This Strategy Implementation Summary includes the lecture material from the course (including notes) to pass the exam! It does not contain summaries of the papers.
Table of Contents
Lecture 1 – Introduction ....................................................................................................2
Lecture 2 – Change Management ......................................................................................4
Lecture 3 – Structure .......................................................................................................12
Lecture 4 – Incentives......................................................................................................19
Lecture 5 – Control Systems ............................................................................................25
Guest Lecture – Marcus Schütz ........................................................................................30
Lecture 9 – Tools and systems of strategy execution ........................................................32
Lecture 10 – Performance Measurement .........................................................................40
Lecture 11 – Organizational Culture ................................................................................47
1
,Lecture 1 – Introduction
Course objectives
- Without a good execution, any strategy is useless. This course aims at exposing and
practicing the different elements necessary for the successful implementation of
organizational strategy
- The concepts exposed in lectures will be operationalized using examples and cases.
Participants will acquire and practice a structured method to understand, analyze and steer
performance in organizations
The challenges
1. Different scope than analysis
2. Need for coherence
3. Complexity
a. Interactions
b. Number of elements
1 Scope
Strategic Planning is the process of deciding on the programs that the organization will undertake
and on the approximate amount of resources that will be allocated to each program over the next
several years (Anthony & Govindarajan, 2007).
- When are the resources actually our resources that we can use and allocate?
- Focus → not about strategy formulation but about strategy implementation
→ Implementation: if you are good at analyzing and creating a strategy, but not at implementation,
you will never reach a competitive advantage
Strategy creation Implementation
Analysis and planning Execution
Thinking Doing
Initiate Follow through
At the top Top-to-bottom
Entrepreneurial Operational
Goal-setting Goal-achieving
2 Coherence
Alignment for implementations
- Supporting activities: IT systems, additional things
- Problem for alignment: if you finetune one thing, it
will not work. All of these elements need to work
together for successful implementation
2
,Alignment checklist
3 Complexity
Supporting activities (Ryanair)
First rate customer service was actually in Ryanair’s strategy
before they went bankrupt. They then removed the
elements that did not work.
- The problem in the scheme above is the hight cost
that come with first rate customer service.
o First what they did was adapt after they
went bankrupt (remove first rate customer
service). Then everything worked well
together.
Requirements
1. Knowledge – information
2. Motivation – control – organization – change management
3. → Performance
3
, Lecture 2 – Change Management
When you want to motivate people to do something, you need to convince them by explaining and
showing them WHY
The pace of business is accelerating, and companies must change in response. Yet 50-765 of change
programs fail. The time tested fundamentals of change management – practices focusing on
leadership, employee engagement, governance, and executional rigor – remain as essential and
powerful as ever.
→ Example new software for police agents; they didn’t use the new software the right way
Why so many failures?
- You need to take steps and measure. If you measure,
you know whether you lack behind (SMART idea)
- Lack of commitment: example of hierarchy in the
navy. When someone’s not in a high rank, he is less
likely to be listened to than someone who is.
Automatic respect.
- Employee resistance: often, they have very logical
reasons to do so.
Strategic drift
Slow change is good, because you need to get people on
board. However, every day a bit change isn’t good, since it
gives signs of instability. Change in steps is good (strategic
drift). Let people get used to the adjustments and when it is
stable, move on to the next step. People need stability.
- Phase 1 & 2: if you would change to fast → change
overflow
- Phase 3: disorder (bottleneck point)
- Phase 4: either you go down, or you change radically
Daimier – Chrysler: one of the worst destructions of value that happened in the M&A. normally,
even when failing, you stay together. They didn’t – they “de-merged”.
Intel Inside: typical clients of Intel are computer makers such as Dell and HP. The microprocessors
were of value for only a little part of the market. Dell wanted to put pressure on intel to buy and
implement their processors. Dell sold their computers with Intel’s new processors to consumers and
teased consumers that with the new processors, you
could make better quality photo’s etc. Eventually,
computerconsumers started to set higher requirements
for computers, including other computers than Dell
(“Does it have a microprocessor?”). This resulted in extra
pressure to perform for Intel.
Governance: companies bought by the government
cause change in the industry.
Diversification: CGE first distributed water, but it became
a technological company. During the inflation, their
cashflows were stable, since water is a primary need.
Therefore, they had the money to expand and became a media/telecom/tv company too.
4
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