RESPONSE TO MARIA V: Analyzing Alternatives

MUST BE A 250 WORD RESPONSE AND INCLUDE REFERENCES

Strategic alternatives refer to different courses of action an organization may pursue at a specific point in time (Rohini, 2018). By identifying various opportunities and threats in the companys environment along with the estimate of risk attached to the selected alternatives, an organization will need to decide what risk it is willing to take to pursue one of the alternatives (Rohini, 2018). Several types of strategic alternatives have varying degrees of risk. For example, a niche strategy concentrates on a product and market, often involving a very low degree of risk and typically representing the behavior of small companies (Rohini, 2018). The niche strategy may be relevant for my coffee shop, Bloom Coffee Shop, as I do not plan on expanding immensely (i.e., franchising, multiple shops in Colorado Springs, etc.). Therefore, smaller companies are more likely to select an alternative with lower risk to avoid bankruptcy or a failed business (Rohini, 2018).

While risk is an essential element of business, an organization must evaluate the probability of its occurrence and the severity of its outcomes (Puia & Potts, 2021). A larger company that can take a larger financial risk may pursue a riskier alternative in the hopes that the outcome is successful (Puia & Potts, 2021). However, as previously stated, if a smaller company like a coffee shop does not have the funds to lose, a riskier alternative may not be the path for that business to take. Much of the risk decision-making depends on the CEO’s values, mission, vision, and company growth plans.

References:

Puia, G., & Potts, M. (2021). Risk in Strategic Management. Oxford Research Encyclopedias.

Retrieved April 2, 2023, from https://oxfordre.com/business/display/10.1093/acrefore/9780190224851.001.0001/acrefore-9780190224851-e-7;jsessionid=8920747D5240FA08D32EAFEE8B043545

Rohini, R. (2018, May 15). Strategic Planning, Alternatives and Implementation | Business

Marketing. Essays, Research Papers and Articles on Business Management. https://www.businessmanagementideas.com/marketing/strategic-planning-marketing/strategic-planning-alternatives-and-implementation-business-marketing/17644

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