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Assignment 1 - Transforming Corner-Office Strategy Into Front Line Action - CS&O - Final

This document discusses strategic principles - concise phrases that capture a company's strategy and allow it to be communicated throughout the organization. It provides examples of strategic principles from various companies like Walmart ("Low prices, every day"), GE ("Be #1 or 2 in every industry we compete, or get out"), and Southwest Airlines ("Meet customers' short-haul travel needs at fares competitive with the cost of automobile travel"). Strategic principles help employees make trade-offs, experiment within clear boundaries, and maintain strategic focus. They drive action in a way that missions statements do not by being more specific and oriented towards decisions. Strategic principles are especially useful for decentralization, rapid growth, technological change, and institutional turmoil.

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Anurag Sukhija
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458 views

Assignment 1 - Transforming Corner-Office Strategy Into Front Line Action - CS&O - Final

This document discusses strategic principles - concise phrases that capture a company's strategy and allow it to be communicated throughout the organization. It provides examples of strategic principles from various companies like Walmart ("Low prices, every day"), GE ("Be #1 or 2 in every industry we compete, or get out"), and Southwest Airlines ("Meet customers' short-haul travel needs at fares competitive with the cost of automobile travel"). Strategic principles help employees make trade-offs, experiment within clear boundaries, and maintain strategic focus. They drive action in a way that missions statements do not by being more specific and oriented towards decisions. Strategic principles are especially useful for decentralization, rapid growth, technological change, and institutional turmoil.

Uploaded by

Anurag Sukhija
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Transforming corner-office

strategy into front line action


Group Customer Service and Operations
Strategic Principles
A memorable and actionable phrase that distills a companys corporate
strategy into its unique essence and communicates it through-out the
organization
Captured all in a phrase
Everyone in the organization can work towards it without being rigid








DELL
Be Direct
With strategic phrase Low Prices, Every Day,
Wal-Mart intends to serve price-sensitive
customers offering a range of branded
products at stockout rates with prompt
after sales service of defective
products.
GE
Be #1 or 2 in every industry
we compete, or get out
Wal-Mart
Low Prices, Every Day
What Strategic Principles Do
Strategic Principles help employees

Make Trade Offs
Test soundness of a business move
Experimentation within clear boundaries


eBay
Focus on trading
communities
AOL
Consumer connectivity first
anytime, anywhere
Vanguards Strategic advantage lies in giving
apex value to its investor-owner by investment
experience, breadth, performance, and low
costs as it is the only client-owned
mutual fund company in the world
Vanguard
Unmatchable value for investor-
owner
South West Airline Example & 80 100 Rule
South-Wests Strategic Principle :
Meet customers short-haul travel needs at fares competitive with
the cost of automobile travel

South West airline pulled out from long-hauled Denver sector routes
in order to focus as per its Strategy Principle.

What it does:
Empowers the employees to innovate and take risks
Maintain strategic focus

80 100 Rule
You are better off with a 80% right and
100% implementable, than one that is
100% right but doesnt drive the
consistent action through out the
organization
Mission vs Strategy Principle
Mission
Informs companys culture
Aspirational
Inspire frontline workers

Strategy Principle
Drives a companys strategy
Action Oriented
Enables them to act quickly by guiding them in
making strategically consistent choices



Example :
Comparison of
GE Mission
Statement and
Strategy
Principle
Need of the Strategy Principle
Decentralization
Need to adapt coherent strategic action
Example : GE

Rapid Growth
Focus and Direction in case of rapid growth
Aids less-experienced manager in decision making
Example : A young start- up company

Technological Change
Technological landscape changing too fast and very rapidly
Example : Dell

Institutional Turmoil
Change in Management can result in new strategy but not a new strategy
principle
Example : Vanguard

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