Professional Documents
Culture Documents
Chapter 11
Employing Strategy
Implementation Levers
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Date
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OBJECTIVES
Unit of measure
* Footnote
2
Source: Source
FORMULATION AND IMPLEMENTATION
Unit of measure
Strategy formulation Strategy implementation
The central, integrated, externally
oriented concept of how we will
achieve our objectives
• Arenas
• Staging
Implementation
• Vehicles
Levers & Strategic
• Differentiators
Leadership
• Economic
logic
* Footnote
3
Source: Source
THREE QUESTIONS
Unit of measure
* Footnote
4
Source: Source
3
* Footnote
Source: J. Pfeiffer and R.I. Sutton, The Knowing – Doing Gap (Boston: Harvard Business School Press, 2000) 5
Source: Source
CAUSES OF THE KNOWING – DOING GAP: INTERNAL & EXTERNAL RESISTANCE
Unit of measure
Internal
• Business
units
• Culture
SAP attempted to launch
consulting service to supple-
ment its core technology
offering but failed to align
with SAP culture
* Footnote
6
Source: Source
HOW WOULD YOU DO THAT? – SAP AMERICA
Unit of measure
• Cultural focus
on costs
Profitability
Revenue • Professionalism
Customer • HR policies
service
• Account “farming”
Employees (not just growth)
Reputation • Web-based
software
* Footnote
7
Source: Source
CEO CHALLENGE – IMPLEMENT
Unit of measure
* Footnote
Source: Hambrick and Cannella, “Strategy Implementation as Substance and Selling” 8
Source: Source
KEY FACETS OF STRATEGIC IMPLEMENTATION
Unit of measure
• Organization structure
Systems and processes
People and rewards
Implementation Levers
Realized
Intended &
Strategy Emergent
Strategie
s
Strategic Leadership
* Footnote
9
Source: Source
ORGANIZATIONAL STRUCTURE ALIGNED TO STRATEGY
Unit of measure
Organizational
Strategy
structure
• Insures control
• Coordinates
information,
decisions, and
activities
* Footnote
10
Source: Source
HOW STRUCTURE INFLUENCES STRATEGY – AIR LIQUIDE
Unit of measure
Structure Strategy
* Footnote
11
Source: Source
SIX FORMS OF ORGANIZATIONAL STRUCTURE
Unit of measure
Functional
Multidivisional
Matrix
Network
Partnerships
Franchises
* Footnote
12
Source: Source
FUNCTIONAL STRUCTURE
Unit of measure
Corporate Office
Organizes
activities
according to the
specific functions
that a company
performs
Marketing/
Finance Operations R&D
Sales
Example
Platypus Technologies has 30 employees
organized into small departments: finance,
marketing, HR, and R&D
* Footnote
13
Source: Source
MULTIDIVISIONAL STRUCTURE
Unit of measure
Headquarters
One solution
Business Group A Business Group B Business Group C to problems of
managing
activities in
Finance Finance Finance multiple
markets or
managing
Marketing Marketing Marketing
multiple
products
Operations Operations Operations
Example
GM is organized according to product division
(GM Trucks, Chevrolet, Buick, Cadillac,
Pontiac, Saturn, etc. Each maintains its own
finance, marketing, and other support functions
* Footnote
14
Source: Source
MATRIX STRUCTURE
Unit of measure
Corporate Office
R&D
Hybrid between
functional and
Operations multidivisional
structure
Marketing
Finance
* Footnote
Source: http://www.cio.com/archive/090103/hs_reload.html 15
Source: Source
NETWORK STRUCTURE
Unit of measure
Indi-
vidual
Example
Gore’s 6,000 employees spread across the
world work in small teams and are encouraged
to seek out colleagues on their own
* Footnote
16
Source: Source
PARTNERSHIPS AND FRANCHISES
Unit of measure
Partnerships Franchises
The company is organized Company not only trans-
as a group of partners fers ownership of local
who own shares or units facilities to franchisees,
in the corporation but license all local man-
agement responsibility
Example Example
* Footnote
17
Source: Source
BALANCED SCORECARD IS A MEASUREMENT SYSTEM TO MANAGE STRATEGY IMPLEMENTATION
Unit of measure
* Footnote
Source: Kaplan & Norton, 1996 18
Source: Source
STRATEGY MAPS HELP LINK ALL PERFORMANCE METRICS TO STRATEGY
Unit of measure
* Footnote
Implementation levers 19
Source: Source
HOW WOULD I DO THAT? – BALANCED SCORECARD AT US NAVAL UNDERSEA WARFARE CENTER
Unit ofNUWC
measure
NUWC Vision:
Vision: Be our nation’s provider of choice
for
forundersea
underseasuperiority
superiority––satisfying
satisfyingtoday’s
today’sneeds
needs
and
andmeeting
meetingtomorrow’s
tomorrow’schallenges
challenges
NUWC
NUWC Mission:
Mission: We provide the technical
foundation
foundationwhich
whichenables
enablesthe
theconceptualization,
conceptualization,
research,
research,development,
development,fielding,
fielding,modernization,
modernization,andand
maintenance
maintenanceofofsystems
systemsthat
thatensure
ensureour
ournavy’s
navy’s
undersea
underseasuperiority.
