1 Strategy Implementation What must we do to put the strategy in place, execute it proficiently, and produce good results? Creating FITS between strategy and external environment and creating FITS inside the organization Control, coordination, and motivation issues
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Strategy Implementation
What must we do to put the strategy in place, execute it proficiently, and produce good results?
Creating FITS between strategy and external environment and creating FITS inside the organization
Non-monetary IncentivesNon-monetary Incentives Praise Constructive criticism Special recognition More, or less, job security Stimulating assignments More, or less, autonomy Rapid promotion
Gaining Commitment: Componentsof an Effective Reward System
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Rewards are the single most powerful tool to win the commitment of company personnel to effective strategy implementation
Objectives in designing the reward system Generously reward those achieving objectives Deny rewards to those who don’t Tie incentive compensation to relevant
outcomes - both strategic and financial
Linking the Reward Systemto Performance Outcomes
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BUILDING A STRATEGY-BUILDING A STRATEGY-SUPPORTIVE CORPORATE SUPPORTIVE CORPORATE
CULTURE CULTURE
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Defining Characteristics of Corporate Culture
Core values, beliefs, and business principles Ethical standards Operating practices and behaviors defining
“how we do things around here” Approach to people management “Chemistry” and “personality” permeating
work environment Often told stories illustrating
Company’s values Business practices Traditions
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A company’s culture is manifested in . . . Values, business principles, and ethical standards
preached and practiced by management Approaches to people management and problem solving Official policies and procedures Spirit and character permeating work environment Interactions and relationships among managers and
employees Peer pressures that exist to display core values Its revered traditions and often repeated stories Its relationships with external stakeholders
Identifying the Key Featuresof Corporate Culture
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Why is Culture Important?
Matching culture to strategy will improve performance A culture that promotes attitudes and behaviors that are
well-suited to strategy is a valuable ally in the strategy implementation process
Can hinder strategy implementation and performance if not compatible with strategy A culture where attitudes and behaviors impede good
strategy implementation is a huge obstacle to overcome Provides another means to control, coordinate, and
motivate employees
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A culture based on ethical principles is vital to long-term strategic success
Ethics programs help make ethical conduct a way of life
Executives must provide genuine support of personnel displaying ethical standards in conducting the company’s business
Value statements serve as a cornerstone for culture-building
Can be used to control employees – to behave in the “right” way