Strategic Management Research Journal, Part 2 Management Essay

Strategic Management Research Journal Part 2
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Strategic Management Research Journal Part 2
Role of Strategic Planning in Achieving Competitive Advantage
Strategic planning refers to the process of developing new strategies and implementing them within an organization to attain the set-out goals of a given firm. This process helps the firm or organization to realize several things, including gaining a competitive advantage over its competitors. Through strategic planning, an organization gets to overcome its competitive forces by foreseeing the future. With a vivid and clear vision of what the future holds, an organization stands at a better position of determining the possible problems that might occur before they take place. This way, mitigation measures can be laid out in advance to prevent the organization from being affected by the anticipated challenges. With that done, the organization then gets to have a better chance of beating its competitors who, due to lack of planning, obliviously slumps into the potential problems.
Caterpillar Inc. Top Focus
According to the strategy and purpose statement that is stipulated on the Caterpillar Inc website, it is evident that the company's primary focus is shareholder value creation. The statement reads,
“Our enterprise strategy focuses on solutions to help our customers build a better world and allows us to deliver profitable growth for our shareholders.” (Caterpillar, 2019)
From the look of the statement, it is clear Caterpillar is so much focused on finding solutions that enable its customers to create a better world. This argument seems to be putting more emphasis on the customer when observed literally. However, from a more in-depth analysis, the debate in the company's strategy statement does influence a profitable growth to the shareholder. This is because presenting solution-oriented products in the market beckons more customers who, in return, create profitable growth to the shareholders, consequently creating more value.
Leveraging of Appropriate Value and Cost in Caterpillar’s Business Strategy
It is convincible to argue that indeed, Caterpillar Inc's business strategy ensures that appropriate value and cost drivers are leveraged promptly. This is because the organization’s business strategy is based on an information-driven approach, which incorporates the use of the Operating and Execution model (O&E). This model is critical in the growth of Caterpillar Inc since it the medium that propels the organization to gain a competitive advantage over its competitors. Through the O&E model, Caterpillar Inc gets to determine the sections of the business that either consume or create more value. With this realization, the company gets to understand the areas with or with the potential of presenting a competitive advantage. This way, more resources are, therefore, directed in such regions to influence growth (Caterpillar, 2019).
Strengths and Weaknesses of Caterpillar’s Competitive Advantages
The primary competitive advantage for Caterpillar Inc is the brand image. It is no doubt that Caterpillar h...