A proposed framework for strategy implementation in the Indian context

AZHAR KAZMI
King Fahd University of Petroleum & Minerals, Dhahran, Saudi Arabia

Abstract

Purpose – Review the extant literature on strategy implementation with a view to

highlight the pitfalls and use these to build a new framework that could be more relevant
to the conditions existing in the Indian context.
Design/methodology/approach – This paper provides a review of strategy
implementation frameworks available both in strategy literature and in strategy texts to
identify the main pitfalls in effective strategy implementation and then proceeds to
propose a framework that could be more suitable to the Indian context. This proposed
framework is then applied and described in the context of a case study of the Reliance
group of companies of India.
Findings – The proposed strategy implementation framework covers many of the aspects
hitherto neglected in the frameworks suggested by researchers and authors more attuned
to the Western context. Two of the major issues in strategy implementation not covered
in the existing framework are of procedural and project implementation that may be
considered as relevant in the Indian context.
Research limitations / implications – The proposed framework is demonstrated in the
case of only one Indian company. The efficacy of the framework need to be further
investigated.
Practical implications – Application of the proposed framework is likely to result in a
more comprehensive coverage of the vital issues in strategy implementation that are
expected to do away with the pitfalls that are commonly experienced in the process of
strategy implementation.
Originality/value – The paper proposes a new framework of strategy implementation
based on the unique requirements of the Indian context.
Keywords strategy implementation, strategy execution, strategy implementation
framework, Indian context, Reliance case
Paper type Conceptual paper

A nicely drafted strategic plan, prepared through a sophisticated process by a team of

accomplished management consultants or a group of top managers, is hardly like to fail
by itself. Failure, when it occurs, almost always happens during the implementation of
the strategic plan. Yet, strategy formulation hogs most of the attention of management
and strategy thinkers while strategy implementation is sidelined. For instance, Okumus
and Roper (1998, p. 219) note that “despite the importance of the strategy execution
process, far more research has been carried out into strategy formulation rather than into
strategy implementation”, while Alexander observes that literature is dominated by a
focus on long range planning and strategy content rather than the actual implementation
of strategies, on which “little is written or researched” (Alexander, 1985, p. 91). The
apathy to strategy implementation can be ascribed to several reasons, among them:

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greater likelihood of failures in implementing strategies; higher complexity in the process
of strategy implementation; strategy implementation being considered to be less
glamorous than formulation; and practical difficulties in research involving middle-level
managers. (See, for instance, Alexander, 1985 and Aaltonen and Ikavalko, 2002)

Despite the benign neglect by academicians and consultants more challenges are
experienced in practice in the course of strategy implementation. In their research,
Bartlett and Ghoshal (1987) found that in all the companies they studied “the issue was
not a poor understanding of environmental forces or inappropriate strategic intent.
Without exception, they knew what they had to do; their difficulties lay in how to achieve
the necessary changes” Strikingly, organizations fail to implement a hefty majority of
about 70 per cent of their new strategies. (Miller, 2002) Another recent study is a bit less
alarming; it says 40 per cent of the value anticipated in strategic plan is never realized.
(Mankins & Steele, 2005) Evidence keeps piling of how barriers to strategy
implementation make it so difficult for organizations to achieve sustained success.1
Bridging the gap between strategy formulation and implementation has since long been
experienced as challenging.2

No wonder, increasing attention is being paid to an intense examination of strategy

implementation. Unlike strategy formulation, where there are well-known frameworks
such as strategic planning, SWOT analysis, Porter’s generic strategies, industry analysis
or competitive analysis, there are few models or frameworks available in the area of
strategy implementation. Those that are available are still in the process of being
developed and refined. Further, almost all the models of strategy implementation in
vogue have the usual Western perspective embedded in them.

This paper reviews some of the existing models and then endeavors to nudge the
boundaries of understanding a bit ahead in this significant area of strategic management.
While doing so, the focus will be on the special context in developing countries,
particularly India, in contrast to what could be there in the case of developed countries.

A review of existing frameworks of strategy implementation

The need for framework (or a model) is sorely felt in the case of strategy implementation.
The reasons are obvious: it’s an extremely complex set of tasks and managers need to
know what are the steps to follow, what is the sequence of those steps, why at all those
steps are necessary, what is more critical in those steps, and so on. Having a framework
of strategy implementation in hand is like having a roadmap in alien territory. In the
absence of a framework, managers would still implement their strategies. But they would
do so thinking of what they, as individuals, think is important resulting in disjointed and
conflicting actions. A framework, on the other hand, would serve as a beacon to guide
managers at various levels spread over different functional areas within the organization.
The review of strategy implementation frameworks will be done in two parts. First, a
review would be done of the frameworks available in the strategy literature and secondly
a reference would be made to those presented in strategy texts.

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Strategy implementation frameworks in strategy literature

There are several frameworks of implementation available in strategy literature. Okumus

(2003) makes an insightful review of the available frameworks in strategy
implementation. Initially, this paper would lean on Okumus’s review and add the later
references later.

