achieve a firm’s business goals. For example, in Chandler’s (1962) definition, strategy is ‘the determination of the basic long-term goals and objectives of an enterprise and the adoption of courses of action and the allocation of resources necessary for carrying out the goals’. A much broader definition specific to business enterprises is provided below although here resource allocation is only implied.
Corporate strategy is the pattern of decisions in a company that determines and reveals its objectives, purposes, goals; produces the principal policies and plans for achieving these goals, and defines the range of business the company is to pursue, the kind of economic and human organization it is or intends to be, and the nature of the economic and non-economic contributions it intends to make to its shareholders, employees, customers, and communities (Andrews 1980).
In Andrews’ definition, there appears to be a clear division between strategy formulation and its implementation. It is at the implementation stage that resource allocation becomes crucial. This is in keeping with the classical or planned model of thinking about strategy. In the more recent, process, or resource-based view (RBV) of strategy, when speaking of the competitive advantage of a firm, scholars stress the importance of ‘resources’ and ‘capabilities’ available to it. It is commonsensical to argue that the strategy implementation of an enterprise is predicated on the availability (’command’) of resources and capabilities of the firm. Resources are held to be available business-wide, while capabilities are the skills and abilities developed within and specific to the firm. Resources alone therefore, are not in themselves sufficient to gain a ’sustainable competitive advantage’ for a firm. Capabilities, often in the form of patents, and expertise developed in-house, and not easily replicated by outsiders, are equally, if not more important.
It is too simplistic to separate strategy implementation from strategy formulation, since a strategy has to be adaptive and evolving, while keeping at the forefront the ends and goals that need to be met for the business to remain viable. Barney (1991), supported by a number of other researchers, claimed that a firm’s key resources needed optimally to conform to the following criteria. The resources must be 1) valuable, 2) rare, 3) does not allow being imitated easily, and 4) not lend themselves to be substituted. However, simply having a supply of resources is not enough. The example given is that having a great deal of money (financial resources) without a clear rationale for its use to generate rent or profit is ineffective. Other ways of referring to resources in a business context are for example: capital, equipment, (tangible assets), and the skills of managers and employees (intangible). Again, just a collection of resources without a clear framework in which to integrate and utilize them would not work. An organization’s activities must be totally in keeping with its resources, circumstances and objectives. It cannot be all things to all (would-be) customers.
Information Technology as a resource these days transforms strategy formulation into a continuous process with performance feedback available to decision makers on a daily, if not an hourly, basis. It is therefore spurious to isolate strategy formulation as a one-off activity, although strategy by its very nature has to be the result of a long-term orientation.
An example in strategic choice is America’s 20th largest manufacturer, and the world’s 55th largest publicly held manufacturer, United Technologies Corporation. It is the 43rd largest US corporation according to the Fortune 500 (2006) list, with 215, 000 employees. UTC makes Otis lifts, Carrier heating and air-conditioning, Hamilton Sundstrand aerospace and industrial systems, Sikorsky helicopters, Pratt and Whitney jet engines, and Chubb security systems. Chubb and Kidde were British companies bought by UTC within the last four years. UTC has thousands of branch offices all over the world. Internet and IT is the key to UTC’s success. ‘Otis’s new system opens a worldwide file for each job, and prevents mistakes in configuration or logistics. Otis is … pretty slick at making lifts - it has … a 19% operating margin, compared with its rivals’ 9%’ (The Sunday Times, Business: June 17, 2007). It is obvious that the UTC chief executive’s command over the organization’s resources around the world accounts for its superior productivity and competitive advantage. But it is equally clear that his control over resources is the result of well-thought out strategic decision-making of someone in close touch with the realities of business in the 21st century.
Michael Porter makes an important distinction between operational effectiveness and strategy. He contends that operational effectiveness of businesses is necessary for their success but not sufficient in itself without a well-thought out strategy behind it. In the recent past companies in their search for market advantage through higher productivity, have resorted to a number of management tools. These include, ‘Total Quality Management, benchmarking, time-based competition, outsourcing, partnering, reengineering and change management’. These tools are useful and may enable firms to perform similar activities better than their competitors. But to be effective, strategic thinking requires performing different activities from your rivals, or perform the same activities differently.
Due to the rapid diffusion of best practice, a productivity barrier is soon reached. Porter gives the example of Japanese car firms which dominated in the 1970s and 1980s. Lack of a strategic perspective has since held them back, while other Japanese businesses like Sony and Cannon flourish due to their strategic positioning. Unlike the car firms, the latter did not sit back with a ready formulated strategy that worked in the past, but revised their strategic thinking taking account of the changing realities of world trade. Obviously, their resource base and mix would have had to alter, and continue to change in the light of changing circumstances.
