Theoretical Basis of Hyundai Strategies

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There are four main concepts of approaches to strategy recognized. These are: Classic, Environmental, Processual, and Systemic. The four approaches differ widely. The Classic theory suggests that the main goal of business is profitability, and to achieve it requires rational planning. The key main features of the Classical approach are; attachment to rational analysis, conception is separated from execution, commitment to profit maximization. In Classic approach the fundamental strategic problem is defined as positioning of the firm in the markets with the maximum profit earning (Sloan, 1963). Evolutionary approaches to strategy also consider that high profitability is essential for survival, however, they consider markets to be the main force to secure profit maximization, and not the ability of the top management to plan and act rationally. According to Williamson (Williamson, 1991) the only real comparative advantage is relative efficiency. Processual approaches consider that neither the ability of top management to strategize rationally, nor markets, is ensuring profit maximizing outcomes. Processual approach inclines towards incremental adjustment (Quinn, 1980) and cultivation of core competences. In Systemic approach, the styles of strategy are embedded in particular social system, and while to the outsider the strategy might seem irregular, their processes and goals are considered rational according to the local criteria. To Systemic theory, the differences between countries’ social systems and changes within countries political systems are important. For the South-East Asia, prevailing forms of business vary according to the local interplay of state, familial and market structures (Whitley, 1999). In my opinion, the Hyundai Motors Company strategies are based on the Systemic concept/theory. The factors supporting this point of view are as following: Ownership structures have implications on the strategy. In the Anglo-Saxon economies the detached...
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