Strategic management: crafting and executing strategy

Strategic Management Facebook

Strategic Management

Mission and Vision Statement against Organizational Performance

Evaluation of Strategic Goals

Financial Performance of the Organization

Competitive and Market Analysis

Corporate Strategy to Maximize Return to Shareholders

Mergers or Acquisitions as a Viable Strategy

Employee Motivational Techniques

Organizational Existing Strategies' Support to Business Ethics

The world of commerce in the twenty fist century has changed, indeed revolutionized in terms of doing business and making money. The technological innovations and advancement has left an indelible imprint on the ways of operating business functions. Strategic management, in this regard, is one of the approaches that are put into effect by the organizations top management in order to analyze their vital initiatives and performance in the external environment (Thompson, Cram101 Textbook Reviews, Strickland & Gamble, 2006).

Strategic management is an enduring phenomenon that serves as a roadmap to the organization, where it usually evaluates and controls the overall performance of the enterprise periodically to determine the overall success of failure of the strategies and policies. Moreover, the phenomenon of strategic management also entails goal setting and development of strategies after comprehensive assessment of the competition within the industry, so that the company can live up to the expectations of the market. Therefore, it can be stated that strategic management is based on three elements: analysis, decisions and actions of the enterprise to maintain competitive advantages (Thompson, Cram101 Textbook Reviews, Strickland & Gamble, 2006).

While taking into account, a public trading company, Facebook is one of the rising enterprises that have become well-known and popular amongst a huge population with no time. Numerous sources of information have brought the fact to the limelight that Facebook has become one of the largest social networks all over the globe (Facebook, 2012).

Facebook is a social utility that provides an opportunity to the people to connect with a group of friends, families, and colleagues from work life and so forth. Additionally, Facebook is a universal forum that opens the means of communication between individuals not only who are easily reachable, but also with the people who are way far from them. Through the personal profile, the users can exchange messages, update their profile status, posts images and videos, join certain groups (based on common interest) and so on (Facebook, 2012).

Mission and Vision Statement against Organizational Performance

Facebook was initiated and founded by some college students of Harvard University, where the membership was confined to only the students of the university. However, with the success of the social media site at Harvard University, the founders expanded their membership to other university students in the United States. As a consequence, the founders received much positive response and support of the students at other universities, due to which they made it publically open for school students and eventually to general public over 13 years in age (Facebook, 2012).

The founders of Facebook had three principal objectives in mind: the first aim was to make the users closely linked to their friends and families; secondly they intended to provide the users with a platform where they can discover the latest happenings of the world; and thirdly, they wanted the users to have an open forum where they can share and express their opinions, standpoints and feedbacks on various issues. In this regard, the mission statement of the enterprise states "to give people the power to share and make the world more open and connected" (Facebook, 2012).

Considering the mission and objectives of Facebook, one can noticeably evaluate that the increasing number of active users in the today's time, which has reached a milestone of more than one billion active users according to the recent research study of the Wall Street Journal (Fowler, 2012). This indicates that how rapidly Facebook has achieved its goals in the sector and business industry of social media.

The graph below clearly exhibits the records of the users that has drastically increased over the years and transformed the image of Facebook into well-accepted and recognized enterprise as a social networking site and is considered as a brand of online communication. This is one of the supporting evidences that reveal the success rate of the company with regard to its mission and vision.

(Techtree News Staff, 2008)

While on the other hand, in terms of its revenue, Facebook obtains most of its revenues from its advertising segment, which is quite below than other competitions in the industry. In response to this factor, Facebook is focusing on providing premium services to the business that can act as a value added feature for them to increase their revenue stream. This is the only aspect in which the company is lacking; however, it has found and implemented alternative options (numerous applications, mobile connectivity and so on) that can enrich their profit levels and revenues (Fowler, 2012).

