✓ Strategic implementation can be defined as turning strategy into action for attaining the strategic objectives and goals.
✓ Since, implementing the strategy is more important than
selecting it, hence, it is very important for the strategists to consider various factors while implementing.
✓ The strategy selected has to be well performed for the purpose
of attaining the strategic objectives.
✓ Even a superior strategy tends to fail in the absence of efficient
implementation.
✓ In other words, strategy implementation can be defined as a
procedure which enables putting the chosen strategy into action. Implementing a strategy requires carrying-out various actions.
Definition of Strategy Implementation
According to Steiner: "The implementation of policies strategies is concerned with the design. and management of systems to achieve the best integration of people, structures, processes, and resources, in reaching organisational purpose". According to Mc Carthy: "Strategy implementation may be said to consist of securing resources organizing these resource and directing the use of these resources within and outside the organisation".
Nature of Strategy Implementation
The characters or scope of strategy implementation can be described
as follows:
1) Action-Oriented: Strategy implementation is action-oriented in the sense that it helps in materializing the things. The ability of management to bring about organisational changes is a part of it. Strategy implementation helps in creating and nurturing culture which supports the strategy. It seeks to meet the performance objectives.
2) Require Leadership: A proficient leadership is required for the implementation of a new strategy in order to persuade others in favour of it. It makes an effort to eliminate the probability of suspicion through motivation and encouragement. I
3) Employee Involvement: The entire management group and official staff are included in implementation and execution of strategy. Just like every part of a clock has to perform in order to function smoothly, all the parts of an organisation have to unite and work, in order to ensure proper execution of strategy.
4) Varied Contexts: Different environment required for every implementation situation, each of which is affected by varied business practices and competitive scenarios, working culture environment, incentives and compensations policies, blend of personnel and the history of the organisation, etc.
5) Challenging Management Job:
Implementing strategy can be regarded as a difficult management task because of the following reasons: • Extensive range of challenging managerial activities which have to be executed. • Several ways for dealing with every activity. • Numerous problem causing issues which have to be sorted out. • Calls for efficient management skills by experts. • Need for introducing and managing a number of ideas all together.
Aspects of Strategy Implementation
Those organisations which are successful at implementing the
strategies are able to efficiently manage six major supporting factors or approaches, which are as follows:
1) Resources Plans/Resources Allocation:
Resource allocation can be defined as a procedure which involves assigning organisational resources to different departments, Strategic Business Units (SBUs) and divisions. It is mainly concerned with securing and assuring physical, financial as well human resources as per the strategic tasks for the purpose of attaining organisational goals.
2) Project Implementation: Project implementation (or project execution) can be regarded as the stage, which involves actualization of visions and plans. It is a logical conclusion drawn after evaluation, decision making. Visualizing, scheduling, applying for the capital, and finally deciding about the financial resources for a project. 3) Procedural Implementation: For the purpose of strategy implementation, execution of the strategy is required on the basis of set rules, regulations and procedures as directed by the government.
4) Organisational Structure: The structures of the organisations are built on the basis of their strategies Organisations can be structured in several ways or methods. The simple structure is required for the simple strategies, while flexible structure is required for the growth strategy and matrix structure is essentially built on the basis of complex strategies.
5) Behavioural Implementation: The features of strategic implementation that affects the behaviour of the persons in organisation are deal through behavioural implementation the behaviour and activities of the personnel has to be directed in the desired directions as the human resources are a fundamental part of the organisation. Formulating a strategy successfully. Does not assure its successful implementation, as practical execution is always a difficult task. Discipline, motivation, diligence and support on the part of the managers and personnel are some of the necessary elements required for successful implementation of strategy.
6) Functional Policies and Implementation:
The development of a plan and policy related to various areas or functions undertaken by the organisation deals with functional implementation. Production, finance, marketing and personnel are some key functions of the organisation. The key functions of the firm include production, marketing, finance, personnel. The guidelines to operational managers are given by functional policies, for the purpose of : • Ensuring coordination across functional units. The decision regarding the strategy of the firm has to be essentially followed by modification of functional policies in order to meet the growing demands emerging out of new business. • Execution of the strategies. • Reducing the time taken by the mangers in decision-making. • Handling of the similar situation unfailingly.
Barriers to Strategy Implementation
The following key issues arise from implementation of the strategy
and their relationship with empowering system, which should be kept in mind by the mangers. Six barriers or issues in strategy implementation are as follows:
1) Time Horizon: The organisation that believe in empowerment, is based both on long- term well as short term dimensions For example, the short term dimension can be in form of rewarding incentives like bonus based on efficiency by measuring quantitative performance. Whereas, it is quite apt to relate long term rewards with qualitative performance as well as some appropriate quantitative measures.
