Business Policies and
Strategies
Strategy Implementation
Strategy Implementation
? An internal,operations driven activity involving
organizing,budgeting,motivating,culture
building,supervising,and leading to make the
strategy worked as intended.
? There must be a fit between strategy and
organizational resources and capabilities,
reward structure,internal support systems,and
organizational structure.
Implementation Questions
? Who are the people who will carry out the
strategic plan?
? What must be changed to align the company’s
operations in the new intended direction?
? How is everyone going to do what is needed?
Do we have the resources and capabilities to do
so?
? Does our organizational culture and structure
have to be changed? Can it be changed?
Implementing Strategy is Tough?
? Implementing a new strategy takes adept
management leadership to
– Overcome pockets of doubt
– Build consensus on how to proceed
– Secure commitment and cooperation
– Get all pieces in place
– Obtain the necessary resources and
capabilities
Implementation Process
? Identify general strategic objectives
? Identify resistance to change
? Determine leadership required
? Determine if culture needs revision
? Formulate specific policies and plans
? Allocate resources and budgeting
? Monitor and control procedures
? Manage strategic change
Implementation Factors
? Seriousness of situation
? Nature and extent of change involved
? Type of strategy
? Strength of engrained behavior
? Financial resources available
? Organizational resources available
? Pressures for quick results
Typical Implementation Problems
? Took more time than planned
? Unanticipated internal major problems arose
? Poor coordination and leadership
? Inability to change the organizational culture
? Insufficient resources and capabilities
? Uncontrollable external events
? Inadequate information systems
Implementation Action Steps
? Install the right leader
? Manage the change and stress
? Benchmark the best
? Set goals and objectives
? Change the organizational structure
? Reengineer processes
? Outsource non-core activities
? Revise compensation systems
? Create a learning organization
Leaders versus Managers
? Managers are people who do things right and
leaders are people who do the right things,
(Bennis and Nanus)
? Managers are concerned about how things get
done and leaders are concerned with what the
things mean to people,(Zaleznik)
Differences
? Managers
– Setting operational goals,establishing plans with
timetables,and allocating resources
– Organizing and staffing
– Monitoring results and solving problems
? Leaders
– Developing a vision of the future
– Communicating the vision
– Motivating and inspiring people
Contextual Features
? Time – how quick
? Scope – what degree
? Preservation – what to maintain
? Diversity – how homogeneous
? Capability – how much experience
? Capacity – how much resources
? Readiness – how much resistance
? Power – what power is needed
Theories E and O
? Theory E – involves heavy use of
economic incentives,drastic layoffs,
downsizing and restructuring,
Shareholder value is key.
? Theory O – geared toward building up the
corporate culture,employee behaviors,
attitudes,capabilities and commitment,
Ability to learn is key.
Resistance to Change
? Lack of trust
? Belief that change is not necessary
? Belief that change is not feasible
? Fear of personal failure
? Loss of power and status
? Resentment of interference
? High costs of change
To Overcome Resistance
? Create a sense of urgency
? Build a coalition
? Prepare people for adjustment
? Help people deal with the change
? Keep people informed of the progress
? Demonstrate continued commitment
? Empower people
Why Change Efforts Fail
? Not establishing a sense of urgency
? Not creating a powerful coalition
? Lacking a vision
? Under-communicating
? Not removing obstacles
? Not creating short-term wins
? Declaring victory too soon
? Not anchoring changes
Tips for Managing Change
? Don’t make changes just for the sake of
making change
? Get support
? Establish trust
? Allow participation
? Provide attention and support
? Show empathy and understanding
Reengineering Processes
? Means by which an organization can achieve a
radical change in performance as measured by
customer requirements (cost,cycle time,service
and quality)
? Focuses on the business as a set of customer
oriented core business processes rather than a
set of organizational functions.
Reasons for Failure
? Try to fix instead of change
? Do not focus on processes
? Ignore everything except process redesign
? Settle for minor results
? Quit too early
? Try to make it happen from the bottom up
? Try to do too much
? Try to make everyone happy
Preconditions for Success
? Senior management commitment
? Realistic expectations
? Empowered and collaborative employees
? Strategic context of growth and expansion
? Shared vision
? Sound management processes
? Sufficient budget
Outsourcing Process
? What and why?
? What issues prior to outsourcing?
? What suppliers and choice determination?
? What price to pay?
? What are the human resource issues?
? Who is involved?
? How to manage the relationship?
Benefits of Outsourcing
? Greater flexibility
? Lower capital investment
? Decrease design cycle time
? Specialized and dedicated suppliers
? Spreads technological risk
? Access to more improvement ideas
? Lower overhead costs
Rightsizing the Organization
? Reduce payroll costs
? Become more competitive
? Lower budgets
? Reduce decision making time
? Improve customer service
Why not just Downsize?
? Can result in financial loss
? Does not produce revenue growth
? May be too understaffed to capitalize on
an economic recovery
? Also weakens the consumer sector
? May not get rid of the deadwood
? May stretch remaining managers too thin
Action Steps for Rightsizing
? Simplify the structure
? Make the changes quickly
? Outsource the work
? Use task forces to solve special problems
? Deal honestly and openly
? Use performance appraisal information
? Personally explain the situation
Gaps and Action Plans
Required Existing Gap Action Plan
Resources
Capabilities
Organization
Culture
Strategies
Strategy Implementation
Strategy Implementation
? An internal,operations driven activity involving
organizing,budgeting,motivating,culture
building,supervising,and leading to make the
strategy worked as intended.
