1. Session19: Implementing Strategies Dr. Mark H. Mortensen 66.490.211 and 212 Tues &Thurs 2:00 to 3:15 3:30 to 4:45 Manning School of Business

2. Mortensen Consulting Group Today 1. Attendance 2. Discussion on how to implement a strategy 3. Group workshop 4. Assignment for next class Apple case study due

3. Implementation Evaluation and Control Whatever is measured gets management attention. Whatever is rewarded gets management action. Whatever is not …. Is not.

4. Mortensen Consulting Group 11-4 Implementation Evaluation and Control Behavior controls How something is done through policies, procedures, rules, SOP’s e.g. ISO 9000 Standards Series, ISO 14000 Standards Series Activity Output controls What is to be accomplished; focus on end result through performance targets Input controls Resources – skills, abilities, values, motives

5. Mortensen Consulting Group Primary Measures of Performance (Output) 11-5 Implementation Evaluation and Control –Traditional Financial Measures Return on investment (ROI) Earnings per share (EPS) Return on equity (ROE) Operating cash flow Free cash flow –Shareholder Shareholder value Economic value added (EVA) Market value added (MVA) Balanced Scorecard Approach Financial Customer Internal business perspective Innovation and learning

6. Mortensen Consulting Group 11-6 Implementation Evaluation and Control Using Benchmarking – Continual process of measuring products, service, and practices against the toughest competitors or those companies recognized as industry leaders

7. Mortensen Consulting Group 11-7 Implementation Evaluation and Control Problems in Measuring Performance – –Short-term orientation –Goal displacement Behavior substitution Suboptimization

8. Mortensen Consulting Group 11-8 Implementation Evaluation and Control Guidelines for Proper Control – –Minimum amount of information necessary –Meaningful activities and results –Timely –Long and short-term –Pinpointing exceptions –Meeting/exceeding standards

9. Mortensen Consulting Group Group Workshop 1. How will you measure the effectiveness of a product manager’s major strategic moves to …  Enter a new market with an existing product?  Introduce a new product to an existing market? 2. What kind of a goal would you give the product manager responsible? 3. How would you reward them?

10. Mortensen Consulting Group Strategic Management – Spring 2013