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Implementing Strategy Chapter 7
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Objectives Upon completion of this chapter, you should be able to: Translate strategic thought to organisational action Effectively implement strategic plans Evaluate key strategic implementation issues Identify force fields analysis factors Appraise and execute the six factors to successful strategy implementation Review the cultural web of an organisation Evaluate progress using the Balance Scorecard
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Introduction To ensure success, the strategy must be translated into carefully implemented action. This means: The strategy must be translated into guidelines for the daily activities of the firm’s members The strategy and the firm must become one – that is, the strategy must be reflected in the way the firm organises its activities and in the firm’s values, beliefs and tone. In implementing the strategy, the firm’s managers must direct and control actions and outcomes and adjust to change.
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Translating strategic thought to organisational action Once corporate and business strategies have been agreed upon and long-term objectives set, the strategic management process moves into a critical new phase – translating strategic thought into organisational action. Managers successfully make this shift when they do four things well Identify short-term objectives Initiate specific functional tactics Communicate policies that empower people in the organisation Design effective rewards
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Implementing Strategic Plans Once strategies have been agreed on, the next step is implementation; this is where most failures occur. It is not uncommon for strategic plans to be drawn up annually and to have no impact on the organisation as a whole. A common method of implementation is total communication effort This can involve slogans, posters, events, memos, videos, websites, etc.
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A critical success factor is whether the entire senior team appears to buy into the strategy and models appropriate behaviours. Success appears to be more likely if the CEO or a very visible leader is also a champion of the strategy. Strategic measurement can help in implementing the strategic plan. Appropriate measures show the strategy is important to the leaders, provide motivation and allow for follow-through and sustained attention. By acting as operational definitions of the plan, measures can increase the focus of the strategy, aligning the workforce around specific issues.
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The results can include faster changes, greater accountability and better communication of responsibilities which may reduce duplication of effort. Creating a strategic map helps identify focal points; it shows the theory of the business in easily understood terms, showing the cause and effect lingkages between key components. It can be a focal point for communicating the vision and mission and the plan for achieving desired goals. The senior team can create a strategic map by identifying and mapping the critical few ingredients that will drive overall performance.
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The panel does not include all of the areas organisations measure, rather the few that the top team can use to guide decisions, knowing that greater detail is available if they need to drill down for more intense examination. These critical few are typically within 6 strategic performance areas: Financial Customer / market operations Environment People Partners / suppliers
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Once the strategic map is defined, organisations must create measures for each focal point. Identify how they contribute to the overall measures, and then define measures of their own. Ideally this process cascades downward until each individual is linked with the strategy and understands the goals and outcomes they are responsible for and how their individual success will be measured and rewarded.
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Cascading the Plan Cascading is often where the implementation breaks down. Cascading is often noted as being a serious problem in implementing strategic measurements systems. Organisations have found it to be helpful to ask each functional area to identify how they contribute to achieving the overall strategic plan. Functional area leaders may be more successful using a cascade team to add input and take the message forward to others in the area.
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Developing ambassadors or process champions throughout the organisation to support and promote the plan and its implementation can also enhance the chance of success. These champions may be candidates for participation on the design or cascade teams and should be involved in the stakeholder review process.
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External Consultants External consultants can play an important role in building and implementing strategic plans if they are used appropriately. Rather than creating or guiding an organisation’s strategy, the primary role of consultant should be that of a facilitator, a source of outside perspective and perhaps as a resource for guiding the process itself. This allows each member of the internal team to participate fully without having to manage the agenda and keep the team focused on the task at hand.
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Consultants can keep the forum on track by directing the discussion to ensure objective, strategic thinking around key issues, tapping everyone’s knowledge and expertise, raising pertinent questions for discussion and debate, managing conflict and handling group-think and other group dynamics issues. Consultants can extract the best thinking from the group and ensure the vision and mission are based on a sound, critical review of the current state and anticipated future opportunities. Once this is accomplished, consultants can facilitate the identification of desired oucomes and the drivers needed to achieve them. They can also help to assure that a true consensus is actually reached, rather than an appearance of a consensus due to fear, conformity or other group effects.
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