OSD & STRATEGY Prof Venkatesh Naga

PLACEMENT BYTES
 Not getting short-listed due to experience & what can I do ?
 Don’t worry, as they are preferences of some recruiters
 Form teams of 2-3 and look for top 20 start-ups in your area ?
 Reach out to them and seek projects
 Send CVs & position your appropriately
 Use your Christmas break to meet them personal and close the deal
 Does it impact me in Final placements as well ?
 It will not hit you during final placements.
 Exp gets your extra fitment, if found relevant to the organization &
job

2
PLACEMENT BYTES
 How to convert PPO/PPI internship
 Understand the context/needs of the organization
 Take feedback from seniors who have done & converted
 Identify the alums and connect with them
 make it a point to meet alum once in 10 days
 demonstrate initiative taking ability
 Be profession

3
ORG – CULTURE – LEARNING REVIEW
 What are three key components of Org Culture ?
 How does OCTAPACE impact org Culture
 Four types of Market Orientation & impact on Org Culture
 Hofstede Model & Dimensions & Org Culture Impact
 How can culture be changed & Strategies
CULTURE CHANGE & REINFORCEMENT
LO’S
 Understand about strategy models & Approaches
 Appreciate how strategy impacts organization’s 4S ( Structure, Systems, Staff &
Skills)
 Apply learning through a learning activity
STRATEGY & ORGANIZATIONAL FACTORS
BMW: The BMW Guggenheim Lab is a mobile laboratory that will travel to nine major cities
worldwide over six years. Led by international, interdisciplinary teams of emerging talents in
the areas of urbanism, architecture, art, design, science, technology, education, and
sustainability, the Lab will address issues of contemporary urban life through programs and
public discourse. Its goal is to explore new ideas, experiment, and ultimately the create
forward-thinking solutions for urban life. This program establishes a social purpose for BMW
that could help address the exclusiveness/elitism of the “Ultimate Driving Machine”. BMW:
The BMW Guggenheim Lab is a mobile laboratory that will travel to nine major cities
worldwide over six years. Led by international, interdisciplinary teams of emerging talents in
the areas of urbanism, architecture, art, design, science, technology, education, and
sustainability, the Lab will address issues of contemporary urban life through programs and
public discourse. Its goal is to explore new ideas, experiment, and ultimately the create
forward-thinking solutions for urban life. This program establishes a social purpose for BMW
that could help address the exclusiveness/elitism of the “Ultimate Driving Machine”.
STRATEGY & ORGANIZATIONAL CONTEXT
STRATEGY APPROACHES
 Internally driven Organizations
 Customer Drive Organizations
 Market Driven Organization
STRATEGY LEVELS

Who will essay these

roles?
How do the roles impact
4S?
3 Strategic Approaches
• Cost Leadership
• Differentiation
• Focus
• Indio
• PayTM
• Leela Hotels
• Research, discuss and
document your thoughts on
4S for these organization
STRATEGY TYPES

