Policy translation and inter-organizational strategy at McDonald's

Inter-Organizational strategic direction
Introduction
Organizations in the current market place are facing increasing need to become more competitive. This need is even more pronounced in multi-national organizations that work in partnership with other organizations and local governments. Organizations are facing unprecedented challenges as a result of among other factors, increased technological needs, and the growing focus to internal business, environmental factors, and the need to realize organizational objectives while at the same time observing the laid down policies (Le Pennec and Raufflet 2018; Alexander 2014). For this paper, the organization selected is McDonalds, the fast food retail chain with multiple internal entities – divisions, locations - nationally and internationally and works in partnership with other organizations to realize the set objectives.
Task 1: How policy objectives are translated into inter-organizational strategies
1.1. Review and assess the relationship between different partners in the development of policy and its impact on inter-organizational strategies.
McDonalds is an organization that works in various countries and in partnership with various other organizations as suppliers and distributors in their value chain. Given the success of the fast food retail chain, the relationship with suppliers is generally positive and successful. McDonald’s relationship with the various partners is based on trust and collaboration that is vested on success (Pradhan 2018). The organization encourages the various partners to be of equal footing and have a common vision that is not only limited to chemistry. For example, one of the partners for McDonalds is Coca-Cola. These two have a relationship of shared common mission and vision which is to expand to a global scale. Arguably, without this shared mission and vision, neither of the two would be where they are today – some of the top brands with a global reach.
The various partners that McDonalds has have similar or comparable policies whether in terms of expansion, product management, environmental policy, and human resource management. For example, the organization has a strict environmental policy that requires suppliers to observe animal right and humane treatment of their poultry. As a result, this policy helps to shape and affect the relationship the organization has with various organizations in the value-chain and supply system. Over the years, the organization has dropped some of their suppliers as a result of not observing environmental factors. Given the financial standing of McDonalds, it has influence of most of the other organization that it is in partnership with as to require them to orient their policies and operations to suit McDonald’s policy requirements. To this effect, it is upon McDonalds suppliers to change their operations, production system, and system so as to continue benefiting from the business provided by the fast food chain.
1.2. Evaluate the contribution of economic, political and social factors to the development of inter-organizational policy and strategy.
Various external factors affect McDonalds differently depending on the country or region of operation. The organization mainly focuses on economic and social factors, but it has ahs to deal with political and technological factors in their day to day operations and in its relationship with other organizations.
Economically – McDonalds is a ‘for profit’ organization therefore, in the development of its inter-organizational policy and strategy, the company has to consider hoe profitable the relationship will be. While in most cases, this has to be in the specter of financial profit, it is also in terms of the business the partnership will create for the organization. For example, while in the selection of its suppliers it has to consider a supplier with a significantly low pricing to allow for a significant profit margin, it has also to consider on the quality of the product being supplied (Golonka 2013). For example, its partnership with Coca-Cola benefits McDonalds in that; it is known that one of the best places to have a coke is in McDonald. This has to do with the fact that, the treatment, packaging, and transportation of coke to McDonalds outlets is done differently because of it is a large supplier, which in turn affects the taste of the coke.
Politically – politics plays a crucial role in the development of inter-organizational strategy and policy. In most cases, politics affect the development of inter-organizational policy and strategy negatively in the form of tariffs and trade embargos (Golonka 2013). The politico-legal system often referred to as the formal institutions operating within a country or a region will significantly affect the not only the development of inter-organizational policy and strategy, but also the performance. This is best illustrated by the fact that, McDonalds has limited partnerships in developing countries because of the nature of and the requirements by the formal institutions. These do not only stifle the initiation of operations in these regions, but also curtail operations. In addition other political aspects like tariffs and trade embargos affect inter-organizational policy and strategy. For example, the current trade tariffs being imposed by the Current rump Administration affect policy and strategy significantly as the organization has to realign its operations so as to be considered compliant.
Social – the main social aspects that the organization has to deal with include national culture, health, and trust. McDonalds is a fast food company and in many societal setups, fast food is considered to be the main cause of such health related conditions like obesity. While this might not be entirely correct based on current research findings, it is a factor that continues to affect inter-organizational relationship and the policy and strategy adopted by the organization. For example, in Asian countries, the company had to orient its operations and products so as to suit the local requirements, culture, and norms. To achieve this, the organization has to collaborate with local suppliers and change its policy and strategy from the western-style production to the Asian-customer preferences.