2) Risk Considerations: A qualitative measure of performance can be more useful in case it is. Desirable to have risk prone behaviour e.g. rewards in the forms of stock options or the bonuses. The reason for this is that quantitative measures tend to avoid the risk. In order to eliminate the chances of failure, instead of taking the risk to attain the results.
3) Bases of Individual Rewards:
The systems of rewards should be related to the ability, diligence and job satisfaction of the individual. Accelerating the rewards to only one part of the performance may adversely affect the other parts of the performance
4) Bases of Group Rewards:
One of the significant issue involve in the reward systems is the choice between individual and group reward. It would be quite tough to reward individuals for their performances and efforts if the structure of the organisation doesn't permit to segregate individual's performance from that of the other people.
5) Corporate and SBU Perspectives:
In case of the organisations with several divisions, a system of rewards based on both corporate as well as Strategic Business Units interests has to be formulated, giving more freedom and autonomy to the business units.
6) Vision Barrier: A large number of personnel fail to understand the strategy of the organisation. Such a scenario was quite suitable at the beginning of the 20th century, when the employees were mainly parts of the industrial mechanism and the value was drawn by efficient use of the organisational resources.
Guidelines for Overcoming Barriers in Strategy Implementation
Following are the tools which can help to overcome the obstruction coming in the way of strategic implementation:
1) Focus: It is the duty of the leaders to ascertain the point of focus for the organisation by limiting it to two or three major action plans which are agreeable to the objective of the organisation.
2) Clear Communication: It is essential for part of the leaders to clearly define the objective of the organisation to the subordinates and they are also expected to explain them their roles in attaining the desired objectives.
3) Teamwork: The leaders at the senior level have to recognize the possible conflicts that might emerge while attaining the top organisational goals and they have to find-out the ways for resolving them. It might involve dealing with the situation by compensation or negotiation.
4) Regular Check-Ins: Keeping an alarming deadline for a specific project acts as a great motivation for accomplishment of the task. Regularly examining the work done by the employee helps to ascertain the completion of assigned tasks within the stipulated time.
5) Accountability: For ensuring the implementation of major objectives, it is essential to hold the employees responsible for not accomplishing the works assigned to them. The staff should be aware about their responsibilities and the consequences which might emerge in case they are not fulfilling the desired duties. Corporate Culture Corporate culture is defined as the set of values, norms of behaviour, modes of interactions, and ethical principles shared by the employees and owner of an organisation corporate culture determines the character of an organisation. Corporate culture also determines the manner in which the people of an organisation interact with each other and deal with its stakeholders, like the customers and suppliers; and with the government and regulatory agencies. Definition of Corporate Culture According to Ember and Ember: "Corporate culture is the set of learned behaviours, beliefs, attitudes, values, and ideals that are characteristic of a particular society or population". According to Murphy: "Corporate culture means that total body of tradition borne by a society and transmitted from generation to generation. It thus refers to the norms, values and standards by which the people act, and it includes the way distinctive in each society of ordering the world and making it intelligible".
Types of Corporate Culture
According to John Kotter and James Heskett, corporate culture can be categorized in two ways : 1) Adaptive Cultures: Adaptive cultures are those in which an element of adaptability is ingrained. Such organisations can make cultural changes in response to changed situations and needs arising out of changed situations. Following are the features of businesses with adaptive culture: • Employees are encouraged to be enterprising and entrepreneurial. The managers have a very practical outlook, which enables them to change and accept change easily. • Such companies stick to the domain of their expertise; a company can make changes easily when it knows its business in and out. • An organisation with adaptive culture maintains excellent relations with its customers. • In such organisations, the personnel head count is small, and there is decentralization of decision-making authority - both factors conducive to flexibility in implementing changes.
2) Inert Cultures: There is little scope for changes and innovation in such organisations. For years and years, value systems remain the same, and there is little, if any, encouragement to employees to come up with new ideas in relation to corporate culture. If the business environment changes, even the top-level executives are reluctant to come out of their comfort zone. Impact of Corporate Culture Corporate culture has a decisive impact on the performance of an organisation. Following factors influence the impact or importance of corporate culture on businesses: 1) Risk: Every business has risk areas, and corporate culture is instrumental in deciding the risk-taking behaviour of a company. In which areas of operation will a company take risk and in which areas it will not . 2) Employee Retention: Employee retention is dependent on employee loyalty, and loyalty is dependent on the trust a company can gain from its employees. Employees will trust a company if it has the following traits woven in its corporate culture: • Transparency in dealings with the employees • A good past record of fulfilment of promises • Sound ethical dealings with customers • Employee-friendly policies A company that can retain employees can perform much better than a company that cannot. A company is a loser if it cannot retain an experienced and trained employee.
