UNIT – 5

Strategy Implementation
1 and Control
 Books Recommended
2  1. Thomas L. Wheelen, J. David Hunger, Alan N. Hoffman and
Charles E. Bamford, “Concepts in Strategic Management and
Business Policy”, Pearson Education Limited, NewDelhi, 2018.
 2. Fred R. David and Forest R. David “Strategic Management:
Concepts and Cases - A Competitive Advantage Approach”,
Pearson Education Limited, New Delhi
 References:
 1. Charles W. L. Hill and Gareth R. Jones, Strategic
Management Theory: An Integrated Approach, Cengage
Learning, New Delhi, 2010.
 2. Hitt, Ireland, and Huskisson “Strategic Management:
Competitiveness and Globalization (Concepts and Cases)”,
Cengage Learning, New Delhi, 2017. • John A Pearce, Richard
B Robinson and Amita Mittal, “Strategic Management:
Formulation, Implementation, and Control”, McGraw Hill,
NewDelhi,201
 UNIT-V
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Issues of Strategy Implementation,
Strategy – Structure relationship,
Types of Organizational Structure for
Strategy Implementation: Functional,
Divisional, SBU, Matrix and
Network/Virtual structures.
Strategic leadership,
Strategy supportive culture,
Strategic change management,
Strategy Control,
Balanced Score card approach
 Strategy Implementation
4
 Strategy Implementation refers to the execution of the plans and
strategies, so as to accomplish the long-term goals of the
organization.
 Issues of Strategy Implementation
5  Strategy Implementation steps:
 Issues of Strategy Implementation
6  Strategy Implementation refers to the execution of the plans and
strategies, so as to accomplish the long-term goals of the
organization.
 Strategy Implementation is the fourth stage of the Strategic
Management process, the other three being a determination of
strategic mission, vision and objectives, environmental and
organisational analysis, and formulating the strategy.
 It is followed by Strategic Evaluation and Control.
 Strategy implementation converts the opted strategy into the
moves and actions of the organisation to achieve the objectives.
 Strategy implementation is the technique through which the firm
develops, utilises and integrates its structure, culture, resources,
people and control system to follow the strategies to have the
edge over other competitors in the market.
 Process of Strategy Implementation
7
i. Building an organization, that possess the
capability to put the strategies into action
successfully.
ii. Supplying resources, in sufficient quantity, to
strategy-essential activities.
iii. Developing policies which encourage
strategy.
iv. Such policies and programs are employed
which helps in continuous improvement.
v. Combining the reward structure, for
achieving the results.
vi. Using strategic leadership.
 Aspects of Strategy Implementation
8  Creating budgets which provide sufficient resources to
those activities which are relevant to the strategic success
of the business.
 Supplying the organization with skilled and experienced
staff.
 Conforming that the policies and procedures of the
organisation assist in the successful execution of the
strategies.
 Leading practices are to be employed for carrying out key
business functions.
 Setting up an information and communication system, that
facilitate the workforce of the organisation, to perform their
roles effectively.
 Developing a favourable work climate and culture, for
proper implementation of the strategy.
 Types of Organizational Structure
9  Types of Organizational Structures are:
Functional Organization
Projectized Organizations
Matrix based
 Functional Organiztional Structure
 Also known as traditional approach to organizing
business.
 Functional organizations are centered on specialties
and grouped by function.
 Ex: Staff members are grouped by specialty like
production, marketing engineering and accounting at
the top level.
 Types of Organizational Structure
10  Functional Organizational Structure
 .
 Types of Organizational Structure
11  Projectized Organizations
 Organizational resources are dedicated to projects and
project work
 Project managers almost always have ultimate
authority over the project
 Project managers are responsible for making decisions
regarding the project and acquiring and assigning
resources.
 They have the authority to choose and assign
resources from other areas in the organization or to
hire them from outside if needed.
 Types of Organizational Structure
12
 Projectized Organizations
 Types of Organizational Structure
13
 Matrix Organizations
 Matrix organizations are an attempt to maximize the
strengths of both the functional and projectized forms.
