Implementation

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Implementation
STRATEGIC MANAGEMENT & BUSINESS POLICY
13TH EDITION
THOMAS L. WHEELEN
J. DAVID HUNGER
Staffing
• The implementation of new strategies
often calls for new human resource
management.
• Priorities and a different use of personnel.
Such staffing issues can involve hiring
new people with new skills, firing people
with inappropriate skills.
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Example on acquired companies
• The percentage of an acquired company’s
top management either quit or asked to
leave:
• Around 25% after the first year, 35% after
the second year, 48% after the third year,
55% after the fourth year, and 61% after
five years.
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Staffing
Integration Managers
•
Prepare a competitive profile of the
company in terms of its strengths and
weaknesses
• Draft a profile of what the ideal
combined company should look like
• Develop action plans to close the gap
between actual and ideal
• Establish training programs to unit the
combined company and make it more
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Successful Integration Managers
•
•
•
•
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Deep knowledge of the acquiring company
Flexible management style
Ability to work in cross-functional teams
Willingness to work independently
Sufficient emotional and cultural intelligence to
work in a diverse environment
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Staffing Follows Strategy
•
•
Training and development
Executive types
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–
–
–
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Dynamic industry expert
Analytical portfolio manager
Cautious profit planner
Turnaround specialist
Professional liquidator
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Selection and Management Development
Executive succession- replacing a key top manager
•
•
•
Succession planning
Identifying candidates below the top layer of
management
Measuring internal candidates against external
candidates
Providing financial incentives
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Identifying Abilities and Potential
Performance appraisal system identifies good
performers with promotion potential
Assessment centers evaluates a person’s suitability
for an advanced position
Job rotation- ensures employees are gaining a mix of
experience to prepare them for future
responsibilities
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Problems in Retrenchment
Downsizing the planned eliminated of positions or
•
jobs
Can damage the learning capacity of an
organization
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Successful Downsizing
•
•
•
•
•
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Eliminate unnecessary work instead of making
across the board cuts
Contract out work that others can do cheaper
Plan for long-run efficiencies
Communicate the reasons for actions
Invest in the remaining employees
Develop value added jobs to balance out job
elimination
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International Issues in Staffing
•
•
•
•
•
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Culture differences
Management styles
Human resource practices
Suboptimization
Communication and coordination
Lack of international management with experience
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Implementation involves leading and coaching
people to use their abilities and skills most
effectively and efficiently to achieve
organizational objectives
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Managing Corporate Culture
•
•
•
Strong cultures are resistant to change
Optimal culture supports mission and
strategies
Change in strategy should be followed
by change in culture
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Accessing Strategy-Culture Compatibility
1.
2.
3.
4.
Is the proposed strategy compatible with the
company’s current culture
Can the culture be easily modified to make it more
compatible with the new strategy
Is management willing and able to make major
organizational changes and accept probable delays
and a likely increase in costs
Is management still committed to implementing the
strategy
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Managing Cultural Change Through
Communication
•
•
•
CEO and top management communicated the
strategic vision throughout the organization
Current performance was compared to competition
and constantly updated
Vision was translated into key elements needed to
accomplish the vision
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Managing Diverse Cultures Following an
Acquisition
•
•
•
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Methods of managing two different cultures
Integration- balanced give and take of cultures
Assimilation- domination of one culture over the
other
Separation of the two cultures
Deculturation: disintegration of one culture
resulting from pressure form the other to impose
its culture and practices
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Action plan- what actions are going to be taken, by
whom, during what time frame, and with what
expected results
1.
2.
3.
4.
5.
6.
Specific actions to be taken to make the program operational
Dates to begin and end each action
Person responsible for carrying out each action
Person responsible for monitoring the timeliness and
effectiveness of each action
Expected financial and physical consequences of each action
Contingency plans
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Importance of Action plans
•
•
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Serve as a link between strategy formulation and
evaluation and control
Specifies what needs to be done differently from
current operations
Evaluation and control processes appraise
performance and identify remedial actions
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Management by Objectives (MBO)- encourages
participative decision making through shared goal
setting and performance assessment based on
achieving stated objectives
•
•
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Establishing and communicating organizational
objectives
Setting individual objectives
Developing an action plan to achieve objectives
Performance review (periodic and annual)
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Total Quality Management (TQM)- philosophy that
is committed to customer satisfaction and
continuous improvement
Objectives
1.
2.
3.
4.
Better, less variable quality of the product and service
Quicker less variable response in processes to customer
needs
Greater flexibility in adjusting to customers’ shifting
requirements
Lower cost through quality improvement and elimination of
non-value added work
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Essential Ingredients
1.
2.
3.
4.
5.
Intense focus on customer satisfaction
Internal as well as external customers
Accurate measurement of every critical variable in
a company’s operations
Continuous improvement of products and services
New work relationships based on trust and
teamwork
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Dimensions of National Culture
1.
2.
3.
4.
5.
Power distance
Uncertainty avoidance
Individualism-collectivism
Masculinity -femininity
Long-term orientation
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1. What skills should a person have for managing a business
unit following a differentiation strategy? Why? What should
a company do if no one is available internally and the
company has a policy of promotion from within?
2. When should someone form outside the company be
hired to manage the company or one of its business units?
3. What are some ways to implement a retrenchment
strategy without creating a lot of resentment and conflict
with labor unions?
4. How can corporate culture be changes?
5. Why is an understanding of national cultures important
in strategic management?
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