Business Challenges
Impact of Globalization
Managing Across Borders
Revolution of Information
Technology
Security Issues.
...
MANAGEMENT CHALLENGES IN THE NEW
MILLENNIA (21ST CENTURY)
 Impact of Globalization - leads to strategic challenges of mix...
The Knowledge-Worker
“These new industries differ from the
traditional 'modern' industry in that
they will employ predomin...
The Key to Organisation Survival &
Prospering in the 21st Century
 Corporate Strategy - Organizations must have a structu...
Changes in Workplace Environment
• Change from fixed contracts to more
negotiated relationships
• Large rise in part-time ...
ORGANISATION CHALLENGES IN MANAGING BUSINESS IN
THE NEW MILLENNIA (21ST CENTURY)
 Enterprise Mobility: is commonly define...
ORGANISATION CHALLENGES IN MANAGING BUSINESS
IN THE NEW MILLENNIA (21ST CENTURY)
 Maintain and contribute to a sustainabl...
Consumers’ Trend in the 21st Century
More affluent
More
educated
Quality of
life
More
feminised
Older
More
fragmented
hous...
STRESSFUL ENVIRONMENT
 Working on parallel projects, tight schedules and deadlines, high workload,
demanding customers an...
INDIVIDUAL & LEADERSHIP CHALLENGES
To bear the pressure and
face the challenges,
workers/professionals need
to be flexible...
INDIVIDUAL & LEADERSHIP CHALLENGES
• Generational leadership - managing an older workforce, as well as the digital
generat...
Implication to HR & Challenges in 21st
Century
 HR must understand the cultures around the world and think of itself and
...
SUMMARY
• New and faster technology, redefined values, and shifting
customer demands are changing the way businesses opera...
Business Vision
Definition
Explain Our Direction
Explains what makes us unique
More Broad and Future Oriented.
Clearly Sta...
Business Mission
Definition
Why Do we Exist?
States the purpose and identity of
the organisation.
Defines Institution’s Va...
Business Core Competency
What are Core Competency?
Defining What you need?
Measuring What you have.
Filling Gaps.
Oportuni...
Business Strategy
Develop
Translate
Plan.
Monitor and Learn.
Test and Adapt
Working out a Business Strategy
Closed-Loop Management System1
1
2
3
4
5
1
Develop the Strategy
Define vision, mission and ...
Working out a Business Strategy
Closed-Loop Management System1
1
2
3
4
5
1
Develop
Translate the Strategy
Define strategic ...
Working out a Business Strategy
Closed-Loop Management System1
1
2
3
4
5
1
Develop
Translate
Plan Operations
Improve key p...
Working out a Business Strategy
Closed-Loop Management System1
1
2
3
4
5
1
Develop
Translate
Plan
Monitor and Learn
Hold s...
Working out a Business Strategy
Closed-Loop Management System1
1
2
3
4
5
1
Develop
Translate
Plan
Monitor and Learn
Test a...
Case Study “Project Scorpio”
Abstract
Background Note
Rethink.
Project Scorpio
Marketing Strategy.
Success.
Vision/Mission Statements
 Statements that explain who we are
 Type of organization
 Products/services
 Needs we fill
...
Business Vision Statement
A statement that clearly defines the firm’s “reason” for
being in business
 Should significantl...
Business Vision Statement
 A guiding philosophy
 Consistent with organizational value
 Influenced by the strengths and ...
Components of a Vision Statement
 Core ideology
 Core Values - timeless guiding principles
 Core Purpose - reason for b...
Mission Statements
 The mission statement of an organization is
normally short, to the point, and contains the
following ...
Vision vs. Mission
 The vision is more broad and future oriented – the
goal on the horizon
 The mission is more focused ...
Examples of Vision Statements
Ben & Jerry’s
Product: To make, distribute, and sell the finest quality all
natural ice crea...
Examples of Mission
Statements
Wyffels Hybrids
Wyffels Hybrids is a
regional agricultural
seed company
providing elite cor...
Cornelius Farms
To be a farm business that farms and/or manages land
to best satisfy the landowner. To be one of the very
...
April 11, 2006 LIS580- Spring 2006 34
Roadmap
 The strategic management process
 Mission and vision statements
 Analyzi...