Analyse & map

the strategies &
implication on 4S
for
 ONGC
 Jio
 Xiaomi
 Wipro
BCG MATRIX

How does this strategy

impact 4S?
Take the example of
Nestle?
STRATEGY APPROACHES – MIND TEASERS
 A leading paints manufacturing organization has brainstormed on the new market
segments and products. After a lot of debate, the Marketing & R & D team came up
with the concept of Innovative cartoon stickers for rooms of children. The organization
created the product and launched it, but discovered that the product has no takers. It
then engaged a market research firm to conduct a survey and identify the customer
feedback. The market feedback was that children and parents did not like the
concept of stickers on walls, rather they liked these stickers on beds and study tables
of children.
 What strategy approach was the organization using ?
 Internally Driven Organization
 Why did the idea and product fail ?
 What changes should it do in the Structure & Process to do avoid these kind of flips
in future ?
STRATEGY APPROACHES – MIND TEASERS
Uber leadership after a lot of research has identified that in today’s fast paced
world, customers do not have luxury of driving into a restaurant have their meal and
snack. Most of the working population either misses its timely intake of food or end
up consuming junk food and as a result are finding it difficulty to maintain their
health. Also it is observed that customer in their intra or in-city travel find it difficult
to get food of their choice. Realizing this need, it launched the “Uber Eats” initiative
 What kind of strategy approach has uber adopted in this case ?
 Customer Centric
 What team in organization structure could help in product and service innovation ?
 Is there any flip side to this kind of strategy approach ?
STRATEGY APPROACHES – MIND TEASERS
Facebook creates a new organizational structure for India. Under the new scheme of
things the functional heads i.e, Public Policy, Global Marketing Operations, , global
sales organization ( Customer partnerships & agencies) Communications, Partnership,
Strategy and operations will now report to Country Managing Director Mr Ajit
Mohan, instead of Regional Functional heads as was the case earlier. This was carried
out keeping in view the strategic importance of India a market for Facebook.
 What kind of strategy approach is this & why did Facebook adopt it ?
 Market Driven
 How did it impact organization structure & role incumbents ?
STRATEGY & ORGANIZATIONAL FACTORS
 Ola and Ola Prime should they have same team or different teams servicing the customers ?
 E-Insurance in vehicle insurance should they have same process as offline insurance channel
or different. How does it impact the customer service delivery and organization design
 CEO of a large commercial bank was directly managing treasury and lending operations
hands on. He was interacting with chief dealer and Head of Corporate Credit. Most of the
trading and lending decisions were taken by him directly. What kind/type of teams should
the bank have ? How does the CEO style impact the functioning of treasury and credit
functions/teams?
 Indian IT Majors, have started hoarding(Hiring) Tech talent in USA, keeping in view the
forthcoming large IT contracts ( both fresh and renewal). This is in response to onsite talent
STRATEGY QUIZ
Adani is the largest private thermal power producer in India with an installed capacity of
10,480 MW. Our four power projects are spread out across the states of Gujarat,
Maharashtra, Rajasthan and Karnataka. We are well on our way to beat our target of having
an installed base of 20,000 MW by 2020 and maintaining our lead as the number one
private player in the industry.
 Adani Transmission Ltd will complete the acquisition of the power generation, transmission
and distribution business in Mumbai run by Anil Ambani-led Reliance Energy Ltd for ₹13,801
crore after securing regulatory approvals this week. The closure of the deal — announced in
December 2017 — will help the cash-strapped Reliance Infrastructure Ltd, a unit of Anil
Ambani’s ADAG Group, pare its debt estimated at about ₹15,000 crore.
An Indian billionaire is forging ahead with a massive coal mine in Australia that activists say
will be a disaster for the environment. Gautam Adani said Tuesday that he had given the
"green light" to his firm's $12 billion coal project in Australia's northeastern Queensland state
- Jun 6, 2017
 What strategy is Adani adopting & why
 How does this strategy impact its organization structure. What functions/department needs
to be added to the organization structure ?
Learning Activity
 Pl go through the Google Case-study on Vernacular and prepare
2 slides on following Qs:-
Discussion Questions
 What factors are driving the Google Strategy?
 How does the strategy shift help google?
 Analyse the impact of this strategy shift using Mckinsey 7s on
Google?
LEARNING ACTIVITY – L & T STRATEGY
 Please go through the L&T Chairman AM Naik’s Interview
article and respond to following Qs as group :-
 What is the strategy adopted by L & T as a group
 What factors are driving the strategy for L & T
 How will the strategy impact organization structure
across business units for L & T
How do we apply
these models
through
DISCUSSION
Strategy & Organizational Factors Mc Kinsey 7S Model

What is the implication

on the structure ?
MuSigma what is the
strategy basis of its
organization
LEARNING ACTIVITY
 Please go through the reading on Ola & Uber strategy
Change and answer the following questions : -
 Why did Ola and Uber plan for a strategy shift (
Identify the factors)
 What will be implication on structure for Ola & Uber
due to strategy shift ?
 Create a new organization structure for Ola & Uber ?
 How will the structure help executing the strategy
 What are the learnings & takeaways from the activity
HYUNDAI TRANSFORMATION
https://economictimes.indiatimes.com/industry/auto/how-hyundai-is-taking-the-
disruptive-events-as-an-opportunity/articleshow/71016491.cms