One of the earlier frameworks was in the form of the popular McKinsey’s 7-S framework
by Peters and Waterman (1980) that considered seven factors of implementation. These
factors are: strategy, structure, systems, style, staff, skills, and subordinate goals. The
conceptual frameworks developed over the succeeding two decades, for instance, by
Stonich (1982), Hrebiniak and Joyce (1984), Galbraith and Kazanjian (1986), Reed and
Buckley (1988), Alexander (1991), Judson (1995), Miller and Dess (1996) and
Thomspson and Strickland (2003) consist of well defined and critical implementation
factors that is a point of similarity of approach in these frameworks. These frameworks,
for instance, use quite similar factors of implementation such as organizational structure,
culture, people, communication, control and outcome. Each of these scholarly
contributions - whether based on empirical or conceptual work - recommends that the
process of strategy implementation be built around a set of implementation factors. These
frameworks might differ in terms of the selection of implementation factors, the
nomenclature given to each factor, the relative emphasis on each factor in the set, and the
way how the factors get implemented. Nevertheless, the idea is clear: there are a set of
implementation factors each significant enough to be treated separately in terms of the
managerial emphasis laid on them.

As one moves towards more recent studies, one finds greater sophistication in terms of
the identification of the implementation factors, the clarity in the interrelationship that
these might have, and the impact that they have collectively on the strategy
implementation process. For instance, works by Aaltonen & Ikavalko (2002) and
Freedman (2003) stress on these: organizational structure and culture that is receptive to
change, elaborate building up of change management systems and skills, and
communication and employee commitment to vision.

As an illustration of how the frameworks of strategy implementation are proposed, two

contributions are being taken up for elaboration. The first illustration is from the 1990s
and the other more recent from 2003. Skivington and Daft (1991) selected three
organizations in the integrated circuits, petroleum, and health care industries. They chose
57 strategic decisions and examined how these were implemented in the course of putting
the competitive generic strategies of low-cost and differentiation. They could identify
several factors such as intended strategy, structure, systems, interactions, and sanctions
that mattered so far as implementation were concerned. They divided these factors into
two broad groups of framework and process factors. It was found that both the
framework and process factors could be used to implement the low-cost and
differentiation strategies.

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The second work by Okumus, 2003 is seminal in the sense that it makes a comprehensive
review and then proceeds to propose a strategy implementation framework. In doing so,
Okumus creates a typology to provide a categorization of frameworks in three groups as
below.

1 A simple approach to listing and describing the implementation factors (e.g.

Hrebiniak & Joyce, 1984)
2 Models that suggest a sequential, rational implementation process that might
be difficult to adopt in complex situations (e.g. Noble, 1999)
3 Frameworks that lay emphasis on context and process ignoring elaboration of
issues such as relative importance of implementation factors, their specific
roles, and their impact on the overall implementation process (e.g. Dawson,
1994)

Okumus (2003), in his own framework of strategy implementation, lays emphasis on

certain pre-conditions that are worth mentioning. He suggests, for instance, that
implementation is too complex a process to be represented by linear models that project
the implementation process as something that is rational and systematic. Another
noteworthy observation is that researchers and practicing managers should be able to
make informed judgments about the strategy implementation process rather than adopt
ready-made solutions. In doing so, they are advised to follow a holistic approach to
considering formulation and implementation as intertwined rather than stand-alone. The
latter observation is in line with the current thinking on the interdependence among
formulation and implementation of strategies.

------------------------------------------------------------------------------------------------------------
Take in Exhibit 1 Okumus’s strategy implementation framework
somewhere here
------------------------------------------------------------------------------------------------------------

The proposed framework by Okumus, 2003 is presented in a simplified form in Exhibit 1.

The various factors in the framework could be summed up as below.

 Strategic content refers to why and how strategy is initiated

 External context refers to the degree of uncertainty and changes in the task and
general environments of the organization
 Internal context refers to the configuration of organizational structure, culture,
and leadership
 Organizational process refers to the configuration of operational planning,
resource allocation, people, communication, control and feedback, and outcome

Undoubtedly, Okumus’s strategy implementation framework is quite comprehensive as it

attempts to take into account an array of variables and binds them into a compact model.
However, as always, there could still be scope for improvement.

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Beyond 2003 when Okumus wrote his review and during the past about five years at the
time of writing this paper, some interesting trends can be observed in reported works in
the area of framework of strategy implementation. There are papers reporting strategy
implementation taking into account functional areas such as accounting, marketing,
human resource management, or information management (for instance, Naranjo-Gil and
Hartmann, 2006). These go beyond the purview of the theme of this paper as they move
vertically, in-depth into the finer aspects of strategy implementation while the concern
here is with the lateral system of the factors of strategy implementation. The next trend is
the continuing emphasis on the well-accepted factors of strategy implementation such as
structure, culture or organizational processes. For instance, the work of Olson, Slater &
Hult, 2005 reiterates the significance of organizational structure and processes in strategy
implementation. The third trend noted is of reporting studies in specific socio-economic
contexts such as those in specific countries (e.g. China as in Wu et al. 2004) or
developing economies (e.g. Latin American as in Brenes et al. 2007). Referring to
strategy implementation as systematic execution, these scholars include organizational
culture and structure, work and information system, and essential business processes as
the key implementation factors. They also stress the significant point that the degree to
which an organization succeeds in establishing a priority system for each implementation
action is necessary.