3) Incentive Bonus: Corporate culture of sharing profits in the form of incentive bonus with performing employees is motivational for the employees to perform to the best of their abilities. 4) Focus: When the same values, beliefs, ideas, ethical standards, behavioural patterns - all these constitute corporate culture-are adhered to by every individual in an organisation, there is focus on one goal, one strategy, uniform behaviour, uniform guidelines, and uniform code of conduct, which results in enhanced efficiency and commendable results for the organisation. 5) Reputation: Corporate culture projects a picture of the organisation to the external stakeholders and the general public in accordance with the characteristics the culture possesses. Hence a healthy, noble, efficient corporate culture builds up an admirable reputation of the organisation. 6) Competitive Advantage: Corporate culture can become a tool to obtain competitive advantage in the market. This is so because corporate culture has an impact on result-influencing parameters in an organisation. Corporate Culture and Strategy A culture of an organisation has a huge impact on how the strategy of the organisation should be formulated and implemented. Therefore, it can be said that the corporate culture and the strategy are inter- connected.
1) Ignore the Corporate Culture:
The first alternative is that the strategist can completely ignore the corporate culture while executing the strategy. In case it is not possible to modify the culture to match the strategy. Concept of culture is ignored by the companies as the corporate culture is developed over a long period of time and it is not possible to immediately modify it according to the company's requirements. If the culture is ignored it may result in lack of coordination between the strategy and structure of the organisation.
2) Adapt the Strategy Implementation to Suit the Corporate
Culture: Next option before the strategists is to modify the implementation process in accordance with the corporate culture. This alternative can by adopted making changes in the processes, designs and systems of the organisation while keeping in mind the elements of the corporate culture. While adopting this alternative the organisation has to come up with creative and innovative solutions for each diverse business situation.
3) Change the Strategy to Fit the Corporate Culture:
In the next alternative the strategists can choose a different strategy in order to match, the corporate culture. However, this is not a feasible option as changing the entire strategy is quite time consuming. Hence, the corporate culture should be considered while selecting a particular strategy. 4) Change Corporate Culture to Suit Strategic Requirements: The last and the most popular alternative is to modify the corporate culture according to the strategy requirements. This option is most beneficial due to the ever changing competitive business environment. This alternative is best suited to India's business environment.
Organizational Change ➢ Organizational Change is a process in which a large company or organization changes its working methods or aims, for example in order to develop and deal with new situations or markets: ➢ Sometimes deep organizational change is necessary in order to maintain a competitive edge. Organizational change is the process in which an organization changes its structure, strategies, operational methods, technologies, or organizational culture to affect change within the organization. ➢ Organizational change can be continuous or occur for distinct periods of time. ➢ Organizational change usually happens in response to – or as a result of – external or internal pressures. ➢ Small commercial enterprises need to adapt to survive against larger competitors. They also need to learn to thrive in that environment. ➢ Large rivals need to adapt rapidly when a smaller, innovative competitor comes onto the scene. To avoid falling behind, or to remain a step ahead of its rivals, a business must seek out ways to operate more efficiently. It must also strive to operate more cost-effectively. Internal and External Factors of Change Management An organisation’s ability to compete and respond successfully to changes in the external environment ultimately determines the organisation’s success or failure. Every organisation has its own culture and everything that affects its ability to respond to changes in the external environment is an aspect of that culture. The internal factors determine how the organisation moves forward, both as a self-contained organisational entity and in response to its external environment.
Internal Factors
The internal factors that affect an organisation include the following:
• Mission – a successful organisation has a clear sense of why it exists,
what its ultimate purpose is, and how it intends to fulfil that purpose • Leadership – successful organisations have great leaders who inspire and direct and they do that most persuasively by example • Communication – successful organisations thrive on robust communication practices, where teams and team leaders communicate freely and often to improve results. This two-way communication up and down the hierarchical structure extends from top to bottom. Organisations with rigid leadership structures often have deficiencies in communication • Organisational Structure – most organisations have highly hierarchical structures, with many layers of leadership and management defining the organisation from top to bottom. There is now a growing understanding and appreciation that organisations with flat structures, i.e. few hierarchical layers from top to bottom, perform better than those with hierarchical structures • Learning – learning is one of the most fundamental human activities and accounts directly or indirectly for the success of any organisation. As technological advances lead to faster rates of change, successful organisations need to find a way to respond that encourages innovation and builds into every employee’s experience the opportunity to learn and explore. Some of today’s most successful organisations, such as Google, Apple and Amazon, are essentially learning organisations.
External Factors
External factors that affect an organisation may be political, economic,
social or technological. The same internal factors that affect and lead to an organisation’s success inevitably characterise the organisation’s relationship with the external environment in these broad areas. For example, an organisation with a clear sense of mission can explain itself better to the world and can align itself with the positive elements in each area. Leaders who learn and communicate what they have learned within their organisations can also learn from the organisation’s external environment and communicate successfully with it, resulting in an ongoing exchange of ideas to the benefit of both the organisation and its environment.