April 11, 2006 LIS580- Spring 2006 35
Checklist 5.1
The Strategic Management Process
 Define the business and its mission...
April 11, 2006 LIS580- Spring 2006 36
A Comprehensive Strategic-Management
Model
FIGURE 5–1Source: Adapted from Fred David...
April 11, 2006 LIS580- Spring 2006 37
Vision and Mission
 A vision statement tells people
 Where we want to go
 What we...
April 11, 2006 LIS580- Spring 2006 38
Examples of Mission Statements
FIGURE 5–2
APEX ELEVATOR
To provide a high-reliabilit...
April 11, 2006 LIS580- Spring 2006 39
FIGURE 5–3
Strategies in Brief
Source: Arit Gadiesh and James Gilbert, “Frontline Ac...
April 11, 2006 LIS580- Spring 2006 40
Checklist 5.2
How to Test the Quality of Your Strategy
 Does your strategy fit with...
April 11, 2006 LIS580- Spring 2006 41
FIGURE 5–4
Relationships Among Strategies in
Multiple-Business Firms
G.Dessler, 2003
April 11, 2006 LIS580- Spring 2006 42
Strategy Types
 Corporate
 Concentration
 Vertical integration
 Diversification
...
April 11, 2006 LIS580- Spring 2006 43
FIGURE 5–5
Forces Driving Industry Competition
Source: Reprinted with the permission...
April 11, 2006 LIS580- Spring 2006 44
FIGURE 5–6
How the Internet Influences Industry
Structure
Source: Adapted from
Micha...
April 11, 2006 LIS580- Spring 2006 45
FIGURE 7–7
Examples of a Company’s Strengths,
Weaknesses, Opportunities, and Threats...
April 11, 2006 LIS580- Spring 2006 46
FIGURE 5–8
Worksheet for Environmental Scanning
G.Dessler, 2003
April 11, 2006 LIS580- Spring 2006 47
Checklist 5.3
How to Benchmark
 Focus on a specific problem and define it
carefully...
April 11, 2006 LIS580- Spring 2006 48
FIGURE 5–9
Cineplex Odeon TOWS Matrix
Source: Fred
David, Strategic
Management
(Uppe...
April 11, 2006 LIS580- Spring 2006 49
FIGURE 5–10
BCG Matrix
G.Dessler, 2003
April 11, 2006 LIS580- Spring 2006 50
Checklist 5.4
Scenario Planning Principles
 Scenarios have value only to the extent...
April 11, 2006 LIS580- Spring 2006 51
Checklist 5.4 (cont’d)
Scenario Planning Principles
 Alternative projections about ...
06 business challenge
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06 business challenge

  1. 1. Business Challenges Impact of Globalization Managing Across Borders Revolution of Information Technology Security Issues. Increasing demand of Knowledge Worker Individual and Leadership Challenges.. Stressful Environment..
  2. 2. MANAGEMENT CHALLENGES IN THE NEW MILLENNIA (21ST CENTURY)  Impact of Globalization - leads to strategic challenges of mixed cultures and languages in the business environment.  Managing Across Borders – the ability of an organisation to survive and succeed in the 21st century transnational workforce and borderless business environment. Challenges in managing enterprise-wide production environments.  Revolution of Information Technology – supported by a new world infrastructure of data communications and telecommunications i.e. use of internet, wireless, e-commerce as part of management tools and easing of technology transfer.  Security Issues with wide usage of internet platform in business transactions.  Increasing demand for knowledge-worker in the knowledge driven organizations.
  3. 3. The Knowledge-Worker “These new industries differ from the traditional 'modern' industry in that they will employ predominantly knowledge workers rather than manual workers.” ~ Peter Drucker in The Age of Discontinuity (1969) Peter Drucker predicted that the major changes in society would be brought about by information. He argues that knowledge has become the central, key resource that knows no geography. According to him, the largest working group will become what he calls knowledge workers. The defining characteristic of these knowledge workers is the level of their formal education. Thus education and development, and to some degree training, will be the central concern of a knowledge society.
