STRATEGY

IMPLEMENTATION
 "The vision must be
followed by the venture.
It is not enough to stare
up the steps – we must
step up the stairs."
– Vance Havner
 1. Introduction
• Strategic Implementation is a process of
activating the strategy. It is the sum total of all
the activities and choices required for
execution of a strategic plan.
• It is the process by which strategies & policies
are put into action through the development of
programs, budgets and procedures.
• Strategy implementation may be said to
consist of securing resources, organizing
these resources and directing the use of these
resources within and outside the organization.
 1. Introduction
• The way in which the strategy is implemented
can have a significant impact on whether it will
be successful.
• In large companies, those who implement the
strategy likely will be different people from
those who formulated it. Thus, care must be
taken to communicate strategy & the reasoning
behind it, otherwise implementation might not
succeed if the strategy is misunderstood.
• In lower level position, managers resist its
implementation because they don’t understand
why the particular strategy was selected.
 2. Strategy Implementation
• Strategy implementation is an internal,
operations – driven activity involving
organizing, budgeting. Motivating, culture –
building, supervising and leading to make the
strategy work as intended.
• Activating a strategy is a process of putting
strategy into action. Strategy implementation
involves several issues in activating the
strategy. Activation of strategy OR steps
involved in strategy implementation can be
elaborated as follows: -
2. Steps of Strategy Implementation

• Institutionalization of strategy.
• Formulation of Action Plans.
• Project Implementation.
• Procedural Implementation.
• Resource Allocation.
• Structural Implementation.
• Functional Implementation.
• Behavioral Implementation.
A) Institutionalization of strategy.
• Institutionalization of strategy is the first activity
involved in activating the strategy.
Institutionalization of strategy involves two
aspects: -
i) Communication of strategy: Once the
strategy is formulated it must be communicated
to those persons who would implement it.
Strategy communication is a process of
transferring the strategy information from the
formulators to the implementers.
Ii) Securing Acceptance of Strategy: It is not
enough to communicate the strategy to the
members of the organizations, but it is equally
important to secure their acceptance of the
strategy, so that they implement effectively.
 B) Formulation of Action Plans
• Once the strategy is Institutionalized through its
communication and acceptance, the
management proceeds to formulate action
plans. The management has to frame action
plans in respect of several activities required to
implement a strategy.
• The action plans may be in respect of
purchasing new machinery, appointing
additional personnel, developing a new
process, etc…
• The type of action plan depends upon nature of
strategy. While framing a manager should
check out the objectives, activities to perform &
resources required to perform the action plans.
 C) Project Implementation
Project Implementation passes through following
phases that are as follows:
• Conception Phase – This phase is an extension
of strategy formulation phase. In this phase,
project ideas are generated during the process of
strategic alternatives & strategic choice that may
be implemented in future by organization.
• Project Analysis Phase – The project ideas have
to be arranged according to priority for the
purpose of development. Before selecting a
project for development, a preliminary project
analysis have to be made in respect of
marketing, technical, finance, etc…and check out
such analysis is required to analyze whether
project would appeal to investors, banks & FI’s.
 C) Project Implementation
• Planning Phase – In this phase, management
undertakes detailed planning of project. The detailed
planning should cover different areas of project such
as production schedules, plant design & layout,
technical arrangements, marketing, finance, etc…
• Organizing Phase – The management must
organize for necessary resources such as
manpower, finance, systems and procedures to
implement the project.
• Implementation Phase – During this phase, the
management must undertake engineering, order
placement for equipment & material etc… leading to
the testing, trial & working of plant.
 C) Project Implementation
• Operation Phase – The final phase involves
handing over the plant to the operating
personnel for operation purpose. At this stage
the production starts.
 D) Procedural Implementation.
• In order to implement the strategies, the management
must have good knowledge of the procedural
framework within which the plans, projects and
programmes have to be approved by the government
authorities. The government authorities besides the
policy guidelines issued by the government authorities
from time to time. Some of the important procedural
requirements can be elaborated as follows: -
1. Formation of a company – The formation of a
company is governed by the provision of Indian
companies act, 1956 as amended from time to time.
All activities for formation should be carried out such
as Registration, obtaining certificates, documentation
must be forwarded to registrar of companies, etc…
D) Procedural Implementation.
2. Licensing Procedures – Certain industries require
licensing procedures. As per the industrial policy,
1991, six industries require licensing manufacturing
products such as alcohol, cigarettes, chemical
fertilizers, industrial explosives, defense and Drugs
& Pharmaceuticals. Therefore company requiring
the license must apply for the same.
3. FEMA Requirements – if required, organization
must fulfill the necessary requirements of the
Foreign Exchange Management Act, 2000. Those
organizations willing to deal in foreign exchange
transactions must ensure that they collect required
information in context to provisions of FEMA.
D) Procedural Implementation.
4. Import and Export Requirements – Similarly,
organization willing to deal in Import & Export
need to follow certain procedural requirements,
such as they have to register with Directorate
General of Foreign Trade (DGFT) and obtain
Importers Exporters Code (IEC)
5. Competition Act, 2002 – The government
has introduced this act that aims at promoting
competition by restricting anti competitive
practices. Large businesses must have a good
understanding of the competitive act.
D) Procedural Implementation.
6. Foreign Collaboration Procedures – For proposals
to set up projects with foreign collaborations require
prior government approval. The government
authorities such as Reserve Bank of India (RBI),
Foreign Investment Promotion Board (FIPB) and
Project Approval Board are major regulatory bodies for
foreign collaborations including joint ventures abroad.
7. SEBI Requirement – Securities and Exchange
Board of INDIA (SEBI) became active since 1992 with
the passing of SEBI Act, 1992. the act empowered
SEBI with necessary powers to regulate the activities
connected with marketing of securities & investments
of stock exchanges, merchant banking, portfolio
management, stock brokers and others connected
with securities
 D) Procedural Implementation.
8) Consumer Protection Act, 1986 – Business firms
must have good knowledge of consumer protection
act, 1986. This act was passed to provide better
protection of the interests of consumers.The act seeks
to promote & protect rights of consumers such as: -
• The right to be protected against the marketing of
goods that are hazardous to life & property.
• The right to be informed about the quality, quantity,
potency, purity standards and price of goods to protect
the consumer against unfair trade practices.
• The right to be heard & be assured that consumers
interests will receive due consideration.
• The right to seek redressal against unfair trade
practices or exploitation of consumers, etc…
 D) Procedural Implementation.
9. Pollution Control Requirements – the govt. of
India has passed several laws relating to the
protection of environment. The business
organizations should have a good knowledge of
such laws. To name few of them are as follows:
• The Water (Prevention & Control of Pollution),
Act, 1974.
• The Air (Prevention & Control of Pollution), Act,
1981.
• The Environment Protection Act, 1986, etc…
 D) Procedural Implementation.
10. Labour Legislation Requirements – The
govt. of India has passed several laws to
protect the interest of the workers. Business
Organizations should have a good
knowledge of such laws, which include:
• The factories Act, 1948.
• The Workmen Compensation Act, 1923.
• The Bonus Act, 1965.
• The Minimum Wages Act, 1948.
• The Industrial Disputes Act, 1947, etc…