SBM L3

• Strategy implementation


  The sum total of the activities and choices required for the execution of a strategic plan
• Strategy implementation


  Objectives, strategies, and policies are put into action through the development of programs, budgets, and procedures
• Strategy implementation


  • It is a key part of strategic management
  • Strategy formulation and strategy implementation should be considered as two sides of the same coin
• Implementers of strategy


  Everyone in the organization, from vice presidents to first-line supervisors
• Programs


  Make a strategy action oriented, e.g. Lean Six Sigma at Xerox
• Matrix of change


  • Helps managers decide how quickly change should proceed, in what order changes should take place, whether to start at a new site, and whether the proposed systems are stable and coherent
• Planning a budget is the last real check a corporation has on the feasibility of its selected strategy
• Procedures


  Standard Operating Procedures (SOPs) that detail the various activities to complete a corporation's programs
• Structure follows strategy - changes in corporate strategy lead to changes in organizational structure

  
• Levels of strategy

  • Corporate strategy
  • Business strategy
  • Functional strategy
• Corporate strategy


  Describes a company's overall direction in terms of its general attitude toward growth and the management of its various businesses and product lines

  
• Business strategy


  Occurs at the business unit or product level, and emphasizes improvement of the competitive position of a corporation's products or services

  
• Functional strategy


  The approach taken by a functional area to achieve corporate and business unit objectives and strategies by maximizing resource productivity

  
• Stages of corporate development

  • Simple structure
  • Functional structure
  • Divisional structure
  • Beyond strategic business unit (SBU)

  
• Stage IV: Beyond Strategic Business Unit (SBU)


  1. Use of SBUs may result in a red tape crisis

  2. Corporation has grown too large and complex to be managed through formal programs and rigid systems

  3. Procedures take precedence over problem solving

  4. New advanced forms of organizational structure are emerging that emphasize collaboration over competition in the managing of an organization's multiple overlapping projects and developing businesses
• Organizational Life Cycle

  • Describes how organizations grow, develop, and eventually decline
  • Stages: Birth (Stage I), Growth (Stage II), Maturity (Stage III), Decline (Stage IV), and Death (Stage V)
• Reengineering


  • Radical redesign of business processes to achieve major gains in cost, service, or time
  • Not a type of structure, but an effective program to implement a turnaround strategy
• Six Sigma


  • Analytical method for achieving near-perfect results on a production line
  • Emphasis is on reducing product variance to boost quality and efficiency
  • Process: Define, Measure, Analyze, Improve, Establish controls
• Job Design


  • Study of individual tasks in an attempt to make them more relevant to the company and to the employee(s)
  • Techniques: Job enlargement, Job rotation, Job enrichment
• Functional Strategy


  • Approach a functional area takes to achieve corporate and business unit objectives and strategies by maximizing resource productivity
  • Concerned with developing and nurturing a distinctive competence to provide a company or business unit with a competitive advantage

  
• Business Strategy


  • Focuses on improving the competitive position of a company's or business unit's products or services within the specific industry or market segment
  • Can be competitive (battling against all competitors) and/or cooperative (working with one or more companies)

  
• Corporate Strategy


  • Primarily about the choice of direction for a firm as a whole and the management of its business or product portfolio
  • Major components: Purpose and objectives, Vector, Competitive advantage, Synergy, Personal values and aspirations, Social obligations

  
• Characteristics of Corporate Objectives


  • Have a time frame
  • Attainable
  • Challenging
  • Understandable
  • Measurable
  • Controllable

  
• Vector


  Gives the directions within an industry and across industry boundaries which the firm proposes to pursue
• Competitive Advantage


  Corporate strategy is relative by nature, must isolate unique features of the organization and be competitively superior

  
• Synergy


  Measurement of the firm's capability to take advantage of a new product market move
• Functions of Corporate Strategy


  • Provides a dual approach to problem solving
  • Focuses attention upon changes in the organizational set up, administration of organizational process affecting behaviour and the development of effective leadership
  • Offers a technique to manage changes
  • Furnishes the management with a perspective whereby, the latter gives equal importance to present and future opportunities
  • Provides the management with a mechanism to cope with highly complex environment