  4. 4. The Key to Organisation Survival & Prospering in the 21st Century  Corporate Strategy - Organizations must have a structure that help to unleash the power of their professionals and to capture the opportunities of today's economy.  Ethical Issues – Understanding the new ethical issues emerged from changes in the social and political landscape and from the development of new technologies.  Social Responsibility – The issues of privacy and confidentially, accessibility to technology issues, property right and ownership issues, freedom of speech…etc  Global Challenges – impact of globalisation and cross-border work culture.  Ecological Issues – Oil exploitation and land rights, food security, mining in Africa, climate vulnerability and ecotourism.  Workforce Diversity - Cultural Awareness/Acceptance (i.e. Ethnic Minorities, Multilingualism, Individual Differences)
  5. 5. Changes in Workplace Environment • Change from fixed contracts to more negotiated relationships • Large rise in part-time and temporary workers • Employees demand greater flexibility and work/life balance • Office structures are moving towards ‘club’ environments – Space for meeting, brainstorming, etc. – Leisure facilities, shops, eateries, dry-cleaning, crèche facilities (day care). Source: ONS; Henley Centre, PCC 2001; DTI projections Change in Employment Status, 1971-2005 (UK) -2461 1046 -1415 1381 2792 4173 776 629 1405 -3 -2 -1 0 1 2 3 4 5 Male Female Total Full time Part time Self-employed 000s
  6. 6. ORGANISATION CHALLENGES IN MANAGING BUSINESS IN THE NEW MILLENNIA (21ST CENTURY)  Enterprise Mobility: is commonly defined as the process of extending business applications / solutions through the use of wireless technology, which can be wireless LAN (WLAN), cellular / mobile, or other technologies, such as wireless broadband.
  7. 7. ORGANISATION CHALLENGES IN MANAGING BUSINESS IN THE NEW MILLENNIA (21ST CENTURY)  Maintain and contribute to a sustainable socioeconomic environment: recycle waste and control pollution in the physical environment.  Importance of "human capital“: to create an organisations which support the workers in their cooperative endeavors.  Improve organisation management (leadership): Eliminating internal competition, alignment of measurement and reward systems, training and empowering employees to act on the scene and communicate critical problems without delay and to get rapid organisational response.
  8. 8. Consumers’ Trend in the 21st Century More affluent More educated Quality of life More feminised Older More fragmented households Less happy Fewer children 1 in 4 women born in 1972 will not have children 40% of the population over 50 by 2010 Disposable incomes have doubled since 1971 Only 1 in 3 households contain a ‘nuclear’ family 35% of 24 year olds are graduates 40% of workforce are women Over half of adults are ‘unhappy with their standard of living’ 38% would take a pay cut for less stress Adapted from: www.henleycentre.com
  9. 9. STRESSFUL ENVIRONMENT  Working on parallel projects, tight schedules and deadlines, high workload, demanding customers and clients, increasing global competition, high degree of flexibility and availability - those are important key factors that characterize and coin the dynamic work environment of the 21st century.  International competition, globalization and modern technology have prompted organizations to consider downsizing, restructuring, and outsourcing as business strategies and hence, making the work environment more competitive than ever before.  Working under these “conditions” will lead to higher pressure that is burden on professionals within an organisation; no matter if the individual is employed or self-employed.
  10. 10. INDIVIDUAL & LEADERSHIP CHALLENGES To bear the pressure and face the challenges, workers/professionals need to be flexible and able to adjust to the changing conditions.
  11. 11. INDIVIDUAL & LEADERSHIP CHALLENGES • Generational leadership - managing an older workforce, as well as the digital generation • Sustainability - protecting today's environment and addressing consumers' needs • Virtual leadership - leading an internet-based environment • The developing world - responding to a changing economy • Diversity - leading a workforce comprising ethnic minorities, mature workers, etc • Globalisation - managing an extended workforce, and social responsibility.
