Minicase 18/ the Premature Death of a Google Forerunner at Microsoft Essay

766 WordsJun 24, 20154 Pages
1. Describe the strategic management process at Microsoft. How are strategic decisions made? What are the strengths and weaknesses of this approach? The strategic management process lists the steps the managers need to take to create and implement strategy successfully in the company. The strategies goal is to lead to a sustainable competitive advantage. Microsoft is a dominant high-tech organization that is large and diversified with many products in many different stages of development. Since Microsoft is competing in a rapidly changing environment, it needs a formal strategic plan. The planning process at Microsoft includes functional and top managers. Their formal strategy plan allows Microsoft to plan toward improving the effectiveness of functional operations. It also allows less time taken to make decisions because only top managers can make decisions regarding strategy which implies all strategic decisions are rational and structured. This plan can fall to criticisms that include the claim that the real world is unpredictable, that lower-level employees often play an important role in the formulation process, and that great strategies are the result of good luck rather than rational planning. An example of this was mentioned in the case when Steve Ballmer decided to shut down LinkExchange even though a lower-level manager suggested that he was making a mistake. In fact, Steve was making a mistake and it cost Microsoft to miss out on gaining competitive advantage in online advertising. 2. Explain the role of organizational inertia in Microsoft’s difficulty in establishing a presence in the online paid-search business. What could Microsoft have done differently? What recommendations pertaining to the strategic management process would you give? Organizational inertia stems from routine behavior, which is the repetitive pattern of activity by

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