The final reference in this paper will be to the larger framework for strategic management
proposed by Hambrick & Fredrickson, 2005 who propose that if a business has to have a
single, unified strategy, then it must necessarily have parts. These parts make up their
framework of strategy design that includes five elements of arenas: where will we be
active? vehicles: how will we get there? differentiators: how will we win in the
marketplace? staging: what will be our speed and sequence of moves? and the economic
logic: how will we obtain our returns? Using this comprehensive framework, for instance,
Carpenter & Sanders, 2007, in their text on strategic management, use the
implementation levers, as they call them, of organizational structure, systems and
processes, people and rewards, and strategic leadership that involve making lever and
resource allocation decisions, and communicating the strategy to stakeholders.

Strategy implementation frameworks in strategy texts

It is interesting to observe the strategy implementation frameworks adopted in strategy

texts as they indicate the current state of thinking related to them. American texts in
strategy dominate curricula around the world so more space will be devoted to them.
Besides the eight American texts chosen two European texts would also be referred to.
The choice of the textbooks is based on the author’s experience of teaching and writing
on strategy for the past about twenty eight years. Table 1 encapsulates the issues covered
under strategy implementation in major texts in strategic management used around the
world including in India.

Table 1: Issues covered under strategy implementation in strategy textbooks

Strategy texts (in alphabetical order by Country Issues covered in strategy implementation

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first author’s surname) origin of
author/s
Carpenter M. and Sanders, G., (2007) American - Employing strategy implementation levers
Strategic Management: Concepts 2nd ed. - Considering new ventures and corporate
Prentice Hall, Englewood Cliffs, N.J. renewal
-Corporate governance in the twenty-first
century

David, F., (2007) Strategic Management: American - Management and operations issues
Concepts and Cases, 11th ed. Prentice Hall, -Marketing, finance/accounting, R&D
Englewood Cliffs, N.J.
Dess, G. G., Lumpkin, G. T., and Eisner, American - Strategic control and corporate governance
A., (2008) Strategic Management: Text - Creating effective organizational designs
and Cases, 4th ed. McGraw-Hill Higher - Strategic leadership: Creating a learning
Education, New York. organization and an ethical organization
- Managing innovation and fostering
corporate entrepreneurship

Hill, C. W. L. and Jones, G. R. (2008) American - Corporate performance, governance, and

Strategic Management: An Integrated business ethics
Approach, 8th. ed. Houghton Mifflin, - Implementing strategy in companies that
Boston compete in a single industry (Organizational
design, structure, strategic control systems,
building distinctive competencies,
restructuring and reengineering)
- Implementing strategy in companies that
compete across industries and countries
(multinational structure, entry mode and
implementation, information technology, the
Internet, and outsourcing)

Hitt, M. A., Ireland, R. D. and Hoskisson, American - Corporate governance.

R. E., (2008) Strategic Management: - Organizational structure and controls.
Competitiveness and Globalization, - Strategic leadership.
Concepts and Cases 8th. ed. Cengage - Strategic entrepreneurship
Learning, Victoria, Australia

Johnson, G., Scholes, K. and Whittington European - Strategy development processes

R. (2008) Exploring Corporate Strategy - Organizing for success
8th. ed. Prentice Hall, Harlow, UK. - Resourcing strategies
- Managing strategic change
- The practice of strategy

Morden, T., Principles of Strategic European - Structure, architecture, culture, and supply
Management 3rd. ed. Ashgate Publishing, chain management
Aldershot, UK - Strategic management of technology,
knowledge, and innovation
- Core competencies
- Resource stretch and leverage
Pearce II, J. A. and Robinson, Jr., R. B., American - Strategy implementation
(2007) Strategic Management: - Implementing strategy through short-term
Formulation, Implementation, and Control objectives, functional tactics, reward system,
of Competitive Strategy, 8th ed. McGraw- and employee empowerment
Hill Irwin, New York. - Structure, leadership, and culture

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Thompson, Jr. A. A. , Strickland III, A. J. American - Building an organization capable of good
and Gamble, J. E., (2008) Crafting and strategy execution
Executing Strategy: The Quest for - Managing internal operations: Actions that
Competitive Advantage: Concepts and facilitate strategy
Cases, 16th ed. McGraw-Hill, New York. - Corporate culture and leadership: Keys to
good strategy execution

Wheelen, T. L. & Hunger, D. L. (2007) American - Organizing for action

Strategic Management & Business Policy, - Staffing and directing
11th ed. Prentice Hall, Englewood Cliffs,
N.J.

