Ch12 implementation
Download as PPT, PDF0 likes353 views
This document discusses various strategies and best practices for implementing organizational strategies effectively. It covers linking budgets to strategy, establishing supportive policies, instituting best practices like total quality management, installing supportive information systems, and designing reward systems to motivate employees. The key points are that implementing strategy requires aligning resources, policies, culture, processes, information flows, and incentives to support the chosen strategic direction.
Ch12 implementation
- 1. 1 IMPLEMENTING AND EXECUTINGIMPLEMENTING AND EXECUTING STRATEGY: BUDGETS, POLICIES,STRATEGY: BUDGETS, POLICIES, BEST PRACTICES, SUPPORTBEST PRACTICES, SUPPORT SYSTEMS, AND REWARDSSYSTEMS, AND REWARDS
- 2. 2 Linking Budgets to Strategy Allocating resources in ways that support effective strategy execution involves Funding capital projects that can make a contribution to strategy implementation Funding efforts to strengthen competencies and capabilities or to create new ones Shifting resources—downsizing some areas, upsizing others, killing activities no longer justified, and funding new activities with a critical strategy role
- 3. ESTABLISH STRATEGY-ESTABLISH STRATEGY- SUPPORTIVE POLICIESSUPPORTIVE POLICIES
- 4. 4 How Policies and Procedures Aid Strategy Implementation Provide top-down guidance regarding expected behaviors Help align internal actions with strategy, channeling efforts along the intended path Enforce consistency in performance of activities in geographically scattered units Serve as powerful lever for changing corporate culture to produce stronger fit with a new strategy
- 5. 5 Creating Strategy-Supportive Policies and Procedures Role of new policies Channel behaviors and decisions to promote strategy execution Counteract tendencies of people to resist chosen strategy Too much policy can be as stifling as Wrong policy or as Chaotic as no policy Often, the best policy is empowering employees and letting them operate between the white lines anyway they think best
- 6. INSTITUTE BEST PRACTICESINSTITUTE BEST PRACTICES AND MECHANISMS (FORAND MECHANISMS (FOR CONTINUOUS IMPROVEMENT)CONTINUOUS IMPROVEMENT)
- 7. 7 Instituting Best Practices and Continuous Improvement Searching out and adopting best practices is integral to effective implementation Benchmarking has created new approaches to improve strategy execution Reengineering TQM Continuous improvement programs
- 8. 8 What is TTotal QQuality MManagement? TQM is a philosophy of managing a set of business practices that emphasizes Continuous improvement in all phases of operations, 100 percent accuracy in performing activities, Involvement and empowerment of employees at all levels, Team-based work design, Benchmarking, and Fully satisfying customer expectations
- 9. 9 Components of Popular TQM Approaches 1. Consistency of purpose 2. Adopt the philosophy 3. Don’t rely on mass inspection 4. Don’t award business on price 5. Constant improvement 6. Training 7. Leadership 8. Drive out fear 9. Break down barriers 10. Eliminate slogans and exhortations 11. Eliminate quotas 12. Pride of workmanship 13. Education and retraining 14. Plan of action Deming’s 14 Points
- 10. 10 The Juran Trilogy Quality Planning Quality Control Quality Improvement • Set goals • Identify customers and their needs • Develop products and processes • Evaluate performance • Compare to goals • Establish infrastructure • Identify projects and teams • Provide resources and training • Establish controls Components of Popular TQM Approaches
- 11. 11 1. Management commitment 2. Quality improvement teams 3. Quality measurement 4. Cost of quality evaluation 5. Quality awareness 6. Corrective action 7. Zero-defects committee 8. Supervisor training 9. Zero-defects day 10. Goal-setting 11. Error cause removal 12. Recognition 13. Quality councils 14. Do it over again Crosby’s 14 Quality Steps Components of Popular TQM Approaches
- 12. 12 Baldridge Award Criteria (1000 points) Quality 1. Leadership (90 points) 2. Information & analysis (80 points) 3. Strategic quality planning (60 points) 4. Human resource development (150 points) 5. Management of process quality (140 points) 6. Quality & operation results (180 points) 7. Customer focus & satisfaction (300 points) Components of Popular TQM Approaches
