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¶ … business, the CEO plays an important role in decision making. One factor that the CEO uses for their decision making processes is commonly refered to as environmental scanning. Environmental scanning is the strategy of determining the overall economic environment of a business in order to make dynamic decisions and ensure continuous growth. This is one role that can only be done by the CEO who is privy to information from all departemnts and angles of the business.
There are many factors that go into proper environmental scanning. For instance, the CEO must have pertinent network ties, both inside and outside the company. These ties keep the CEO grounded in a realistic view of the company and its current financial state. Network ties outside of the industry are especially important because those ties have an outside perspective and can assist the CEO in seeing all the extra-industry and socioeconomic trends.
In order to prove the importance of environmental scanning, the author attempted an experiment where certain keywords related to environmental scanning were detected and pulled from the annual reports of various businesses. The study found that there was a statistically signifigant positive relationship between CEO extraindustry network ties and focus of environmental scanning. In other words, the companies who were obviously and actively using environmental scanning had the highest amount of extraindustry network ties.
The article then goes on to discuss the fact that prudent CEO's use the information obtained from the environmental scanning to change and update their business to follow the growing needs and demands of their respective industry. The overall conclusions of the article are that environmental scanning allows CEO's to change their businesses keeping them dynamic and competitive in the continuously changing marketplace. Additionally, the quality of their overall analysis, rests of the types of contacts that the CEO has....
When CEO's have contacts outside of the both their company and their business, the reports are much more informed and broad and allow for greater flexability, interpretation, and change.
From this reading, I learned that it is vital to the success of a business to make connections outside of the company. The primary question that this article raised in my mind was as to the credibility of those network connections within a specialized industry. The author's primary question was regarding the importance of intrabusinsess connections with regard to the growth and transformation of a business.
Abebe, Michael, et al. (2010). Chief Executive Networks and Environmental Scanning Activities: An Emprical Examination. Strategic Management Review, 4(1), 30-43.
The business world can be a tricky place to maneuver, especially for those in executive positions whose entire income rests on the success of their company. In order to foster greater success, some companies such as Enron, stepped over the line and falsely reported their company's value in the annual reports. As a result, the company unexpectedly collapsed resulting in thousand's of employees losing their retirement accounts and the company going bankrupt. Those invovled in the misrepresentation were prosecuted for their actions to commit fraud. Even more, the government stepped in and enacted Sarbanes-Oxley to put stronger reings on the actions that businesses can take regarding their financial reports.
This article seeks to explore two hypothesis. First: "Does a high presence of institutional ownership foster an environment conducive to earnings management?" And second: How is prior positive organizational performance related to earnings management in an institutional heavy firm? In other words, what causes a business to…
The question being raised in this study is which type of institutional ownership is positive and which is negative to the overall success of a company. The study revealed that insurance and banks have a negative effect on corporate political stratagies. The reason was that those agencies are very conservative and seek to ensure that only the most conservative decisions are made within the company. On the other hand, there was no corrolation found between other insider groups inculding employees, as some would vote against decisions and risks, while others were infavor of those risks.
Overall, the study confirmed that there is a link between a company's owners and the desire to appear a certain way to the media. It is always risky portraying the company to the public eye, so conservative investors tended to shy away from such a risk. However, the more risk-taking players within the businesses would often seek this outside reinforcement of business decisions and often enjoy the resulting success.
Ozer, M., Oneonta, S., Alakent, E. (2010). Institutional Ownership and Corporate Political Stratagies: Does Heterogeniety of Institutional Owners Matter? Strategic Management, 4(1), 18-29.
Financial managers and CEO's play important roles in ensuring that organizations meet their specific goals. The skill levels for both positions are high and require a great deal of patience and experience. The purpose of this discussion is to determine whether being a financial manager is the best preparation for later becoming a CEO. Role of the Financial Manager According to the Bureau of Labor, financial managers must have a bachelor's degree
Collaboration between HR and operational departments is essential to establish the right criteria for knowledge, skills, and abilities, previous performance, and other desirable objective traits in successful candidates. Collaboration between HR and operational managers must include the final candidate selection process. Managers are hiring according to apparent nationality and cultural biases. Slide #6 Legal Considerations The consequences of accusations or claims of discrimination could be damaging to the organization both financially and in terms of
We can use this opportunity to establish loyalty among our existing customers, develop referrals among our customers to their colleagues, and establish our brand and credibility as local suppliers of organic fertilizer of high quality and at a good price to our market. With this in place, it will be difficult for any new market entrants to displace us in our local area as the main suppliers of organic
CEO of Harley Davidson The Harley Davidson Company came to be in 1903, founded by William Harvey and Arthur Davidson. In 1907, the two associates incorporated the Harvey Davidson Motor Company leading to a split of stock into four, to cater for the new associate Walter Davidson. Over the years, Harley Davidson has managed to remain financially stable, despite the prior records of slowed growth, owing to the maturing market that
This means that you must continually monitor and communicate about possible changes, pertaining to the overall scope of the threat. Once this occurs, is when an entity will have an effective security procedure that will adapt to the various changes that are taking place. This is significant, because this information can be used to corroborate the overall nature of security threats that could be faced by the SME. Where, this
Alford reports that "for some, the earth moves when they discover that people in authority routinely lie and that those who work for them routinely cover up. Once one knows this, or rather once one feels this knowledge in one's bones, one lives in a new world. Some people remain aliens in the new world forever. Maybe they like it that way. Maybe they don't have a choice." (Alford,