As we observe from the data presented in Table 1, the American and European strategy
texts cover many of these issues under strategy implementation:

 Structural issues such as organization structure, organizational architecture,

organization design, controls, rewards, etc.
 Behavioral issues such as leadership, culture, business ethics, managing change,
etc.
 Governance issues such as corporate governance, strategic control, etc.
 Functional issues such as marketing, finance, operations, R&D, supply-chain
management, etc.
 Operational issues such as resource allocation, technology, innovation,
outsourcing, etc.

Besides the issues covered in strategy implementation, it is also noticed that only a few
texts follow a well-defined framework of strategy implementation. In many of these
popular texts, strategy implementation issues are dealt with in a random manner rather
than being based on a definite framework or model of strategy implementation. This is in
sharp contrast to how systematically strategy formulation is presented in many of these
texts.

Further, some space will be devoted to mentioning the pitfalls in strategy implementation
to derive a few areas for proposing a framework of strategy implementation.

Improving the strategy implementation process

Hrebiniak, 2006 points some general, overarching issues that impede strategy
implementation. Among them is the fact that managers are often trained to plan and not
to execute strategies, the top managers are reluctant to soil their hands in the messy tasks
of implementation, formulation and implementation being interdependent yet being done
by two different groups of managers, typically implementation taking longer than
formulation putting pressure on the managers to show results, and formulation involving
many more people within an organization than does formulation. Hrebiniak’s own
empirical findings listed the following major obstacles:

 An inability to manage change

 Poor or vague strategy

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  Not having guidelines or a model to guide implementation efforts
 Poor or inadequate information sharing
 Unclear responsibility and accountability
 Working against the organizational power structure

Although there could be several ways to improve upon the implementation process in the
light of the shortcomings as noted above, the means to overcome the barriers to strategy
implementation discussed in the strategy literature usually revolve around the following
three main suggestions:

1. Adopting a clear model of strategy implementation Often, implementation

activities take place according to the abilities and initiatives of managers involved
in them. Though a process, implementation moves in fits and starts. This uneven
progress of the process does not do much good for the effectiveness of
implementation efforts. Again, managers often do things which they consider to
be important; they do not do things which are important enough to be done. This
results in a lot of confusion and uncoordinated actions. What is required is a clear
model of the strategy implementation process that can provide unambiguous
guidelines to the managers implementing the strategy. Such a model should lay
down the elements, or at least the major themes, of implementation process so
that there is a high level of understanding of how the process has to proceed. At
the same time, there needs to be comprehension of how the various elements or
themes are interconnected. Is such a model available? Alexander (1991, p. 74)
states that “One key reason why implementation fails is that practicing executives,
managers and supervisors do not have practical, yet theoretically sound, models to
guide their actions during implementation. Without adequate models, they try to
implement strategies without a good understanding of the multiple factors that
must be addressed, often simultaneously, to make implementation work.” Noble
(1999, p. 132) observes that “there is a significant need for detailed and
comprehensive conceptual models related to strategy implementation. To date,
implementation research has been fairly fragmented due to a lack of clear models
on which to build.”
2. Effective management of change in complex situations Implementation almost
always creates the need to manage change in complex organizational contexts.
Many of these areas of change are behavioral in nature and are therefore
multifaceted and messy in nature. For instance, leadership style changes required
to implement different kinds of strategies or the cultural changes to be brought
about to facilitate new strategy implementation are intricate matters that call for
careful handling. No wonder, managers often fail to manage these complex
organizational issues satisfactorily creating conditions for sub-optimal
implementation of strategies.
3. Setting down clear measures of effectiveness Many of the failures in
implementation of strategies can be attributed to the lacunae in setting down clear
measures of effectiveness. If there are clear measures of effectiveness the
likelihood of implementation succeeding is enhanced. This is an intuitively
appealing argument and may be self-evident. Yet, efforts at setting down clear

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 measures of effectiveness may be half-hearted or missing. There are reasons why
this happens: lack of clarity in laying down objectives is reflected in ambiguity in
setting down measures of effectiveness; it may be difficult to come up with an
adequate set of effectiveness measures; and it may be cumbersome to follow
through the achievement of effectiveness in the humdrum of routine
organizational activities. The current popularity of performance management
systems such as the balanced scorecard can be partly ascribed to inadequate
measures of effectiveness.

Further, these three suggestions will be used to propose a framework of strategy

implementation in the main section of this paper.

The proposed strategy implementation framework

This section of the paper presents a model of strategy implementation that includes all the
relevant issues covered in strategy literature as well as the strategy texts. Besides these
issues special emphasis would be laid on those strategy implementation issues that might
not be of interest to scholars in the context of developed economies but may be of
relevance to the business environment in developing economies such as the Indian
economy.

Exhibit 2 presents a model of strategy implementation that attempts to capture the major
themes in strategy implementation and the activities that make up each theme. The
forward linkage from strategic plan guides the implementation process and connects it to
the preceding phase of strategy formulation. The feedback flowing in reverse from the
following step of strategy evaluation and control moves through the implementation
phase and goes back to strategy formulation establishing the backward linkage.

