Functional Implementation Of Strategy Present by: KALIM AHMAD

Functional implementation
It deals with the formulation and implementation of functional plans and polices the emphasis is on relating the formulation and implement of functional plans and policies, and the changes to be made in them, to the strategic changes. Five major considerations for strategist are identified and discussed so that effective integration can take place.

Functional plane and policies

For effective implementation, strategists have to provide direction to functional manager regarding the plans policies to be adopted. In fact , the effectiveness of strategic management depends critically on the manner in which strategies are implemented

Nature of functional plan and policies

Functional strategies, or more appropriately, functional plans and policies as they actually are plans and tactics to implement business strategies- are made within t he guide line set at higher level . Plans are made to select a course of action while policies are required to act as guideline to action. Functional managers need guidance from the business strategy in order to make decisions .

Need for functional plans and policies

Glueck suggests five reason while functional plans and policies are needed . These are developed to ensure that The strategic decisions are implemented by all the parts of an organisation ; There is a basis available for controlling activities in the different functional areas of business; The time spend by functional managers in decision making is reduced as plans lay down clearly what is to be done and policies provide the discretionary frame work within which decisions need to be taken ;

continue
Similar situation occurring in different functional areas are handled in a consistent manner by the functional managers ; and Coordination across the different functions takes place where necessary

Development of functional plans and policies

It aimed as making the strategies- formulated at the top management level practically feasible at the functional level. the development process may range from the formal and in formal . A larger and more complex organisations may have several hundred policies related to every aspect many of these policies could have been formulated through the formal process and laid down in company manuals and documents.

Financial plans and policies

The financial plans and policies of organisation are related to the availability, usage and management of funds. Strategists need to formulate plans and policies in these areas so that strategies may be implemented effectively.

Sources of funds
Plans and policies related to sources of funds deal with financing or capital mix decisions. Plans and policies have to be made for the following major factors: capital structure; procurement of capital and working capital borrowings; reserve and surplus as source of funds; and the relationship with lenders, banks, and financial institutions.

Usage of funds
Plans and policies for the usage of funds deal with investment or asset mix decisions. The important factors that are relevant here are: capital investment, fixed asset, acquisition, current assets, loans and advances, dividend decisions and the relationship with shareholders. Usage of funds is important since it relates to the efficiency and effectiveness of resource utililisation in the process of strategy implementation.

Management of funds
The management of funds can play a pivotal role in strategy implementation as it aims at the conservation and optimum utilisation of fundsobjectives which are central to any strategic action. Organisations which implement business strategies of cost leadership cannot escape the rigors of proper management of funds. In fact, good management of funds often creates the difference between a strategically successful and unsuccessful company.

Marketing plans and policies

Plans and policies related to marketing have to be formulated and implemented on the basis of 4 Ps of marketing mix that is: 1. Product: it denotes the goods and services that an organisation offers to its target markets. Generally this is determine by customer preferences and product characteristics such as quality, feature, smell etc;

Cont..
2. Pricing: it denotes the money that customer pay in exchange for goods and services. It is important to seller because it represents the return of its efforts. Several price characteristics such as discount, mode of payment etc; affect pricing plans and policies. 3. Place: place ( or distribution ) is the process by which goods and services are made available to the customers. Distribution plans and policies address themselves to issues such as channel to be used; storage inventory management; coverage of markets etc;

Cont..
4. Promotion: it deals with the marketing communication intended to convey the companys and its products or services image to prospective buyers. A promotional mix consist of four activities: advertising, personal selling, sales promotion, and publicity.

operations plans and policies

The plans and policies for operations are related to the production system , operational planning and control ,and R&D. 1. Production system: it is concerned with the capacity , location , layout , product or service design , work system , degree of automation , extent of vertical integration and other such action . Plans and policies related to the production system or significant as they deal with vital issues affecting the capability of the organisation to achieve its objectives

Continue
2. Operation planning and control: plans and policies regarding this are concerned with aggregate production planning : materials supply ,cost ,etc. the main aim of this is efficiently utilization of resources . 3. Research and development: Plans and policies for R&D deal with product development, personnel and facilities, level of technology used, technology transfer and absorption, technological collaboration and support and so on.

Personnel plans and policies

It relates to the personnel system, organisational and employee characteristics, and industrial relations . In formulating personnel plans and policies the strategists keep three things in mind, which are: 1. Personnel system: Plans and policies related to the personnel system deal with factors like manpower planning, selection, development, compensation, communication and appraisal. The importance of such plans and policies lies in the role that personnel system play in providing and maintaining human resources.

Cont
2. Organisational and employee characteristics: It include factors such as , the corporate image, quality of managers, staff and workers, perception about and the image of the orgenisation as an employer, availability of development opportunities for employees and working condition. 3. Industrial relations: It deals with issues such as union-management relationship, collective bargaining, safety, welfare and security, employee satisfaction and morale

conclusion
Functional implementation is the third aspect of strategy implementation. The functional plans are made in the light of strategic tasks and are meant to act as a course of action. Financial plans and policies are related to the sources, usage and management of funds . Marketing plans and policies are concerned with the 4P`s of marketing mix. operations plan and policies are concerns with the production system, operation planning and control, and R&D. personal plans and policies cover the areas of personnel system, organizational and employee characteristics , and industrial relation .