STRATEGY

IMPLEMENTATION
 Strategic Management Model

Environmental Strategy Strategy Evaluation

Scanning Formulation Implementation and Control
Mission
External
Reason for
Societal
existence
Environment Objectives
General Forces
What results
to
Task Strategies
accomplish
Environment
by when Plan to
Industry Analysis
achieve the Policies
mission &
Internal objectives Broad
guidelines for Programs
Structure decision Process
Chain of Command making Activities to monitor
needed to performance
Budgets
Culture accomplish and take
Beliefs, Expectations, a plan corrective
Cost of the
Values action
programs
Procedures
Resources
Sequence
Assets, Skills
of steps
Competencies,
needed to
Knowledge do the job Performance

Feedback/Learning
Strategy Execution

“In too many companies there is a grand, and overly vague, long-term goal on
one hand…and detailed short-term budgets and annual plans on the other
hand … with nothing in between to link the two together
… the long term doesn’t start at year five of the current
strategic plan. It starts right now!”

Competing for the Future by Gary Hamel and C.K. Prahalad (Harvard Business Press)
Issues includes:
- What new business to enter
- What business to abandon
- How to allocate resources
- Expand operations or diversity
- Merge or form joint venture
Issues includes:
- Annual objectives
- Policies
- Employee motivation
- Resource allocation
 Fluctuating = Good performance =
Strong vision + Strong vision +
Weak Strong
implementation implementation

Vision
Going nowhere = Conservative = Excellent
Weak vision + Weak vision + performance
Weak Strong management
implementation implementation

Implementation
 scenario 1 scenario 2 scenario n

result 1

result 2

result n

MISSION + CONSEQUENCES
STRATEGY
 Strategy implementation is the total activities and choices
required for the execution of a strategic plan. It is the process by
which strategies and policies are put into action through
programs, budgets, and procedures.

 Implementation Process Questions:

– Who are the people to carry out the strategic plan?
– What must be done to align operations with new direction?
– How is work going to be coordinated?
 More time than planned
 Unanticipated problems
 Activities ineffectively coordinated
 Crises deferred attention away
 Employees w/o capabilities
 Inadequate employee training
 Uncontrollable external factors
 Inadequate leadership
 Poorly defined tasks
 Inadequate information systems
Developing programs, Budget, and Procedure.

 Programs: The Purpose of a program to make strategy action

oriented. Compare proposed programs and activities with
current programs and activities.

 Budgets: After programs has been developed, the budget

process begins. Planning a budget is the last real check a firm
has on the feasibility of the selected strategy.

 Procedures: Standard operating procedures are developed after

approving budget. They typically detailed the various activities
that must be carried out to complete the corporation's programs.

 Achieving Synergy:
 States what actions are going to be taken, by whom,
during what time frame, and with what expected results.

 Action Plan Elements

•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.
•Estimate expected financial and physical
consequences of each action.
•Develop contingency plans.
Organizational approach to help ensure purposeful action
towards desired objectives.

 The MBO process involves:

1. Establishing and communicating organizational
objectives
2. Setting individual objectives that help implementing
organizational one
3. Developing an action plan of activities needed to achieve
the objectives
4. Periodically reviewing the performance as it relates to
the objectives and including the results in the annual
performance appraisal.
Successful corporations tend to follow a pattern of structural
development as they grow and expand. The structure
development is as follow:

• Stage I : Simple Structure; Little formal structure.

• Stage II : Functional Structure; A single-product firm or a

single dominant businesses firm should employ a functional
structure.

• Stage III: Divisional Structure; A firm in a several lines of

business that somehow related to should employ a multi
divisional structure.

• Stage IV: Beyond SBU’s :A firm in several unrelated lines of

business should be organized into strategic business unit
 The organizational life cycle describes how organizations
grow, develop, and eventually decline. It is the organizational
equivalent to the product life cycle in marketing. These
stages are:
 The
implementation of new strategies and policies often call for new
human resource management priorities and different use of personnel.
Same as structure, staffing requirements are likely to follow a change
in strategy.

 Hiring
and Training Requirements Change
• Human resources needed to support the strategy
• Selection process and procedure
• Training is also needed in implementing strategies like
retrenchment

 Matchingthe Manager to the strategy

• Depending on strategy direction of the firm
◦ Executive type; Executives with a particular mix of skills and
experiences
• Analytical portfolio manager (Growth—Diversification))
 Leading people to use their abilities and skills most effectively and
efficiently to achieve organizational objectives.

 Corporate culture
Like structure and staffing, corporate culture should support the strategy
• Affects firm’s ability to shift its strategic direction
• Strong tendency to resist change
• Corporate culture should support the strategy

 Strategy-Culture Compatibility: Consider the following:

• Is the planned strategy compatible with the firm’s current culture?
• Can the culture be easily modified to make it more compatible with new
strategy?
• Is management willing to make major organizational changes?
• Is management committed to implementing the strategy?