 Team members report to both the project manager and
functional manager.
 Team member do project work in addition to normal
departmental work.
 Example: Consider an employee/staff working in
department C. He/she is assigned part-time to projects X
and Z. Such an employee would be reporting to three
different managers.
 His/her line manager (Dept. C)
 Project manager for project X
 Project manager for project Z
 Types of Organizational Structure
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 Matrix Organizations
 Types of Organizational Structure
15
 Matrix Organizations
 Types of Organizational Structure
16
 Matrix Organizations
 Advantages
Efficient exchange of data, since people from
different areas work closely together
Democratic leadership style which incorporates
the input of team members before decisions are
made
Improved satisfaction and motivation for
individual
Flexibility in utilization of resources and
expertise
 Types of Organizational Structure
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 Matrix Organizations
 Disadvantages
Conflict between functional and project managers
Issues of resource allocation and prioritization
Lack of recognition for individuals
 Strategic Business Units
18

 Strategic Business Units
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 Organizations operating on a large scale or having
geographically distributed operations divide their
operations into several divisions or unit.
 These units are called strategic business units (SBUs).
 Each of these unit acts as separate businesses under
one single parent organization.
 Generally, the business units operate in different
industries and may have different brand names.
 Strategies adopted by such strategic business units are
called business level strategies.
 These strategies enable the business units to acquire a
competitive advantage over other organizations in the
industry.
 SBUs – Characteristics
20
 Strategic Business Unit (SBU) implies an
independently managed division of a large company,
having its own vision, mission and objectives, whose
planning is done separately from other businesses of
the company.
 Characteristics of Strategic Business Unit
 Separate business or a grouping of similar businesses,
offering scope for autonomous planning.
 Own set of competitors.
 A manager who is accountable for strategic planning,
profitability and performance of the division.
 SBUs
21
 Strategy – Structure Relationship
22  Corporate Strategies deals with the following questions:
 Strategy and structure are both important components
within a business, and changing one can affect the other.
 Some professionals believe business owners should choose
a strategy first, then the structure.
 Others believe structure should come first.
 Structure plays a critical role in the accomplishment of
an organization’s overall strategy. Another notable aspect is
that both business strategy and organizational
structure need to be continuously inter-linked in order to
achieve desired results.
 Structure performs a unique role in organizations – it
provides a framework in which we work together and, it
starts with Strategy.
 Strategy – Structure Relationship
23  Once strategy is clearly articulated, then four key elements of
structure can be explored:
1. How many levels should our structure be? These are not
arbitrary. Too many leads to bureaucracy, and too few means
you aren’t looking far enough out and your competition will
surpass you.
2. What are the key functions? Which functions are key to
delivering the Strategy? Good strategy work defines which is
the preeminent function that all others are there to support.
3. Who are the best to fill the roles? A good structure defines
the roles without the people and then finds the right people for
the roles.
4. How will the roles inter-relate? This is about defining the
authority of the roles concerning one another to clarify who
gets service, has a say in others’ work, and can impact others'
work.
 Strategy – Structure Relationship
24  The two aspects can affect each other in the following
ways:
 Strategy shifts structure:
 A company's strategy can cause the structure to change or
shift. As a business creates specific goals, it may need to
change its structure. For example, a company whose goal is
to open a new location may need to adjust its teams and
department sizes. They may choose to revise their structure
to accomplish the new goals from their business strategy.
 Structure supports strategy
 An organization's structure can help the company reach its
business goals. As the business grows and operates, the
structure may change as leadership adds new positions and
employees. This change to the structure may eventually
change the strategy.
 Strategic Leadership
25  The basic philosophy of the practical and holistic approach
to leadership —‘it is perfectly possible to improve
myself; I can hope to improve others only by personal
example’.
 The key to effective Strategic Management is to ensure that
leadership runs like a uniform thread through all functions
of management so as to integrate them into a culture of
excellence.
 One of the primary needs for effective strategic
management is to ensure that effective leaders are groomed
and developed at every level in an organization.
