COMM 104 Lecture Notes - Lecture 3: Strategic Management, Toms Shoes, Profit Maximization
1 Sep 2016
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Document Summary
Ethics and strategy four models of the strategic firm. Managers are increasingly discovering the need to formulate stratigies that incorporate a much broader notion of value creation. Thinking about ethics more broadly has led in many instances to superior outcomes including competitive positioning and enhanced share value weitzner and rarroch. Today effective management requires that ethical reasoning and ethical practices and values play a central role in strategic management. In the classic economic model that has come to dominate strategic thinking strategic choice is limited to activities that serve the core corporate objective of improving the firm s bottom line. Externalities: social costs that the firm through its value creating activities creates but does not necessarily have to pay for. Ex pollution factories create pollution which harms the environment and causes local communities to suffer yet most firms do not have to pay to eliminate the pollution they have caused.
