Introduction
Development and implementation of efficient management strategies are the challenging issues for multinational corporations (Inamete 2014). The effective corporate strategy takes into consideration the multiple evaluations of the internal and external environments: the situation in the market, costs and budgets, as well as the organizational strengths, weaknesses, and knowledge. It is considered that the value-based strategies may successfully help in addressing such issues as allocation of resources, creation of synergy between departments and various business operations, increase in efficiency of managerial decision-making, and development of the organisational portfolio (Goold & Sommers Luchs 1996).
The strategy implementation is usually determined as a ‘sequence of carefully planned consecutive steps’ (Li, Guohui & Eppler 2010). It is observed that strategies may fail because of the unexpected environmental changes in the market or their inefficient performance.
The success of the strategy largely depends on the internal organisational factors. The formulation of the appropriate strategic objectives, the maintenance of sound interrelations and communication between the organisational units, goal-oriented execution, elaboration of tactics for the strategy implementation, and the level of employees’ commitment influence the strategic efficiency.
The current report provides the investigation of WRSX Group business strategy. WRSX Group is a large international advertisement and marketing agency with the headquarter offices in Paris, New York, London, and Singapore. Nowadays, the international advertisement and marketing industry is exposed to continuous and rapid changes following the technological advancement and the shifts in the customers’ preferences. And the managerial ability to manage changes is regarded as a core competency in many industries (Rawlins 2014).
The evaluation of the organisational strategy will allow the identification of WRSX Group’s competencies, as well as its weaknesses and strengths in the development of abilities aimed to cope with the changes in the external environment. The information obtained through the strategic analysis will assist in the elaboration of an appropriate and effective strategy that will help WRSX Group to develop the competitive advantages such as high level of organisational attractiveness, customer loyalty, and profitability increase.
WRSX Strategic Decision-Making
The overall business performance is always affected by many factors, but it is possible to say that the influence of leadership is crucial in this regard (Dukynaite & Alisauskas 2012). According to WRSX Group report, its Leadership Capability scores are negatively affected by the ineffective managerial operations, the lack of information and knowledge management, and poor administration in some of the international offices.
As a result, WRSX Group’s indicators are below the industry average in many aspects of performance (WRSX 2009). Moreover, some of the organisational leaders (Raphael Roux and Serge Toussaint from the Parisian office) were involved in the corporate scandals the bribery incidents that indicate a low level of efficiency in the organisational governance and managerial regulation (WRSX 2009).
The issues of poor inner organisational regulation may be successfully evaluated from the theoretical perspective of the strategic and ethical leadership. The previous literature findings make it clear that the success of any organisation largely depends on the way it is managed (Harrington & Ottenbacher 2011). Since the leaders’ decision and behaviour may be considered a decisive factor in the efficiency of the organisational business conduct and the employees’ productivity, the selection of right strategic approaches in leadership may have a significant favourable effect on the corporate performance and its outcomes.
The strategic and ethical leadership are meant to address a set of issues of both internal and external character. Through the elaboration of leadership strategies, the executives may achieve success in managing and guiding their subordinates, establishment of partnership relationships, and addressing the needs of organisational stakeholders (Sergiu 2015).
Leadership involves inspiration, motivation, and encouraging for achievements, while effective management is focused merely on the fulfilment of the basic working processes. ‘In an organisational context, most agree that, at the very least, leaders set the tone for their organisation and, therefore, questions about their leadership immediately raise broader questions about the organisation, and potentially the teams that they lead being a reflection of their leadership’ (Carnall & Roebuck 2015). Therefore, it is very important for WRSX Group leaders to comply with the ethical principles to establish high standards of conduct and performance for all members of the working staff.
Through the incorporation of ethical principles into the strategy, WRSX leaders may effectively address the issues of corporate sustainability and value increase. As Strand (2014) claims, ‘corporate sustainability refers to the integration of economic, environmental, and social considerations on the part of corporations’ (688). The managerial strategies and the compliance of the leaders with their organisational responsibilities may have the overall positive effects on the business outcomes. Therefore, organisational leaders need to address these aspects of corporate performance while developing a strategy.
Traditionally, strategic leadership focuses on the group of top management and its executive capabilities (Strand 2014). The strategies may usually be task-oriented or employee-oriented, and through them, the leaders attempt to guide, support, and motivate the subordinates, communicate with them, and give feedback. The motivational aspect is essential to the strategic efficiency as it gives the employees the purpose for the effective fulfilment of their duties and productivity increase (Atta-Panin 2013).
The consideration of the concept of corporate sustainability by leadership allows the realization of the external advantages and disadvantages ‘that may have otherwise gone unrealized without concerted attention and coordination afforded by a strategic level position’ (Strand 2014). In this way, by increasing the corporate social responsibilities leaders attain the opportunity to expand their focus. As a result, the organisation accumulates the competitive advantages that help it to overcome the crises, forecast it, and prevent undesired outcomes.
According to ADCOM Industry Benchmark Survey Results & Impact on Share Price, WRSX’s Leadership Capability indicators and Corporate Social Responsibility indicators are below the Industry average (WRSX 2009). Moreover, since the fourth quarter of 2008, WRSX share price declined from the point of £3.71million to £2.28 million by the ninth quarter (WRSX 2009). It is observed that the value decrease is caused by the bribery incidents in the Parisian office. Therefore, it is possible to assume that the orientation to ethics and corporate sustainability in the leadership strategy is of significant importance for WRSX because the inclusion of ethical principles into the strategic management will help the leaders to increase the organisational value and share price.
