Strategic Agility Levendary Cafe

Today’s class Little bit about Feb 18th class Case analysis questions BREAK Strategic agility and multiunit enterprises

Levendary Cafe What is the central problem? Analysis of issues ? Central recommendation/strategic alternatives? An implementation plan (a specific action program for Foster to deal with continued growth in China)

Strategic Agility for MNEs Maneuvering between established and emerging markets needs strategic agility Sensing local opportunities Enacting global complementarities Appropriating local value

Sensing local opportunities Discovering opportunities through local presence and strong ties to local partners Applying tailor made metrics for evaluating and rewarding initiatives Championing (interaction between HQ-subsidiary)

Enacting global complementarities Mobilizing and sharing complementary resources globally Coordinating cross emerging market tasks Leveraging resources and best practices across emerging and established markets

Appropriating local value Adapting go to market concepts locally Building legitimacy in local power networks Creating dynamic barriers to imitation

Strategic agility and organizational Tensions ‘Tensions of Belonging’ : Differences between mindsets between HQ and subsidiaries Maintaining distinctiveness versus centralizing Mistrust between HQ and subsidiaries Performing tensions: performance objectives of subsidiaries and MNCs could be at odds over time frame Organizing tensions: tensions between local empowerment and centralised directions Between collaboration and competition

Getting around organizational tensions Developing modular systems Having specific standardized interfaces Malleable subsystems Having integrative thinkers in the TMT Having high performance HRM practices Facilitate flow of expat and local managers Facilitate cross functionality and communication flow

What is a multiunit enterprise ? A geographically dispersed organization built from standard units. Norm in several industries, such as apparel, banking services, consumer electronics, food and drug stores, general merchandise, hospitality, hardware, mail and package delivery, and toys and sporting goods.

What are the advantages of multi unit enterprise? What are its disadvantages?

What kind of challenges does the multi unit structure offer?

Challenges of Structure Hard to maintain consistency Implementation needs most attention Aligning priorities, plans and practices Some leverage for customization even though they are standardized Attention to consumer demography/taste/prefence Employee availability, skill and wages Sharp division between corporate HQ and field organization Corporate makes decisions about initiatives Field makes decisions about implementation Struggle to get the best out of field managers

Challenges of the multiunit enterprise Growth How do these firms grow? Starbucks Marriott What can the potential impact of the different models of growth be? On implementation On roles and responsibilities Strategic Responsiveness? Speed Remedial response Anticipatory initiatives