CHAPTER 9 Strategy Implementation: Organizing for Action STRATEGIC MANAGEMENT & BUSINESS POLICY 11TH EDITION CHAPTER 9 Strategy Implementation: Organizing for Action CHAPTER 9 Strategy Implementation: Organizing for Action THOMAS L. WHEELEN J. DAVID HUNGER Prentice Hall 2006

--Strategy implementation through programs, budgets, and procedures --Sum total of activities & choices required for strategic plan execution --Strategy implementation through programs, budgets, and procedures Prentice Hall 2006

Key Implementation Questions – Strategy Implementation Key Implementation Questions – Who carries out strategic plan? What needs doing for alignment w/ strategy? How is work coordinated? Prentice Hall 2006

Programs – Action oriented Matrix of change Feasibility Strategy Implementation Programs – Action oriented Matrix of change Feasibility Sequence of execution Location Pace & nature of change Stakeholder evaluations Prentice Hall 2006

Achieving Synergy – Shared know-how Coordinated strategies Strategy Implementation Achieving Synergy – Shared know-how Coordinated strategies Shared tangible resources Prentice Hall 2006

Achieving Synergy – Economies of scale or scope Strategy Implementation Achieving Synergy – Economies of scale or scope Pooled negotiating power New business creation Prentice Hall 2006

Structure follows strategy – Strategy Implementation Structure follows strategy – New strategy is created New administrative problems emerge Economic performance declines New appropriate structure is invented Profit returns to previous level Prentice Hall 2006

Stages of Corporate Development – Strategy Implementation Stages of Corporate Development – Stage I: Simple structure Stage II: Functional structure Stage III: Divisional structure Stage IV: Beyond SBU’s Prentice Hall 2006

Blocks to Changing Stages – Strategy Implementation Blocks to Changing Stages – Loyalty to comrades Task oriented Single-mindedness Working in isolation Prentice Hall 2006

Organizational Life Cycle Prentice Hall 2006

Changing Structural Characteristics of Modern Organizations Prentice Hall 2006

Advanced Types of Organizational Structures – Strategy Implementation Advanced Types of Organizational Structures – Matrix Temporary cross-functional task forces Product/brand management Mature matrix Prentice Hall 2006

Advanced Types of Organizational Structures – Strategy Implementation Advanced Types of Organizational Structures – Network structure (virtual organization) Cellular organization Prentice Hall 2006

Network Structure Prentice Hall 2006

Cost saving programs for all types of manufacturers Strategy Implementation Six Sigma – Cost saving programs for all types of manufacturers Define Measure Analyze Improve Establish Prentice Hall 2006

Job design (the way jobs are done) to implement strategy – Strategy Implementation Job design (the way jobs are done) to implement strategy – Job enlargement Job rotation Job enrichment Job characteristics model Prentice Hall 2006

International Issues – MNC’s International Strategic Alliances Strategy Implementation International Issues – MNC’s International Strategic Alliances Prentice Hall 2006

International Development Stages– Domestic company Strategy Implementation International Development Stages– Domestic company Domestic company w/export division Domestic company w/int’l division MNC w/multidomestic emphasis MNC w/global emphasis Prentice Hall 2006

Centralization vs. Decentralization– Product-group structure Strategy Implementation Centralization vs. Decentralization– Product-group structure Geographic-area structure Prentice Hall 2006

Geographic Area Structure Prentice Hall 2006