Integrative Framework for Contextual Factors †MyAssignmenthelp.com

Question: Discuss about the Integrative Framework for Contextual Factors. Answer: Introduction Business organizations can succeed by formulating and implementing effective strategies which align with the vision and mission of the organization (Kronsbein, Meiser, Leyer, 2014). Strategic management is dynamic because the formulated strategies largely depend on the environment in which the company operates. Almost all business organizations dont have exactly similar environments; it suggests that the outcomes of the business enterprises are largely dependent on the context of the business (Shin Edington, 2007). The paper analyses the contextual factors impacting the Costume Jewellery business introduced in the previous paper. A jewelry store is started in Sydney, and the contextual factors that impact the jewelry business are identified and explained. The internal and external contextual factors that impact the business are identified. Costume jewelry business is mostly an innovative and entrepreneurial venture and the contextual factors related to innovation and entrepreneursh ip are analyzed. The impact of the contextual factors on the business strategy, structure and decision-making are discussed. The paper discusses how the contextual factors will be utilized for enhancing the business practice of jewelry business. Contextual factors can be defined as the characteristics of the environmental factors which largely affect the business practice. The contextual factors can be external like policies, legal and governmental regulations, and internal factors which include the size of the firm, innovation, knowledge management, and entrepreneurship. The costume jewelry business is an innovative entrepreneurial venture, and the most important contextual factors that impact the business are innovation and entrepreneurship. Innovation is considered as the key driving force which shapes competition and enables the organization to take revolutionary approaches to business operations and thereby transform the nature of the market and the industry in which it operates (). Innovation takes place on three important levels namely Revolution, Renewal and Resilience. Revolution relates to the phase where new products or business approaches are designed by challenging the existing fundamentals of the industry. Renewal relates to the phase where the process of rethinking and recreating existing models take place. Lastly, Resilience refers to continuous improvement and reconstruction of new product and services. Disruptive and open innovation is the new innovation concepts which should be adopted by organizations today so as to compete and sustain in the industry. Disruptive innovation aims at improving the not so good products, but these products are introduced as simpler and attract less demanding customers. Open innovation is the modern model of innovation and as discussed by Chesbrough (2003) in open innovation model, the organizations can commercialize the ideas generated by it and also the innovations of outside firms and deploys the new innovations to explore new markets (Chesbrough, 2003). Researchers have identified norms that promote creativity as well as innovation. According to Dawson and Andripoulous (2014), six important norms should be seen in innovative organizations (Dawson Andriopoulos, 2014). The organizations must foster an innovative culture. These norms include stress on idea generation, and inculcating a learning culture and risk taking attitudes, handling the conflicts sportingly and supporting the necessary change while tolerating some mistakes. Contrasting to these six norms, Dyer, Gregson and Christensen (2009), have a different approach which suggests that innovation can be inculcated and taught to individuals (Dyer, Gregerson, Christensen, 2009). Dyer et al. (2009) also define five basic capabilities which can be noticed in the innovators. These capabilities are an association, questioning, observing, experimenting and networking. The jewelry business is a huge market and can sustain competition if it provides innovative products to its customers . Entrepreneurs are said to exploit innovation to bring about a change for earning profits (Burns, 2009). Entrepreneurship is referred as a mindset that identifies the opportunities and undertakes actions to gain economic success (Burns, 2008). McMillan and McGrath (2000) argue that entrepreneurs continuously search for high-potential opportunities. The entrepreneurs would then frame the opportunities in long-term and short-term goals (McGrath McMillan, 2000). The entrepreneurs would stock the interesting opportunities in the opportunity register so that they can choose from best possible opportunities. Another important trait of entrepreneurs include shifting the focus, when necessary, and the entrepreneurs focus on limiting the downside of the opportunity until the expected outcome from the opportunity is achieved. Lastly, entrepreneurs promote adaptive execution, which suggests that the execution of the idea is not always according to the plan and that the execution will change as required. Entrepreneurship is an important contextual factor which will impact the business process and strategy. The jewelry industry is highly competitive and entrepreneurship concepts will help in focusing on existing concepts and developing new strategies which will help in enhancing business practice. Contextual Factors and Business Strategy Competition and innovation are the two