Strategy Implementation and

evaluation
By GK
 What is strategy implementation
• Strategy Implementation refers to the execution of the
plans and strategies, so as to accomplish the long-term
goals of the organization. It converts the opted strategy
into the moves and actions of the organization to achieve
the objectives.

• Strategy implementation is the technique through which

the firm develops, utilizes and integrates its structure,
culture, resources, people and control system to follow the
strategies to have the edge over other competitors in the
market.
Pre requisites for strategy implementation

• Institutionalization of strategy
• Developing proper organizational climate
• Formulation of operating plans
• Developing proper organizational structure
• Periodic review of the strategy
 Aspects of Strategy Implementation

• Creating budgets which provide sufficient resources to those activities which

are relevant to the strategic success of the business.

• Supplying the organization with skilled and experienced staff.

• Conforming that the policies and procedures of the organisation assist in the
successful execution of the strategies.

• Leading practices are to be employed for carrying out key business functions.

• Setting up an information and communication system, that facilitate the

workforce of the organisation, to perform their roles effectively.

• Developing a favourable work climate and culture, for proper

implementation of the strategy.
Process of strategy implementation
• Resource allocation
• Creating organization structure
• Leadership
• Communication of strategy
• Evaluation
 Resource allocation
• Resource allocation is defined as the allocation or division of
resources that are used in the implementation of strategy in an
organization.

• According to Churchman, “In organizations, the decision-making

function is the responsibility of management. In order to
execute its responsibility, an organization’s management
requires information about the resources available to it and
their relative effectiveness for achieving organization’s purpose.
Resources are acquired, allocated, motivated and manipulated
under the manager’s control. They include people, materials,
plant and equipment, money and information.”
 Resource Allocation
• Strategy implementation deals with two types
of resource allocation, namely one-time
resource allocation and continuous resource
allocation. A one-time resource allocation
implies that resources are allocated and
employed in a process only once; while a
continuous resource allocation demands a
constant inflow of the required resources.
 Factors affecting resource allocation

• Organization objectives
• Preference of dominant strategists
• Internal policies
• External influence
• Availability of resources
• Proper statement of resource needs
 Means of resource allocation
• Capital Budgeting
• PLC based budgeting
• Zero based budgeting
• Strategic Budgeting
• Parta system
• Performance Budgeting
 Problems of resource allocation
• Power play to get more powerful unit
• Dominance of key strategists
• Commitments of the past
• Resistance to change
• Environmental challenges
 Organization Structure
• Buchanan and Huczynski (2004) define structure as:
"A formal system of task and reporting relationships that controls,
co-ordinates and motivates employees so that they work together to
achieve Organizational goals“

• Thus structure is synonymous to a rope that employees hold and

binds all employees towards unified direction and aids the
identification of Who is Who and What is What of organization.
Structure serves as basis for orchestrating organizational activities.
Organizations shall understand importance of structure in carrying
out business operations. Organization can choose from variety of
structure like, functional, divisional, project teams, holding
companies and matrix structure. 
Dimensions of organizational structure

• Vertical Dimensions

• Horizontal Dimensions
Dimensions of Organizational Structure
• Vertical Dimensions: The vertical structure is planned to
facilitate superiors to implement control over the work of
subordinates. Vertical structures are known as tall structures.
Such structures are suitable for companies which produce
standardized products / services on a large scale with the help
of mass production systems and well established technologies.

• The vertical dimension is characterized by i. Specialization of

tasks ii. Chain of command iii. Formal reporting relationships
iv. Grouping of individuals into departments v. Upward and
downward communication
 Dimensions of organizational structure
• Horizontal Dimensions: The horizontal dimension is designed to
make certain cooperation and coordination among employees
working at the same level of authority. Horizontal structures are
also known as flat structures. Such structures are more vital for
companies making differentiated products. Medium sized
manufacturing and service enterprises and nonprofit orgainsation
which present specific social services are examples of these
orgainsations.

• The main characteristics of horizontal dimensions are i. Sharing of

tasks ii. Sharing of information iii. Decentralized decision making
iv. Focus on learning
 LEADERSHIP
• Leaders and their leadership skills play an important
role in the growth of any organization. Leadership
refers to the process of influencing the behaviour of
people in a manner that they strive willingly and
enthusiastically towards the achievement of group
objectives.
• A leader should have the ability to maintain good
interpersonal relations with the followers or
subordinates and motivate them to help in achieving
the organizational objectives.
 How leadership work
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 Importance of leadership
• Ensure cooperation and coordination
• Guidance and motivation towards strategy
implementation
• Creating work environment
• Induce changes
• Creating successors
 Leadership styles
• Autocratic leadership
• Democratic or participative leadership
• Leissez faire or free rein leadership
 Communication of strategy
• To make the communication effective, leader or
the strategists should ensure-

• Availability of both oral and written communication

• Two way communication
• Clear and specific message
• Open suggestion from workforce
• Flexibility
 Strategy Evaluation
• Strategy evaluation is that phase of the strategic management process in which
manager tries to assure that the strategic choice is properly implemented and is
meeting the objectives of the enterprise. When one talks of evaluation one
cannot forget control aspect.

• ‘Strategy evaluation’ is the process through which the strategists know the extent
to which a strategy is able to achieve its objectives. In the words of Professor
William F. Glueck and Lawrence R. Jauch, “Evaluation of strategy is that phase of
strategic management process in which the top managers determine whether
their strategic choice as implemented is meeting the objectives of the enterprise.”

• Therefore, when one says that he is talking of strategic evaluation, he is talking of

strategic evaluation and control. Then, strategic evaluation and control stands for
the process of determining the effectiveness of a given strategy in attaining the
organisational objectives and taking corrective action if need there be.
 Process of strategy evaluation
• 1. Fixing Benchmark of Performance

• 2. Measurement of Performance

• 3. Analyzing Variance

• 4. Taking Corrective Action