Technological – the organization relies on technology for majority of its production e.g. through automation, research and development, and mobile advertising and technology. Technology also plays a part in inter-organizational policy and strategy development. The technological environment in which the organization operates in is a major cause of the dynamic growth in alliances and networks. As a result of deepening of globalization and processes related to globalization, increasing competition, and emerging markets, technology plays a crucial role in inter-organizational policy. To this effect, organizations have to make policy and strategy on how to use technology e.g. video conferences to replace the conventional board meetings.
1.3. Assess and evaluate the role of domestic, national, and multi-national interests in the translation of policy into inter-organizational strategy.
In addition to the generation of profits, the organization has domestic, national, and multi-national interests which are survival, growth, and market share. To realize these objectives, McDonalds the organization has set policy into inter-organizational strategy. First, the organization has adopted varying business models within its fast-food business. These include the operation of restaurants and restaurant franchise. These two models have resulted to increase in their market share and growth at the same time. About 15% of the McDonald restaurants are directly owned by the organization, the others are under franchise operations i.e. they are in to joint venture with the owners (Pradhan 2018).
Secondly, for profit maximization, the organization is also venturing into properties. Properties are considered to be a second source of revenue. As compared to the fast-food business, real estate is rather stable and its income dependable. In addition, any economic issues that face the properties market are projectable as compared to the very unstable fast-food business. This way, the properties business guarantees continued income generation for the organizations as well as profit maximization for the organizations. The property business is a domestic interest within the American market, and the organization majors primarily on restaurants business outside the US.
To realize this objective within the US, the organization has adopted various policies and strategies. First, the organization is flexible enough to change with the aim of aligning its global operations and strategy with the aim of realizing the set objective. This ability was best witnessed in 2015 after the company revamped its operations, spruced up the company image globally and set new goals to adapt to the changing demographics within its customer base. The ability to change with the times is a major factors how the organization translates its interests to the inter-organizational strategy and policy.
Second, for the organization to remain profitable, grow, and increase its market share, one of the policies that they have adhered to religiously is the need for fresh food and simplicity. Initially, McDonalds focused on solid business where food was served quickly in a friendly environment. But overtime, as millennials began to abandon the chain for healthier food choices; the chain had to evolve and therefore, trimmed its overstuffed menu for a more curated selection of better and healthier foods that are less-processed. The interest to remain competitive and retain its market share, the policy and strategy for more fresher and high quality food was developed. Over time, the objectives of the organization have changed which has also lead to the change of their policies and strategies.
Task 2: roles of relevant partners in the formulation of inter-organizational strategy
2.1. Identify and evaluate the policy position of different partners involved in the development and implementation of inter-organizational strategy
McDonalds has both corporate and strategic partners. The corporate partners include the Coca-Cola Company and Southwest airline among others. On the other hand, strategic partner include Asian American Justice Center (AAJC) and the Wounded Warrior Project (WWP) among others. The objective for corporate partnership is to help support families through sponsorship and funding while on the other hand, strategic partners help in the establishment of key relationship with particular community-based organizations where McDonalds is a neighbor and does business (Pradhan 2018).
McDonalds and Coca-Cola have been referred to as junk-food because of the common misinformation that fast-food is a major contributor to obesity. Even though obesity is as a result of a myriad of factors working together, this affects both organizations negatively. Obesity is a health issue for this generation and thus, both organizations have a policy to fight obesity by primarily encouraging an active lifestyle. The main cause of obesity is the accumulation of calories, thus an active lifestyle is an effective strategy to dispose them off. This partnership has so far been success as the two organizations have adopted a number of strategies. First, through the introduction of fresh and healthy foods and the indication of calories per serving and second, getting people moving through supporting physical activities and programs in countries that the organizations does business. Additionally, the organization has undertaken to responsible marketing of their products.
Additionally, the organization has partnership with southwest airline which has a policy to support special districts and Non-Governmental Organizations. As a result, McDonalds has partnered with Southwest airlines to reach and support these special districts through scholarship and project funds.