------------------------------------------------------------------------------------------------------------
Take in Exhibit 2 A framework of the strategy implementation process
somewhere here
------------------------------------------------------------------------------------------------------------

1. Activating strategies The theme of activating strategies serves to prepare the

ground for managerial tasks and activities of strategy implementation. Three sets
of activities have been identified under this theme that in the author’s opinion
could be more relevant for organizations in the developing countries. These are:
project implementation, procedural implementation, and resource allocation. It is
to be noted that the first two sets of activities are rarely found in frameworks of
strategy implementation developed in the context of developed economies. There
does not seem to be any plausible reason why the western frameworks of strategy
implementation disregard project and procedural implementation despite the
evidence that “the alignment of project management and business strategy helps
organizations focus on the right projects, given the objectives sought to be
achieved.” (Srivannaboon & Milosevic, 2006) In such a manner, project
management is a key enabler of strategy implementation within organizations.

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 Similar is the case with procedural implementation that is given short shrift in the
western frameworks of strategy implementation. “For companies in many nations,
regulatory policy increasingly shapes the structure and conduct of industries and
sets in motion major shift in economic value….. The far-reaching impact of
regulation means that for companies to maximize their long-term value, they must
link their regulatory strategies with their product, business, and corporate
strategies.” (Beardsley, et. al. 2005)
2. Managing change The next theme is the core of strategy implementation and
deals with managing change in complex situations. Three sets of activities under
this theme have been identified that should enable coverage of most of the major
implementation tasks: structural implementation, leadership implementation, and
behavioral implementation.
3. Achieving effectiveness The last theme in strategy implementation is the outcome
of the process of strategy implementation. An organization looks forward to
seamless implementation of its strategies. This can be visualized in terms of the
well-known concept of fit. There are two types of fit: vertical and horizontal fit.
The vertical fit ensures that strategies at lower levels are in consonance with those
at the higher level. Thus, business strategies aligned to corporate strategies create
vertical fit. The horizontal fit ensures that strategies at the same level are aligned
to each other. Thus, marketing strategies should be in consonance with financial
strategies. The consideration of vertical fit leads to functional implementation
while horizontal fit leads to operational implementation. This theme will thus
cover two sets of activities of functional and operational implementation.
Functional implementation deals with the implementation of functional strategies
such as marketing or finance in a specific functional area, allocation of resources
within that functional area, and coordination of activities in that area. Operational
implementation deals with the nitty-gritty of strategy and is thoroughly action-
oriented. It deals with operational effectiveness that is concerned with continual
improvements in implementing strategies at the grassroots level. One approach to
operational effectiveness is based on the four P’s of operational implementation
viz. the productivity, processes, people and pace. (Kazmi, 2008, pp. 469-477)

Applying the strategy implementation framework to the case of Reliance group

This part of the paper would attempt an application of the proposed model of strategy
implementation to the case of Reliance group of companies of India.

The Reliance group of companies, founded by Dhirajlal Hirachand – better known as

Dhirubhai – Ambani (1932-2002) is the largest private sector company in India with total
revenues of US 27 billion. Starting with a small trading establishment in 1958 after
returning to India from Aden, Dhirubhai set up in 1977 a small textile company and
achieved the status of a Fortune-500 company in less than three decades. The group
exports products worth more than US $ 15 billion to more than 100 countries. The group
bifurcated in 2005 between the two brothers Mukesh and Anil following a bitter
succession dispute after the death of Dhirubhai Ambani in 2002. The combined worth of
the Reliance group is estimated to be US $125 billion in 2008. Reliance Industries

10
Limited is the group’s flagship company besides which the group has several hundred of
investment companies, satellite companies, and trusts. The Reliance group companies
employ about 40000 people.

The evolution and growth of the Reliance group is based on sustained backward vertical
integration strategy starting with textiles in late-1970s leading to a fully-integrated
company moving through the value chain from polyester, fiber intermediates, plastics,
petrochemicals, petroleum refining, through oil and gas exploration and production. The
business of the Reliance group include exploration and production of oil and gas, refining
and marketing, petrochemicals, textiles, financial services and insurance,
telecommunication and information technology. Reliance is in the process of strategic
change from an organic growth model to a mix of organic and aggressive acquisitions-led
mode of growth aimed towards a mix of local and international expansion into sunrise
industries.

The corporate philosophy of the Reliance group are claimed to have the following
components: (Ambani, 2004)

 World-scale and world-class

 State-of-the-art technologies
 Integration across the complete value chain
 Global competitiveness
 Leadership in chosen areas of business
 Superior project execution
 Financial conservatism
 Highest standards for health, safety and environment
 Consistent overall shareholder value enhancement

The core competencies that the Reliance group of companies has been able to develop
and sharpen over the years include project management and execution, financial
engineering, and infrastructure development for setting up global-scale plants and
facilities.

