3.10.3 Managing strategic implementation Flashcards
(37 cards)
What is a business’s strategy?
A plan for achieving its corporate objectives. For example, if the main objective is growth, it needs a strategy for how it can go about growing.
What does the strategic planning process involve?
What is a strategic plan?
Document that defines a business’s corporate objectives and strategy, along with an outline of how the strategy will be implemented and monitored throughout the business
What are the internal factors businesses look at when planning a strategy?
What are the external factors businesses look at when planning a strategy?
How is sensitivity analysis a useful tool for assessing risk of strategies?
A useful tool for assessing risk of strategies is sensitivity analysis. This looks at each assumption that a strategy relies on, and predicts how well the strategy would still do if these assumptions change.
For example, could the business cope if the increase in costs is greater than expected.
Based on this analysis, the business will assess whether the strategy is worth the risk.
How is feasibility an important factor in strategic decision making?
The business needs access to the resources or skills necessary to implement the strategy.
What are contingency plans?
Plan that outlines what to do in case the unexpected happens
Give examples of contingency planning can help a business respond to different crises.
For example, a hostile takeover bid, a fire that destroys a factory, bad news or PR in the media, a sudden change in demand for products, or lost or corrupt data caused by computer network problems.
What is crisis management?
When an unexpected situation occurs and a business has to respond.
How does contingency planning affect crisis management?
How can strategic planning help businesses?
- Helpful as a strategic plan gives the business a clear direction, communicates what the business is trying to achieve, so everyone works towards the same goals.
- Helps managers think about SWOT, helping to spot opportunities that they might’ve not noticed, and matching their strategy to the current situation.
How can strategic planning hinder businesses?
- Restricts flexibility – employees think they have to follow the plan even when the situation’s changed since it’s making, or if there’s a better way of doing things.
- Based on analysis - can be inaccurate
- Likely more useful to businesses in stable markets, not innovative businesses responding regularly to change. Those innovative businesses are suited for emergent strategies.
What are the things that need to be considered when implementing a strategy?
Explain why good leadership is important in implementing strategy.
How can different leadership styles like authoritarian and laissez faire affect employees reaction to change?
In times of change, authoritarian leadership might make employees more fearful of change, and they might be more likely to resist it. Laissez-faire leadership can mean that employees don’t have confidence that changes will work out well, so they won’t be supportive The most suitable forms of leadership for helping employees cope with change are the paternalistic and democratic styles.
What is the purpose of communication?
Clearly pass on info and ideas, to motivate people.
Explain the importance of good communication to implementing strategy
What are the four organisational structures?
- Functional
- Product based
- Regional
- Matrix
Explain functional structures
1) Businesses can be organised into several departments, which group jobs together by function.
2) The main four departments are finance, marketing, operations and HR, which are all run separately.
3) Each function can work in its own area of expertise, which can make implementing strategy simpler.
4) However, this could mean each department has its own culture and focuses on its own priorities.
If communication between departments isn’t good, it will be hard to coordinate strategy.
Explain product based structures
1) In a business that produces lots of different products, each group of products can be run almost as a separate business. Each product division has its own director, marketing team, finance team, etc.
2) This would be an ideal structure for implementing certain strategies - for example, a business may want to grow the market share of one particular product, while keeping another product’s market share steady.
3) But there may be unnecessary duplication of roles - e.g. instead of each division having its own research team, it might be more efficient to have just one research department for the whole company.
Explain regional structures
1) Regional structures are based on location. A business might have branches all over the country, which are grouped into regional divisions that run themselves.
2) A global company could have headquarters on each continent, which oversee national divisions.
For example, an Asian HQ oversees the Japanese and Indian divisions.
3) A regional structure tends to suit a market development strategy where the business is expanding into new geographical markets. If there are different market demands in different locations, control can be decentralised so each division can run itself independently and adapt to local needs.
Explain matrix structures