On strategic partnership, McDonalds has partnered with among other, The AAJC which work in fighting for civil liberties and empowering Asian Americans and for the creation of a more just American for everyone and the WWP which works in providing support for veterans who have been injured physically while serving the country. To meet these social obligations, the organization functions closest to citizens and on an incremental basis, increases its requirements for social-welfare. Because the organization is dependent on the public for its continued success, McDonalds has a firm Corporate Social Responsibility (CSR) initiative and working with AAJC and WWP is one of the strategies to fulfill this policy. These partners influence the inter-organizational policy of the organization because it mainly supports these organizations through mainly funding. To this effect, both organizations have to align their operations and initiatives to fulfilling the ultimate goal shared by both.
2.2. Evaluate tensions and conflicts of interest in the roles of different partners, and propose innovative solutions to enhance relationships and outcomes in order to achieve a coherent output
One of the major sources of tension and challenges within McDonalds is from suppliers. The organization is in partnership with a number of suppliers and distributors in its value chain. These tensions and challenges are as a result of the interests of each organization in the relationship. While, suppliers seek to produce and supply within the shortest time possible at the highest possible pricing, McDonalds has laid down preferences and requirements that suppliers must adhere to. This presents a conflict as the organization seeks to adhere to a given standard of operations for example, observing human right and animal rights, while at the same time maximizing profits not only for the organization, but also for its partners.
To solve this problem, the organization has adopted the McDonald’s Standards of Business Conduct and Supplier Code of Conduct. This code of conduct helps to minimize and address grievances that arise along the organizations supply chain. As a result of this code of conduct, the organizations worldwide supply chain received a number of grievances which by using the code of conduct, has been able to investigate and take corrective actions as necessary. For employee who might feel that their human rights have been infringed upon, they are encouraged to use the McDonalds Business Integrity Line and speak openly and honestly. The line is researched to employees of the organization and it is open and reachable on a 24/7 basis. The line is managed by an outside firm, it is free of charge, and interpreters are available for retail units from non-English speaking countries. Callers are anonymous and there is not attempt to identify them unless otherwise required by law. In such a case, the organization maintains a struck non retaliation rule where employees are free and safe to speak up and report any issues of concern.
For the majority of corporate and strategic partners that work with the organization, there are no reports of issues of challenges. This is primarily because their work is geared towards profit generation or CSR effort. To this effect, any undertaking is mutually benefiting and there is minimal, if any tensions and challenges and they do not make it to the public. However, McDonalds has often been faced with legal challenges in its work with local and national governments. These are however inevitable in any working and judicial proceedings can and will be instituted by any aggrieved parties. The only solution to legal challenges is to work around them as to be compliant otherwise, cease operations within the region.
2.3. Develop models which support inter-organizational working and which respect the integrity of partner organizations and their political, moral, social and economic stance and differences
The success of any partnership depends on the selection of the right governing and coordination mechanisms. Cogitation systems for the connotation and processing of inter-organizational relationships need to show inference about the requirements for the effective and successful management of partnership. Connotations o the frames and forms within inter-organizational partnership take a multiplicity nature. The multiplicity nature of such inter-organizational partnerships makes it possible for the implementation of joint goals and projects in general. Such a partnership can develop, maintain, as well as encumber the association and collaboration that happens as value is exchanged. Therefore, a facilitative and supportive structure is a major and important constituent for the efficient implementation of inter-organizational partnership.
The operational processional model of collaboration in inter-organizational settings suggested by Straus (2002) is presented to here to support the workings within an inter-organizational collaboration. This model is very characteristic and it represents the integrity of partner organizations and the various external and internal factors that prevail. According to the author, inter-organizational collaboration is an association not only between the formal organizations, but also with informal structures. Formal organizations in an inter-organizational partnership share authority and power and have a stake in decision making. On the other hand, informal structures have their activities based on consensus. Based on this model, organizations within inter-organizations collaboration are linked by inevitably subordination, which is evident between the various partners whether horizontally or hierarchically. However, regardless of the nature of the linkage, at time, members or representatives of all organizations have to be involved especially in joint problem solving meetings. For this reason, during sensitive and important periodical meetings the various stakeholders within the inter-organizational setup, and striving to achieve a common goal should seek to satisfy each of the interested groups from a point of consensus. Once a decision is made and agreed upon, then it is the responsibility of each organization within the inter-organizational setup to familiarize with the decisions and initiate work towards the realization of the goal.