  12. 12. Implication to HR & Challenges in 21st Century  HR must understand the cultures around the world and think of itself and operate as a business globally.  With the unemployment rate standing at 4.1%, "the type of worker being sought in the new millennium are more skilled or higher educated than in the past. The pool of such people is running dry.  Putting together programs that help employees find the right balance between home and work.  Using best practices to create an environment that attracts people and makes them want to stay.  Effective handling of company downsizing and retrenched workers.  Technology, as well as the change in the traditional workweek and how jobs are defined, will combine to give employees more autonomy over when they work.  Dealing with a diverse workforce and will find a way to direct these workers toward a common purpose.  Change of workplace to ‘club’ environment requires HR professionals to have extra skills in determining the design and layout of offices and meeting areas.
  13. 13. SUMMARY • New and faster technology, redefined values, and shifting customer demands are changing the way businesses operate in the twenty-first century. • The delivery of goods, services, and spare parts will be done by e-commerce organizations. • In the majority of developed countries, the population is aging. • Human resources is being transformed from a specialized, stand-alone function to a broad, corporate competency. • HR policies and program initiatives will have to be responsive to market conditions and global business structures. • Importance of Global Leadership in the 21st century
  14. 14. Business Vision Definition Explain Our Direction Explains what makes us unique More Broad and Future Oriented. Clearly States the Reason for being in Business.
  15. 15. Business Mission Definition Why Do we Exist? States the purpose and identity of the organisation. Defines Institution’s Values and philosophy. States what organisation is to achieve. Examples.
  16. 16. Business Core Competency What are Core Competency? Defining What you need? Measuring What you have. Filling Gaps. Oportunities for developing current People Engaging the focus.
  17. 17. Business Strategy Develop Translate Plan. Monitor and Learn. Test and Adapt
  18. 18. Working out a Business Strategy Closed-Loop Management System1 1 2 3 4 5 1 Develop the Strategy Define vision, mission and values (Conduct strategic analysis) Formulate strategy Translate Plan Monitor and Learn Test and Adapt Robert Kaplan & David Norton (2008). “Mastering the Management System”. In: Harvard Business Review. January 2008, Vol. 86 Issue 1 (2008): 62-77 29 / 30 Mission - Vision - Strategy
  19. 19. Working out a Business Strategy Closed-Loop Management System1 1 2 3 4 5 1 Develop Translate the Strategy Define strategic objectives and themes Select measures and targets Select strategic initiatives Plan Monitor and Learn Test and Adapt Robert Kaplan & David Norton (2008). “Mastering the Management System”. In: Harvard Business Review. January 2008, Vol. 86 Issue 1 (2008): 62-77 29 / 30 Mission - Vision - Strategy
  20. 20. Working out a Business Strategy Closed-Loop Management System1 1 2 3 4 5 1 Develop Translate Plan Operations Improve key processes Develop sales plan Plan resource capacity Prepare budgets Monitor and Learn Test and Adapt Robert Kaplan & David Norton (2008). “Mastering the Management System”. In: Harvard Business Review. January 2008, Vol. 86 Issue 1 (2008): 62-77 29 / 30 Mission - Vision - Strategy
  21. 21. Working out a Business Strategy Closed-Loop Management System1 1 2 3 4 5 1 Develop Translate Plan Monitor and Learn Hold strategy reviews Hold operational reviews Test and Adapt Robert Kaplan & David Norton (2008). “Mastering the Management System”. In: Harvard Business Review. January 2008, Vol. 86 Issue 1 (2008): 62-77 29 / 30 Mission - Vision - Strategy
  22. 22. Working out a Business Strategy Closed-Loop Management System1 1 2 3 4 5 1 Develop Translate Plan Monitor and Learn Test and Adapt the Strategy Conduct profitability analysis Conduct strategy correlation analysis Examine emerging strategies Robert Kaplan & David Norton (2008). “Mastering the Management System”. In: Harvard Business Review. January 2008, Vol. 86 Issue 1 (2008): 62-77 29 / 30 Mission - Vision - Strategy
  23. 23. Case Study “Project Scorpio” Abstract Background Note Rethink. Project Scorpio Marketing Strategy. Success.