To be used for 19-20 batch of PGDM students

Kirana Onboarding by Flipkart

https://www.financialexpress.com/industry/sme/flipkarts-festive-season-game-plan-
onboards-record-number-of-kiranas-to-sell-this-big-billion-day/1700843/
LVB & INDIA BULLS MERGER
Lakshmi Vilas Bank to merge with Indiabulls Housing Finance
Our Bureau Mumbai | Updated on April 05, 2019 Published on April 05, 2019
https://www.thehindubusinessline.com/money-and-banking/lakshmi-vilas-bank-to-merge-with-
indiabulls-housing-finance/article26749991.ece
Amazon food delivery service in BLR
https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/amazon-readies-new-
spread-to-lure-eateries-away-from-zomato-swiggy/articleshow/70746707.cms
Banks threatened by Ola & Swiggy
https://economictimes.indiatimes.com/industry/banking/finance/banking/will-it-be-business-
as-usual-for-banks-as-with-ola-and-swiggy-entering-the-
space/articleshow/68915673.cms?utm_source=ETTopNews&utm_medium=HPTN&utm_campai
gn=AL1&utm_content=23
APOLLO HOSPITALS – STRATEGY
https://economictimes.indiatimes.com/industry/healthcare/biotech/healthcare/apollo
s-back-on-track-by-doubling-its-bottom-line-in-fy19/articleshow/70207019.cms

AI needs massive reskilling of employees

https://www.thehindubusinessline.com/news/globally-120-million-workers-need-
retaining-due-to-ai-impact-finds-poll/article29350134.ece?homepage=true
PATANJALI & RUCHI SOYA DEAL
https://economictimes.indiatimes.com/industry/cons-products/fmcg/patanjali-moves-
closer-to-acquisition-of-ruchi-soya/articleshow/68823994.cms

TCS – 3P strategy

https://economictimes.indiatimes.com/tech/ites/3ps-to-power-new-business-model-
of-tcs/articleshow/70182626.cms
TATA GROUP RESTRUCTURING
https://economictimes.indiatimes.com/news/company/corporate-trends/n-chandrasekaran-
kickstarts-process-to-shrink-1000-tata-subsidiaries/articleshow/68088702.cms

Birla Group Restructuring

https://economictimes.indiatimes.com/tech/ites/how-tech-mahindra-missed-the-growth-bus-
after-satyam-
acquisition/articleshow/68733871.cms?utm_source=ETnotifications&utm_medium=editpush&ut
m_campaign=ITeS&utm_content=bigimage
https://economictimes.indiatimes.com/industry/telecom/telecom-news/kumar-mangalam-birla-
to-rejig-promoter-cos-ahead-of-vodafone-idea-issue/articleshow/68662953.cms
OLA & SOFT BANK
https://economictimes.indiatimes.com/small-biz/startups/features/why-bhavish-
aggarwal-turned-down-a-1-1-billion-softbank-deal/articleshow/68788526.cms
STRATEGY & STRUCTURE – INTERPLAY
Organizational design
 Selecting the structure and control
systems that are most strategically
effective for pursuing sustainable
competitive advantage.
The role of structure and control
 To coordinate strategy implementation.
 To motivate and provide incentives for superior performance.
DIFFERENTIATION & INTEGRATION - BUREAUCRATIC COSTS

Bureaucratic costs and strategy implementation:

 Bureaucratic costs increase with
organizational complexity.
 More differentiation = more managers.
 More integration = more coordination.
 Better strategy implementation = better bottom-line performance
and profitability.
ORGANIZATIONAL STRUCTURE – PERSPECTIVES
Building blocks of organizational structure
 Differentiation in the allocation of people and resources to create value.
 Vertical differentiation in the distribution of decision-making
authority.
 Horizontal differentiation in dividing up people and tasks
into functions and divisions.

 Integration
 The means used in coordinating people and functions to accomplish organizational
tasks.
VERTICAL DIFFERENTIATION
Span of control (division of authority)
 The number of subordinates that a single manager directly manages.
Organizational hierarchy choices
 Flat structures
 Few organizational levels
 Wide spans of control
 Tall structures
 Many organizational levels
 Narrow spans of control
TALL AND FLAT STRUCTURES
PROBLEMS WITH TALL STRUCTURES
Principle of minimum chain of command
 Maintaining a hierarchy with the least number of levels of authority needed
to achieve a strategy.

Sources of bureaucratic costs:

CENTRALIZATION OR DECENTRALIZATION
.