superiority. Financial: To succeed, how must we
look to our constituents in terms of
External: To achieve our vision and balanced budgets, revenue sources,
mission, how must we look to our and value?
customers on the dimensions of
purpose, service, and quality?
Rewards
* Footnote
Implementation levers 21
Source: Source
PEOPLE AND REWARDS
Unit of measure
People
* Footnote
Strategic Leadership 23
Source: Source
RESOURCE ALLOCATION DECISIONS
Unit of measure
Resource dimensions in the airline industry Major airlines
Level of offering Southwest
12
JetBlue
10
8
Most airlines
6 mimic each
other while
4 Southwest
and JetBlue
2 follow
decidedly
0 different
strategies
ity
e
ls
s
e
et
d
en
ce
re
ge
ic
ic
ee
ea
t iv
fle
rv
m
Pr
rtu
oi
un
Sp
M
ec
Factors of
in
se
of
ch
pa
Lo
ta
nn
ss
ly
ng
de
er
co
nd
ne
competition
nt
i
at
nt
ie
ub
ew
te
Se
ue
Fr
H
gh
eq
fli
Fr
In
* Footnote
Source: Adapted from W.C. Kim and R. Mauborgne, “Charting Your Company’s Future, “Harvard Business 24
Source: Source
Review, June. 2002
STRATEGIC LEADERSHIP – COMMUNICATING WITH KEY STAKEHOLDERS
Unit of measure
Convince top management
of a new strategy (e.g., Intel’s
shift to microprocessors)
Upward
Win cooperation of
Managers external stakeholders
Win support of other must sufficiently including customers
Across Outward
units within the firm communicate in and distributors (e.g.,
4 directions Compaq failed to do
this with retailers)
Downward
C ontacts
C ultural understanding
C redibility
* Footnote
26
Source: Source
STRUCTURAL OPTIONS
Unit of measure
* Footnote
Global and Dynamic contexts 27
Source: Source
FIRM RESPONSES TO DYNAMIC CONTEXTS
Unit of measure
Two common
Challenges responses
of dynamic, • Ambidextrous
high-veto city organization
contexts
• Patching
* Footnote
Global and Dynamic contexts 28
Source: Source
THE AMBIDEXTROUS ORGANIZATION
Unit of measure
Structural barriers preventing
interference and interactions
Corporate Office
between existing and emerging
businesses
Manu- Manu-
Sales R&D Sales R&D
facturing facturing
Existing organization with historic New organization develops its own levers
implementation levers consistent with the needs of the radical
innovation
Ambidextrous organizations establish units that are structurally independent from all other units. The
emerging business units are to develop their own structures, processes, systems, cultures, strategies,
etc. They are only integrated into the mother organization at the level of senior management
* Footnote
Global and Dynamic contexts 29
Source: Source
PATCHING
Unit of measure
Example: HP
Laser printing
business
Patching: regularly
remapping businesses in
accordance with
changing market New technologies
conditions and restitching
them into internal
business ventures
New business unit
* Footnote
Global and Dynamic contexts 30
Source: Source
SUMMARY
Unit of measure
* Footnote
31
Source: Source
INSERT TITLE TEXT
Unit of measure
* Footnote
32
Source: Source