Another model that could be applicable for this setup is the organizational-dynamic model presented by Luna et al. (2002). For this model, the project group is at the core and it is made up of representatives from the various organizational within the partnership. The work done by the group is considered to be a dynamic-enhancing partnership;
· The joint work by the partnership improves the perception of one’s role and helps to expand understanding of each other
· Because of the increased understanding of each other and their work, trust between the partners is increased and strengthened
· With increased trust, the various partners are able to share information more openly and intensively
· The increased and open sharing of information results to increased efficiency of the joint project and promotes progress in performance
· The awareness of progress increases participation within the partnership therefore more strong collaboration
According to research findings, partners within the collaboration who have a higher status whether financially or in authority ought to be more facilitative for this model to be effective.
Task 3: Impact of economic factors in the coordination of inter-organizational policy objectives and strategy
3.1. Identify and assess the key economic drivers of inter-organizational policy and strategy.
Economic drivers of policy and strategy in inter-organizational collaborations are as diverse but specific to the scope, structure, targets, and form of the partnership. For each case, these drivers are different and proceed specifically and distinctly to the situation at hand and depending on the external and internal determinants that prevail at the specific moment. Moreover, the knowledge and practical implementation of the policy and strategy within an inter-organizational collaboration are hinged on the interpretation and therefore, they differ considerably among the various organizations. That notwithstanding, there are some of the general economic reasons why organizations will set up collaboration and strategy and policy to guide their operations.
The main economic factors that drives organizations to enter inter-organizational partnerships is to safe guard interests which among them, are the economic investments made. Given the negative effects of the downside of the trade cycle, investments can be diversely affected. Uncertainly is one of the effects that organizational investments have to deal with and the investments the organization has made are one of the robust variables in explaining long-term rates of growth to income, and even at an organizational level. The link between investments and business cycle and the volatility it presents is robust than the link between growth rate and business cycle (Sedlá?ek and Sterk 2017).
Market and external economic environment – this refers to economic motives related to the market and the economic external environment in which an organization operates. Market and external economic environment is a driver that requires organizations within an inter-organizational collaboration to develop a strategy and policy, with the primary objective being to protect themselves from the unfavorable economic environment and market conditions during trade cycle down side and the negative effects attached to it. This driver consists of seven themes; market access, the power of the market, time, flexibility, protection, collective lobbying, and external pressure.
Competitiveness – from the initial stages of a startup, the competitiveness environment opposing an organization increases with time. Competition is a market force that benefits the customer, but too much of competition will ultimate threatens the entire market. Inter-organizational policy and strategy would therefore be set to regulate this competition from the perspective of the organization, but at the same time be beneficial to the customer. Competitive dimension as an economic driver for inter-organizational policy and strategy has three motives; competition, strategy motives, and competitive advantage.
Financial and Risk aspects – one of the main reasons why organizations, especially for-profit organizations, get into inter-organizational collaboration is to safeguard against financial and economic risks. There are a number of risks that face organizations and organizational collaboration helps to create an umbrella body that can set up strategies and policies to prevent and fight financial and economic risks that might arise. Financial and risks aspects comprise of cost advantage, risk sharing, economies of scale, relational rents, and product rationalization.
Value creation – in certain industries like tourism, organizations will come together for the purpose of creating value for their product, e.g. at the national level. Moreover, this economic driver unites the other drivers. Value creation includes resource accessibility, dependencies, resource retention, specializations, organizational learning and knowledge development, and innovation.
Irrational factors- organizational leaders might find irrational motives to create inter-organzayional collaboration strategies and policies. While irrational motives will begin as such and bring organizations together, they later find reason in rational reasons (Gittus and Lazdina 2017).
3.2. Evaluate the impact on existing policy and strategy commitments of the finance and funding of operational activities arising from new inter-organizational strategic and policy imperatives
In practical organizational operations, it is impossible to mitigate against all possible risks. Some of these challenges and risks will originate from the business cycle as well as from other aspects for example, the costs of money, the ability and desire for the organization to take on risks based on the availability of resources and the ability and role of disruptive technologies in the fast-food sector. In cases where the existing policy and strategy is unable or insufficient in handling the new operational activities, then an internal assessment, evaluation, and audit of organizational resource will be undertaken to determine the need for new or remodeled inter-organizational policies and strategic needs.