Authority patterns in organizations:

Centralized : Decision making retained in the hands of upper-level
managers.
Decentralized : Decisions delegated to lower levels in the
organization

What is the implication on employee empowerment ,

motivation & performance
CENTRALIZATION (STRUCTURAL) CHOICE?
Advantages of decentralization
 Reduced information overload on upper
managers.
 Increased motivation and accountability
throughout organization.
 Fewer managers; lower bureaucratic
costs.
Aadhar Goof up ? What are the lessons ?
Advantages of centralization
 Easier coordination of organizational
activities.
 Decisions fitted to broad organizational
objectives.
 Exercise of strong leadership in crisis.
 Faster decision making and response.
STRATEGY & STRUCTURE
Structure Follows Strategy: Stages of corporate development
• New strategy is created Simple Structure
• New administrative problems emerge Functional Structure
• Economic performance declines
Divisional Structure
• New appropriate structure is invented
• Profit returns to its previous levels Beyond SBU’s

44
STRUCTURE & INSIGHTS
Stage Structure Insights

I Entrepreneur Tight Decision Making, Little or No Structure, Planning for short-

term/reactive, Flexible & Dynamic

II Functional Management Team, Functional Specialization, Delegation in

Structure decision making, Centralization/Specialization

III Divisional Diverse product lines, Decentralized decision making, SBU’s

Structure , Almost unlimited resources

IV Beyond SBU’s Increasing environmental uncertainty, Technological advances, Size

& scope of worldwide businesses, Multi-industry competitive
strategy, Better educated personnel
TYPES OF STRUCTURES
 Functional
 Multidivisional
 Matrix
 Network
FUNCTIONAL STRUCTURE
MULTIDIVISIONAL STRUCTURE
MATRIX STRUCTURE

 Two-boss employee
 Network Structure

Packagers

Designers Suppliers

Corporate
Headquarters
(Broker)

Manufacturers Distributors

Promotion/
Advertising
Agencies

50
STRATEGY, STRUCTURE, LEADERSHIP & CULTURE
 Effective implementation requires: Leading people to use their abilities and skills most effectively and
efficiently to achieve organizational objectives
 Staffing follows strategy ( Matching Manager to strategy) : Executives with a particular mix of
skills and experiences.
 Executive Types : Dynamic industry expert, Analytical portfolio manager, Cautious profit planner,
Turnaround specialist, Professional liquidator
 Managing corporate culture : Affects firm’s ability to shift its strategic direction, Strong tendency to
resist change, Corporate culture should support the strategy
 Strategy-Culture Compatibility :
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?

51
MATCHING CHIEF EXECUTIVE “TYPES” WITH STRATEGY
Business Strength/Competitive Position

Strong Average Weak

Growth—
Retrenchment

Industry Attractiveness
Concentration
Dynamic Industry
—
Expert Save
Company
Stability
Turnaround
Cautious Profit
Specialist
Planner
Growth— Retrenchment
Diversification —
Close
Analytical Company
Portfolio
Professional
Manager Liquidator
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 Learning activity

https://economictimes.indiatimes.com/industry/auto/news/tata-motors-turnaround-plan-is-bearing-
fruit/articleshow/64616768.cms

Turnaround strategy of Tata Motors

1) How did the CEO go about planning for turn around of TAMO?
2) What were key turnaround strategies?
3) How did the organization become customer centric ?
4) How did employees participate ?
5) How did the turnaround strategy in financials f TAMO?
DISCUSSION
Subscription is the new business model
https://economictimes.indiatimes.com/tech/internet/how-subscription-model-is-a-test-
of-loyalty-for-companies-like-netflix-hotstar/articleshow/66671261.cms
Strategy shift in IT industry
https://economictimes.indiatimes.com/tech/ites/indian-it-industry-is-making-
convincing-strides-as-their-clients-demand-digital-
transformation/articleshow/66669349.cms?utm_source=Colombia&utm_medium=C1
&utm_campaign=CTN_ET_hp&utm_content=19
https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/why-
tatas-should-tread-carefully-before-investing-in-jet/articleshow/66651489.cms
WARM UP
Jet Turn around strategy
Jabong lay-off case study
https://economictimes.indiatimes.com/small-biz/startups/jabong-jobs-at-risk-in-flipkart-
restructuring/articleshow/66645554.cms
https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/mckinsey-to-draw-up-jets-
turnaround-plan/articleshow/66453863.cms
Coca Cola Vs Pepsi battle
https://www.business-standard.com/article/companies/pepsi-in-coca-cola-out-at-domino-s-as-jubilant-gets-
new-beverage-partner-118103001034_1.html
INDIGO and competition – Dynamic and flexible organizations
https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/rivals-allege-indigo-of-using-
its-strength-to-squeeze-them-out/articleshow/66423453.cms
Amazon Sales Formats
https://www.dnaindia.com/business/report-amazon-s-digital-day-sale-today-top-deals-you-should-know-
2680857
 LEARNING TEASERS - STRATEGY & STRUCTURE INTERPLAY
 Vivo conquerin Indian market

