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Strategy Implementation : Strategy Implementation :

Strategy Implementation : - PowerPoint Presentation

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Strategy Implementation : - PPT Presentation

Organizing for Action Chapter 9 Learning Objectives Develop programs budgets and procedures to implement strategic change Understand the importance of achieving synergy during strategy implementation ID: 719272

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Slide1

StrategyImplementation:Organizing for Action

Chapter 9Slide2

Learning ObjectivesDevelop programs, budgets and

procedures to

implement strategic change

Understand the importance of achieving synergy during strategy implementationList the stages of corporate development and the structure that characterizes each stageIdentify the blocks to changing from one stage to another

Copyright © 2015 Pearson Education, Inc.

9-

2Slide3

Learning ObjectivesConstruct matrix and network structures to support flexible and nimble

organizational strategies

Decide

when and if programs such as reengineering, Six Sigma and job redesign are appropriate methods of strategy implementationUnderstand the centralization versus decentralization issue in multinational corporations

Copyright © 2015 Pearson Education, Inc.

9-

3Slide4

Strategy ImplementationStrategy implementationthe sum total of all activities and choices required for the execution of a strategic plan

Who

are the people to carry out the strategic plan?

What must be done to align company operations in the intended direction?How is everyone going to work together to do what is needed?

Copyright © 2015 Pearson Education, Inc.

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4Slide5

Common Strategy Implementation Problems

Took more time than planned

Unanticipated major problems

Ineffective coordinationCompeting activities and crises created distractionsEmployees with insufficient capabilitiesLower-level employees were inadequately

trainedUncontrollable external environmental factors

Poor departmental leadership and direction

Inadequately defined implementation tasks and activities

Inefficient information system to monitor activities

Copyright © 2015 Pearson Education, Inc.

9-

5Slide6

Developing Programs, Budgets and Procedures

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 planThe purpose of a program or a tactic is to make a strategy action-oriented.Copyright © 2015 Pearson Education, Inc.

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6Slide7

Timing Tactics: When to CompeteTiming tactic

deals

with

when a company implements a strategyFirst moverfirst company to manufacture and sell a new product or serviceLate 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 © 2015 Pearson Education, Inc.

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7Slide8

Market Location Tactics: Where to Compete

Market location tactic

deals with where a company implements a strategy.

Offensive tactic usually takes place in an established competitor’s market locationDefensive tactic usually takes place in the firm’s own current market position as a defense against possible attack by a rivalCopyright © 2015 Pearson Education, Inc.

9-8Slide9

Offensive Tactics

Copyright © 2015 Pearson Education, Inc.

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9Slide10

Defensive TacticsRaise structural barriersIncrease expected retaliationLower the inducement for attack

Copyright © 2015 Pearson Education, Inc.

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10Slide11

Developing Programs, Budgets and Procedures

Planning a

budget

is the last real check a corporation has on the feasibility of its selected strategy.Proceduresdetail the various activities that must be carried out to complete a corporation’s programsStandard operating proceduresCopyright © 2015 Pearson Education, Inc.

9-

11Slide12

Achieving SynergySynergyexists for a divisional corporation if the return on investment is greater than what the return would be if each division were an independent business

Copyright © 2015 Pearson Education, Inc.

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12Slide13

Forms of Synergy

Copyright © 2015 Pearson Education, Inc.

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13Slide14

Structure Follows StrategyStructure Follows Strategychanges in corporate strategy lead to changes in organizational structure

New strategy is created

New administrative problems emerge

Economic performance declinesNew appropriate structure is inventedProfit returns to its previous level

Copyright © 2015 Pearson Education, Inc.

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14Slide15

Factors Differentiating Stage I, II and III Companies

Copyright © 2015 Pearson Education, Inc.

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15Slide16

Stages of Corporate Development

Simple Structure

Flexible and dynamic

Functional StructureEntrepreneur is replaced by a team of managersDivisional StructureManagement of diverse product lines in numerous industriesDecentralized decision makingBeyond SBU’sMatrix

Network

Copyright © 2015 Pearson Education, Inc.

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16Slide17

Blocks to Changing StagesInternalLack of resources

Lack of ability

Refusal of top management to delegate

ExternalEconomic conditionsLabor shortagesLack of market growthCopyright © 2015 Pearson Education, Inc.

9-17Slide18

Blocks to Changing Stages(Entrepreneurs)

Copyright © 2015 Pearson Education, Inc.

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18Slide19

Organizational Life CycleOrganizational life cycledescribes how organizations grow, develop and decline

Copyright © 2015 Pearson Education, Inc.

