5 chg programs n projects: + Summing up to: (w 2 dims) + What to do if overfull n unaffordable?
- migration - polit n legal reqs - curr projects - chg reqs out of curr biz - M&A Sum = Proj portfolio (ManYears & $) > If unaffordable, sell Co!
5 types of strategies:
1- owner strategy > is your biz optimally structured (risk n rewards) as compared to inv alternatives? 2- Corp strat > which biz are / should we be in? w what resources n alliances? 3- Biz strat > w whom n how we compete? And grow? > Porter 5 forces & generic strats 4- Config strat > how to design Value Added Engine? 5- Functional strat > principles & standards in functions
Biz architecture n Corp Transf: 3 stratified interacting components + Interpretation of Corp Transf n its 2 challenges
Strategies Processes Systems + CT = from curr to target; though immaterial n cannot be stopped
Change strategies (classification)
Radical. Evolutionary Top-down. Bold strokes. (Unusual) High involvement. (Unusual). Long marches
Companies usually die due to... How? 4 Sequential stages:
...internal reasons (unless de-privatised) 1-Strategic crisis > lack of vision 2-Earnings crisis > less investing > getting worse (3-)Banks' pressure > restructuring (shrink to healthy core) 4-Liquidity crisis > bankruptcy
StG DEF enterprise, company, firm
A productive social system.
Ease of change "formula" =
= f ( Dissatisfaction [0...1] x ModelOfFuture x ProcessOfChg )
Longest lasting Cos: why
- Coz congruence in identity bw CEO n Co Eg family owned biz, Church. CEOs of public listed Cos often need to be brutal > yearly results Family biz can think long term.
Rough process costing: (yearly total)
h/activity * activity/day * days/years / h/years * total_cost_of_1 employee/y
StG DEF mgmt / leadership
- start ~ create
- run / grow ~ steer
- change ~ develop
productive social systems, on two levels:
The 3 main mgmt levels: + usual career direction
Top->down - normative - strategic - operational Career usually proceeds bottom up.
Transformation management "beer formula" =
= Project mgmt (general discipline, domain independent) + Process model (domain dependent: what steps?) + Change mgmt (psy... often badly w money incentives)
(outdated) BCG matrix for corp strat:
(low/high growth) x (low/high market share)
3 economic sectors, in order f dev, as GDP grows + correl. f 3rd + maybe next one
1- agriculture 2- industries 3- services ~ urbanization > deindustrialization in UK eg (4- maybe next: repair env damage)
3 surprising sources of increased value added:
1- (repair of) env damage 2- (measures against) terrorism 3- regulation => CONTROLLED VALUE ADDED
3 types of psychology:
1- analytical > focus on what's wrong (< childhood) 2- behavioral > rituals (to improve) 3- systemic > optimize your resources (strength) w social perspective
4 Characteristics of adaptable Cos =
- adaptable vs traditional - considers all stakeholders - perf. n leadership oriented - collaborative, low hierarchy (-> check controller's cost center structure!)
4+1 big strategies of biz segmentation: (As a taxonomy)
(Positioning): Products + (Markets): Regions Channels Customer segments + Value Chain Functions -> CRI
Auto referentiality of systems n premature aging of systems =
Successful Co wants to conserve! -> Goes on failure path
B2B vs B2C n brand
brand B2C. love B2B. CR,services
4 Biggest factors of failure of (strategic) projects: (n typical scapegoats)
1- resistance to change from the changed (psy) 2- insufficient support from (strategic) managers 3- unrealistic expectations 4- bad project management (can't learn as you go > project/change consulting!) + Often IT ppl are scapegoated.
Bw 4 salary quartiles of mngrs, who will boards hire? N therefore?
-> Q2 (choose best ones but avoid press n malpractice accusation) -> Q2 salaries go up
Challenge for Cos by large sing. Mkts:
Be there! In each country
Character = Character Dev. =
= sum of your unquestioned beliefs; shows under pressure; Character Dev. = Revising beliefs; leaders (should) have more
Chg strats n culture: Nations n what matters
BS < Us,Uk,LatAm,China LM < DE,Jp,Scandi but (international) Co culture trumps!
Co life: Span Death Typical longest good spell
- short n decreasing (avg 14y in CH) based on registered name change - typically die by being bought (otherwise bad for board members) - rarely more than 12y spell w good VA
Combining dims: best n worst quadrants: run vs chg biz n mechanical vs psy
best is mech chg only, w already adaptive co culture; worst is when psy chg is needed b4 all else
Common segmentation vs variants
(local) variants are fine if they add value, otherwise kill them
Company culture =
= norms, (unquestioned) beliefs
corp strat nowadays: 1. old, why? 2. one big, yielding billions 3. 4.
1. portfolio mgmt > diversify thru acquisitions w/o merging... today useful only for familiy offices, coz fin mkts are so efficient today 2. restructuring biz > eg GS: buy sick biz, infuse it w knowledge & industry veterans, then resell it 3. transfer skills in value chain activities > eg GE: let bizs f Co learn from each others, based on similarities 4. (most common today) "sharing activities in VC" > share HR, R&D, ... shrink bizs as much as possible