driving forces in business organizations today. (Choudhary, 2016). Both domestic and international markets face huge competition as the customers get more demanding and the companies have much more to offer (Choudhary, 2016). Changing customer attitudes, technological advancements and environmental uncertainties force managers to choose correct strategies so as to effectively allocate resources for better functioning of departments to achieve success (Choudhary, 2016). Innovation highly influences the external contextual factors. Using the innovation strategy and concept, the business organization should work towards continuous improvement (Sila, 2007). Open innovation can be used effectively to include the best designs from newcomers in the industry and also that of known brands. Moreover, the business organization can take a step forward and customize the jewelry with a specific time of delivery. Thus the business will work towards continuous improvements and tap different opportunities to invest in current markets as well as divest in upcoming markets (Scaper et al, 2014). Hence, open innovation will allow the business organization to develop new strategies for commercializing the existing innovative ideas and the innovations from others. Thus, innovation will largely influence the business strategies. Moreover, the business organization will tap new trends in the market, and also exploit the new opportunities for entering new markets, and expand the business. Similarly, entrepreneurial activities of the organization like focusing on limiting the downside until the expected outcome from the venture are achieved (Brinckmann, Grichnik, Kapsa, 2010). Hence, the focus of the business strategy can be changed whenever required so as to limit any losses. Thus, it can be said that innovation and entrepreneurship can be used to enhance the strategy and business practice. Contextual Factors and Business Decisions Making Almost all strategic decisions are unique and influence by contextual factors (Elbanna, 2011). It is evident that strategic decisions are context-specific, and hence, strategic decision-making can be enhanced by analyzing the important contextual factors. Innovation and entrepreneurship are major contextual factors in the new jewelry start-up plan. Entrepreneurial concepts suggest that business organizations must continuously improve and implement adaptive execution strategy so that the strategies and strategic decisions can be changed before actual implementation and execution. Hence, entrepreneurial concepts can impact and enhance the business decision-making process (Brinckmann, Grichnik, Kapsa, 2010). Innovation on the other side will encourage entrepreneurs to tap the important opportunities which can bring about a change in the industry. Thus, innovative practices and open innovation strategy will enable business organizations to tap important high-potential markets, and expand their business. Moreover, innovation and entrepreneurship will enable organizations to become dynamic and exploit and explore existing and new markets, to earn high profits. The external contextual factors like the policies and competition, customer demands will also impact the business decision making process. Competition and customer attitudes are major external contextual factors that affect jewelry business. Innovation culture can be inculcated in the organization to encourage the generation of new ideas, which will enable the organization to sustain competition and get a competitive advantage. Innovation will foster entrepreneurship and allow the entrepreneurs to tap similar high-potential opportunities. For example, the jewelry brand can sponsor some Fashion weeks, so as to get recognized and also display their innovative designs and ideas. Thus, innovation and entrepreneurship concepts can be used effectively to enhance the business decision-making process. The decision-making process is highly context-specific, and the concepts of innovation and entrepreneurship will allow the organization to make effective strategic decisions. Conclusion The strategies, structure and business practice of business organizations are largely influenced by contextual factors. Strategic decisions are context-specific, and hence, it is important to identify and analyze the contextual factors so as to enhance the strategic business practices. Innovation and entrepreneurship are identified as important contextual factors that affect the structure, strategy and business practice for an innovative jewelry business. The innovation and entrepreneurship concepts can be successfully applied so as to enhance the business practice and decision making. Costume jewelry business is mostly an innovative and entrepreneurial venture and the contextual factors related to innovation and entrepreneurship are analyzed. The impact of the contextual factors on the business strategy, structure and decision-making are discussed. The paper discusses how the contextual factors will be utilized for enhancing the business practice of jewelry business. Bibliography Brinckmann, J., Grichnik, D., Kapsa, D. (2010). Should entrepreneurs plan or just storm the castle? A meta-analysis on contextual factors impacting the business planningperformance relationship in small firms. Journal of Business Venturing , 25 (1), 25-40. Burns, P. (2008). Corporate Entrepreneurship: Building the Entrepreneurial Organization. New York: Palgrave Macmilan. Chesbrough, H. (2003). The Era of OPen Invention. 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