Evaluation of Strategic Goals

Facebook is one of the social media companies that have the core focus and attention on the user growth as their primary strategic goal. Furthermore, the company's owners also exhibited that international expansion is another element of their strategic goals, where they can add languages to the service they are providing. This vision is again a narrow scope that can lead them to their ultimate strategic goal of growth. For the company, optimizing revenue was not the core objective, as they wanted more and more people to be connected to Facebook that can connect them to their friends and families (Locke, 2007).

This goal of having more users is closely linked to the company's mission that insists on the connectivity of the people to their friends and family, discover the happenings of the world, and share or express what matters to them (Facebook, 2012). This is only achieved when the users are engaged with Facebook and create their profiles on the company page. According to the company's initial goals, they desired to develop and mature in the international market, as this was a wider platform that can provide them with a good business by having gargantuan amount of users (Locke, 2007).

Facebook owners also pointed out the fact that their strategic goals is to provide the people with a channel that is efficient and effective for the users to communicate and stay in touch, where they can receive as well as share the information with their friends and families. The core emphasis of Facebook has always been on the utility component. In short, Facebook was developed with the prime objective to add value to the lives of the people (Locke, 2007).

Financial Performance of the Organization

On an overall basis, when considering the financial performance of the company, one can evidently notice the fact that Facebook has reached more than nine hundred active users that connect to Facebook on monthly and annually basis and a significant proportion of the users are using Facebook on mobile devices. This indicates that the operational performance of Facebook witnesses an increase of more than twenty five percent on annual basis on daily and monthly active users (Facebook, 2012).

Records also state that users are more engaged with Facebook who are actively suing it via their mobile devices. Sharp increases in the mobile users have been indicated as the operational highlights of the company's performance. This clearly determines the strong connection between the goals and financial performance that is creating greater options for Facebook to introduce new products and improve the overall platform (Facebook, 2012).

The financial highlights, on the other hand, undoubtedly reveal the fact Facebook is experiencing dramatic rise of nearly 30% in the revenues and gaining more profits from the time the company has become a public trading company. The facts and figures of the financial performance of Facebook expose that the company is witnessing sharp rise in its revenues on yearly basis (Facebook, 2012).

This trend of increasing revenues at an unprecedented rate is expected to continue in the coming years, as more and more users are being connected to Facebook. Eventually, the amazing and outstanding financial performance with reference to the strategic goals and objectives is leading the company to become multi-billion dollar company in the near future.

Competitive and Market Analysis

While taking into account the competitive and market analysis, it is prudent to note that MySpace has been the biggest and most challenging competitor of Facebook. However, Orkut and Twitter are few other competitors of Facebook that is being accessed by thousands of users. One of the strengths of Facebook elucidates that it is significantly the leading social networking site and has outshines the major competitor that is MySpace and have millions of active users, which are increasing at an accelerated pace (Sutherland, 2012).

While continuing to expose the strengths of Facebook, one cannot ignore the fact that it is translated into more than sixty languages all over the world, thus caters a huge amount of consumers and the strong user database adds to its strengths. Facebook provides its users with multiple options to interact and connect to the groups of their choice or common interest such as wall posts, private chats and many more while in comparison, other competitors do not provide with such extensive options (Sutherland, 2012).

Numerous applications are also one of the string points of Facebook that differentiates them from others and is a source of attraction for millions of people. The like buttons and fan pages allow the users to communicate with friends over the topic of interest, which is not so extensively available by other social media sites (Sutherland, 2012).

The one significance difference that has become a crucial weakness of Facebook is lack of ability to customize the page. The company needs to consider their weaknesses so that they can convert it into opportunities and then into their strengths (Sutherland, 2012).

Since the video conferencing has gained much importance in the current epoch, thus it creates an opportunity for the Facebook to launch such a facility to its users, where a number of other competitors are practicing this approach. Another opportunity for Facebook is the selling of products and services through Facebook marketplace. Since the people prefer to make purchases from online websites, thus it is one of the opportunities for them to have more business and users (Sutherland, 2012).