All these core competencies can be observed in the case of project implementation by
Reliance Industries, which operates the world's third largest single-location refinery in
the world at Jamnagar, on the western coast of India in the state of Gujarat (with a
capacity of 33 million tons per annum), has embarked on setting up India's first export-
oriented refinery through a subsidiary, Reliance Petroleum, at a cost of Rs. 27,000 crore.
The refinery will have a capacity of 29 million tons, and is expected to be operational by
December 2008.

A typical refinery would take about 45 months to build but Reliance does the same in 36
months. Intense focus on costs, concept of extended owner-manager style of
management, advance booking of vendor capacity, ordering longer-lead time items first,
using standardized equipments to take advantage of bulk buying, and close monitoring of
projects at every stage rather than adopting the lump-sum turnkey project approach are

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the key components of Reliance project management tactic. The Jamnagar project is a
complex configuration based at a site that covers an area nearly equal to London and
employs about 80000 personnel including 7000 engineers. (Kumar, 2007)

Procedural implementation assumes significance in the case of the Reliance group as it

has been continually involved in expanding its business interests. Any project of the
global size that Reliance group normally undertakes involves a plethora of government
permissions and sanctions. For instance, its Jamnagar project is based in a Special
Economic Zone that attracts special incentives from the central (or federal) and state
governments.

Dhirubhai is considered as a legendary industrialist credited with creating the equity cult
in India. At the same time, he was often accused of bending government rules,
manipulating the stock markets, and taking advantage of loopholes in the laws such as the
complicated Indian taxation laws. The penchant for implementing projects quickly by the
Reliance group could partly be ascribed to its ability to bend cumbersome government
rules to its advantage. Dhirubhai developed close relationship with government
bureaucrats and politicians and exploited this networking to expedite approvals for his
various projects. (Thakurta, 2005)

“He (Dhirubhai) had institutionalized the key factors that have contributed to his success.
These can be summarized as a penchant for global benchmarking, intense cost
consciousness, and determined pursuit of goals, flawless implementation, and the will to
dominate. He challenged existing paradigms and bent the rules when they did not suit his
entrepreneurial ventures.” (Ravimohan, 2002) Of course, Dhirubhai was not the only one
adept at tweaking the establishment or currying favors with politicians and bureaucrats.
During the license-permit-quota raj in Indian economy, this was the typical way of
extracting licenses from the government.

Resource generation and allocation becomes a significant part of strategy implementation

when an ambitious business group such as Reliance is constantly looking for ways to
garner resources. The ability to garner financial resources is a major core competence of
the Reliance group. This ability goes back to Dhirubhai’s vision of helping to create the
equity cult in India. He was fond of describing Reliance shareholders as ‘family
members’ and the group’s annual general meetings acquired the atmosphere of carnivals
organized in open air stadiums attended by hordes of mostly middle-class investors. To
nurture his entrepreneurial aspirations, Dhirubhai adopted a policy of raising money from
the public rather than the conventional way adopted by other businessmen of relying on
the banks and financial institutions. In 1977, Reliance Industries went public and raised
equity capital from tens of thousands of investors, many of them located in small towns.
Since then, Reliance’s shareholders have often been handsomely rewarded not only in the
form of dividends and rights and bonus issues but also appreciation of the market value
of their investments. The money raised through equity has been invested in scores of
large-scale capital-intensive projects in various parts of India mainly the states of Gujarat
and Maharashtra.

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Several elements of leadership implementation at the Reliance group can be traced back
to the top leadership style institutionalized by Dhirubhai Ambani. He was a visionary
who combined a unique sense of connecting to the realities of the business environment.
Among his extraordinary personal qualities were ability to dream big and pursue success
to its logical end, playing with a heavy hand against adversaries while exhibiting ample
generosity with friends, modesty, humility, and simplicity.

In the words of his son, Mukesh Dhirubhai’s "… way of managing was to lead his team;
first was to build a competitive team. He always believed that I want the best in the world
in terms of competencies and in terms of people on my team. And then he would lead by
trust and he would lead by love and he would lead by example. This in turn creates
loyalty of the entire team and the loyalty is not to an individual, the loyalty is to the
mission and to the vision that has been set forth and then that becomes a common mission
and vision.” (Ambani, 2005)

The two sons Mukesh and Anil have a contrasting leadership style. Mukesh is known for
his conservative style being an engineer and a stickler for detail. Anil, in contrast,
possesses a flamboyant, outgoing, aggressive style. Succession at Reliance group
experienced a serious problem after the death of Dhirubhai in 2002. Eventually it was
resolved by asset sharing between the two brothers. (Rai, 2004)

Behavioral implementation at Reliance group has several facets of stakeholder

management, corporate governance, corporate culture, business ethics and personal
values, and corporate social responsibility.

Stakeholder management is seen in the case of the Reliance group as giving more
importance to the investors and the government. Corporate governance is adopted and
followed by the Reliance group of companies in the usual manner as required by law.
There is a code of conduct and ethics for directors and management personnel displayed
on the companies’ websites.

