Philip Roscoe argues that economic thinking has become very influential within modern society, and this is certainly true in the area of management and corporate strategy. What underlying assumptions stemming from economic theory can you identify in the article by Peter Cohan? Describe why they are underlying and whether they are reality or value assumptions? Finally, discuss whether you agree with the assumptions you identified. Why or why not?Note: This newspaper article is very similar to the type of article that will appear on the midterm exam. It is strongly recommended that you practice with this article in preparation for the midterm. This is not to be submitted and will not be graded, but will be discussed in class. The midterm exam question is as follows:
Read the newspaper article below and then respond to the following questions in the exam booklet provided:
- a) Using your own words, state the primary claim that is being made in the article and identify any secondary or related claims. (?5 marks)
- b) Then critically evaluate the evidence provided by the author using the terms and concepts taught in this course. (?10 marks)
- c) Next, identify any underlying assumptions you think the authors hold. (?5 marks)
- d) Finally, discuss whether you think the author’s claims are valid and convincing and use your critical analysis above to defend your response. (?5 marks)
What are the Values and Assumptions of Business Strategy?
According to Roscoe (2014), economic thinking has turned to be highly influential in the modern society. Some of the most affected areas include decisions made as consumers that extend to family relations, health, and education. According to Roscoe (2014), people are ready to sway their moral duties and molarity in an effort to justify economically customized self-interest. This is Roscoe’s view normally results in limitations in the forecasting of the future by creating financial recessions and excess environmental threats across the globe.
What underlying assumptions stemming from economic theory can you identify in the article by Peter Cohan?
Cohan’s (2017) article reflects on opposing changes taking place in two different companies in the same business environment; Amazon and GE. While Amazon is growing and acquiring other companies, GE is recording negative growth with a decline in shares value. The underlying assumption that can be identified to stem from Cohan’s article’s economic theory is that the choice made on business portfolio to grow and which one to discard play a great role in determining the company’s ability to survive, grow and gain financial sustainability in the future. Wrong mover negatively affects the company after a short while. However, a well-calculated business mover with an effective analysis of its ability to grow and areas in the market to take advantage of can give a company a strong foundation of experiencing a great level of growth in the future, even when other businesses experience business strain.
Describe why they are underlying and whether they are reality or value assumptions?
The assumptions are important or underlying because they give a business a direction to take in the quest for growth and expansion. Business is built by making strategic decisions that determine the new changes that must take place to promote growth. The results of these changes are highly characterized by how well the strategic move was calculated. The assumptions can never be 100% accurate. However, they are value assumptions that are likely to bring positive change if well thought of and well informed. However, it is always important for an organization to know that situations do change with time. In this regard, new moves should be made frequently to address changing market situation to safeguard the business position in the market. This means, while the assumption may be real for a certain time, this situation is not permanent. GE according to Cohan (2017) managed to make positive growth with their new strategy of growing unique business portfolio, while discarding the common one. However, this also failed after sometimes. Things change with change of market situation and other external business environment, and hence the organization executives must remain alert and ready to make adjustments while needed.
Finally, discuss whether you agree with the assumptions you identified. Why or why not?
I highly agree with the identified assumptions. The success in any business is highly determined by the steps taken to make change. Business growth is determined by understanding the business and understanding the market and using this understanding to make business changes that address gaps in the market. Once the right move is made, there is nothing that can stop growth and taking advantage of the market loophole for a while. However, it is important to note that no situation is permanent. In this regard, the executives need to continue studying their business and market to keep on making viable changes so as to maintain the business survival, financial growth, and competitiveness in the market.
Cohan, P. (2017 Jun, 26). Wall & main: GE, Amazon, and the future of corporations. Telegram. Retrieved from https://www.telegram.com/news/20170626/wall-amp-main-ge-amazon-and-future-of-corporations
Roscoe, P. (2014). I spend therefore I am: how we all become economic. Random House Canada