Strategy Implementation

Putting Strategy in Action

20.1.2019
 Strategic Management Model
Environmental Evaluation &
Strategy Formulation Strategy Implementation
Scanning Control
Gathering Monitoring
Developing Long Range Plans Putting Strategy in Action
information Performance

External Mission
Societal Reason
for Objectives
Environment existence
General Forces What results
to accomplish Strategies
Task by when
Environment Plan to achieve
Industry Analysis the mission & Policies
objectives
Broad
Internal guidelines for Programs
decision making
Structure Activities
Chain of command needed to Budgets
accomplish a
Culture plan Cost of the
Beliefs, Expectations, programs Procedures
Values
Sequence of
Resources steps needed
Performance
Assets, Skills, to do the job
Competences, Process to monitor
Knowledge performance and take
corrective action
 Strategic Management Process

Scan External Environment

- National
- Global Identify Strategic Factors
– Opportunities, Threats

Evaluate Current Formulate Strategy

- Mission Define new
– Corporate
- Goals
SWOT Mission Goals,
– Business,
Implement
Grand Strategy Strategy
- Strategies – Functional

Scan Internal Environment

- Core Competence Identify Strategic Factors
- Synergy – Strengths, Weaknesses
- Value Creation
 Strategic Planning Model
AB C DE
Where we are Where we want to be How we will do it How are we doing

Down to
Assessment Baseline Components Evaluate
Specifics

• Environmental • Situation • Mission & Vision • Performance • Performance

Scan - Past, Present Measurement Management
and Future
• Background • Significant Issues • Values / Guiding • Targets / Standards • Review Progress –
Information Principles of Performance Balanced Scorecard

• Situational • Align / Fit with • Major Goals • Initiatives and • Take Corrective
Analysis Capabilities Projects Actions

• SWOT – • Gaps • Specific Objectives • Action Plans • Feedback

Strength’s, upstream – revise
Weaknesses, plans
Opportunities,
Threats
 Assessment Model: SWOT

Internal Assessment:
Organizational assets, resources,
people, culture, systems,
partnerships, suppliers, . . .

External Assessment:
Marketplace, competitor’s, social
trends, technology, regulatory
environment, economic cycles .

Where is your organization in its development RIGHT now?

Assess the Internal and External Environments

 Components of a Strategic Plan

 Vision – Developing a clear understanding of what is your preferred future

 Mission – Developing a sound statement about why you exist

 Core Values and Beliefs – Describes behaviors and ideas that are
important to your organization

 Strategic Issues – The issues that create a gap between the ideal and reality

 Operational Plans – How are you going to achieve your vision?

 Components of Strategic Planning

Strategic Plan
Action Plans
Mission Why we exist
Evaluate Progress
Vision What we want to be

Goals What we must achieve to be successful

Objectives Specific outcomes expressed in

O1 O2 measurable terms (NOT activities)

Initiatives AI2 AI3 Planned Actions to Achieve Objectives

AI1

Measures M1 M2 M3 Indicators and Monitors of success

Targets T1 T1 T1 Desired level of

performance and timelines
 What is Strategic Planning?

• Process to establish priorities on what you will

accomplish in the future /objectives

• Allows you to make choices on what you will do

and what you will not do (Action Plans)

• Pulls the entire organization together around a single

game plan for execution (Direction)

• Broad outline on where resources will get allocated

 Hierarchy of Strategy
Overall Direction of Company and Management of its Businesses
Corporate
Corporate Headquarters
Strategy

Competitive and Corporate strategies

Strategic Strategic Strategic Business

Business Business Business Strategy
Unit Unit Unit (Division Level)

Maximize Resource Productivity

Research and Human Functional

Manufacturing Finance Marketing Strategy
Development Resources
Corporate Level Strategy (Directional Strategy)
• Growth Strategy
• Stability Strategy
• Defensive Strategy

Business Level Strategy

• Cost Leadership Strategy
• Differentiation Strategy
• Focus Strategy

Functional Level Strategy

• Marketing Strategy
• Financial Strategy
• R & D Strategy
• Operation Strategy
Strategy Formulation & Strategic Choice

Strategy Strategy
Formulation Analysis

Strategy
Choice
 Mintzberg’s Types of Strategies
Intended, Emergent and Realized Strategies

Emergent Strategies
(Alternate Strategies)

Intended Strategy Deliberate Strategy Realized Strategy

(Strategy Formulated) (Choice of Strategy) (Strategy Implemented)

Un-realized Strategy
(Unfruitful Strategy)
 Strategy Implementation

“Successful strategy formulation does not guarantee successful

strategy implementation.”

“Strategies most often fail because they are not executed well.”

• Strategy implementation is actually putting strategies in to action.

• The Strategies formulated at various levels of the organizations

are implemented so as to achieve the objectives taken up at the
corporate level.
 Strategy Implementation Stages

• Strategy implementation happens in two stages

1) Project Implementation

2) Procedural Implementation

• A poor control on strategy implementation may result in

unexpected situation of Malfunctioning of Strategy
Inter-relationship of Strategy & Implementation

• Strategy implementation needs some restructure in

Forward
Organization or in Resources to match with the strategy.
Linkage
• Strategy Provides overall direction for implementation

• Strategies are selected based on current structure and

Backward
Linkage resources that are available for effective implementation.
• Circumstances may affect selection of Strategy
Mintzberg’s 5 P’s
 Mintzberg’s 5 P’s for Strategy

Strategy as Plan: The strategy is made in advance of its implementation and is

followed up by actual implementation and development.
Strategy as Ploy: This is a specific maneuver intended to outperform a competitor.
Strategy as Pattern: Strategy ca sometimes be explained in terms of a pattern that
emerged rather than something that was preplanned.
Strategy as Position: This is represented by finding a niche, providing distinctive
product, or by exploiting existing competences to deter
competitors.
Strategy as Perspective: This refers organizational culture as strategy can be a
result of the way a company views itself.
 Model of Strategy Implementation

Activating Managing Achieving

Strategy Change Effectiveness

Project
Implementation Structural E
Implementation V
Functional A
L
Strategic Procedural Leadership U
Plan Implementation Implementation A
T
Operational I
Behavioral O
Resource Implementation N
Allocation
Important aspects of Strategy Implementation

 Where are we now? (Assessment)

 Where do we need to be? (Gap / Future End State)

 How will we close the gap? (Strategic Plan)

 How will we monitor our progress (Evaluation Balanced Scorecard)

 Barriers to Implementation of Strategy

Corporate Level
Strategy
Formulation
Business Level

Strategy
Implementation Functional Level
 Barriers to Implementation of Strategy

Barriers to Strategy Implementation

Vision People Management Resource

Barrier Barrier Barrier Barrier

85% of the
Only 5% of the Only 25% of executive teams 60% of
workforce the Managers spends less than organizations
understand the have Incentives one hour/ month don’t link budget
Vision linked to Strategy discussing to strategy
Strategy
 Barriers to Implementation of Strategy

 Implementing strategy has always been a challenge for organizations

across the industry.

 Ability to implement strategy is the deciding factor between success

and failure of a company’s strategy.

 Strategy formulation and strategy implementation are not two discrete

processes but are intertwined together.

 Planning is no doubt important, but making the plan work is a

bigger challenge which deals with organizational politics, culture
and sometimes managing change.