Martha Stewart Company: Strategic Alternatives

Martha Stewart Company: Strategic Alternatives
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Martha Stewart Company: Strategic Alternatives
Based on my CLC and individual analysis, Martha Stewart Living Omnimedia Inc. is excelling in its current ratio (the media company is adequately capitalizing on its current assets to meet short-term obligations and payables). The company is also doing well regarding its debts-to-assets ratio (most of the organization's assets are owned by shareholders rather than creditors). However, the company needs to improve its other financial ratios (return on total assets, total-assets turnover, and price-earnings ratio) that indicate significant underperformance in productivity, sales promotion, profitability, and shareholder confidence.
Key analytical findings indicate that Martha Stewart Living Omnimedia Inc.'s poor productivity and profitability may result from its poor capitalization of assets to facilitate product sales. The company's underwhelming sales promotion strategies have resulted in a low price-earnings ratio and reduced investor confidence in the company's future success. There is a need for the company to improve how it uses its assets to generate income, especially the efficiency with which it capitalizes on its resources to generate sales to increase investment earnings and confidence.
The first creative and viable corporate-level strategic alternative that Martha Stewart
Living Omnimedia Inc. can employ to improve organizational success is effective portfolio management. Although the company has an extensive portfolio, there is a need to enhance the same through selective prioritization and control of all programs and projects. Martha Stewart Living Omnimedia Inc. needs to streamline its investments to include only those aligned with company strategic objectives and revenue generation. The advantages of this alternative strategy include eliminating unnecessary financial risks such as recurrent losses, improved tax planning, additional resources to invest in profit-making investments, and effective management of liquidity (Goulden, 2019). The disadvantages of effective portfolio management include poor downside protection and faulty forecasting, resulting in financial losses.
The other strategic alternative is reducing owner dependence by developing and sustaining high-performance work teams. Martha Stewart Living Omnimedia Inc. needs to end its overreliance on its founder and begin developing high-performance work teams capable of ensuring the company’s continuity and ability to grow sustainably after the departure of Stewart. There is a need to diversify the company's database and groom capable leaders who understand the dynamics of the industry and can turn around the company’s current poor productivity and sales performance. The advantage of this strategy alternative is that it will result in the influx of new ideas and practices that challenge and improve the organization’s current culture and processes (Aebis, 2019). Even though this plan will increase the transfer of knowledge and talent, it may also result in the loss of Stewart's critical institutional knowledge and fan base following.<...