implementing strategies: management & operations issues · stories, legends & myths measure...
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Implementing Strategies:
Management & Operations Issues Week 07
W. Rofianto, ST, MSi
� Formulation focuses on effectiveness
� Implementation focuses on efficiency
Nature of Strategy Implementation
Formulation vs. Implementation
Management Perspectives - Shift in responsibilityManagement Perspectives - Shift in responsibility
StrategistsDivisional or FunctionalManagers
Management
Issues
Resources
Organizational Structure
Restructuring
Annual Objectives
Policies
Management Issues
Rewards/Incentives
Supportive Culture
Production/Operations
Human Resources
Resistance to Change
Natural Environment
Purpose of Annual Objectives
� Basis for resource allocation
� Mechanism for management evaluation
� Metric for gauging progress on long-term objectives
� Establish priorities (organizational, divisional, and departmental)
Management Issues
departmental)
Management Issues
Four Types of Resources
1. Financial resources
2. Physical resources
3. Human resources
4. Technological resources
Managing Conflict
� Conflict not always “bad”
� No conflict may signal apathy
� Can energize opposing groups to action
� May help managers identify problems
Strategy-Structure Relationship
Basic Forms of Structure
� Functional Structure
� Divisional Structure
� Strategic Business Unit Structure (SBU)
� Matrix Structure
Typical Top Managers of a Large Firm
Sonoco Product’s SBU Organizational Chart
An Example Matrix Structure
Restructuring and Reengineering
Restructuring
� Downsizing
� Rightsizing
� Delayering
Reengineering
� Process management
� Process innovation
� Process redesign
Tests for Performance-Pay Plans
Linking Performance and Pay to Strategy
Seniority-based and performance-based approach
� Does the plan capture attention?
� Do employees understand the plan?� Do employees understand the plan?
� Do employees understand the plan?
� Does the plan pay out when it should?
� Is the company or unit performing better?
Managing Resistance to Change
� Force Change Strategy
� Educative Change Strategy
� Rational/Self-interest Change Strategy
Resistance to Change can be considered the single greatest threat to successful strategy implementation
� Rational/Self-interest Change Strategy
Rational/Self-interest Change Strategy
1. Invite employee participation
2. Motivation & incentive to change
3. Communication of change purpose
4. Giving & receiving feedback
Creating a Strategy-Supportive Culture
� Formal statements of organizational philosophy
� Designing physical spaces
� Role modeling, teaching and coaching by leaders
� Selection, promotion, retirement, reward and status system
� Stories, legends & Myths
Measure and control� Measure and control
� Leader reaction to critical incidents
� Organizational design and structure
� System and procedures
Production processes typically constitute more than 70% of firm’s total assets
Production/Operations Concerns
Production/Operations Decisions
� Plant size, equipment & Location
� Product Design & Packaging� Product Design & Packaging
� Shipping
� Job specialization, employee training & cross-training
� Inventory/Inventory control
� Standard & Quality control
� Cost control
� Technological innovation
Human Resource Strategic Responsibilities
� Assessing staffing needs/costs
� Developing performance incentives
� ESOPs (Employee Stock Ownership Plans)
� Work–life balance issues
� Diverse Workforce