https://economictimes.indiatimes.com/industry/cons-products/electronics/oppo-vivo-bolster-bbks-no-2-position-by-revenue-in-
fy18/articleshow/66309832.cms?utm_source=ETMyNews&utm_medium=HPMN&utm_campaign=AL1&utm_content=20

https://economictimes.indiatimes.com/tech/ites/a-loan-firm-in-bengaluru-holds-clue-to-xiaomis-next-big-bet-in-india/articleshow/64329193.cms

 https://economictimes.indiatimes.com/industry/auto/news/passenger-vehicle/toyota-maruti-suzuki-to-share-factories-dealers-for-bigger-india-
footprint/articleshow/64327070.cms

https://www.business-standard.com/article/companies/uber-targets-new-users-in-india-with-lighter-app-local-languages-118061201416_1.htm
 https://economictimes.indiatimes.com/industry/services/retail/shoppers-stop-plans-to-focus-on-private-labels-to-revive-growth/articleshow/64877526.cmsl

 Digitization is impacting Branch Expansion by Indian Banks ?

 IDFC merger and exits

https://economictimes.indiatimes.com/industry/banking/finance/banking/top-management-rejig-likely-at-idfc-bank/articleshow/65986167.cms

 Digital adoption to impact 65% of jobs in next 4 years ( E & Y)

 Language Processing Specialist
 Cloud Architect
 Robot Programmers
 Block Chain Architect
 Cyber Security Specialist

 Insurance purchase/renewal online going up ? Role of Agents/Dis-intermediation ?

 Customer self declaration of vehicle fitness & impact on assessors/certifiers ?

FUNCTIONAL STRUCTURE
Advantages
 Task grouping facilitates
specialization and productivity.
 Better monitoring of work
processes, reduced costs.
 Greater control over
organizational activities.
Disadvantages
 Functional orientation creates
communication problems.
 Performance and profitability
measurement problems.
 Location versus function
problems (coordination).
 Strategic problems due to
structural (vertical and
horizontal) mismatches.
MUTLITDIVISIONAL STRUCTURE
Advantages Disadvantages
 Enhanced corporate control by division  Establishing the divisional-
 Enhanced strategic control of each SBU corporate authority relationship
in portfolio  Distortion of information by
 Growth is easier. New units don’t have divisions
to be integrated across organization  Competition for resources by
 Stronger pursuit of internal efficiencies. divisions
Performance of individual units is  Transfer pricing problems
readily measurable. between divisions
 Short-term research and
development focus
 Bureaucratic costs
MATRIX STRUCTURE
Advantages
 Flexibility of the structure and membership
 Minimum of direct hierarchical control
 Maximizes use of employees’ skills
 Motivates employees;
frees up top management
Disadvantages
 High bureaucratic costs
 High costs (time and money) for building relationships
 Two-boss employee’s role conflict
NETWORK STRUCTURE
 “nonstructure” – elimination of in-house business functions
 Termed “virtual organization”
 Useful in unstable environments
 Need for innovation and quick response
STRATEGIC REWARD SYSTEMS
Individual reward systems
 Piecework plans
 Commission systems
 Bonus plans
 Promotion
Group and organizational
reward systems
 Group-based bonus systems
 Profit sharing systems
 Employee stock option systems
 Organization bonus systems
HORIZONTAL DIFFERENTIATION
Focus is on division and grouping of tasks to meet business
objectives.
Simple structure:
 Characteristic of small entrepreneurial companies.
 Entrepreneur takes on most managerial roles.
 No formal organization arrangements.
 Horizontal differentiation is low.
Structure Follows Strategy:

 Changes in corporate strategy lead to changes in organizational

structure

64