The fast food sector in which the organization operates is characterized by dynamic and changing requirements that will obviously require new and revolutionary initiatives. To determine the beneficial effects being derived from an inter-organizational collaboration as well as compare between the existing and new inter-organizational policies and strategies the Net Present Value (NPV) evaluation method and Log Frames (Archer and Ghasemzadeh 1999; De Reyck et al. 2008).
The NPV method is used to determine the difference between the current value of cash inflows and the current value of cash outflows over a given period of time. This method is best suited for situations involving capital budgeting with the aim of determining the profitability of a project or an investment. NPV can be calculated using the relevant Apps or manually using the formulae below;

Where, Ct = net cash inflow for the particular period of time
C0 = total initial investment costs made
r = the applicable discount rate
t = the period of time
A positive NPV is an indication that the projected income generated from a project or an investment will exceed the anticipated costs and thus, profitable. In such a case, between existing and a new inter-organizational policy and strategy, the one with a positive NPV, or a higher value NPV is to be opted for as the best suited for the organization (Archer and Ghasemzadeh 1999).
On the other hand, Log Frames are basically tables where the simplest has 4×4 entries and a total of 16 cells and indicated below;

Log frames are used for the planning and management of a project and the sequence of events is seen to lead to the final goal (De Reyck et al. 2008). Once the log frame is filled, then a decision would be made depending on the appropriateness of the two inter-organizational policy and strategies available.
3.3. Propose and assess ways of funding unexpected operational activities which will need to meet inter - organizational policy and strategic commitments
To avoid unnecessary spending which might result to loses, it is important that an organization limits its operations to the budget. However, it is also vital that an organization prepares for any unforeseen activities especially if they are of financial or economic importance to the organization. Three strategies are hereby proposed for funding unexpected operational activities;
First is through contingency funds. Contingency funds are finances reserved in the form of cash or assets to cater for unforeseen situation within an organization. In the case of inter-organizational policy and strategies, contingency funds play the role of improving the organizations financial stability through a safety net that the organization can use to address emergency needs. A contingency fund will shield the organization of taking high interests loans e.g. credit card to cover emergency expenses (Jeffrey and Bidgoli 2004; Apostolakis 2007).
Second is through the depreciation fund method also known as the sinking fund method. This method allows for the treatment of depreciation by creating a fund that has the amount of annual depreciation. Each year, an amount equal to the annual depreciation is invested in government papers or other gilt-edged securities external to the business. The income generated from this invested is deposited into the fund and ordinarily, it is immediately reinvested. The special feature of this investment is that, once a new asset is required, the total amount needed is available from the fund. The fund is closed once the depreciation asset is sold (Jeffrey and Bidgoli 2004; Flemming 2014). For the case of unexpected inter-orgnizational policy and strategy, the income from this investment is a potential source for funds to finance these emergencies.
Lastly is self-funding projects which require assuming the responsibility to fully fund a project. This plan requires an organization to pay for the actual amount and not anticipate support is refund. This model is basically an insurance plan where the organization makes payment of a specific amount periodically (Jeffrey and Bidgoli 2004). In the event of unexpected inter-organizational policy and strategy, this pan can be used to source for funds to address the emergency.
Task 4: the coherence of inter-organizational strategy, planning and implementation
4.1 Review and critique current methods and theories of inter-organizational strategic planning and implementation.
Traditionally, strategy planning has been treated as a process than flows from formulation to implementation. This was considered to be an organizational design where systems and structures could be manipulated as per the strategic goals. In inter-organizational planning and implementation, the current view is that it is either a question of getting the organization totally involved through string corporate culture of as a platform for gaining prior group commitment through coalitional decagon making (). Four methods and theories are used to explain strategic planning and implementation in inter-organizational collaborations.