 “Leadership is the capacity to frame plans which will
succeed and the faculty to persuade others to carry them out
in the face of all difficulties.” (Moran, 1984).
 Leadership is: knowing what to do + GETTING THINGS
DONE
 Strategic Leadership
26  The basic philosophy of the practical and holistic approach
to leadership —‘it is perfectly possible to improve
myself; I can hope to improve others only by personal
example’.
 The key to effective Strategic Management is to ensure that
leadership runs like a uniform thread through all functions
of management so as to integrate them into a culture of
excellence.
 One of the primary needs for effective strategic
management is to ensure that effective leaders are groomed
and developed at every level in an organization.
 “Leadership is the capacity to frame plans which will
succeed and the faculty to persuade others to carry them out
in the face of all difficulties.” (Moran, 1984)
 Strategic Leadership
27  Strategic leadership is when managers use their creative
problem-solving skills and strategic vision to help team
members and an organization achieve long-term goals.
 According to Margaret Andrews, strategic leadership is
“that you want to be strategic about your leadership.”
 “Strategic leadership is about understanding yourself and
your goals,” she says. “It’s about understanding the
situation, considering options, and deciding. It’s also about
getting the best out of people, the best out of the situation,
so that the organization does well. Leaders who lead
strategically have done the inner work necessary to lead
with integrity, vision, and purpose.”
 Strategic Leadership can be defined as the ability of the top
level managers or executives to determine the future
courses of action and direction of the firm and motivate the
members to make efforts in that direction
 Strategic Leadership
28  .
 Roles Played by a Strategic Leader
29

 Top Skills and Qualities of Strategic Leaders Leaders
30  They Know Who They Are
 “They really understand themselves, who they are and what
matters,” says Andrews. “They know their values.”
 They Are Interested in Others
 Strategic leaders want to hear from team members, and
they listen attentively as part of their leadership strategy. As
a result, team members naturally feel more invested.
Andrews references a famous quote of Theodore Roosevelt:
“No one cares how much you know until they know how
much you care.”
 They Are Good Communicators
 Leaders who think strategically speak clearly in ways that
others can easily understand. Good communicators listen
closely enough to hear the reservations of others and
address those concerns.
 Top Skills and Qualities of Strategic Leaders
31  They Know Who They Are
 “They really understand themselves, who they are and what
matters,” says Andrews. “They know their values.”
 They Are Interested in Others
 Strategic leaders want to hear from team members, and
they listen attentively as part of their leadership strategy. As
a result, team members naturally feel more invested.
Andrews references a famous quote of Theodore Roosevelt:
“No one cares how much you know until they know how
much you care.”
 They Are Good Communicators
 Leaders who think strategically speak clearly in ways that
others can easily understand. Good communicators listen
closely enough to hear the reservations of others and
address those concerns.
 Strategy Supportive Culture
32  Peter Drucker’s saying: “Culture eats strategy for
breakfast” in some or the other context.
 Organizational culture may be defined as a system of
assumptions, values, norms and attitudes manifested
through symbols, which the members of an organization
have developed and adopted through mutual experience
and which help them to determine the meaning of the world
surrounding them and how to behave in it.
 Role of organization culture:
Gives direction to the conduct of the business
Redefine the intra-organizational line of
communication, encouraging new idea
development
High employee engagement and healthy
turnover intention, if at all it is inevitable
 Strategy Supportive Culture
33  Peter Drucker’s saying: “Culture eats strategy for
breakfast” in some or the other context.
 Edgar Schein(1985) defines organisational culture as “a
pattern of basic assumptions – invented, discovered or
developed by a given group as it learns to cope with its
problems of external adaptation and internal integration –
that has worked well enough to be considered valuable and,
therefore, to be taught to new member as the correct way to
perceive, think, and feel in relation to those problems.
 Organizational culture influences not only the process of
strategy formulation, but also the process of selected
strategy implementation.
 Culture may be an incentive factor, but also an
insurmountable barrier to implementation of the selected
strategic courses of action. It will depend on the degree of
conformity of cultural assumptions, values and norms with
 Strategy Supportive Culture
34  Each selected strategic course of action implies a specific
set of operating activities through which it is implemented.
