MNG3702 Study PACK

Topic 1: Strategy Implementation 1. Explain what Strategy implementation entails (5)  Strategy implementation can be defined as the process that turns selected strategy into action to ensure that the stated goals (aligned with the vision and mission) are accomplished.  Strategy implementation deals with translating the strategic plan into action.  It is the phase in which management aligns or matches strategic leadership, organisational culture, organisational structure, reward systems, policies and resource allocation with the chosen strategy or strategies.  It is an essential component of the strategic management process, as it deals with the strategic change required within an organisation to make the new strategy work and to achieve the desired results.  It is the most difficult part of the strategic management process. 2. Differentiate between strategic planning and strategic implementation (8) Strategic Planning Strategy implementation 1 Is the intellectual or thinking phase The thinking phase in which these thoughts are operationalized and turned into action. 2 Is mostly a market driven activity with an external focus Is an internal, operational driven activity. 3 Requires good intuitive and analytical skills Requires strong motivation and leadership skills. 4 Well structured, rational and controlled Not so well structured, rational and controlled. 5 Takes place at top management and senior management The responsibility of all levels of management and the entire work force is involved. 6 Focus on effectiveness Focus on efficiency 7 Positioning forces before the action Managing forces during the action lOMoARcPSD| MNG3702 Study PACK 8 Requires co-ordination among a few individuals Requires co-ordination among many individuals 3. Comment on the importance of strategy implementation as a component of the strategic management process (5)  Strategy implementation is an essential part (the most important part) of strategic management process.  Is the process that turns strategic plans into a series of actions tasks and ensures that these tasks are executed in such a way that the objectives of the strategic plan are achieved?  It entails the communication, interpretation, adoption and enactment of strategic plans.  It is the phase in which management aligns strategic leadership, organisational culture, organisational structures, reward systems, policies and resource allocation with the chosen strategy.  It involves taking management form thinking to actually doing.  It is also an important source of competitive advantage. 4. Discuss the problems organisations experience when attempting to implement their chosen strategy (8) / Discuss 5 reasons why strategy implementation fails (5)  There is no alignment between the organisational structure and the strategy.  The information and communication systems are inadequate to report on the progress with strategy implementation.  The coordination of implementation efforts was not sufficiently effective.  The leadership and direction provided by top and middle managers was inadequate.  Goals were not sufficiently defined and not well understood by employees.  The formulators of the strategy were not involved in implementation or left before the implementation was complete.  Key changes in the responsibilities of employees were not clearly defined. 5. Discuss the barriers to successful strategic implementation (5)  Vision Barrier  Failure to communicate the vision and strategy may confuse the work force.  If lower levels of management and the work force do not know or understand the organisations vision and strategy, they won’t understand their role in the implementation process. lOMoARcPSD|  Management Barrier  Too often executives are focused on solving short term problems and not enough time is spent on strategic management.  Some executives that were promoted from the functional areas and tent to remain involved in functional issues.  Resource Barrier  Resource allocation plans or budgets are not linked to the chosen strategies.  Resources are not allocated in support of the strategy.  People Barrier  About 75% of managers do not have rewards and incentives inked to strategies.  Key responsibilities of employees are not clearly defined. 6. Strategy implementation and corporate governance (4)  It is the responsibility of the board of directors of an organisation to define the purpose of the organisation and to identify the stakeholders relevant to the business of the organisation.  The board has to formulate a strategy based on these factors.  The King Report states that it is the board’s responsibility to ensure that management mot only implements the formulated strategy, but also monitors that implementation.  Strategy implementation should take issues such as social responsibility, environmental responsibility, stakeholder engagement and sustainability into consideration at all times. 7. Explain the different types of strategic change and the issues involved (10) Different Types  Adaption. The current organisational setting can facilitate the incremental change that must happen in order to achieve the desired goals. It is only necessary to adapt to this new situation.  Reconstruction. The current organisational setting can handle a change that involves a sudden alteration in the market conditions. It may be that only the reconstruction of processes and policies is required to implement the new strategy.  Evolution. This strategy involves fundamental changes in the way the organisation has to deal with the situation, but it can happen over time.  Revolution. The strategy involves fundamental changes as a result of sudden and fast-changing conditions. Issues of Change  Time. How quickly is change needed; does the organisation have time to change?