While strategic leadership is rather focused on the increase of organisational efficiency through the evaluation of environments, the ethical leadership is more concerned with the issues of moral and respectful business conduct (Mihelic, Lipicnik & Tekavcic 2010). Despite the differences in approaches, both leadership styles provide the opportunities for the organisational improvement, and the incorporation of different strategic approaches to the organisational regulation may allow the leaders to attain the long-term sustainability in business.
Ethical leadership is primarily concerned with decision-making and its consequences. According to the principles of ethics, the top managerial group needs to make the decision based on fairness, responsibility and respect (Mihelic, Lipicnik & Tekavcic 2010).
The leaders are regarded as main contributors to the dissemination and incorporation of ethical values into the organisational culture. Thus, the efficiency of ethical leadership defines the extent towards which the subordinates accept the principles of ethical behaviour at the workplace and comply with them. ‘Ethical leaders’ conduct serves as role-modelling behaviour for followers as their behaviour is accepted as appropriate’ (Mihelic, Lipicnik & Tekavcic 2010). Therefore, communication may be regarded as the main instrument of ethical leadership. The establishment of a sound and positive leader-employee relationships is the only way for the development of ethical behaviour in the subordinates.
Through the consideration of the universal ethical and moral principles, and by addressing the needs and interests of a vast number of stakeholder groups, the leaders represent the organisation as a good corporate citizen and improve its reputation in the external environment (Mihelic, Lipicnik & Tekavcic 2010). In this way, in comparison to the competitors who do not pay respect to ethical conduct, WRSX may gain the advantages of the customer attraction, brand awareness, and, as a result, the profitability increase.
Moreover, compliance with ethics may help WRSX Group to decrease the staff turnover. The previous WRSX’s low Leadership Capabilities indicators demonstrate that the corporate leadership strategy was underdeveloped and, as a result, the organisational culture was affected in a negative way. The company also experienced difficulties in the retention of personnel and the attraction of new employees (WRSX 2009).
It is possible to say that the negative impacts on corporate culture and personnel management are mainly provoked by poorly developed leadership capabilities. The incorporation of the ethical values and standards into the organizational culture will help to increase its attractiveness to the potential employees and improve the motivation of current personnel (Sergiu 2015). The ethical leadership is regarded as a vital element in the fulfilment of the corporate mission and vision; it serves as the motivation for the achievement of the long-term and short-term goals (Mihelic, Lipicnik & Tekavcic 2010). Overall, the ethical leadership indicates the moral health of the organisation which is regarded as the main construct of corporate sustainability and success.
Analysis of Changes in WRSX Strategy
Initially, the strength of WRSX Group’s strategy was in its customer-oriented approach to trade and business conduct. Before the organisational involvement in the corruption scandal, WRSX had an excellent reputation, and the company represented itself as a good corporate citizen. However, the main weaknesses of the strategy included poor leadership management and the lack of corporate integrity.
Two main forms of internalisation and entry to the new countries was acquisition and merger with other organisations in the hosting markets (WRSX 2009). Traditionally, WRSX Group supported the independent operation of different business units and attempted to maintain their autonomy because the top management believed that this kind of business structure increased the managerial effectiveness at the local levels.
WRSX didn’t have the universal corporate policies and regulations that would unify all units located in different countries, and the company tended to manage businesses regionally. However, this policy proved to be inefficient in control of leaders’ decisions. Therefore, the company needs to focus its strategic decisions and goals on the elaboration of the organisational culture and development of policies that will include the universal standards of conduct, clear-cut ethical values, and principles of business operation that will help WRSX to handle the difficult situation with leadership and improve organisational performance in multiple areas.
The evaluation of the original strategic position makes it clear that the integration of corporate units through the compliance with common organisational regulations is vital. The enhancement of the leadership capabilities is of significant importance as well. Since it is observed that only a few of WRSX Group offices demonstrate poor performance in leadership indicators, the development of the solid corporate culture that will be accepted in all regions of business operation will help to provide the conformity in the performance of the executive offices and raise the standards of business conduct at the local levels.
Strategy into Practice
In the lecture ‘Strategy. Or a series of unfortunate events,’ Richard Lee discussed the aspects of strategic planning, the significance of managerial insight and intuition in the evaluation of external and internal environments, and the constructs of effective execution of the developed strategy. Richard Lee has a large experience in IT management and development, and his lecture supported by the extensive competence provided motivation and helped to attain a deeper understanding of the subject.
First of all, the lecturer emphasized the importance of a strategic vision of the desired achievements and goals in business. The strategic vision may be externally and internally oriented, and it requires the clear formulation of long-term and short-term objectives, development of corporate values and mission statements that would serve as motivators for the organisational employees, efficient knowledge management, and free dissemination of information within the company’s boundaries. Since the working team plays a significant role in the execution of strategic processes, the team-building is important as well. The cohesion within the work team can be efficiently provided through the elements of corporate culture and effective communication patterns between leaders and subordinates.
The execution of strategy in the continuously changing conditions may be challenging. To increase the possibility of success, the strategy must be exposed to the systematic evaluations and analysis. The assessment of strategic efficiency in the achievement of short-term goals may help to avoid and forecast the difficulties, and make the timely corrections in the strategic directions.
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