2. ABAHO ERNEST STR.MGT BSC ACC 2
Strategy implementation is the sum
total of activities and choices
required to implement a strategic
plan. This requires the development
of programs, budgets and procedures
3. ABAHO ERNEST STR.MGT BSC ACC 3
Basic issues to be addressed in
implementing strategy
Who are the staff who will undertake the
tasks?
What must be done to ensure congruence
between current operations and the new
strategic direction?
How is every one going to do what is
required?
4. ABAHO ERNEST STR.MGT BSC ACC 4
Common problems encountered in
strategy implementation
Time taken is more than that originally planned
Un foreseen problems set in
Ineffective coordination of activities
Other company activities overshadowed implementation of
strategy
Respective staff lacked required skills
Lack of training to create required skills
Unforeseen external factors
Inadequate leadership from top management
Poorly defined activities to be implemented
Insufficient back up by ICT
5. ABAHO ERNEST STR.MGT BSC ACC 5
The strategy implementer’s task is to
convert the plan into action and
undertake what is called for by the
plan. Managing strategy
implementation is therefore more art
than science.
6. ABAHO ERNEST STR.MGT BSC ACC 6
The eight managerial components of
implementing strategy
1. Building a capable organization
2. Developing budgets and allocating ample resources to the
strategic effort
3. Establishing strategy friendly and enabling policies
4. Instituting best practices and continuous improvement
5. Providing support systems that enable staff to perform
6. Linking rewards/ incentives with achievement of strategic
targets
7. Creating corporate culture which ensures/ enhances strategy
achievement
8. Exercising strategic leadership to drive implementation
7. ABAHO ERNEST STR.MGT BSC ACC 7
Building a capable organization
Selecting people for key positions – creating a strong
management team
Building core competences and capabilities which are
un matched: competitive advantage.
Employee training and retraining
Match orgn structure to strategy: identify and build
structure around critical activities then consider
outsourcing non core activities.
Resolving which decisions to centralize and which to
decentralize
8. ABAHO ERNEST STR.MGT BSC ACC 8
Strategic advantages and disadvantages of various
organization structures
Functional specialization
Geographic organization
Decentralized biz divisions
Strategic biz units
Matrix structures
( students to fill in )
9. ABAHO ERNEST STR.MGT BSC ACC 9
Strategy and stage of corporate
development
Stage one
1. Major problem- survival and growth, dealing with
short term operational probs
2. Objectives- personal, subjective
3. Strategy- implicit, entrepreneur owner
4. Structure- one man show
5. Control – personal criteria, daily observation
6. Reward punishment- informal, incentives limited
and used for control/ creating allegiances.
10. ABAHO ERNEST STR.MGT BSC ACC 10
Strategy and stage of corporate
development ctnd
Stage two
1. Major problems- growth, expansion of resources
2. Objectives – SMART meeting functional
performance targets
3. Strategy – limited to exploitation of one product
4. Organization- one unit functionally specialized
5. Control – many persons and systems involved
6. Reward punishment – based on agreed policies
11. ABAHO ERNEST STR.MGT BSC ACC 11
Strategy and stage of corporate
development ctnd
Stage three
1. Major problems- agency/ trusteeship and control of
diversified resources.
2. Objectives – SMART but expanded scope to
include society and environment
3. Strategy – growth and product diversification
4. Organization- decentralized operations
5. Control – complex formal systems with divisional
managers.
6. Reward punishment – based on agreed policies
12. ABAHO ERNEST STR.MGT BSC ACC 12
Functional organization structure
Advantages:
• Centralizes control
• Good for single biz unit
• Develops functional skills
Disadvantages:
• Interfunctional rivalry
• Tall structure enters bureaucracy/ delay
• Functional myopia/ conflicts
• Limits development of staff with cross
functional skills.
13. ABAHO ERNEST STR.MGT BSC ACC 13
GEOGRAPHIC ORGN STRUCTURE
Advantages:
1. Strategy made specific to region
2. Reaps advantages of local operations/ scales
3. Improves functional coordination
Disadvantages:
• Difficult to attain uniformity across regions
• Duplication of staff to run geographic units
• Adds another layer of staff to run the geo. areas
14. ABAHO ERNEST STR.MGT BSC ACC 14
Strategic business unit orgn structure
Advantages:
• Enables decentralization/ delegation of authority
• Responsibility for each biz unit lies with it
• Profit responsibility rests on SBUs
Disadvantages:
• HQ managers may lose touch with sbu operations
• Excessive rivalry among SBUs
• HQ managemnt becomes heavily dependent on
SBUs
15. ABAHO ERNEST STR.MGT BSC ACC 15
A MATRIX ORGN
STRUCTURE HAS TWO OR
MORE CHAINS OF
COMMAND, TWO LINES OF
BUDGET AUTHORITY AND
TWO SOURCES OF
PERFORMANCE AND
REWARD
16. ABAHO ERNEST STR.MGT BSC ACC 16
MATRIX STRUCTURE CTND
Advantages
Gives formal attention to each dimension of strategic
priority
Creates chks and balances among competing view
points
Encourages cooperation
Disadvantages
Very complex to manage
Many people involved in decision
Promotes organization bureaucracy
17. ABAHO ERNEST STR.MGT BSC ACC 17
Supplementing the basic orgn structure
1. Special project teams
2. Cross functional task forces
3. Venture teams- manage launch of new
product
4. Self contained work teams- work on semi
permanent basis on continuous
improvement of the company
5. Process teams- functional specialists
6. Contact persons – single point/ one stop
port for all services.