 If these activities are consistent with cultural assumptions,
values and norms, they will be interpreted as legitimate, i.e.
useful, justified and needed. In this case, employees and
managers who conduct these activities will be motivated to
apply them in both shape and manner as the top
management pictured it.
 This is a situation in which organizational culture is an
incentive factor of strategy implementation.
 In this case, culture legitimizes strategy which is, as far as
culture is concerned, implemented without problems and
difficulties
 Strategic Change Management
35  Strategic change management involves long-term
planning which would allow an organization to stay
relevant in the market, continue to thrive and meet and
exceed the competition of industry competitors and
prepare for complex scenarios like a complete
overhaul of the management team, mergers and
acquisitions, technology in use becoming obsolete,
relocating an office to a new area etc.
 Organizations implement strategic changes to their
business to help achieve goals or boost their
competitive advantage in their market.
 Strategic Change Management
36  Change management strategies are of three types:
 Restructuring: This aspect is performance focused and
brings about changes to enhance daily performance. In
some situations, organizations may need to reorganize
aspects of their company to remain competitive. This
process is known as restructuring.
 Reengineering: This aspect studies business processes
and associated systems to bring about a change in
organizational functions. When pursuing change
through reengineering, organizations focus on
redesigning their business processes and related systems
to improve performance.
 Innovation: This aspect focuses on ideating and
coming up with new goods and services to cater to new
competition and enhance its current offering.
 Example of Strategic Change Management
37  Example
 A publisher that owns a newspaper realizes that the industry
is in decline.
 After collecting data, its leaders determine that most people
receive their news on the internet.
 As a result, they decide to shift to an online-only model that
requires users to buy subscriptions to read the content.
 This shift requires structuring the organization's staffing by
selling its printing facility and laying off the employees
who worked there or delivered the physical paper.
 Eliminating the costs associated with the print product
enables the newspaper to continue its operations and focus
on its new online-only strategy.
 Strategy Control
38  The meaning of ‘control’ is 'to regulate' or ‘to check’.
 This means that the top management needs to keep check
on how well the strategy is being implemented to achieve
the objectives of the organization.
 For example, if the business is not giving resu1ts as
expected, it may be necessary to increase promotional
efforts, or revise the product policy, or as a last resort, the
firm may close a particular business.
 Control is exercised by mangers in the form of four steps:
 Setting performance standards
 Measuring actual performance
 Analyzing variance
 Taking corrective actions
 Strategy Control
39  Relationship between Strategic Planning and Strategic
Control

 Strategy Control
40  The word meaning of ‘control’ itself means ‘to
regulate’ or ‘to check’.
 The basic aim of any organization is to achieve its
goals.
 But to achieve the goals, the organization faces lots of
hurdles.
 To overcome these hurdles, it is necessary for any
organization to have a sound strategic control process.
 For example, if the business is not giving results as
expected, it may be necessary to increase promotional
efforts, or revise the product policy, or as a last resort,
the organization may pull out of a particular business.
 Strategy Control – Characteristics
41
 Nature: Formulation and implementation of
strategy
 Control: Feed forward
 Management level: Top level
 Orientation: Futuristic
 Direction: Monitors whether the organization is
aligned with the goals and objectives or not.
 Environment: External
 Aim: Effectiveness
 Time period: Long-term
 Focus: Strategic Management Process
 Strategy Control
42  Quantitative criteria for evaluation: Here, the actual
results are compared with the expected results.
 Usually the organizations use financial ratios as
quantitative criteria for evaluating strategies.
 These are used due to the following reasons:
 To compare the performance of the organization over
different time periods;
 To compare the performance of the organization with
its competitors in the industry.
 To compare the organizations’ performance to industry
averages.
 Four Types of Strategic Controls
43
 Premise Control: Every strategy is
founded on certain planning premises or
assumptions. Premise control is intended
to examine whether the premises on
which a strategy is based are still valid
in a systematic and continuous manner.
