IMPLEMENTATION

Business Strategies Operations and Production Issues Management Issues Research and Development Issues Information Systems Issues Marketing Issues Finance and Accounting Issues

IMPLEMENTATION

Putting Strategies Into ActionShift in responsibility to divisional and functional managers

CORPORATE STRATEGY

Decisions aboutwhat markets to compete in

Competing in thesemarkets via existingoperations, mergers,acquisitions, jointventures, divestitures

BusinessStrategy

IMPLEMENTATION

FORMULATION

Decisions abouthow to competein each market

Competing byleast cost, focus,differentiation

FunctionalStrategy

Decisions aboutthe actions neededwithin each functional area

Carry out strategy chosen for eachfunction

Why Implementation is so difficult

Strategy is often implicit in the head of the CEO and/or top management team

Strategy is developed in isolation Strategic thinking is not encouraged Outside consultants set direction and

strategies

Management Issues in Implementation

Corporate

Business

Functional

I. ANNUAL OBJECTIVES

II. POLICIES

III. RESOURCE ALLOCATION

IV. CONFLICT MANAGEMENT

Causes Consequencesof Conflict of Conflict

Interdependency Competition Different Goals and

Activities Personalities Scarce Resources

Negative Consequences Hostility Withdrawal

Positive Consequences Increased Motivation Increased Performance More creative thinking

ConflictLow High

Low

HighPerformance

Optimal Level of Conflict

How to Prevent/Reduce Conflict

Emphasize Organizational Goals Structure Tasks Promote Organizational Communication Separate dysfunctionally conflicting groups Apply rules and regulations Encourage confrontation and negotiation Use 3rd party consultants Rotate members among groups

How to Stimulate Conflict

Increase competition Increase uncertainty among groups Change reward systems

V. MATCHING STRUCTUREWITH STRATEGY

Types of Organizational Structure

Functional (Centralized) Divisional (Decentralized)

“M” form for multidivisional Geographic Product Customer Process

Strategic Business Unit (SBU) Matrix Others

VI. RESTRUCTURING

Downsizing, rightsizing, delayering Primary benefit sought is cost reduction Reducing employees, costs, levels, assets

VII. MANAGING RESISTANCE TO CHANGE

Implementation Issues -Other Functional Areas

Research and Development Issues

Emphasize product and/or process improvements Stress basic or applied research Be leaders or followers in R&D Develop robotics or manual type processes Spend a high, average, or low amount of money

on R&D Perform R&D within firm or contract out Use university or private sectors researchers

Information Systems Issues

Computer hardware and software facilitate global information consistency

All divisions self-sufficient, but compatible Support cross-functional integration Data and information should be available to any

department that has a demonstratable need. Security Upgrading hardware and software

Marketing Issues

Marketing Mix Product Place Promotion Price Market Segmentation Product Posititioning

Finance and Accounting Issues

Acquiring Capital to Implement Strategies EPS/EBIT

Pro Forma Financial Statements Income Statement

Financial Budgets Evaluating the Worth of a Business

VIII. Creating a Supportive Culture