  24. 24. Vision/Mission Statements  Statements that explain who we are  Type of organization  Products/services  Needs we fill  Statements that explain our direction, our purpose, our reason for being  What difference do we make?  Statements that explain what makes us unique  Values  People  Combination of products and services
  25. 25. Business Vision Statement A statement that clearly defines the firm’s “reason” for being in business  Should significantly stretch the resources and capabilities of the farm  Should inspire people in the organization to achieve things they never thought possible  Should unite people in the organization toward the pursuit of one common goal
  26. 26. Business Vision Statement  A guiding philosophy  Consistent with organizational value  Influenced by the strengths and weaknesses of the business
  27. 27. Components of a Vision Statement  Core ideology  Core Values - timeless guiding principles  Core Purpose - reason for being  Envisioned future  Big Hairy Audacious Goals (BHAG) - clearly articulated goals  Vivid description - a graphic description of what success and the future will be like  Recognition of service to stakeholders  Owners/creditors  Employees  Customers
  28. 28. Mission Statements  The mission statement of an organization is normally short, to the point, and contains the following elements:  Provides a concise statement of why the organization exists, and what it is to achieve;  States the purpose and identity of the organization;  Defines the institution's values and philosophy; and  Describes how the organization will serve those affected by its work.
  29. 29. Vision vs. Mission  The vision is more broad and future oriented – the goal on the horizon  The mission is more focused – how you will get to the horizon
  30. 30. Examples of Vision Statements Ben & Jerry’s Product: To make, distribute, and sell the finest quality all natural ice cream and related products in a wide variety of innovative flavors made from Vermont dairy products. Economic: To operate the Company on a sound financial basis of profitable growth, increasing value for our shareholders and creating career opportunities and financial rewards for our employees. Social: To operate the Company in a way that actively recognizes the central role that business plays in the structure of society by initiating innovative ways to improve the quality of life of a broad community: local, national, and international.
  31. 31. Examples of Mission Statements Wyffels Hybrids Wyffels Hybrids is a regional agricultural seed company providing elite corn hybrids, high oil corn seed blends, and premium alfalfas to farmers of the U.S. midwest.
  32. 32. Cornelius Farms To be a farm business that farms and/or manages land to best satisfy the landowner. To be one of the very best farmers and farm managers in our region. To rent farm land by striving to obtain maximum income per acre, thus creating maximum profits for the landlord and tenant, through the use of distinguished management of the land. We also have the motto that “appearance is everything,” that goes for our equipment to your land. We make every effort to ensure that the landowner’s land is virtually weed free and well kept. Examples of Vision Statements
  33. 33. April 11, 2006 LIS580- Spring 2006 34 Roadmap  The strategic management process  Mission and vision statements  Analyzing strategic drivers and core competencies  SWOT analysis  Scenario planning
  34. 34. April 11, 2006 LIS580- Spring 2006 35 Checklist 5.1 The Strategic Management Process  Define the business and its mission.  Perform external and internal audits.  Translate the mission into strategic goals.  Generate and select strategies to reach strategic goals.  Implement the strategy.  Evaluate performance. G.Dessler, 2003
  35. 35. April 11, 2006 LIS580- Spring 2006 36 A Comprehensive Strategic-Management Model FIGURE 5–1Source: Adapted from Fred David, Strategic Management (Upper Saddle River, NJ: Prentice-Hall, 2001), p. 77. G.Dessler, 2003
  36. 36. April 11, 2006 LIS580- Spring 2006 37 Vision and Mission  A vision statement tells people  Where we want to go  What we want to become  What we want to accomplish  Why it is important  And a mission expresses the organization’s:  Purpose - the needs we exist to address  Business - what are we doing to address these  Values - what principles or beliefs guide our work
