Professional Documents
Culture Documents
Yimer Stratgic MGMT CH 7ppt
Yimer Stratgic MGMT CH 7ppt
Implementing Strategies
Ch 7 -1
Strategy Formulation vs.
Implementation
Strategy Formulation (SF) Strategy Implementation
Positioning forces (SI)
before the action Managing forces during
Focus on effectiveness the action
Primarily intellectual Focus on efficiency
Shift in responsibility
Divisional or
Strategists Functional
Managers
Ch 7 -3
Management Issues Central to Strategy
Implementation
Establish annual Match managers to strategy
objectives Develop a strategy-
Devise policies supportive culture
Allocate resources Adapt production/operations
Alter existing processes
organizational structure Develop an effective human
Restructure & reengineer resources function
Revise reward & incentive Downsize & furlough as
plans needed
Minimize resistance to Link performance & pay to
change strategies
Ch 7 -4
Purpose of Annual Objectives
Basis for resource allocation
Mechanism for management evaluation
Major instrument for monitoring progress
toward achieving long-term objectives
Establishpriorities (organizational, divisional,
and departmental)
Ch 7 -5
Resource Allocation
1. Financial resources
2. Physical resources
3. Human resources
4. Technological resources
Ch 7 -6
Managing Conflict
Conflict – a disagreement between two or more parties.
Interdependency of objectives and competition for limited
resources can cause conflict.
Ch 7 -7
Matching Structure With Strategy
Changes in strategy often require changes in the way an organization
is structured because:
(1) structure largely dictates how objectives and policies will
be established (e.g., objectives and policies established
under a geographic organizational structure are couched in
geographic terms) and
(2) structure dictates how resources will be allocated (e.g.,
if an organization’s structure is based on customer groups,
then resources will be allocated in that manner).
Structure should be designed to facilitate the strategic
pursuit of a firm and, therefore, follow strategy.
When a firm changes its strategy, the existing
organizational structure may become ineffective. For
example, new strategies to reduce payroll costs may
require a change in span of control.
Ch 7 -8
Ch 7 -9
Basic Forms of Structure
Functional Structure
Divisional Structure
Strategic Business Unit Structure
(SBU)
Matrix Structure
Ch 7 -10
Functional Structure
Groups tasks and activities by business
function (e.g., production, finance,
marketing, R&D, HR, IT, etc.).
Ch 7 -11
Functional Structure
Ch 7 -12
Divisional Structure
By customer
By process
Ch 7 -13
Divisional Structure
Ch 7 -14
Strategic Business Unit Structure
(SBU)
Groups similar divisions into strategic
business units and delegates authority and
responsibility for each unit to a senior
executive who reports directly to the chief
executive officer.
Ch 7 -15
Matrix Structure
Ch 7 -16
Matrix Structure
Ch 7 -17
Restructuring
Restructuring - reducing the size of an organization. Also called:
Downsizing
Rightsizing
Delayering
These methods involve, respectively, reducing the number of
employees, number of divisions, and number of hierarchical levels
in a firm’s organizational structure. Reducing the size of an
organization is intended to improve its efficiency and effectiveness.
Ch 7 -18
Creating a Strategy-Supportive Culture
Ch 7 -19
Creating a Strategy-Supportive Culture
Ch 7 -21
Human Resource Concerns
Assessing staffing needs and costs.
Selection Methods.
Employee Training.
Motivating Employees – Developing
Performance Incentives; Work-Life Balance
Issues; etc.
Selecting Appropriate Leadership Styles.
Ch 7 -22