18. ABAHO ERNEST STR.MGT BSC ACC 18
IMPLEMENTING STRATEGY –
BEST PRACTICES
TQM- ENTAILS CREATING A TOTAL
QUALITY CULTURE KEEN ON
CONTINUOUS IMPROVEMENT OF EVERY
ASPECT OF PERFORMANCE. STEP BY
STEP IMPROVEMENTS.
REENGINEERING SEEKS ONE TIME
QUANTUM IMPROVEMENT – BIG /
RADICAL DEPATURES
19. ABAHO ERNEST STR.MGT BSC ACC 19
BUILDING TOTAL QUALITY
MANAGEMENT CULTURE
PASSION FOR TOTAL QUALITY
INCLUDING QUALITY VISION, SPECIFIC
MEASURABLE GOALS
ENCOURAGING TQM SUPPORTIVE
BEHAVIOURS: REWARDING, Q TRAINING
USING QUALITY TEAMS
EMPOWERING EMPLOYEES
ICT SUPPORT
PREACH TQM, EAT TQM
20. ABAHO ERNEST STR.MGT BSC ACC 20
STRATEGY SUPPORTIVE
REWARD SYSTEMS
CREATING EMPLOYEE COMITMENT
AND WINNING ATTITUDES IS
IMPERATIVE.
21. ABAHO ERNEST STR.MGT BSC ACC 21
WHAT IS COMMITMENT?
COMMITMENT DETERMINES THE
RELATIONSHIP BTN EMPLOYER AND
EMPLOYEE
BINDS EMPLOYEE TO THE
ORGANIZATION
RESULTS IN EXTRA ROLE
CONTRIBUTIONS BY EMPLOYEES.
22. ABAHO ERNEST STR.MGT BSC ACC 22
HOW EMPLOYEES VIEW
COMMITMENT
PERFORMANCE ON THE JOB/ OUT PUT
VOLUNTARISM “ GOING AN EXTRA MILE”
INVOLVEMENT
QUALITY OF WORK
NUMBER OF HOURS PUT IN THE JOB.
23. ABAHO ERNEST STR.MGT BSC ACC 23
NATURE OF EMPLOYEE
COMMITMENT
COMMITMENT TO THE BOSS
COMMITMENT TO WORKMATES
COMITMENT TO THE ORGANIZATION
COMMITMENT TO THE JOB
COMMITMENT TO THE ORGANIZATION’S
POLICIES
24. ABAHO ERNEST STR.MGT BSC ACC 24
FACTORS CAUSING LOW
COMMITMENT
LOW PAY
DELAYS IN PAYING STAFF CLAIMS
NATURE OF EMPLOYMENT TERMS (PART-TIME)
LACK OF JOB SECURITY
PREVIOUS EXPERIENCES WITH FORMER EMPLOYERS
FAILURE TO RECOGNIZE AND REWARD EFFORT
LACK OF EMPATHY
LACK OF INCENTIVES
UNFULFILLED PROMISES
LAZINESS / WORK ETHIC
25. ABAHO ERNEST STR.MGT BSC ACC 25
Indicators of commitment
Attendance and punctuality
Daily performance on the job
Ability to meet deadlines
Willingness to market the organization /
ambassadors
Time spent/helping developing skills of other
employees
Willingness to voluntarily assist colleagues
and administration (without pay)
26. ABAHO ERNEST STR.MGT BSC ACC 26
Incentives for commitment
Pay for extra work
Housing and Transport
Advances and loans
Financial bonuses
Recognition for good performance
Medical attention for self and family
Education subsidy for children
Financial assistance extended to staff in problems
27. ABAHO ERNEST STR.MGT BSC ACC 27
BEST PRACTICE IN REWARDS
LINK WORK ASSIGNMENT TO
PERFORMANCE TARGETS
REWARD ACHIEVEMENT OF
PERFORMANCE TARGETS
INCENTIVES SHOUL BE MORE THAN 20%
OF SALARY
FAIRNESS IN REWARDS
INDIVIDUALS SHD BE ABLE TO AFFECT
OUTCOME ( AVOIDS
UNCONTROLLABLES)