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Strategic management practices @ bec doms
 

Strategic management practices @ bec doms

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  • This session will be a review of key points of the first two semesters subject matter, as a lead into this semesters strategy themes.
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Strategic management practices @ bec doms Strategic management practices @ bec doms Presentation Transcript

  • Strategic Management in Practice
  • Strategy Development
    • The Three Strategy Lenses
    • Strategy as Design
    • Strategy as Experience
    • Strategy as Ideas
  • Exhibit 2.2 Patterns of strategy development Continuity Incremental Flux Transformational
  • Exhibit 2.3 Strategic evolution and consolidation . Product launch Acquisition Divestment Overseas expansion Strategies evolve and inform strategic decisions, which in turn consolidate strategic direction Evolving strategic direction Strategic decisions e.g.
  • Exhibit 2.4 Strategy development routes Unrealised strategy Intended strategy 3 5 Planned implementation 1 2 5 Realised strategy Strategy as outcome (of cultural and political processes) Imposed strategy 4
  • Exhibit 2.7 The role of the paradigm in strategy formulation Opportunities and threats Strengths and weaknesses Performance Environmental forces Organisational capabilities THE PARADIGM Strategy
  • Strategy development dimensions
    • Planning
    • Incremental
    • Cultural
    • Enforced choice
  • The 6 key planning questions
    • Where are we now?
    • How did we get there?
    • Where are we heading?
    • Where would we like to be?
    • How do we get there?
    • Are we on course?
  • STRATEGY DEVELOPMENT DIMENSIONS (1)
    • The Planning Dimension
    • strategies are the outcome of rational, sequential, planned and methodical procedures
    • definite and precise strategic objectives are set
    • the organisation and environment are analysed
    • potential strategic options are generated and the optimum solution chosen
    • defined procedures for implementation and the achievement of the strategic objectives are developed
    • the strategy is made explicit in the form of detailed plans
  • STRATEGY DEVELOPMENT DIMENSIONS (2)
    • The Incremental Dimension
    • evolutionary but purposeful strategy development
    • strategy is developed as issues arise
    • strategy is continually adjusted to match changes in the operating environment
    • early commitment to a strategy is tentative and subject to review
    • strategic options are continually assessed for fit
    • successful options gain additional resources
    • strategic options are developed from existing strategies by experimentation and through gradual implementation
  • STRATEGY DEVELOPMENT DIMENSIONS (3)
    • The Cultural Dimension
    • a “way of doing things” in the organisation guides strategic direction
    • strategies evolve in terms of a core set of shared assumptions based on past experience, values and beliefs held by the organisation’s members
    • - the selection of goals and objectives
      • the identification of strategic issues
      • the selection of information
      • the selection of strategies
  • STRATEGY DEVELOPMENT DIMENSIONS (4)
    • The Enforced Choice Dimension
    • strategic choice is prescribed or limited by external forces which the organisation is unable to control or influence.
    • organisations respond to environmental imperatives.
    • strategic change is instigated from outside the organisation.
    • barriers in the environment severely restrict strategic mobility.
  • Exhibit 2.6 Cultural frames of reference Functional/ divisional Organisational Professional (or institutional) National (or regional) Industrial/ sector (recipe) The individual
  • Implications for strategy development
    • Intended & realised strategy
    • Strategic drift
    • Strategic management in uncertainty & complexity
  • Exhibit 2.5 Incremental change Environmental change Incremental strategic change Time Amount of change
  • THE PARADIGM
    • ... The beliefs and assumption held in common
    • and taken for granted in an organisation.
    • Edgar Schien ****
    • W. Williams ****
  • Exhibit 2.8 Phases of strategic decision making Issue awareness Selection of solutions Solution development Issue formulation
  • Exhibit 2.10 The cultural web Control systems Stories Symbols Rituals and routines The Paradigm Power structures Organisational structures
  • Exhibit 2.11 The dynamics of paradigm change Source: Adapted from P. Grinyer and J-C. Spender, Turnaround: Managerial recipes for strategic success , Associated Business Press, 1979, p. 203 The paradigm Development of strategy Implementation Corporate performance Step 1 Tighter control Step 2 Reconstruct or develop new strategy if unsatisfactory Step 3 Abandon paradigm and adopt a new one
  • Exhibit 2.13 Different approaches to strategic management Strategic Strategic intent Planning Incremental Encouraging ‘intrapreneurship’ Simple ‘Product’ Complex Product Unpredictable environment Predictable environment
  • Exhibit 2.12 The risk of strategic drift Time Amount of change Phase 1 Phase 2 Phase 3/4 Incremental change Flux Transformational change or demise Strategic change Environmental change 1 5 2 3 4
  • The Learning Organisation
    • Organisations where people are continually learning how to learn together
    • People who function together in an extraordinary way - trust one another -complement each others strengths – compensate for each others limitations – common goals larger than individual goals – produce extraordinary results
    • The Fifth Discipline., the Art & Practice of the Learning Organisation, by Peter Senge
  • The Learning Organisation
    • The Systems Approach
    • Systems Thinking
    • Team Learning
    • Personal Mastery
    • Mental Models
    • Building a Shared Vision
  • THE BENEFITS OF FORMAL PLANNING SYSTEMS
    • A structured means of analysis and thinking about strategic problems.
    • Encouraging questioning and challenging of the taken for granted.
    • The involvement of people in strategy development.
    • Contributing to ownership and co-ordination of strategy.
    • A means of communication of intended strategy.
    • A means of control against agreed objectives .
  • DANGERS AND PROBLEMS OF FORMAL PLANNING SYSTEMS
    • The neglect of cultural and political dimensions of organisations.
    • Delegating responsibility to specialists
    • Failure to achieve ownership of plans
    • Individuals understanding parts rather than the whole of plans
    • Detail rather than vision
    • Information overload
    • Strategy as ‘the plan’
    • The search for the mythical ‘right strategy’.
  • STRATEGIC MANAGEMENT PROCESSES
    • Different organisations develop strategies according to their culture to suit their environment
    • We need to understand how strategies are developed and managed in our organisations and relate it to the learning on this subject.
  • Summary - Understanding Strategic Development
    • Three lenses for making sense of strategy, Design, experience & ideas
    • Most often the process of strategy development is described as a result of analysis evaluation & planning systems carried out by top management objectively & dispassionately
    • The experience lens shows how the organisational culture tends to lead to being adapted from strategies of the past
    • The ideas lens is useful to develop really innovative strategies that can cope with rapidly changing & unpredictable environments & emerge where the emphasis is on diversity & variety
    • These lenses can be helpful in providing insight into strategy development , considering the argument for/against strategic planning, how strategic leaders influence strategy in their organisations, the way political activity plays a part, how organisations may proactively try to cope with dynamic & uncertain environments through the emergent process of logical incrementalism, or more open learning systems in which diversity o f views is encouraged, or how strategies might be imposed on organisations by external agencies
    • It is likely that a mixture of these strategy development processes is employed, known as the configuration of process
    • Important to differentiate between realised strategy, that evolves incrementally, over time, interrupted by periods of punctuated equilibrium during which transformational change occurs & the intended strategy an organisation ought to follow
    • Historical data my be useful in stable environment s, but less useful in dynamic environments & complex environments in which more attention needs to be given to responding throughout the organisation to change,.