strategic-chp6 (1).ppt.strategic planning

Implementing
Strategies:
Marketing,
Finance/Accounting,
R&D, and MIS Issues
Chapter 6

Stages of Strategic Management
Strategy
formulation
Strategy
implementation
Strategy
evaluation
1-2
Copyright ©2013 Pearson Education

8-3

4
Strategy Implementation
Strategy Implementation:
 Sum total of the activities and choices
required for the execution of a strategic plan.
 Process by which strategies and policies
are put into action through programs,
budgets, and procedures.

5
Strategy Implementation
Implementation Process Questions:
 Who are the people to carry out the
strategic plan?
 What must be done to align operations
with new direction?
 How is work going to be coordinated?

Strategy implementation
Strategy implementation
 requires a firm to establish annual objectives,
create policies, motivate employees, and
allocate resources so that formulated
strategies can be implemented.
 often called the action stage
1-6

Resources and Competencies
 Strategy implementation depends on resources
and competencies possessed by the firm.
These include:
 Money in certain amounts.
 Particular types of equipment.
 Specified numbers of people with …
 Certain skills, capabilities, and competencies
 Control and reporting systems.

Seven Actions of Implementing
Strategy
 Allocate resources.
 Institute policies.
 Pursue best practices and continuous
improvement.
 Information and operating systems.
 Rewards to strategy and goals.
 Shape corporate culture.
 Apply leadership.

Annual Objectives
Annual objectives
 short-term objectives that organizations must
achieve to reach long-term objectives.
 should be measurable, quantitative,
challenging, realistic, consistent, and
prioritized.
 should be established at the corporate,
divisional, and functional levels in a large
organization.
1-9

Annual Objectives
Annual objectives benefits:
1. Represent the basis for allocating resources.
2. Main tool for evaluating managers.
3. Major tool for monitoring progress toward
achieving long-term objectives.
4. Establish organizational, divisional, and
departmental priorities.
7-10

Policies
Policies
 the means by which annual objectives will be
achieved.
 include guidelines, rules, and procedures
established to support efforts to achieve
stated objectives
 tool for strategy implementation.
 clarify what can and cannot be done in pursuit
of an organization’s objectives.
1-11

Resource Allocation
Resource allocation
 Central management activity that allows for
strategy implementation.
 Strategic management enables resources to be
allocated according to priorities established by
annual objectives.
7-12

Types of Resources
Financial Physical
Human Technological
7-13

Strategy Implementation Actions
 Overall strategy broken down into manageable
parts.
 Goals and deadlines set for accomplishment.
 Appropriate resources allocated.
 Right numbers and types of people assigned.
 Policies and procedures to guide their actions.
 One person assigned overall responsibility for each
part.
 Progress measured and tracked.
 Changes and adjustments when appropriate.

Current Marketing Issues
1. How to make advertisements more interactive
to be more effective.
2. How to best take advantage of Facebook and
Twitter conservations about the company and
industry.
3. How To use exclusive dealerships or multiple
channels of distribution.
4. How TV advertising versus online advertising.
8-15

Current Marketing Issues
 How Firms should provide incentives to
consumers to share their thoughts, opinions,
and experiences on the company website.
 How The company website must not be all
about the company—it must be all about the
customer too.
8-16

Market Segmentation
Market Segmentation
 Subdividing of a market into different
divisions of customers according to needs
and buying habits
 widely used in implementing strategies.
 Market segmentation decisions directly affect
marketing mix factors: product, place,
promotion, and price.
8-17

Market Segmentation
 Market segmentation permits a firm to operate
with limited resources because mass
production, mass distribution, and mass
advertising are not required.
8-18

Acquiring Capital to
Implement Strategies
Successful strategy implementation often
requires additional capital.
Two basic sources of capital for an
organization are debt and equity.
8-19

Financial Budgets
Financial budget :
 a document that details how funds will be
obtained and spent for a specified period of
time.
 include, operating budgets, sales budgets,
profit budgets, capital budgets, expense
budgets, divisional budgets.
8-20

R&D Approaches for
Implementing Strategies
 Be the first firm to market new technological
products.
 Be an innovative successful products, thus
minimizing the risks and costs of start-up.
 Be a low-cost producer by mass-producing
products similar to but less expensive than
products recently introduced.
8-21

Management Information
Systems (MIS) Issues
 Having an effective management
information system (MIS) may be the most
important factor in differentiating successful
from unsuccessful firms.
 The process of strategic management is
facilitated hugely in firms that have an
effective information system.
8-22

Examples of Organizational Systems
Accounting and budgeting system
Management information system
Manufacturing control system
Compensation and reward system
Planning system

Potential Implementation Problems
 Original plan poorly considered.
 Take more time than planned.
 Poor coordination of activities.
 Assigned employees lacked necessary skills.
 Insufficient allocation of resources.
 Uncontrollable external environmental factors.
 Poorly defined key tasks and activities.

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