i. Deliberate strategy
This planning and implementation strategy has clear intentions and it is backed by formal control. The organization’s leadership is the centre of authority and the entire planning and implementation process is strategic and characterized by precision with the aim of transforming with minimum distortion. The strategy involves systems and programs that are built for control and ensure that no one acts in a way that is not intended. However, for this planning and implementation strategy, it requires that the environment be very stable or the unfolding of events within the organizations, in the inter-organizational collaboration, and external environment be predictable for it to be successful (Bourgeois and Brodwin 1984; Howlett and Rayner 2007). This is a major limitation because, while it might be to some degree possible to control internal environment, it is virtually impossible to control or predict the external environment. Moreover, this strategy doesn’t allow organizations to plan for a project or commit resource for the long-term because it might not tolerate the unstable environment.
ii. Emergent strategy
Emergent strategy on the other hand involves identification and management of unexpected outcomes from the planning and implementation of an organizational strategy. It is virtually impossible to predict or prepare in advance for all the outcomes or possible scenarios in the implementation of a project, emergent strategy therefore provides a way to address such arising matters then learn and integrate them in future planning and implementation undertakings. Emergent strategy is a suitable learning opportunity as organizations are able to determine what works over period of time. Additionally, it is an effective method of “putting out fires” when there are new and unexpected situations that an organization has to face (Riege and Lindsay 2006; Howlett and Rayner 2007). However, this strategy doesn’t have guaranteed results especially at the first stage. While the results might be extremely beneficial, they can also be extremely disastrous. Moreover, because of the nature of emergent strategies, it is impossible for an organization to plan for it therefore, it can destroy a company entirely (Howlett and Rayner 2007).
iii. Scenario based strategy
The scenario strategy is useful in inter-organizational strategic planning and implementation for the prediction of key performance indicators by linking them to a perceived cause-and-effect model. This strategy bears the potential to play a crucial role in designing of strategic maps and it provides a rather stable and effective method for looking into the future. The scenario based strategy provides an alternative to the deliberate strategy in planning for the future. As organizations develop scenarios for the future, they can consider the possible discontinues states that might unfold in the future and prepare themselves for many plausible events, in addition to the one they anticipate (Bass and Dalal-Clayton 2012; Bodwell and Chermack 2010). This method is common in military planning and it results to plan B, C, D, etc. However, this strategy is often extrapolation of parts experiences and performances and it is in most cases, insufficient in managing the future state of events. Depending on the state of future event, all the plans in plan might be inapplicable requiring a new strategy.
iv. Resource based strategy
The basis for this inter-organizational planning and implementation strategy is in the view that resources are the superior element is the performance of an organization. For a resource to be considered superior and to bring attract sustainable competitive advantage or value for the organization, it must bear the VRIO (Valuable, Rare, Costly to Imitate, and Organized to bring/capture value) attributes (Rothaermel 2015). According to this theory, an organization must organize its resource in a way as to generate competitive advantage or generate value from a project. However, this theory has been criticized for being tautological, relying on an underdeveloped product market, and the practical reality that, different configuration of resource will generate the same value therefore offering no competitive advantage. Moreover, this strategy fails to take into consideration the factors surrounding resources by making the assumption such factors simply exist. The theory also relies on the assumption that an organization can be profitable by simply being highly competitive by exploiting the advantageous resource at its disposal; this assumption doesn’t always hold and the factors concerning the entire industry should be taken into account (Bass and Dalal-Clayton 2012).
4.2 Propose original and innovative alternatives to improve inter-organizational communication coordination, strategic planning and operational implementation, and evaluate their likely impact.
The Viable System Model (VSM) created by Stafford Beer (1959) is suggested for the improvement of inter-organizational strategic planning and implementation, and communication coordination. The VSM is a conceptual tool that has been used extensively for understanding and redesigning organizations and supporting management through the change process. The model is underpinned by core cybernetic principles of communication and controlling complex organizations.
i. Implementation
To redesign or improve on implementation, the VSM requires that any team involved in production undertakes more viable systems containing further sub-systems for the purpose of dealing with the complexities they face in the production environment. The main reason for the added sub-systems is for the implementation of value-adding tasks.
ii. Coordination
It is vital for a system that is viable to have coordination between the various interfaces of its value-adding functions. However, often coordination is used as a term for the top-down direction and control of day to day activities within an organization. In the context of VSM, coordination is an adjustment of process through mutual agreement and support by both the top and the subordinate units in an organization. Through coordination, teams within an organization are able to share common standards, values, and approaches which improve lateral communication (Espejo and Gill 1997). The more these lateral links are, at both human and technological front, the stringer the organization through increased synergy. At the same time, management is less involved in attempting to impose control and focuses in additional production and empowerment.