Southwest Airlines is cited as an example of a business that did not rely only on operational effectiveness but actively developed a strategy to take advantage of a gap in the market. Its success reminds one of similar successes achieved by ‘no frills’ airlines in the UK (e.g. Ryanair and Easyjet). They are all short-haul, low cost, point-to-point, carriers serving mid-sized cities using secondary airports. They do not fly long distances and limit the facilities available to passengers such as not providing meals on board. Southwest Airlines introduced automated ticketing systems and avoided using travel agents. The turnaround time was on average less than 15 minutes. This was achieved, as part of the strategy by employing better-paid, efficient ground and gate crew. Another airline (Continental Airlines) with an established long-haul capability tried to emulate Southwest Airlines and failed miseraby. Theoretically, although Continental Lite (as the short-haul arm was called) could command the same or even better physical resources than Southwest Airlines, its failure was ascribed to lack of strategic direction. With their fleet limited to Boeing 737s, Southwest Airlines managed a higher level of aircraft utilization than Continental. This and other synergies that it’s fully thought out strategy entailed, made it unbeatable.
Examples of the interplay between strategic thinking and resource allocation are given below. IKEA, the Swedish furniture and household goods retailer is a case in point. An ‘activity system map’ reveals IKEAs strategy of segmenting the urban working customer and meeting his/her needs. Its positioning in suburban sites with ample parking space helps customers in self-transport of purchases. Its items are supplied from an ample inventory and it relies on long-term supplier sources. It does not have a large sales force as items displayed are self-selected by customers. The design of its floor space is such that customers are led from one display to another in a logical sequence. This often leads to impulse buying. It does not always follow that the availability and command of resources alone can help in the operationalizing of a formulated strategy. The IKEA ‘activity system map’ discussed above show that organizational structures, systems and processes have to be in line with a clearly defined and ‘owned’ strategy in order for the organization to thrive. In all the examples given here, we can see how all activities of a firm support and reinforce each other to achieve business goals.
‘The success of a strategy depends on doing many things well - not just a few - and integrating among them. Strategy requires constant discipline and clear communication’. Another example is Carmike Cinemas which concentrates in serving cities and towns with less than 200, 000 people. It employs just one member of staff, the manager in each of its theatres, spends less on films (’lean cost structure’) and passes on the savings to customers. The strategy has worked well with Carmike Cinemas with overheads as low as 2% compared with the industry average of 5%.
The above examples bring us to the consideration of another important variable in the optimal utilization of a firm’s resources. This is the concept of trade-offs. IKEA has to trade-off serving wealthy customers with one-off articles of high value furniture in order to satisfy its chosen, average income clientele. Southwest Airlines had to forego the luxury end of the long-haul flier market (e.g. first class and business class) in order to concentrate and win over the frequent traveler between short distances, who may have habitually undertaken that journey earlier by bus or car. Carmike Cinemas avoids locating in large cities with variable pricing. The example of Continental Airlines underlines the danger of not understanding the nature and importance of trade-offs. It tried to operate equally in both the long-haul market with its travel agents, high cost and high customer expectations end of the continuum, and also cater for the low end of the market. This resulted in confusion and dissatisfaction among its staff, travel agents and its customers. Arguably, resources (passenger planes, airport access) were equally available to both Airlines, but lack of insight by top management on the strategic fit of their activities and trade-offs resulted in a celebrated failure of massive proportions.
Business literature is replete with discussions on what strategy is, but does not give a conclusive answer. This paper relies on a broad distinction between pre-planned strategies and an ongoing, processual, and resource-based approach.
From the evidence discussed above, we can safely conclude that strategy implementation is not just a matter of finding and utilizing resources to activate a previously formulated strategy in the abstract, but a continuous, creative and synergistic application of selected resources and capabilities to optimize a sustained organizational viability that is eminently practical and profitable.
A business strategy is formulated by selecting the target audience of the product and assembling the marketing mix. A firm can assemble marketing mix elements in many different ways so that the relative weightage of the different elements will be different in the different combinations. Because of this reality, business firms are employing an abundance of strategies and strategy stances. It is a relentless race to stay ahead of competition.
Basically, however, there are only two broad routes available for forging business strategies. They are the price route and the differentiation route. In other words, any strategy has to be ultimately either a price-based strategy or a differentiation-based strategy.
Companies taking the price route compete on the strength of their pricing and the price cushions they enjoy. Normally, those who resort to the price route and compete on price will enjoy substantial cost advantages, giving them flexibility in pricing and marketing. The differentiation route, on the other hand, revolves around elements other than price. The product with its innumerable features is one major source of differentiation. In fact, any of the ever-so-many activities performed by the business unit can constitute the nucleus for differentiation.
In other words, differentiation allows the company the freedom and flexibility to fight on the non-price front. Differentiation, therefore, is a crucial option for a firm in its search for a rewarding strategy. A good majority of business battles are in fact fought with a differentiation-based strategy rather than a price-based strategy.
As already mentioned, a business unit that opts for the price route in its competitive battle will enjoy certain flexibilities in the matter of pricing of its products, and use price as the main competitive lever. It will price its products to suit varying competitive demands. It will enjoy certain inherent cost advantages, which permit it to resort to a price-based fight.