A quote from Dhirubhai goes like this: "Think big, think fast, think ahead. Ideas are no
one's monopoly” This quote is probably a reflection of the corporate culture at Reliance
group. A distinguishing feature of the corporate culture at Reliance group companies is
reported to be performance-orientation geared to efficiency with no questions asked.
Pursuing project deadlines - and beating them as is expected at the Reliance group -
certainly fosters a high concern for efficiency. But with it may result certain negative
features such as stressful workplace teeming with workaholics, short-term focus on
performance measurement, and overemphasis on efficiency at the cost of effectiveness.

Business ethics and personal values is a ticklish issue when it comes to describing the
Reliance group’s case. It is a matter of opinion whether some of the means adopted by
Reliance group companies to achieve corporate success were fair or foul. When seen in
the context of business ethics, clearly there are a few instances when Reliance group’s
ethical behavior is not above board. Contrasting this with the general lack of ethical
values in what in India is known as the corrupt neta-babu-lala (politician – bureaucrat –

13
businesspeople) nexus the actions of Reliance group can be perceived as driven by
utilitarian-eclectic approach to business ethics. Indeed, Reliance in achieving corporate
success did benefit the national economy in several ways though questions remain as to
how that success was achieved.

Social responsibility and community development are taken up by the Reliance group of
companies in areas such as education, healthcare, environment and community welfare
around its project sites. The group also publishes a corporate sustainability report.
Compared to its peers in the Indian corporate world such as Infosys, Reliance is
perceived to be lagging behind in terms of issues such as corporate governance as well as
corporate social responsibility.

Among the areas of functional implementation there are several that have the unique
brand of Reliance group’s corporate philosophy imprinted on them. Finance is a major
area for functional implementation at the Reliance group. It is characterized by relying on
equity as source of finance, liberal dividend policy, maintaining close relationship with
investors, conservatism in financial policies, intense focus on cost management, prudent
cash, credit, and risk management, and accessing tax advantages.

Marketing plans and policies, as a component of strategy implementation, makes one

recall the finesse with which Reliance Textiles – a group company in the early phase of
the group’s career - was able to create a unique brand name ‘Vimal’ that continues as a
success story in consumer marketing. But most of the group’s products such as
propylene, naptha or gasoline are industrial products requiring a very different approach
to marketing.

Operations implementation at Reliance group is characterized by huge capacities, large-

scale production, vertical integration, tight operations planning and control, and emphasis
on quality control and management.

Personnel or HRM implementation at the Reliance group relies on building a varied skill
set for its employees who serve a wide-ranging diverse portfolio of businesses. New
employees are often poached from domestic and foreign companies attracted by higher
pay and benefits. Earlier, the group was known for attracting managers from the public
sector companies in India (Adhikari, 2006). There are training programs for various
levels of managers and employees designed to enhance skills in the areas critical to the
group’s requirements such as project management, marketing and communication,
manufacturing, and finance and accounting apart from continual professional
development for senior managers. Employee Stock Options Scheme is in place to
motivate employees to share the high returns on group companies’ shares.

Information management at Reliance group tries to focus on its core competence of

project management. The company’s ITPMS (Information Technology Project
Management System), for instance, gives a single-window view of the status of the group
companies’ IT projects that are initiated, in-process, and at completion stage. The system
currently tracks around 1200 running projects, of which 400 are development projects.

14
Various infrastructure rollout projects constitute 250, and the remaining are operations
and maintenance related. (Raval, 2007)

Operational implementation can be viewed in terms of the four P’s of productivity,

processes, people, and pace. (Kazmi, 2008) Productivity at Reliance group starts from
creating capital productivity by implementing their projects at lower costs than
competitors followed by operational productivity on an ongoing basis in their factories
and plants. Processes have seen continual improvements at various Reliance group
companies in terms of technology. Having latest technology even at high cost was one of
the concerns of Dhirubhai Ambani that is shared by his sons. People are given due
consideration at Reliance group of companies especially in the context of dearth of
managers at the senior level and trained and experienced engineers and technologists in
the Indian employment market at present. Reliance employees have been given liberal
raises in their salaries so as to prevent attrition especially in the functions of engineering,
manufacturing, and marketing. Pace has always been of great concern at the Reliance
group. Dhirubhai was known for impatience with delays and his emphasis on swift
implementation of projects has developed into a core competence for the group
companies.

The case of Reliance group demonstrates how a strong founder-leader imparts his sense
of vision and mission to an organization and how, in time, these percolate down to the
nitty-gritty of strategy implementation. In retrospect, it may be said that Dhirubhai might
never had a clear conception of how his ideas would get translated into reality but the
case of Reliance demonstrates the power of a clear vision in driving the implementation
of strategy. Further, the case illustrates the complexity of strategy implementation for
instance when one observes how a vision-led leadership style impacts the choice of high
technology or insistence on high quality demonstrating the interconnectedness of
seemingly disparate issues in the strategic management of an organization. Only a clear
model of strategy implementation can help to bring to the fore such complexity in a
meaningful relationship.

