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    Chapter 9

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    Chapter 9

    Uploaded by

    Vidgezxc Loria
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    Chapter 9 PPT

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    Chapter 9 PPT

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    Chapter 9 PPT

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    Download as ppt, pdf, or txt
    639 views21 pages

    Chapter 9

    Uploaded by

    Vidgezxc Loria
    Chapter 9 PPT

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
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    CHAPTER 9 Strategy

    Implementation:
    Organizing for Action

    STRATEGIC MANAGEMENT & BUSINESS POLICY


    10TH EDITION
    THOMAS L. WHEELEN J. DAVID HUNGER

    Prentice Hall, Inc. © 2006 9-1


    Strategy Implementation

    Strategy Implementation
    --Sum total of activities & choices
    required for strategic plan execution
    through programs, budgets, and
    procedures

    Prentice Hall, Inc. © 2006 9-2


    Strategy Implementation

    Key Implementation Questions –

    –Who carries out strategic plan?


    –What needs to be done for alignment w/strategy?
    –How is work coordinated?

    Prentice Hall, Inc. © 2006 9-3


    Strategy Implementation

    10 Top Implementation Problems (i.e. excuses)


    – Took longer than planned
    • (Problem or result?)
    – Unanticipated major problems
    – Uncontrollable external factors
    – Competing activities and crises
    • (It’s Not My Fault!)
    – Employees not capable
    • (Duh!)
    – Lack of training
    – Ineffective coordination
    – Inadequate leadership
    – Tasks/activities poorly defined
    • (Those incompetent middle managers…)
    – Inadequate information systems
    • (Those incompetent IT Guys…)

    Prentice Hall, Inc. © 2006 9-4


    Strategy Implementation

    Who carries out strategic plan?

    Everyone!

    Prentice Hall, Inc. © 2006 9-5


    Strategy Implementation

    Programs – Budgets – Procedures


    Make a strategy Action oriented

    –Matrix of change – Program Evaluation


    1. Compares Existing versus Target Practices
    2. Identifies Practices as complementary or interfering
    a) Between existing and target
    b) Among existing or target
    3. Evaluates each Practice based on relative importance
    in accomplishing the strategy
    4. Identify problem areas and conflicts

    Prentice Hall, Inc. © 2006 9-6


    Programs, Budgets and Procedures

    Budget
    Detailed costs associated with each Program

    Procedures
    Activities that must be carried out to complete
    the Programs
    Standard Operating Procedures (SOP)

    Prentice Hall, Inc. © 2006 9-7


    Strategy Implementation

    Synergy
    The ROI of each division is greater than if they were
    independent separate companies

    Achieving Synergy – (6 forms)


    –Shared know-how
    –Coordinated strategies
    –Shared tangible resources
    –Economies of scale or scope
    –Pooled negotiating power
    –New business creation

    Prentice Hall, Inc. © 2006 9-8


    Strategy Implementation

    STRUCTURE FOLLOWS STRATEGY (Chandler)

    –New strategy is created


    –New administrative problems emerge
    –Economic performance declines
    –New appropriate structure is invented
    –Profit returns to previous level

    Centralization Decentralization
    (Control) (Autonomy)

    Prentice Hall, Inc. © 2006 9-9


    Strategy Implementation

    Stages of Corporate Development –

    –Stage I: Simple structure


    Entrepreneur
    –Stage II: Functional structure
    Team of functional specialists
    –Stage III: Divisional structure
    Many products/industries
    –Stage IV: Beyond SBU’s
    Matrix/Network based on projects

    Prentice Hall, Inc. © 2006 9-10


    Strategy Implementation

    Blocks to Changing Stages –


    Entrepreneur tendencies
    –Loyalty to comrades
    –Task oriented
    –Single-mindedness
    –Working in isolation

    Prentice Hall, Inc. © 2006 9-11


    Organizational Life Cycle

    Prentice Hall, Inc. © 2006 9-12


    Changing Structural Characteristics of Modern Organizations

    Prentice Hall, Inc. © 2006 9-13


    Strategy Implementation

    Advanced Types of Organizational


    Structures –

    –Matrix
    •Temporary cross-functional task forces (J&J)
    •Product/brand management (P&G)
    •Mature matrix (Aerospace)
    –Network structure (virtual organization)
    •Supply Chain Management & Communications
    –Cellular organization
    •Self managed teams

    Prentice Hall, Inc. © 2006 9-14


    Network Structure

    Prentice Hall, Inc. © 2006 9-15


    Strategy Implementation

    Business Process Reengineering (BPR)


    Principles (Hammer)
    – Organize around outcomes
    – Those that use the output perform the process
    – Integrate information processing into real work
    – Treat geographically dispersed resources as
    centralized
    – Link parallel activities
    – Put decision point where work is performed
    – Capture information once at it’s source

    Prentice Hall, Inc. © 2006 9-16


    Strategy Implementation

    Six Sigma – Sigma Performance Levels -- One To Six Sigma

    Defects Per Million Opportunities


    Sigma Level
    DMAIC Methodology (DPMO)

    –Define 1 690,000

    2 308,537
    –Measure 3 66,807

    –Analyze 4 6,210

    –Improve 5 233

    –Control 6 3.4

    Real-World Performance Levels

    In 1 Sigma In 3 Sigma In 6 Sigma


    Situation/Example
    World World World

    Pieces of your mail lost per year [1,600 per year] 1,106 107 <1

    Number of empty coffee pots at work (who didn't fill the coffee pot again?) [680 per year] 470 45 <1

    Number of telephone disconnections [7,000 talk minutes] 4,839 467 0.02

    Erroneous business orders [250,000 per year] 172,924 16,694 0.9

    Prentice Hall, Inc. © 2006 9-17


    Strategy Implementation

    Job design to implement strategy –

    –Job enlargement
    –Job rotation
    –Job enrichment
    –Job characteristics model
    •Combine tasks to increase variety
    •Form natural work units - make workers responsible
    •Establish client relationships
    •Vertically load the job – authority & responsibility
    •Open feedback channels

    Prentice Hall, Inc. © 2006 9-18


    Strategy Implementation

    International Issues
    –Multi-National Corporation’s
    Multi-Domestic versus Global

    International Development Stages–

    –Domestic company
    –Domestic company w/export division
    –Domestic company w/int’l division
    –MNC w/multi-domestic emphasis
    –MNC w/global emphasis

    Prentice Hall, Inc. © 2006 9-19


    Geographic Area Structure

    Centralization vs. Decentralization–


    –Product-group structure
    –Geographic-area structure

    Prentice Hall, Inc. © 2006 9-20


    CHAPTER 9 Strategy
    Implementation:
    Organizing for Action

    STRATEGIC MANAGEMENT & BUSINESS POLICY


    10TH EDITION
    THOMAS L. WHEELEN J. DAVID HUNGER

    Prentice Hall, Inc. © 2006 9-21

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