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Bus 411
Day 11
Copyright 2005 Prentice Hall 1
Copyright 2005 Prentice Hall Ch 1 -2
Agenda Question? Assignment 3 partially Corrected
Poor results on ratios
Assignment 4 posted Due March 8 @ 12:30 PM SWOT, Space, BCG and QSPM matrixes for McDonald’s
Mid-term exam March 19th or 22th
Chapters 1 – 9 and 10, 11? MCD’s ratios – class excercise
Discussion on Implementing Strategies: Management and Operations Issues
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Ch 7 -3
Chapter 7Implementing Strategies: Management & Operations Issues
Strategic Management: Concepts & Cases
13th Edition
Fred David
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Ch 7 -4
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Ch 2 -5
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Ch 7 -6
Strategy Formulation vs. Implementation
Strategy Formulation Positioning forces
before the action Focus on effectiveness Primarily intellectual Requires good intuitive
and analytical skills
Requires coordination among a few people
Strategy Implementation Managing forces during
the action Focus on efficiency Primarily operational Requires special
motivation and leadership skills
Requires coordination among many people
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Ch 2 -7
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Ch 7 -8
Shift in responsibility
Nature of Strategy Implementation
Management Perspectives
Divisional or FunctionalManagers
Strategists
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Ch 7 -9
Management Issues Central to Strategy Implementation
Establish annual objectives
Devise policies Allocate resources Alter existing
organizational structure Restructure & reengineer Revise reward & incentive
plans Minimize resistance to
change
Match managers to strategy Develop a strategy-
supportive culture Adapt production/operations
processes Develop an effective human
resources function Downsize & furlough as
needed Link performance & pay to
strategies
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Ch 7 -10
Purpose of Annual Objectives
Basis for resource allocation
Mechanism for management evaluation
Major instrument for monitoring progress toward achieving long-term objectives
Establish priorities (organizational, divisional, and departmental)
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Ch 7 -11
Annual Objectives
Horizontal consistency of objectives
Vertical consistency of objectives
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Ch 2 -12
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Ch 2 -13
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Ch 7 -14
Policies
Policies set boundaries, constraints, and limits on the kinds of administrative actions that can be taken to reward and sanction behavior
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Ch 7 -15
Resource Allocation
1. Financial resources
2. Physical resources
3. Human resources
4. Technological resources
Four Types of Resources
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Ch 7 -16
Managing Conflict
Conflict not always “bad”
Lack of conflict may signal apathy
Can energize opposing groups to action
May help managers identify problems
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Ch 7 -17
Managing Conflict
Approaches for managing and resolving conflict Avoidance Defusion Confrontation
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Ch 7 -18
Matching Structure with Strategy
Structure dictates how objectives and policies will be established
Structure dictates how resources will be allocated
Changes in strategy often lead to changes in organizational structure
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Ch 7 -19
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Ch 7 -20
Basic Forms of Structure
Functional Structure
Divisional Structure
Strategic Business Unit Structure (SBU)
Matrix Structure
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Ch 7 -21
Functional Structure
Group tasks and activities by business function
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Ch 7 -22
Functional Structure
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Ch 7 -23
Divisional Structure
Can be organized in one of four ways: By geographic area By product or service By customer By process
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Ch 7 -24
Divisional Structure
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Ch 7 -25
Strategic Business Unit Structure (SBU) Group similar divisions into
strategic business units and delegate authority and responsibility for each unit to a senior executive who reports directly to the chief executive officer
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Ch 2 -26
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Ch 7 -27
Matrix Structure
The most complex of all designs because it depends upon both vertical and horizontal flows of authority and communication
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Ch 2 -28
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Ch 7 -29
Matrix Structure
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Ch 2 -30
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Ch 2 -31
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Ch 7 -32
Restructuring, Reengineering, and E-engineering
Restructuring is called
Downsizing
Rightsizing
Delayering
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Ch 7 -33
Restructuring, Reengineering, and E-engineering
Cornerstones of Reengineering
Decentralization
Reciprocal interdependence
Information sharing
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Ch 2 -34
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Ch 2 -35
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Ch 7 -36
Tests for Performance-Pay Plans
Does the plan capture attention?
Do employees understand the plan?
Is the plan improving communication?
Does the plan pay out when it should?
Is the company or unit performing better?
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Ch 2 -37
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Ch 2 -38
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Ch 7 -39
Managing Resistance to Change
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Ch 7 -40
Creating a Strategy-Supportive Culture
1. Formal statements of organizational philosophy
2. Design of physical spaces
3. Deliberate role modeling, teaching, and coaching
4. Explicit reward and status system
5. Stories, legends, myths, and parables
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Ch 7 -41
Creating a Strategy-Supportive Culture
6. What leaders pay attention to
7. Leader reactions to critical incidents and crises
8. Organizational design and structure
9. Organizational systems and procedures
10. Criteria for recruitment, selection, promotion, leveling off, retirement, and “excommunication” of people
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Ch 7 -42
Production/Operations Concerns
Production processes typically constitute more than 70% of a firm’s total assets
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Ch 7 -43
Production/Operations Decision ExamplesPlant size
Inventory / Inventory control
Quality control
Cost control
Technological innovation
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Ch 2 -44
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Ch 2 -45
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 7 -46
Human Resource Concerns
Assessing staffing needs/costs
Furloughs
Developing performance incentives
ESOPs
Work–life balance issues
Matching managers with strategy
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Ch 7 -47
Corporate Wellness Programs
Wellness of employees has become a strategic issue for many firms
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Ch 7 -48
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