B301 Making Sense of Strategy Tutorial Four

Agenda Progress TMA3 Review of Block 4 and 04 Block 2 and 3 consolidation Block 5 and implementation TMA05

TMA03 (remember that one?) Very much like the exam questions (might even be one) Average score of 55 Q1 av 30 Q2 av 25 Examples = higher marks No examples = fail Answer both questions

TMA03 Q1 -1 Be clear about the question Position selection and navigation YOUR exploration of for and against Very few writers disagree with Porter’s basic hypothesis regarding “caught in the middle” and the risks of trying do everything at the same time Even Hitt, Ireland and Hoskisson explicitly accept the validity of the “caught in the middle” argument in their book (which many people claimed to have read) Integrated or mixed strategies are best seen as a fifth variant – a fifth deliberately chosen approach But integrated strategies don’t “disprove” Porter’s view.

TMA03 Q1 - 2 “Twenty-five years of empirical research has failed to resolve a basic strategy question. Does strategic purity pay? Most theorists believe strategic purity—the extent to which a business pursues one type of generic strategy over another—contributes to better performance. By defining the strategy space consistent with the theory, and employing improved design and methods, our study of 2,351 businesses finds a significant relationship between strategic purity and performance. Purity does appear to pay. Some variations in strategic purity and performance relationship were observed across four major industry sectors: manufacturing, construction, retail, and business services. But in all instances pure strategies never did less well, and often did better than hybrid strategies.” Thornhill, S. and White, R. E. (2007), Strategic purity: A multi-industry evaluation of pure vs. hybrid business strategies. Strat. Mgmt. J., 28: 553–561. doi: 10.1002/smj.606 And there are numerous “real life” examples (some people used them)

TMA03 Q2 Decisions and more decisions? Whether to use one or two models? Which ones to choose – rational, political, sense making? Whether to use examples which the guidance demands? Use the reader material? Eisenhardt / Hammond Shall I ignore the essay structure?

Block 4 Reflections please

TMA04 (how could you forget this one?) Generally well done Some issues where people didn’t answer the question asked – even with lots of guidance on offer Remember that “critical thinking” doesn’t simply mean negative thinking. The aims of the course include: thinking strategically in the context of a case study (learning outcome 7) critical thinking, analysis and synthesis; including identifying and questioning assumptions, weighing evidence appropriately, identifying and challenging false logic or reasoning, and generalising in a way which recognises the limits of knowledge in strategy (learning outcome 8) evaluation and comparison of competing perspectives from a variety of sources, including some informed by current issues or research developments (learning outcome 9) the ability to argue relevantly and justify a point of view (learning outcome 10).

Block 2 refresh - quiz Questions on day

Block 3 refresh - quiz Questions on day

BREAK

Block 5: Strategic Implementation Barriers to implementation Strategists as People Structure and Strategy Managing Strategic Change

Block 5 explores ‘Implementation’ Analysis Choice Johnson and Scholes’ (2006) Implementation

“We have a ‘strategic’ plan. It’s called ‘doing things “We have a ‘strategic’ plan. It’s called ‘doing things.’ ” Herb Kelleher, Southwest Airlines

80% of change programmes fail to deliver as expected

Getting Strategy Execution Right https://www.youtube.com/watch?v=nCo6WN_Q2GU

Alexander’s five key obstacles Key tasks are not defined in enough detail Problems requiring intervention by top management were not communicated to them fast enough Changes in roles and responsibilities were not clearly defined The key formulators of the strategic decision did not play an active enough role in implementation Major problems surfaced during implementation, which had not been identified beforehand

Hrebiniak’s consulting experience revealed obstacles managers have to overcome Managers are trained to plan not execute Let the ‘Grunts’ handle execution Planning and execution are interdependent Implementation takes longer than formulation Execution involves more people than formulation Reading 16 B203 Tutorial 2 18 18

Facilitating Implementation – Critical Path Analysis Set up ordering systems (20) Send off first orders (5) Confirm agreement (2) Carry out minor works (20) Install racking (10) Receive Stock Decide layout etc (10) Confirm lines (5) Install signage (7) Decide Staffing (2) Recruit and train staff (18)

Facilitating Implementation – Gantt Chart However: “Unfortunately, no GANTT chart survives contact with reality. No plan can anticipate every event that might help or hinder a company trying to achieve its strategic objectives” Sull et al. (HBR March 2015 p.61) So always useful to add in some buffer time for delays and contingencies What is YOUR Gantt chart to the end of B301?

Control Loop Possible action: Revise objectives Possible action: 1. Set objectives and establish standards of performance 2. Plan tasks, identify performance measures, carry out tasks and measure performance 3. Monitor progress and compare performance to standards 4. Act on results of monitoring and take corrective action if necessary Possible action: Revise objectives Possible action: Adjust task/resources Possible action: Do nothing

Strategists as People Senior Managers Middle Managers

Mintzberg’s six ‘ideal’ structural types Simple Structure Machine Bureaucracy Professional Bureaucracy Divisionalised Form Adhocracy Missionary Key part Strategic apex Technostructure Operating core Middle line Support staff Ideology Coordinating mechanism Direct supervision Standardisation of work processes Standardisation of skills Standardisation of outputs Mutual adjustment Standardisation of norms Dominant pull to: centralise standardise professionalise balkanise collaborate evangelise Where does your organisation fit? (Mintzberg 1979) See expansion in B5 p59

Temporal Separation Organisations change back and forth between different corporate structures Decentralisation is used to ignite innovation and change: centralisation to increase coordination and efficiency Exploitation and exploration are emphasized sequentially rather than simultaneously

Structural Separation Organisations are divided into two (or more) separate units with different structures at the same time Flexible ‘innovative units’ explore new areas for growth, while more formal ‘operational units ensure efficient organisations in the existing businesses Exploitation and exploration are addressed by different employees and organisational units

Parallel Structures Organisations create supplemental network structures to compliment the formal primary structure Employees switch between the two types of structures depending on their respective tasks Exploitation and exploration are addressed by the same employees, but in different structural environments

Managing Strategic Change What is the difference between the planned and the incremental view of change? What is ‘punctuated equilibrium’? According to Balogun and Hope Hailey (2008) what are the four types of strategic change (depending on the nature and scope of change)? B203 Tutorial 2 27 27

Balogun and Hope Hailey Scope of Change Transformation Realignment Evolution Adaption Revolution Reconstruction Nature of Change Big Bang Incremental Balogun and Hope Hailey (2008) B203 Tutorial 2 28 28

Hrebiniak’s model for implementing strategic change

TMA 05 – 6 April 2017 Selecting concepts from Block 5 as appropriate to your discussion, explain some common barriers to successful strategy implementation and how they may be overcome with regard to the BRF 2015 strategy for Brasil Foods (evaluated in TMA 04). You should write your answer as a report from the perspective of an independent strategy consultant to the board of directors – but with appropriate academic referencing. Ensure that you make relevant and critical use of your selected concepts. 2500 words

TMA 05 Guidance This question requires you to make it clear what aspects of the BRF 2015 strategy you think are likely to be problematic in implementation and what recommendations you would make to overcome such implementation problems. You also need to demonstrate how both problems and solutions relate to material in Block 5. The concepts you choose (both to clarify problems and suggest solutions) can be from anywhere in the Block but part of the challenge of the assignment is to demonstrate your ability to select them appropriately and apply them with critical understanding, and practicality.

Final Thoughts?