iii. Control
Communication is essential for control, and in VSM, two-way communication between the meta-level unit and the sub-unit is a prerequisite. To avoid direct common within the organization, it is recommended that exceptional reporting systems and management by objectives be used by management to replace direct control.
iv. Intelligence
Intelligence functions to link the primary activities within an organization – viable system – with the external environment. It allows the adaptation of the organizational function by; providing continuous market pace feedback for the primary activity and technological changes relevant for future planning, and incorporates the identify image of the organization into the environment. Intelligence therefore is crucial for continued relevance of an originations’ product to the environment as well as embedding the organizations image and identify to the environment (Espejo and Gill 1997).
v. Policy
Overall to this is the formulation of policy, which is low-variety and requires comprehensive and selective information. The selectiveness is derived from the interaction between the intelligence and the control function. Policy is required for providing clarity and guidance on overall direction, purpose, and values for the organization as a unit.
Once all these processes are effectively and rightly adhered to, the impact is that the organization functions as a find synchronized machine that is effective and successful. The various aspects of VSM once successfully implemented they allow an organization to function around the complexities of the environment and within an inter-organizational collaboration, the impact of the VSM is improved functioning, effective project execution, and risk preparedness (Espejo and Gill 1997).
Task 5: Future view of how trends and events can and will influence inter-organizational policy and strategy.
5.1. Research and review authoritative, quantitative and qualitative data and sources to identify relevant political, social, economic, technological and moral trends which will be likely to affect short, medium and long-term inter-organizational policy and strategy.
Various political trends have been identified by research as to affect inter-organizational policy and strategy in the short, medium, and long term. These include the tax policies being imposed by various governments, trade and tariff control which are currently being used by governments and environmental and consumer protection legislation (Aldehayyat 2015). These trends are being used by governments for the purpose of, allegedly, regulating or de-regulating the markets. In addition, other politically oriented trends that are expected to have an impact are freedom of the press corruption, and the level of bureaucracy. While all these changes are dependent largely on the government in power, in democracies and as administration change, it is also expected that changes in the political environment will affect inter-organizational policy and strategies.
Economically, the various stages of business cycle will continue to affect inter-organizational policy and strategies. In addition, changes in projected economic growth, inflation and interests rates as well as the cost of labor will have an impact. Based on research from the last decade, immigration and the impact of globalization, tied with unemployment and the supply of labor will also affect inter-organizational operations (Hill 2008; Dunning 1999). In the medium and long term, it is projected that the continuing change to the economic environment will impact inter-organizational operations.
Over the last decade, there has been a change in demographic and in particular population change among racial and tribal lines, as well as age profile. Moreover, improvement in population health, social mobility and education are expected to positively impact inter-organizational policies and strategies. One of the crucial trends, especially in the American context that is expected to affect inter-organizational operations possibly in the short and medium terms is press attitudes, social attitudes, and public opinion particularly in the context of ‘fake news,’ disinformation campaigns, and the political divide being witnessed in the country (Berkowitz and Schwartz 2016).
The widespread use and change in technology is also a major trend that will affect inter-organizational policies and strategies diversely. First of all, the impact of the internet, the reduction of costs of communication and increase in remote working at an individual level is expected to be a game-changer in the short, medium, and long terms. This effect is expected to be more pronounced with the impact of emerging technologies. Moreover, continued research and development, and the day to day innovation of more sophisticated technologies are expected to exacerbate this impact. The impact on inter-organizational policy and strategy will be diversely felt as a result of technology transfer.
Moral aspects will be expected to play a role in inter-organizational policy and strategy, primarily at the level of management executives. Morality to some degree cuts along the various categories of political, social, economic, and technology. Willingness and actual participation in immoral undertaking e.g. corruption, taboos, and crime are trends that affect inter-organizational policy and strategy.
5.2. Use current concepts, theories and methodologies to forecast likely future events which will affect and be affected by inter-organizational policy and strategy.