Conclusions and implications for strategic management

The model of strategy implementation proposed here could be considered an addition to the
existing literature on frameworks of strategy implementation. Besides its academic value, it
may add to our understanding of how the complexity of the strategy implementation can be
represented in the form of a model. It takes into account a range of topical issues such as
change management and organizational effectiveness and attempts to cascade them into the
framework in a way that makes sense.

The practical value of the suggested model may lie in the way that neglected factors of
implementation such as project and procedural implementation have been incorporated. To
managers in developing economies, matters related to the procedures for setting up a factory
and seeking a license to run them are ‘strategic’ in contrast to the way that developed
economies work. To managers in the developed economies, procedures involved in setting
up a factory or even closing it down may be routine work. Likewise, project management is

15
of utmost importance in strategy implementation, a fact that has been curiously neglected in
the most of existing frameworks. Lately, there are some signs that this neglect may be
corrected (Morris and Jamieson, 2005). The proposed model of strategy implementation
seeks to add to the efforts to provide project management its due place in strategy
implementation. In doing so, the model undertakes the task of bringing to the foreground the
role of executive management in contrast to that of top management. Many strategic
management and strategy implementation models have an underpinning of an exclusive top
management point of view assuming the executive management to be passive implementers
of strategic directions from above. The reality of implementation might be different where
executive management may be called upon to shoulder the major responsibility for strategic
management far removed from the ivory tower view of top management. The proposed
model of strategy implementation seeks to do away the overriding emphasis of
organizations being led by top managers rather than being pulled by executive managers that
may, in the author’s opinion, reflect organizational realities more realistically in developing
economies such as that of India.

Lastly, the proposed model gives due recognition to the interrelatedness of the different
issues in strategy implementation. For instance, the three issues in activating strategies of
project implementation, procedural implementation, and resource allocation are
considered as interrelated activities as they feed upon each other. Likewise, behavioral
implementation is a compendium of structure, leadership, and other issues such as culture
and ethics. Finally, effectiveness results from the continual interaction of implementation
taking place at the functional and operational levels.

As with models and frameworks, the proposed framework may have limited applicability
as this paper demonstrates its application only to one case of a specific organization in
India. Future work may carry on the task of testing the applicability to a wider spectrum
of organizations in varying contexts. The strong point of the proposed framework is the
holistic manner it attempts to bring together the various elements of the strategy
implementation. This strength can be utilized in capturing the complexity of strategy
implementation as an ongoing process aimed at achieving effectiveness through
management of change through activating strategies.

Notes

1. Many research studies are available that deal with the barriers to strategy
implementation and suggest how to counter those barriers. For instance, Beer, M.,
Eisentat, R.A. and Spector, B. (1990), "Why change programs don't produce
change", Harvard Business Review, November-December, pp.158-66;
Sandelands, E. (1994), "All talk and no action? Perish the thought", Management
Decision, Vol. 32 No. 5, pp. 10-11.
2. See, for instance, Mintzberg, H., Ahlstrand, B. and Lampel, J. (1998) Strategy
Safari Prentice Hall, Hemel, Hempstead; Verweire K. and Van den Berghe L.
(2004) Integrated Performance Management Sage Publications, London; and
Grant R.M. (2005) Contemporary Strategy Analysis Blackwell Publishing,
Malden, MA

16
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About the author

Azhar Kazmi is a visiting professor of management at the King Fahd University of

Petroleum and Minerals at Dhahran, Saudi Arabia. He has worked at universities in India
and Malaysia teaching, researching, and publishing in the area of strategic management
for more than twenty-eight years. His special interest is in the different areas of strategic
management in the non-Western context. Azhar Kazmi can be contacted at:
[email protected] or [email protected]

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---------------------------------------------------------------------------------------------------------------------------------------
Exhibit 1 Okumus’s strategy implementation framework

---------------------------------------------------------------------------------------------------------------------------------------

Source: Adapted simplified version from Okumus, F., (2003) “A framework to implement
strategies in organizations” Management Decision Vol. 41 No.9, p. 876.

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------------------------------------------------------------------------------------------------------------------------------------------------------------------------
-----------------------------------Exhibit 2: The proposed framework of strategy implementation

ACTIVATING MANAGING ACHIEVING

STRATEGIES CHANGE EFFECTIVENESS
-------------------------------------------------------------------------------------------------------------------------

PROJECT
IMPLEMENTATION
STRUCTURAL FUNCTIONAL
IMPLEMENTATION IMPLEMENTATION

STRATEGIC PROCEDURAL LEADERSHIP

EVALUATION
PLAN IMPLEMENTATION IMPLEMENTATION
& CONTROL
BEHAVIOURAL OPERATIONAL
IMPLEMENTATION IMPLEMENTATION
RESOURCE
ALLOCATION

FEEDBACK

--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Kazmi, A., (2008) Strategic Management and Business Policy Tata McGraw-Hill, New Delhi, p. 317.

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