The statistical records evidently present the fact that almost half of the users are using mobile Facebook, thus this social media business can utilize this option as one of the opportunities, because mobile advertising would provide them with increased revenues and cash flows. Facebook must also reach the emerging markets that are still un-catered as the potential is high due to its popularity (Sutherland, 2012).

Corporate Strategy to Maximize Return to Shareholders

As mentioned earlier, Facebook has reached a substantial degree of popularity amongst millions of users from all over the globe. Due to its high demand and recognition, the most appropriate strategy that can be applied to maximize the organization's return on investment to the shareholders is differentiation strategy (according to a personal outlook). Differentiation strategy is opted for Facebook to maximize the return to shareholders because the other two strategies that are low cost or niche strategies cannot be applied, as the product (social media site of Facebook) is already a well-known product/service.

Differentiation strategies usually provide the product or service that is distinct and unique from its competitors. Facebook is also a unique application, as it provides the users with open and extensive options to stay connected to friends and family in an exclusive manner. The technical superiority in terms of value is also created as Facebook offers its users with wide ranging applications and fan pages to initiate their own distinct social world.

Facebook has also been developed to create high value for users in terms of connectivity to the entire world, thus differentiation strategies have been selected as the most appropriate approach. As the status and fame of the company escalates, the return to shareholders is the ultimate outcome. In this regard, the shareholders definitely benefit from being a part of Facebook Company, as the public limited company with millions of users and advertising revenues would only add the shareholder's return in terms of income growth (dividend) and capital growth (share price). Facebook on mobile devices is again an increasing trend that immensely contributes to the growth of the company's revenue, which eventually increases the return to shareholders.

Mergers or Acquisitions as a Viable Strategy

Mergers and acquisitions have been widely practiced by numerous organizations as a tool to stay ahead from the competition. However, results of mergers and acquisitions require change initiatives on large-scale, which has been the root cause of its failure. Therefore, on a broader aspect, companies instead of opting for mergers and acquisitions, they focus on incorporating business units, strengthening and combining subdivisions and so on.

However, with respect to mergers or acquisitions, considering the aspect of Facebook, according to a personal viewpoint merger would demonstrate to be more viable strategy to implement. Since video chat and conferencing is gaining more importance, thus from a personal standpoint, Skype is one of the emerging and effective options for Facebook to have a merger.

By integrating Skype into Facebook, the users would have the touch of both - social networking and video talking/conferencing on a single platform. The users of Facebook would have more options to stay much closer and connected to their loved ones through video chats from all over the world. This would be one of the convenient ways for the users to be in touch. On the other end of the spectrum, the enterprise of Skype senses a threat and fear of having an impact on the clientele who are on non-Microsoft platforms.

On an overall basis, personally it is believed that this merger would be fruitful for both the social media enterprises and would have more business opportunities in terms of advertising revenues. Since both the enterprises provide cost-effective products and services, thus, they would engage more clients that would eventually provide monetary benefits to them. In addition, Facebook would increase and broaden its opportunity and can strengthen their online presence.

This merger would facilitate its business users to interact with their fan followings in a more personalized way, which would build and enhance trust and credibility. As a consequence, more business would come for both the merged companies. By having a merger of Skype and Facebook, escalated revolutionary changes on the platform of social media would be the core aspect of expectations in the future. These expectations and anticipations would heighten the organization's success businesses and would facilitate both to expand their online presence especially on a completely new level.

Employee Motivational Techniques

Since Facebook is a huge social media site, thus, it has hired thousands of professionals and experts that are skilled, experienced and proficient in their work. However, reward system is one of the integral and pivotal ways that are applied by virtually every organization in order to keep their employees motivated and enthusiast. The level of employee motivation and enthusiasm is directly associated to the extent of their productivity and output. Therefore, it has become vital for the organizations to retain their skilled and proficient people and have productive and effective output from them that can lead the enterprise to the stairs of success.