Strategic Management and Business Policy 15e, Global Edition PDF

Strategic Management and Business Policy 15e, Global Edition Chapter 10 Strategy Implementation: Organizing and Structure...

Strategic Management and Business Policy 15e, Global Edition Chapter 10 Strategy Implementation: Organizing and Structure Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. Learning Objectives (1 of 2) 10-1 Describe the major issues that impact successful strategy implementation 10-2 Explain how you would develop programs, budgets, and procedures to implement strategic change 10-3 List the stages of corporate development and the structure that characterizes each stage Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-2 Learning Objectives (2 of 2) 10-4 Explain how matrix, network, and modular structures are used implement strategy 10-5 Discuss the issues related to centralization versus decentralization in structuring organizations Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-3 Strategy Implementation (1 of 2) Describe the major issues that impact successful strategy implementation – the sum total of all activities and choices required for the execution of a strategic plan Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-4 Strategy Implementation (2 of 2) Describe the major issues that impact successful strategy implementation whene we start this question we have to ask Who are the people to carry out the strategic plan? What must be done to align company operations in the new intended direction? How is everyone going to work together to do what is needed? Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-5 Parts of Strategy Implementation 1(2) Describe the major issues that impact successful strategy implementation Setting Objectives: Defining clear, specific, and measurable goals that align with the strategic plan. Allocating Resources: Distributing necessary resources, including financial, human, and technological resources, to execute the strategies effectively. were sould we do it and what Structuring the Organization: Designing the organizational structure, including roles, responsibilities, and hierarchies, to support the execution of the strategy. Developing Operational Plans: Translating strategic objectives into detailed short-term plans that specify what needs to be done, by whom, and by when. people should know what they have to do Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-6 Parts of Strategy Implementation 2(2) Describe the major issues that impact successful strategy implementation did the campony atchive the golas Establishing a Performance Management System: Implementing a system to monitor, measure, and evaluate the performance of individuals, teams, and the organization against the strategic objectives. Type text here Building a Supportive Culture: Fostering a corporate culture that supports the strategic plan through leadership, communication, and alignment of incentives and rewards with strategic goals. Managing Change: Effectively handling the changes in processes, systems, and culture required to implement the strategy, including overcoming resistance and ensuring stakeholder buy-in. Leadership and Direction: Providing leadership to guide, motivate, and inspire employees to achieve the strategic objectives, including clear communication of the vision and strategy. Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-7 Ten Common Strategy Implementation Problems (1 of 2) Describe the major issues that impact successful strategy implementation 1. Took more time than planned 2. Unanticipated major problems 3. Ineffective coordination 4. Competing activities and crises created distractions 5. Employees with insufficient capabilities Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-8 10 Common Strategy Implementation Problems (2 of 2) Describe the major issues that impact successful strategy implementation 6. Lower-level employees were inadequately trained 7. Uncontrollable external environmental factors 8. Poor departmental leadership and direction 9. Key implementation tasks and activities were poorly defined 10.The information system inadequately monitored activities Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-9 Developing Programs, Budgets, and Procedures Explain how you would develop programs, budgets, and procedures to implement strategic change this is show why people should be organise: plan than implemantation organization realized strategy Program – a collection of tactics where a tactic is the individual action taken by the organization as an element of the effort to accomplish a plan The purpose of a program or a tactic is to make a strategy action-oriented. Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-10 Timing Tactics: When to Compete (1 of 2) Explain how you would develop programs, budgets, and procedures to implement strategic change Timing tactic – deals with when a company implements a strategy First mover – first company to manufacture and sell a new product or service Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-11 Timing Tactics: When to Compete (2 of 2) Explain how you would develop programs, budgets, and procedures to implement strategic change Late movers – may be able to imitate the technological advances of others, keep risks down by waiting until a new technological standard or market is established, and take advantage of the first mover’s natural inclination to ignore market segments Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-12 Market Location Tactics: Where to Compete Explain how you would develop programs, budgets, and procedures to implement strategic change Market location tactic deals with where a company implements a strategy – Offensive tactic  usually takes place in an established competitor’s market location – Defensive tactic  usually takes place in the firm’s own current market position as a defense against possible attack by a rival Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10- Offensive Tactics Explain how you would develop programs, budgets, and procedures to implement strategic change Frontal assault Flanking maneuver Bypass attack Encirclement Guerilla warfare Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-14 Defensive Tactics Explain how you would develop programs, budgets, and procedures to implement strategic change Raise structural barriers Increase expected retaliation Lower the inducement for attack Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-15 Budgets and Procedures Explain how you would develop programs, budgets, and procedures to implement strategic change Planning a budget is the last real check a corporation has on the feasibility of its selected strategy. Procedures – detail the various activities that must be carried out to complete a corporation’s programs corcration like dior for exampel thay have perfume, bags, jewelry and clothes all of that dont need to have defrint departmint to adve for thim – standard operating procedures Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. Achieving Synergy Explain how you would develop programs, budgets, and procedures to implement strategic change Synergy – exists for a divisional corporation if the return on investment is greater than what the return would be if each division were an independent business corcration like corcration like dior dior for for exampel exampel thay thay have have perfume, perfume, bags, bags, jewelry jewelry and and clothes clothes all of all of that that dont dont need need toto have have defrint defrint departmint departmint to to adve adve for for thim thim Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10- Six Forms of Synergy Explain how you would develop programs, budgets, and procedures to implement strategic change 1. Shared know-how 2. Coordinated strategies 3. Shared tangible resources 4. Economies of scale or scope 5. Pooled negotiating power 6. New business creation Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10- 18 Structure Follows Strategy List the stages of corporate development and the structure that characterizes each stage Structure Follows Strategy – changes in corporate strategy lead to changes in organizational structure 1. New strategy is created. 