Strategic managers can consider four types of social commitment ,economic responsibility is one of them:
Economic responsibilities are the most basic social responsibilities of business. As we have noted, some economists see these as the only legitimate social responsibility of business. Living up to their economic responsibilities requires managers to maximize profits whenever possible. The essential responsibility of business is assumed to be providing goods and services to society at a reasonable cost. In discharging that economic responsibility, the company also emerges as socially responsible by providing productive jobs for its workforce, and tax payments for its local, state, and federal governments.
Economic responsibilities: The duty of managers, as agents of the company owners, to maximize stockholder wealth.
More from this Section
- Economic Factors
Economic factors concern the nature and direction of the economy in which a firm operates.Bcause consumption patterns are effected by the relative affluence of various market segments ,each firm must consider economic trends in the segments that affect its industry.
A business strategy that seeks to build competitive advantage with its product or service by having it be “different” from other available competitive products .
Another approach that focuses on the role and ability of corporate managers to create value in the management of multi business companies is called “patching.
- Strategic flexibility
Strategic flexibility refers the ability to recognize major external changes, to quickly commit resources, and to recognize when a strategic decision
- Industry Boundaries
Industry boundaries helps executives determine the arena in which their firm is competing,focuses attention on the firm’s competitors.
- Strategic process
Decision making, operational activities, and sales activities that are critical business process.
- Functional Conflicts
Functional Conflicts that support a group’s goals and improve its performance.