 Special Alert Control: A particular alert
control is the rigorous and quick
reconsideration of an organization’s plan
in response to an instant, unanticipated
incident.
 Four Types of Strategic Controls
44  Implementation Control: Implementation control is
a sort of strategic control that must be implemented as
events develop. Strategic thrusts or projects and
milestone reviews are the two forms of
implementation controls. Strategic thrusts give
information that may be used to assess if the overall
strategy is progressing as expected. With milestone
reviews, you may track the strategy’s success at
regular intervals or milestones.
 Strategic Surveillance: Strategic surveillance is
intended to monitor a wide variety of events both
within and outside your organization that are likely to
have an impact on the direction of your business’s
strategy. Trade periodicals, journals, trade
conferences, talks, and observations are examples of
such sources.
 Balanced Score Card Approach
45
 Balanced Score Card
 Balanced Score Card Approach
46  The term balanced scorecard (BSC) refers to
a strategic management performance metric used to
identify and improve various internal business
functions and their resulting external outcomes.
 Balanced Score Card is a set of financial and non-
financial measure relating to a company’s critical
success factors.
 It is approach, which provides information to
management to assist in strategic policy formulation
and achievement.
 It emphasizes the need to provide the user with a set of
information, which addresses all relevant areas of
performance in an objective and unbiased manner.
 Balanced Score Card – Objectives
47  It emphasizes the need to provide the user with a set of
information, which addresses all relevant areas of
performance in an objective and unbiased manner.
 As a management tool it helps companies to assess
overall performance, improve operational processes
and enable management to develop better plans for
improvements.
 It offers managers a balanced view of their
organization upon which they can further add-on.
 Balanced Score Card – Advantages
48  It brings strategy arid vision as the center of management focus
 It brings together in a single management report, many of the
seemingly desperate elements like customer orientation,
shortening response time, improving quality etc. on a competitive
agenda.
 Balanced Score Card provides management with a
comprehensive picture of: business operations
 The methodology of balanced score card facilitates
communication and understanding of business goals and
strategies at all levels of an organization
 The Balanced Score Card provides strategic feedback and
learning.
 It emphasizes an integrated combination of traditional and non-
traditional performance measures. It helps senior managers to
consider all-important performance measures together and let
them to see, whether an improvement in one area may have been
achieved at the expense of another.
 Balanced Score Card Approach
49

 Balanced Score Card – Components
50
 Generally, balanced score card has following four
perspectives:
Customer perspective i.e. how do customers see us.
Internal perspective i.e. what must we excel at.
Innovation and learning perspective i.e. can we
continue to improve and create value.
Financial perspective i.e. how do we look to our
shareholders.
 Thus, the score card provides a view of an
organization’s overall performance by integrating
financial measures with other key performance
indicators.
 It offers managers a balanced view of their organization
upon which they can further add-on.
 Balanced Score Card – Components
51
 Learning and growth are analyzed through the investigation of
training and knowledge resources. This first leg handles how well
information is captured and how effectively employees use that
information to convert it to a competitive advantage within the
industry.
 Business processes are evaluated by investigating how well
products are manufactured. Operational management is analyzed
to track any gaps, delays, bottlenecks, shortages, or waste.
 Customer perspectives are collected to gauge customer
satisfaction with the quality, price, and availability of products or
services. Customers provide feedback about their satisfaction
with current products.
 Financial data, such as sales, expenditures, and income, are used
to understand financial performance. These financial metrics may
include dollar amounts, financial ratios, budget variances, or
income targets.
 Balanced Score Card – Creation Process
52
 Steps:
i. To identify a vision i.e. where an organization is
going.
ii. To identify organization’s strategies i.e. how an
organization is planning to go there.
iii. Define critical success factors and perspectives i.e.
what we have to do well in each perspective.
iv. Identify measures which will ensure that everything
is going on, in the expected way.
v. Evaluation of Balanced Score Card i.e. ensuring
what we are measuring is right.
vi. Create action plans and plan reporting of the
Balanced Score Card.
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