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19Slide20

Advanced Types of Organizational Structures

Matrix structures

functional and product forms are combined simultaneously at the same level of the organization

Copyright © 2015 Pearson Education, Inc. 9-20Slide21

Matrix StructureCopyright © 2015 Pearson Education, Inc.

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21

Figure 9-1Slide22

Advanced Types of Organizational Structures

Conditions for

m

atrix structures include:Ideas need to be cross-fertilized across projects or productsScarcity of resourcesAbilities to process information and to make decisions needs to be improvedCopyright © 2015 Pearson Education, Inc.

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22Slide23

Advanced Types of Organizational Structures

Phases of

m

atrix structure development Temporary cross-functional task forces

Product/brand managementMature matrix

Copyright © 2015 Pearson Education, Inc.

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23Slide24

Advanced Types of Organizational Structures

Network structure

virtual

elimination of in-house business functionsVirtual organization composed of a series of project groups or collaborations linked by constantly changing nonhierarchical, cobweb-like electronic networks

Copyright © 2015 Pearson Education, Inc.

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24Slide25

Network StructureCopyright © 2015 Pearson Education, Inc.

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25

Figure 9-1Slide26

Cellular/Modular Organization: A New Type of Structure?Cellular/Modular structurecomposed 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 innovationCopyright © 2015 Pearson Education, Inc.

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26Slide27

Reengineering and Strategy Implementation

Reengineering

the radical redesign of business processes to achieve major gains in cost, service or time

effective program to implement a turnaround strategyCopyright © 2015 Pearson Education, Inc. 9-

27Slide28

Principles for ReengineeringOrganize around

outcomes

, not tasks

Have those who use the output of the process perform the processSubsume information-processing work into real work that produces informationTreat geographically-dispersed resources as though they were centralized

Copyright © 2015 Pearson Education, Inc.

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28Slide29

Principles for ReengineeringLink parallel activities

instead of integrating their results

Put the

decision point where the work is performed and build control into the processCapture information once and at the sourceCopyright © 2015 Pearson Education, Inc.

9-29Slide30

Six SigmaSix Sigmaanalytical method for achieving near perfect results on a production line

emphasis

is on reducing product variance in order to boost quality and

efficiencyLean Six Sigma includes the removal of unnecessary steps in any process and fixing those that remainCopyright © 2015 Pearson Education, Inc.

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30Slide31

Process of Six Sigma

Define

a process where results are

poorer than averageMeasure the process to determine current performanceAnalyze the information to pinpoint where things are going wrong

Improve the process and eliminate the error

Establish

controls to prevent future defects from occurring

Copyright © 2015 Pearson Education, Inc.

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31Slide32

Designing Jobs to Implement Strategy

Job design

the study of individual tasks in an attempt to make them more relevant to the company and to the employees

Job enlargementcombining tasks to give a worker more of the same type of duties to performJob rotationmoving workers through several jobs to increase varietyCopyright © 2015 Pearson Education, Inc.

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32Slide33

Designing Jobs to Implement Strategy

Job characteristics

using task characteristics to improve employee motivation

Job enrichment altering the jobs by giving the worker more autonomy and control over activitiesCopyright © 2015 Pearson Education, Inc. 9-33Slide34

International Issues in Strategy Implementation

Multinational corporation (MNC)

a highly developed international company with a deep involvement throughout the world, plus a worldwide perspective in its management and decision makingCopyright © 2015 Pearson Education, Inc.

9-34Slide35

Drivers for Strategic Fit among Alliance Partners

Partners must agree on

values

and visionAlliance must be derived from business, corporate and functional strategy

Alliance must be important to partners, especially top management

Partners must be

mutually dependent

for achieving objectives

Copyright © 2015 Pearson Education, Inc.

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35Slide36

Stages of International Development

Stage 1

: Domestic company

Stage 2: Domestic company with export divisionStage 3: Primarily domestic company with international divisionStage 4: Multinational corporation with multidomestic emphasis

Stage 5: Multinational corporation with global emphasis

Copyright © 2015 Pearson Education, Inc.

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36Slide37

Centralization versus DecentralizationProduct 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 costsGeographic area structureallows the company to tailor products to regional differences and to achieve regional coordinationCopyright © 2015 Pearson Education, Inc.

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37Slide38

Geographic Area Structurefor an MNC

Copyright © 2015 Pearson Education, Inc.

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38

Figure 9-2Slide39

Copyright © 2015 Pearson Education, Inc. 9-39