? There must be a fit between strategy and
organizational resources and capabilities,
reward structure,internal support systems,and
organizational structure.
Implementation Questions
? Who are the people who will carry out the
strategic plan?
? What must be changed to align the company’s
operations in the new intended direction?
? How is everyone going to do what is needed?
Do we have the resources and capabilities to do
so?
? Does our organizational culture and structure
have to be changed? Can it be changed?
Implementing Strategy is Tough?
? Implementing a new strategy takes adept
management leadership to
– Overcome pockets of doubt
– Build consensus on how to proceed
– Secure commitment and cooperation
– Get all pieces in place
– Obtain the necessary resources and
capabilities
Implementation Process
? Identify general strategic objectives
? Identify resistance to change
? Determine leadership required
? Determine if culture needs revision
? Formulate specific policies and plans
? Allocate resources and budgeting
? Monitor and control procedures
? Manage strategic change
Implementation Factors
? Seriousness of situation
? Nature and extent of change involved
? Type of strategy
? Strength of engrained behavior
? Financial resources available
? Organizational resources available
? Pressures for quick results
Typical Implementation Problems
? Took more time than planned
? Unanticipated internal major problems arose
? Poor coordination and leadership
? Inability to change the organizational culture
? Insufficient resources and capabilities
? Uncontrollable external events
? Inadequate information systems
Implementation Action Steps
? Install the right leader
? Manage the change and stress
? Benchmark the best
? Set goals and objectives
? Change the organizational structure
? Reengineer processes
? Outsource non-core activities
? Revise compensation systems
? Create a learning organization
Leaders versus Managers
? Managers are people who do things right and
leaders are people who do the right things,
(Bennis and Nanus)
? Managers are concerned about how things get
done and leaders are concerned with what the
things mean to people,(Zaleznik)
Differences
? Managers
– Setting operational goals,establishing plans with
timetables,and allocating resources
– Organizing and staffing
– Monitoring results and solving problems
? Leaders
– Developing a vision of the future
– Communicating the vision
– Motivating and inspiring people
Contextual Features
? Time – how quick
? Scope – what degree
? Preservation – what to maintain
? Diversity – how homogeneous
? Capability – how much experience
? Capacity – how much resources
? Readiness – how much resistance
? Power – what power is needed
Theories E and O
? Theory E – involves heavy use of
economic incentives,drastic layoffs,
downsizing and restructuring,
Shareholder value is key.
? Theory O – geared toward building up the
corporate culture,employee behaviors,
attitudes,capabilities and commitment,
Ability to learn is key.
Resistance to Change
? Lack of trust
? Belief that change is not necessary
? Belief that change is not feasible
? Fear of personal failure
? Loss of power and status
? Resentment of interference
? High costs of change
To Overcome Resistance
? Create a sense of urgency
? Build a coalition
? Prepare people for adjustment
? Help people deal with the change
? Keep people informed of the progress
? Demonstrate continued commitment
? Empower people
Why Change Efforts Fail
? Not establishing a sense of urgency
? Not creating a powerful coalition
? Lacking a vision
? Under-communicating
? Not removing obstacles
? Not creating short-term wins
? Declaring victory too soon
? Not anchoring changes
Tips for Managing Change
? Don’t make changes just for the sake of
making change
? Get support
? Establish trust
? Allow participation
? Provide attention and support
? Show empathy and understanding
Reengineering Processes
? Means by which an organization can achieve a
radical change in performance as measured by
customer requirements (cost,cycle time,service
and quality)
? Focuses on the business as a set of customer
oriented core business processes rather than a
set of organizational functions.
Reasons for Failure
? Try to fix instead of change
? Do not focus on processes
? Ignore everything except process redesign
? Settle for minor results
? Quit too early
? Try to make it happen from the bottom up
? Try to do too much
? Try to make everyone happy
Preconditions for Success
? Senior management commitment
? Realistic expectations
? Empowered and collaborative employees
? Strategic context of growth and expansion
? Shared vision
? Sound management processes
? Sufficient budget
Outsourcing Process
? What and why?
? What issues prior to outsourcing?
? What suppliers and choice determination?
? What price to pay?
? What are the human resource issues?
? Who is involved?
? How to manage the relationship?
Benefits of Outsourcing
? Greater flexibility
? Lower capital investment
? Decrease design cycle time
? Specialized and dedicated suppliers
? Spreads technological risk
? Access to more improvement ideas
? Lower overhead costs
Rightsizing the Organization
? Reduce payroll costs
? Become more competitive
? Lower budgets
? Reduce decision making time
? Improve customer service
Why not just Downsize?
? Can result in financial loss
? Does not produce revenue growth
? May be too understaffed to capitalize on
an economic recovery
? Also weakens the consumer sector
? May not get rid of the deadwood
? May stretch remaining managers too thin
Action Steps for Rightsizing
? Simplify the structure
? Make the changes quickly
? Outsource the work
? Use task forces to solve special problems
? Deal honestly and openly
? Use performance appraisal information
? Personally explain the situation
Gaps and Action Plans
Required Existing Gap Action Plan
Resources
Capabilities
Organization
Culture