2. New administrative problems emerge. 3. Economic performance declines. 4. New appropriate structure is created. 5. Economic performance rises. Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-19 Stages of Corporate Development List the stages of corporate development and the structure that characterizes each stage I. Simple Structure – Flexible and dynamic II. Functional Structure – Entrepreneur is replaced by a team of managers III. Divisional Structure – Management of diverse product lines in numerous industries – Decentralized decision making IV. Beyond SBU’s – Matrix – Network Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-20 Blocks to Changing Stages List the stages of corporate development and the structure that characterizes each stage Internal – Lack of resources – Lack of ability – Refusal of top management to delegate External – Economic conditions – Labor shortages – Lack of market growth Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-21 Table 10-2: Organizational Life Cycle List the stages of corporate development and the structure that characterizes each stage Organizational life cycle – describes how organizations grow, develop, and decline Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-22 Flexible Types of Organizational Structures (1 of 4) Explain how matrix, network, and modular structures are used implement strategy Matrix structures – functional and product forms are combined simultaneously at the same level of the organization Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-23 Figure 10-1: Matrix Structure Explain how matrix, network, and modular structures are used implement strategy Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-24 Flexible Types of Organizational Structures (2 of 4) Explain how matrix, network, and modular structures are used implement strategy Conditions for matrix structures include: Ideas need to be cross-fertilized across projects or products. Resources are scarce. Abilities to process information and to make decisions needs to be improved. Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-25 Flexible Types of Organizational Structures (3 of 4) Explain how matrix, network, and modular structures are used implement strategy Three distinct phases of matrix structure development include: 1. Temporary cross-functional task forces 2. Product/brand management 3. Mature matrix Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-26 Flexible Types of Organizational Structures (4 of 4) Explain how matrix, network, and modular structures are used implement strategy Network Structure – virtual elimination of in-house business functions Virtual organization – Composed of a series of project groups or collaborations linked by constantly changing non-hierarchical, cobweb-like electronic networks Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-27 Figure 10-1: Network Structure Figure Explain how matrix, network, and modular structures are used implement strategy Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-28 Cellular/Modular Organization: A New Type of Structure? Explain how matrix, network, and modular structures are used implement strategy Cellular/Modular Structure – composed of cells (self-managing teams, autonomous business units, etc.) which can operate alone but which can interact with other cells to produce a more potent and competent business mechanism Beginning to appear in firms that are focused on rapid product and service innovation. Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-29 Reengineering and Strategy Implementation Discuss the issues related to centralization versus decentralization in structuring organizations Reengineering – the radical redesign of business processes to achieve major gains in cost, service, or time – effective program to implement a turnaround strategy Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-30 Principles for Reengineering (1 of 2) Discuss the issues related to centralization versus decentralization in structuring organizations Organize around outcomes, not tasks. Have those who use the output of the process perform the process. Subsume information-processing work into real work that produces information. Treat geographically-dispersed resources as though they were centralized. Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-31 Principles for Reengineering (2 of 2) Discuss the issues related to centralization versus decentralization in structuring organizations Link parallel activities instead of integrating their results. Put the decision point where the work is performed and build control into the process. Capture information once and at the source. Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-32 Six Sigma Discuss the issues related to centralization versus decentralization in structuring organizations Six Sigma – analytical method for achieving near perfect results on a production line – emphasis on reducing product variance in order to boost quality and efficiency Lean Six Sigma – includes the removal of unnecessary steps in any process and fixing those that remain Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-33 Process of Six Sigma Discuss the issues related to centralization versus decentralization in structuring organizations 1. Define a process where results are poorer than average. 2. Measure the process to determine current performance. 3. Analyze the information to pinpoint where things are going wrong. 4. Improve the process and eliminate the error. 5. Establish controls to prevent future defects from occurring. Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-34 Designing Jobs to Implement Strategy (1 of 2) Discuss the issues related to centralization versus decentralization in structuring organizations Job design – the study of individual tasks in an attempt to make them more relevant to the company and to the employees Job design techniques: – Job enlargement  combining tasks to give a worker more of the same type of duties to perform – Job rotation  moving workers through several jobs to increase variety Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-35 Designing Jobs to Implement Strategy (2 of 2) Discuss the issues related to centralization versus decentralization in structuring organizations Job characteristics – using task characteristics to improve employee motivation Job enrichment – altering the jobs by giving the worker more autonomy and control over activities Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-36 Centralization versus Decentralization Discuss the issues related to centralization versus decentralization in structuring organizations Product group structure – enables the company to introduce and manage a similar line of products around the world – enables the corporation to centralize decision- making along product lines and to reduce costs Geographic area structure – allows the company to tailor products to regional differences and to achieve regional coordination Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-37 Figure 10-2: Geographic Area Structure for an MNC Discuss the issues related to centralization versus decentralization in structuring organizations Copyright © 2018 Pearson Education, Ltd. All Rights Reserved.. 10-38