Different theories, methodologies, and concepts are used in inter-organizational policy and strategy forecasting depending on the nature and type of the organizations, and the market they are operating in. One of the strategies applicable to the fast food industry is the judgmental method that makes a prediction of the future based on past and current trends (Holt 2004). Currently, this method is more informed by big data as customer make purchases through technology and pay through technology platform e.g. credit cards. The data collected can therefore be used as a path-print of the customers preferences, and how these preferences have changed with time, the trends that have been there since the initiation of the big-company fast-food industry era, how these trends have evolved with time, the current trends, and then, relying on this information, predict the future trends.
Currently, fast-food brands continue to have premium menu items that compete with fast casuals, with the fast-food casual going into drive-thru. The traditional dining segment is growing colder to the fast-food segment, as the customer seek to eat what they want and how they want it. Based on this, it is suggested that in the short term future, the menu-trend for fast food outlets will swing back and forth blending fine dining’s flavors with fast foods speedy preparation.
About 50 years ago when big-company fast food retailers like McDonalds began, the trend then was reliability, consistency, and the understanding that as a customer, you can get the same thing regardless of the unit and region. However, over the last decade, this has changed tremendously as customers want what they like and that what reflects their identity, history, culture, and normal eating habits. This led to localization of the menu to offer regional experience not only in terms of the food, but also in terms of the restaurant design. Even though it is hard to predict how fast the pendulum may swing in this regard, it is expected that the menu will continue to be localized with the aim of bringing on board those who feel left behind. One of the possible suggestion is that this might swing further into the past as we start to see some of the terns like the Neolithic menu emerge.
In the past decade, as the customer demographic changed to the millenials, there has been a major focus on fresh and quality food that are considered to be healthier. This is expected to be blended with emerging technology even as such technologies like 3D printing find their way into the fast food industry (Johar et al. 2017).
In summary, it is predicted that in the future – 5 years on average – the fast food industry will evolve to incorporate more fresh and healthy food and technology will play a crucial role in how fast foods are served and delivered.
5.3. Propose alternative and innovative solutions which challenge received wisdom to achieve better outcomes from the process of inter-organizational policy and strategy formulation.
“The only thing that is constant is change.” Even as new solutions are formulated and put into implementation, there are always better solutions. A number of scenarios drive change in inter-organizational policy and strategy formulation. The first driver for formulation of new inter-organizational policies and strategies is forecasting. Forecasting techniques provides management executives with the possible next-big thing idea and thus, where to invest their money and focus organizational resources. For the majority of organizations, they are driven by the need to meet their set goals and objectives, which mainly, have customers at the other end. As customer preference change, the organization must be appropriately positioned to deliver and meet customer needs; otherwise, the organization will become irrelevant and lose out on business.
The second driver that challenges received wisdom is environment scanning to identify weal signal. The environment in this case refers to the information environment, and this is a targeted investigation to identify emergence of change, effect dynamics, and useful information of third parties in the form of investors, competitors, and customers. This investigation seeks to identify what’s to improve on the current standing, the current product, or/and the current standard of operations. In general, this related to competitive intelligence and how to make the inter-organizational policies and strategies better suited for competitive advantage (Le Pennec and Raufflet 2018; Alexander 2014). For some organizations, the scanning process begin by envisioning an effective research designing by reviewing prior strategic plans, vision, or scenarios, and then turn to investigation of external conditions and emerging change.
The third method is scenario based strategy formulation, which involves the incorporation of scenarios by senior management, the alternative stories on the organization’s competition, capital investments, new technologies, and markets in the inter-organizational planning process. With this as the working scenario, these executives are therefore able to test and build a consensus on the appropriate alternative for their inter-organizational policy and strategy.
Lastly, the resource based strategy formation challenges the existing wisdom for better outcome for inter-organizational policy and strategy by a review of the resource available and how better they can be managed for increased output by adoption of a new strategy (Alexander 2014). The resource available and the nature and quality of the resources available for an inter-organizational partnership play a crucial role in challenging the status quo for better superior outcome.
For these drivers to work in challenging the existing or considered-new wisdom, there are necessary forces e.g. competition, new management, consumer preferences that are changing, or legislative requirements (Alexander 2014). Otherwise, in the absence of these, it is possible for the inter-organizational management to enter into a comfort zone and abandon research and development to better their policies, strategies, or products.
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