Copyright 2007 Prentice Hall Ch 7-1 Chapter 7 Implementing Strategies: Management & Operations Issues Strategic Management: Concepts & Cases 11 th Edition Fred David

Copyright 2007 Prentice Hall Ch 7-2 Formulation focuses on effectiveness Implementation focuses on efficiency Nature of Strategy Implementation Formulation vs. Implementation

Copyright 2007 Prentice Hall Ch 7-3 Shift in responsibility Nature of Strategy Implementation Management Perspectives Division or Functional Managers Strategists

Copyright 2007 Prentice Hall Ch 7-4 Management Issues Management Issues Resources Organizational structure Restructuring Rewards/Incentives Annual Objectives Policies

Copyright 2007 Prentice Hall Ch 7-5 Management Issues (cont’d) Management Issues Supportive Culture Production/Operations Human Resources Resistance to Change Natural Environment

Copyright 2007 Prentice Hall Ch 7-6 Management Issues Purpose of Annual Objectives --  Basis for resource allocation  Mechanism for management evaluation  Metric for gauging progress on long-term objectives  Establish priorities (organizational, division, & departmental)

Copyright 2007 Prentice Hall Ch 7-7 Management Issues 1. Financial resources 2. Physical resources 3. Human resources 4. Technological resources 4 Types of Resources

Copyright 2007 Prentice Hall Ch 7-8 Management Issues  Conflict not always “bad”  No conflict may signal apathy  Can energize opposing groups to action  May help managers identify problems Managing Conflict

Copyright 2007 Prentice Hall Ch 7-9 Management Issues  Functional Structure  Divisional Structure  Strategic Business Unit Structure (SBU)  Matrix Structure Basic Forms of Structure

Copyright 2007 Prentice Hall Ch 7-10 Management Issues Reengineering  Process management  Process innovation  Process redesign

Copyright 2007 Prentice Hall Ch 7-11 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?

Copyright 2007 Prentice Hall Ch 7-12 Management Issues Production/Operations Concerns -- Production processes typically constitute more than 70% of the firm’s total assets

Copyright 2007 Prentice Hall Ch 7-13 Management Issues Production/Operations Decisions  Plant size  Inventory/Inventory control  Quality control  Cost control  Technological innovation

Copyright 2007 Prentice Hall Ch 7-14 Management Issues Human Resource Strategic Responsibilities  Assessing staffing needs/costs  Developing performance incentives  Child-care policies  Work-life balance issues

Copyright 2007 Prentice Hall Ch 7-15 Diversity Issues CEOCompanyAge Meg WhitmaneBay49 Andrea JungAvon Products47 Anne MulcahyXerox52 Marjorie MagnerCitigroup56 Betsy HoldenKraft Foods49 Ann MooreAOL Time Warner57 Women CEO’s in U.S (examples)

Copyright 2007 Prentice Hall Ch 7-16 Benefits of a Diverse Workforce Improves corporate culture Improves employee morale Leads to a higher retention of employees Leads to easier recruitment of employees Decreases complaints and litigation Increases creativity Decreases interpersonal conflict

Copyright 2007 Prentice Hall Ch 7-17 Benefits of a Diverse Workforce Enables the organization to move into emerging markets Improves client relations Increases productivity Improves the bottom line Maximizes brand identity Reduces training costs