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STAFFING FOLLOWS STRATEGY
• • • • • Hire different people or retain current employees to implement the new strategy Training in technical and interpersonal skills Training specially important for a differentiation strategy Training also important when implementing a retrenchment strategy Successful downsizing means that a company has to invest in remaining employees
MATCHING THE MANAGER TO STRATEGY
• • • Career life cycles for executives: learning stage, harvest stage, decline stage The length of the time spent in each stage varies among executives The most appropriate CEO of an organization changes as a firm moves from one stage to another.
Matching Chief Executive “Types” with Strategy
Business Strength/Competitive Position
Retrenchment— Save Company Turnaround Specialist
Growth—Concentration Dynamic Industry Expert
Stability Cautious Profit Planner
Growth—Diversification Analytical Portfolio Manager
Retrenchment— Close Company Professional Liquidator
Source: Thomas L. Wheelen and J. David Hunger, “Matching Proposed Chief Executive ‘Types’ with Corporate Strategy.” Copyright © 1991 by Wheelen and Hunger Associates. Reprinted by permission.
SELECTION AND MANAGEMENT DEVELOPMENT
• • • • Executive succession is the process of replacing a key top manager: Promote from within (heir apparent)- Insiders Hiring from the outside- Outsiders Encourage boards to help the CEO create a succession plan, identifying succession candidate, measuring internal candidates against outside candidates, and develop a comprehensive set of skills, providing appropriate financial incentives
• • •
Prosperous firms tend to look outside for CEOs only if they have no obvious internal candidates Firms in trouble, choose outsiders to lead them Boards realize that the best way to force a change in strategy is to hire a new CEO who has no connection to the current strategy
Identifying Abilities and Potential
• • • • Establish a sound performance appraisal system to identify good performers with promotion potential People should be hired and identified for training without regard to their racial, ethnic and religious background Assessment centers to evaluate a person’s suitability for an advanced position Job rotation : moving people from one job to another to improve the level of organization learning
Competencies to identify Potential Executives (HP)
• • • • • • Practice the HP way Lead Change and Learning Know the internal and external environments Lead strategy setting Align the organization Achieve results
PROBLEMS OF RETRENCHMENT
• Downsizing (rightsizing) refers to the planned elimination of positions or jobs and is used to implement retrenchment strategies Retrenchment can sometimes lead to further weakening instead of strengthening the organization When companies use downsizing as part of a larger restructuring program to narrow company focus, they enjoy better performance
• • • • • • Eliminate unnecessary work. Contract out work that others can do cheaper. Plan for long-run efficiencies. Communicate the reasons for actions. Invest in the remaining employees. Develop value-added jobs to balance out job elimination.
INTERNATIONAL ISSUES IN STAFFING
• Because of cultural differences, managerial style and human resource practices must be tailored to fit the particular situations in other countries MNCs provide their managers with international assignments to improve organizational learning Hiring an promoting people from the host country Using people with an international orientation regardless of their country of origin or host country assignment Taking advantages of immigrants to staff key positions
• • • •
• • • • • Managing Corporate Culture Action Planning Management by Objectives Total Quality Management International considerations in leading
Managing Corporate Culture
• • • Organization culture exerts a powerful influence on the behavior of all employees There fore it can affect the ability of the company to shift its strategic direction In case of a strong culture the change in mission, objectives, strategies and policies may not be accepted Corporate culture has a strong tendency to resist change
Is the planned strategy compatible with the current culture? Yes
Assessing Strategy—Culture Compatibility
Tie changes into the culture. Yes
Can the culture be modified to make it more compatible with the new strategy?
Is management willing and able to make major organizational changes and accept probable delays and a likely increase in Yes
Manage around the culture by establishing a new structural unit to implement the new strategy. Yes Find a joint-venture partner or contract with another company to carry out the strategy.
Is management still committed to implementing the strategy? No
Formulate a different stately.
Managing Cultural Change through Communication
• • Communication is key to effective management and change Rationale for strategic change should be communicated to workers through newsletter, and training and development Communicate the vision to the employees Translate the vision into key elements necessary to accomplish that vision
Managing Diverse Cultures Following an Acquisition
• • • Top management must give consideration to a potential clash of corporate culture When corporate cultures are similar performance problems are minimized It is dangerous to assume that the firms can simply be integrated into the same reporting structure
Methods of Managing the Culture of an How Much Members of Acquired Firm the Acquired Firm Value
Preservation of Their Own Culture Not at All Very Much
Perception of the Attractiveness of the Acquirer
Not at All Attractive
Source: A. Nahavardi and A. R. Malekzadeh, “Acculturation in Mergers and Acquisitions,” Academy of Management Review (January 1988), p. 83. Copyright © 1988 by the Academy of Management. Reprinted by permission.
1. 2. 3. 4. List specific actions. List dates to begin and end each action. Name person responsible for each action. Name person responsible for monitoring timelines and effectiveness of each action. 5. Estimate expected financial and physical consequences of each action. 6. Develop contingency plans.
MANAGEMENT BY OBJECTIVES
• • • • Establishing and communicating organizational objectives Setting individual objectives through superiorsubordinate interaction that help implement organizational objectives Develop an action plan of activities needed to achieve the objectives Periodically review the performance as it relates to the objectives and including the results in the annual performance appraisal
Process of Management by Objectives
2 Revise structure 3 1 Formulate corporate, divisional, and functional objectives 7 Evaluate corporate, divisional, and functional performance 6 Review and discuss overall results 5(b) Drop inappropriate objectives Consider new information 5 Subordinate proposes objectives Feedback and Change 4 Joint agreement on subordinate’s objectives and action plan 3 Superior plans objectives for subordinates
Review and discuss interim results
Objectives of Total Quality Management (TQM)
1. Better, less variable quality of product / service. 2. Quicker, less variable response to customers’ needs. 3. Greater flexibility in adjusting to customers’ shifting requirements. 4. Lower cost through quality improvements and elimination of non value-adding work.
Essential Ingredients of Total Quality Management (TQM)
• • • • • Intense focus on customer satisfaction Internal as well as external customers Accurate measurement of every critical variable in a company’s operations Continuous improvement of products / services New work relationships based on trust and teamwork
International Considerations in Leading
• • Leaders must consider the dimensions of national culture MNCs must pay attention to the many differences in cultural dimensions around the world and adjust their management practices accordingly
Hofstede’s International Cultural Dimensions
1. Power distance 2. Uncertainty avoidance 3. Individualism—collectivism 4. Masculinity—femininity 5. Long-tern orientation