Chapter 9

Strategy Implementation: Staffing and Directing

Strategy Implementation

Staffing:
Hiring new people with new skills, firing people with inappropriate skills, and/or training existing employees to learn new skills.

Strategy Implementation
Staffing follows strategy:
Training and development
Firms with training programs 19% higher productivity Reduction in scrap Overall cost savings

Matching the manager to the strategy

Executive type - executives with a particular mix of skills and experiences
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Strategy Implementation
Executive Types:
Dynamic industry expert Analytical portfolio manager Cautious profit planner Turnaround specialist Professional liquidator
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Matching Chief Executive Types with Strategy

Business Strength/Competitive Position Strong Average Weak
Retrenchment Save Company Turnaround Specialist

GrowthConcentration Dynamic Industry Expert

Industry Attractiveness

Stability
Cautious Profit Planner

GrowthDiversification Analytical Portfolio Manager

Retrenchment Close Company Professional Liquidator

Strategy Implementation

Executive Succession:
Process of replacing a key top manager.

Strategy Implementation
Executive Succession:
Boards help CEO develop succession plan Identify succession candidates below top layer Measuring internal candidates against external candidates Appropriate financial incentives
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Strategy Implementation
Identifying Abilities & Potential:
Establish a sound performance appraisal system Assessment centers
Used to evaluate a persons suitability for an advanced position.

Job rotation
Used to ensure that employees are gaining the appropriate mix of experiences to prepare them for future responsibilities.
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Strategy Implementation

Problems in Retrenchment:
Downsizing (rightsizing)
Planned elimination of positions or jobs Used in retrenchment strategies

Strategy Implementation
Guidelines for Downsizing:
Eliminate unnecessary work vs. making across-the-board cuts Contract out work for efficiencies Plan for long-run efficiencies Communicate reasons for action Invest in the remaining employees Develop valued-added jobs to balance out job elimination
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Strategy Implementation
International issues in staffing:
Considerable planning Can be very costly Cultural differences must be considered Experience through international assignments
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Strategy Implementation
International issues in staffing:
Effective management of foreign assignments:
Focus on transferring knowledge and developing global leadership Foreign assignments to people with technical skills matched or exceeded by cross-cultural abilities Deliberate repatriation at end of assignment with career guidance and jobs
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Strategy Implementation
Strategy-Culture Compatibility:
Consider the following:
Is the planned strategy compatible with the firms current culture? Can the culture be easily modified to make it more compatible with new strategy? Is management willing to make major organizational changes? Is management committed to implementing the strategy?
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Assessing StrategyCulture Compatibility

Is the planned strategy compatible with the current culture? No Yes

Tie changes into the culture. Yes

Can the culture be modified to make it more compatible with the new strategy?

Is management willing and able to make major organizational changes and accept probable delays No Yes

No

Manage around the culture by establishing a new structural unit to implement the new strategy.

Is management still committed to implementing the strategy? No

Yes
Find a joint-venture partner or contract with another company to carry out the strategy.

Formulate a different strategy

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Strategy Implementation

Managing different cultures:

Integration Assimilation Separation Deculturation

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Managing the Culture of an Acquired Firm

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Strategy Implementation

Action Planning:
Action Plan
States what actions are going to be taken, by whom, during what time frame, and with what expected results.

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Action Plan Elements

List specific actions. List dates to begin and end each action. Name person responsible for each action. Name person responsible for monitoring timelines and effectiveness of each action. Estimate expected financial and physical consequences of each action. Develop contingency plans.
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