  37. 37. April 11, 2006 LIS580- Spring 2006 38 Examples of Mission Statements FIGURE 5–2 APEX ELEVATOR To provide a high-reliability, error-free method for moving people and products up, down, and sideways within a building. UNITED TELEPHONE CORPORATION OF DADE To provide information services in local-exchange and exchange-access markets within its franchised area, as well as cellular phone and paging services. JOSEPHSON DRUG COMPANY, INC. To provide people with longer lives and higher-quality lives by applying research efforts to develop new or improved drugs and health-care products. GRAY COMPUTER, INC. To transform how educators work by providing innovative and easy-to-use multimedia-based computer systems. G.Dessler, 2003
  38. 38. April 11, 2006 LIS580- Spring 2006 39 FIGURE 5–3 Strategies in Brief Source: Arit Gadiesh and James Gilbert, “Frontline Action,” Harvard Business Review, May 2001, p. 74. COMPANY STRATEGIC PRINCIPLE America Online Consumer connectivity first—anytime, anywhere Dell Be direct eBay Focus on trading communities General Electric Be number one or number two in every industry in which we compete, or get out Southwest Airlines Meet customers’ short-haul travel needs at fares competitive with the cost of automobile travel Vanguard Unmatchable value for the investor-owner Wal-Mart Low prices, every day G.Dessler, 2003
  39. 39. April 11, 2006 LIS580- Spring 2006 40 Checklist 5.2 How to Test the Quality of Your Strategy  Does your strategy fit with what’s going on in the environment?  Does your strategy exploit your key resources?  Will competitors have difficulty keeping up with you?  Are the elements of your strategy internally consistent?  Do you have enough resources to pursue this strategy?  Can your strategy be implemented? G.Dessler, 2003
  40. 40. April 11, 2006 LIS580- Spring 2006 41 FIGURE 5–4 Relationships Among Strategies in Multiple-Business Firms G.Dessler, 2003
  41. 41. April 11, 2006 LIS580- Spring 2006 42 Strategy Types  Corporate  Concentration  Vertical integration  Diversification  Status quo  Investment reduction  Strategic alliances/joint ventures  Competitive  Cost leadership  Differentiation  Focus
  42. 42. April 11, 2006 LIS580- Spring 2006 43 FIGURE 5–5 Forces Driving Industry Competition Source: Reprinted with the permission of The Free Press, a division of Simon & Schuster from Competitive Strategy: Techniques for Analyzing Industries and Competitors by Michael E. Porter. Copyright © 1980 by The Free Press. G.Dessler, 2003
  43. 43. April 11, 2006 LIS580- Spring 2006 44 FIGURE 5–6 How the Internet Influences Industry Structure Source: Adapted from Michael Porter, “Strategy and the Internet,” Harvard Business Review, March 2001, p. 67. G.Dessler, 2003
  44. 44. April 11, 2006 LIS580- Spring 2006 45 FIGURE 7–7 Examples of a Company’s Strengths, Weaknesses, Opportunities, and Threats G.Dessler, 2003
  45. 45. April 11, 2006 LIS580- Spring 2006 46 FIGURE 5–8 Worksheet for Environmental Scanning G.Dessler, 2003
  46. 46. April 11, 2006 LIS580- Spring 2006 47 Checklist 5.3 How to Benchmark  Focus on a specific problem and define it carefully  Use employees who will actually implement changes to identify the best-practices companies and to conduct on-site studies.  Be willing to share information with others.  Avoid sensitive issues such as pricing, and don’t look for new product information.  Keep information you receive confidential. G.Dessler, 2003
  47. 47. April 11, 2006 LIS580- Spring 2006 48 FIGURE 5–9 Cineplex Odeon TOWS Matrix Source: Fred David, Strategic Management (Upper Saddle River, NJ: Prentice-Hall, 2001), p. 207. G.Dessler, 2003
  48. 48. April 11, 2006 LIS580- Spring 2006 49 FIGURE 5–10 BCG Matrix G.Dessler, 2003
  49. 49. April 11, 2006 LIS580- Spring 2006 50 Checklist 5.4 Scenario Planning Principles  Scenarios have value only to the extent that they inform decision makers and influence decision making.  Scenarios add value to decision making only when managers and others use them to systematically shape questions about the present and the future, and to guide how to go about answering them.  In each step of developing scenarios, the emphasis must be on identifying, challenging, and refining the substance of managers’ mindsets and knowledge. G.Dessler, 2003
  50. 50. April 11, 2006 LIS580- Spring 2006 51 Checklist 5.4 (cont’d) Scenario Planning Principles  Alternative projections about a given future must challenge managers’ current mental models by creating tension among ideas, hypotheses, perspectives, and assumptions.  The dialogue and discussion spawned by the consideration of alternative futures should directly affect managers’ knowledge.  Scenarios should include enough indicators so that managers can track how the future is actually evolving so that the learning and adaptations stimulated by the scenarios are continuous. G.Dessler, 2003

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