- 13. 13 Implementing a Philosophy of Continuous Improvement Instill enthusiasm to do things right throughout company Strive to achieve little steps forward each day, (what the Japanese call kaizen) Ignite creativity in employees to improve performance of value-chain activities Preach there is no such thing as good enough Reform the corporate culture
- 14. 14 TQM vs. Process Reengineering Objectivity Reengineering Aims at quantum gains of 30 to 50% or more TQM Stresses incremental progress Techniques are not mutually exclusive Reengineering - Used to produce a good basic design yielding dramatic improvements TQM - Used to perfect process, gradually improving efficiency and effectiveness
- 15. 15 Using Best Practice Programs as an Implementation Tool Select indicators of successful strategy execution Benchmark against best practice companies Reengineer business processes Build a TQ culture Requires top management commitment Install TQ-supportive employee practices Empower employees to do the right things Provide employees with quick access to required information Preach that performance can be improved
- 17. 17 Installing Support Systems Essential to promote successful strategy execution Types of support systems On-line data systems Internet and company intranets Electronic mail E-commerce systems Mobilizing information and creating systems to use knowledge effectively can yield Competitive advantage
- 18. 18 Examples: Support Systems Airlines Computerized reservation system Federal Express Computerized parcel-tracking system, leading-edge flight operations systems, and e-business tools
- 19. 19 Examples: Support Systems Otis Elevator Sophisticated maintenance support system Domino’s Pizza Computerized systems at each outlet facilitate ordering, inventory, payroll, cash flow, and work flow functions
- 20. 20 Formal Reporting of Strategy-Critical Information Accurate, timely information is essential to guide action Prompt feedback on implementation activities is needed before actions are fully completed Key strategic performance indicators must be tracked as often as practical Barometers of overall performance Statistical information Reports and meetings Personal contact
- 21. 21 What Areas Should Information Systems Address? Customer data Operations data Employee data Supplier/partner/collaborative ally data Financial performance data
- 22. DESIGN STRATEGY-DESIGN STRATEGY- SUPPORTIVE REWARDSUPPORTIVE REWARD SYSTEMSSYSTEMS
- 23. 23 Gaining Commitment: Components of an Effective Reward System Monetary Incentives Salary raises Performance bonuses Stock options Retirement packages Promotions Perks Non-monetary Incentives Praise Constructive criticism Special recognition More, or less, job security Interesting assignments More, or less, job responsibility
- 24. 24 Approaches: Motivating People to Execute the Strategy Well Inspire employees to do their best Get employees to buy into strategy Structure individual efforts in teams to facilitate a supportive climate Allow employees to participate in decisions about their jobs Make jobs interesting and satisfying Devise strategy-supportive motivational approaches
- 25. 25 Examples: Motivational Practices No Lay-Off Policies Japanese automobile producers, along with several U.S. based companies (Southwest Airlines, FedEx, Lands’ End, and Harley Davidson) have no lay-off policies, using employment security both as a positive motivator and a means of reinforcing good strategy execution.
- 26. 26 Examples: Motivational Practices Stock Options More than 35 of the 58 publicly held companies on the 1999 list of the 100 Best Companies to Work for in America (includes Cisco Systems, Procter & Gamble, Merck, Charles Schwab, General Mills, Amgen, and Tellabs) provide stock options to all employees. Having employee-owners sharing in a company’s success is widely viewed as a positive motivator.
- 27. 27 Balancing Positive vs. Negative Rewards Elements of both are necessary Challenge and competition are necessary for self-satisfaction Prevailing view Positive approaches work better than negative ones in terms of Enthusiasm Effort Creativity Initiative