Business Strategy MOD003337 (Level 6)

Week 8: Implementing Organisational

Strategy
 Session Focus
• What strategy implementation is
• Factors that determine a successful
strategy implementation
• Key questions to ask
• The 4-stage implementation plan
Background

• Developing organisational strategy is a complex exercise for

managers. It is even a more complex one for strategy to be
implemented.
• In order to maximise the benefits of any strategy it must move
from being a mere expression on paper/electric device by
tactfully converting it into actionable objectives.
• Problems encountered with the implementation of strategy
often lie not with any flaws in the strategy itself, but rather in
a failure to implement it effectively.
• This session explores a generic form of strategy
implementation.
Strategy implementation

Strategy implementation refers to the translation of

chosen strategy into tactfully planned actions,
assigning tangible and intangible resources within a
defined timeframe, so as to achieve organisational
goals and objectives.
Key considerations for strategy implementation
Business environment factors
Available resources
Organisational structure
Organsational culture & policies
Reward structure
Time

Effective management of these factors can impact on the

how strategy is successfully implemented and the
subsequent results.
Open Class discussion (15mins)

What’s the relationship between each of these factors and

strategy implementation?

• Business environments
• Available resources
• Organisational structure
• Organsational culture
• Organisational policies
• Reward / remuneration structure
• Time
Key questions to ask

• What strategy do we want to implement?

• What resources are required to implement our
strategy?
• How do we go about implementing our
strategy?
• How long will it take us to implement our
strategy?
• How will we know that we have implemented
our strategy?
Key components to consider in strategy implementation
What strategy do we This is determined when managers make ‘strategic
want to implement? choices’ as discussed in week 6.

What resources do we An essential role of senior management is

need to implement our development and distribution of resources as
strategy? discussed in week 5. Also includes all tangible and
intangible resources such as human and machine.
How do we go about This relates to planning at business-level strategy as
implementing our discussed in week 4. Also involves tact and thorough
strategy? consideration of stakeholders and risk factors.

How long will it take us A key ingredient of strategy is corresponding

to implement our timeframe. Managers are responsible for allocating
strategy? realistic a timeframe to each action of strategy.
How will we know that This relates to evaluation of implemented strategy. It
we have implemented allows organisations to develop learning loops. Tools
our strategy? used include surveys, feedback and Balance Score
Cards.
Strategy implementation plan

A four-stage strategy implementation plan can be

adopted in converting strategy into action. This
involves:
1.Stating a clear and specific strategic goal
2.Listing all resources that will be required and
planning a supply-chain management
3.Planning actions to be taken, when and how long
each will take
4.Evaluating the strategy and its process
Stage 1: Strategic Goals

 They are specific financial and non-financial objectives and results

an organisation aims to achieve over a specific period of time. They
must be S.M.A.R.T in nature.
 They are usually set over the next three to five years. ...but rapidly
changing factors and business environments means these goals
must be reviewed as often as necessary to ensure strategic
alignment.
 

 They are important because they: Drive priority setting, resource

allocation, capability requirements and budgeting activities.
 They must be accompanied by clearly defined key success factors
(key performance indices) and scope.
A few areas of strategic goals

 Customer – e.g. ‘to grow number of clients by in 3yrs’

 Employees – e.g. ‘achieve employee retention score of 90% in
the new financial year’
 Shareholders – e.g. ‘grow revenue by 4.5% and net profit by
18% per year over the next 3 years’

In what other areas of business can strategic

goals be set?
Stage 2: Available Resources

A key attribute of the organisation is the ability to pull resources together in

order to accomplish goals. The major resources used by organisations are:
 human resources – people, will, structure, engagement
 financial resources – cash, assets, bonds, access to funds
 physical resources – building, land, machine
 information resources – knowledge, patent, database
 Technological resources – equipment, software, innovation
 Ethical resources – culture, integrity, consumer trust,
 Brand resources – product quality, value, years of experience
 time resources – process, supply-chain, turn-around period
 All must be considered in strategy implementation

 
 A simple resource supply-chain set
of questions
• What do we need?
• What do we need it for?
• Exactly when do we need it?
• Is it readily available or do we need to source it?
• If we must source it where do we source it from?
• How long will it take to source?
• What will it cost?
• Who do we need to speak to?
• Who is our primary spokes-person?
• Who will monitor that supply has arrived and quality?
• What is the return policy?
Stage 3: Actions & Timeframe (Action
Plan)
Challenges to strategy implementation include
poor/no action and unrealistic timelines. In order to ensure effective action plan:
 Develop an overall corporate-level strategy implementation timeline – e.g. A six-
month or three-year strategic goal
 Group the strategy into departmental or business-level strategies – e.g. Human
resources, Marketing, production
 Break down each business-level strategy into actionable goals – e.g. improving
awareness of customer needs.
 Create a logical flow of tasks that will lead to the achievement of each business-
level goals

 
Stage 4: Evaluation

The strategy evaluation process involves analysing

your implementation process and assessing how well you have done in achieving
the goals in your strategy.
It is an internal analysis and should be part of a broader strategic analysis for the
organisation when making decisions about your strategy. 
Five key questions to ask: 
1.What did we set out to achieve (key success factors)?
2.What did we achieve (actual performance)?
3.Any difference between 1 and 2 and why?
4.What lessons can we learn?
5.How do we use what is learnt in the future?
 This process creates organisational learning loop.

 
Stage 4: Evaluation

Answers to those 5 questions can be can be realised

through various ways including:
 the use of questionnaires/surveys - e.g. In the case of employee
development strategy such as training or reward

 the design of a tailored balanced scorecard system – this often works

best when clearly success factors have been defined, agreed and
communicated from the onset – e.g. In the case of revenue or client
growth.

Balance scorecard explained by Bernard Marr:

https://www.youtube.com/watch?v=SIPcT92E18w
 
 Balanced Scorecard Strategy Map
Sustained Shareholder Value
Perspective Productivity strategy Revenue growth strategy

Financial Improve cost structure Increase asset utilisation Enhance customer value Expand revenue
opportunities

Customer Customer value proposition

Product/service attributes Relationship Image

Price Quality Availabili Selecti Functional Service Partners Brand

ty on ity hip
Internal Operations management Customer Innovation Regulatory and
process Produce and deliver products management Create new products and
and services social
Enhance customer services Improve communities
value and the environment

Learning and Human capital Information capital Organisation capital

growth Skills, training, knowledge Systems, databases, networks Culture, leadership,
alignment, teamwork
Linking balance scorecard to strategy

What is my vision for Statement of vision

the future 1.Definition of SBU (Strategic Business Unit)
2.Mission statement
3.Vision statement

If my visions succeeds Shareholders Customers Internal management Innovation and growth

how will it differ for

What are the critical 1. 1. 1. 1.

success factors 2. 2. 2. 2.
3. 3. 3. 3.
4. 4. 4. 4.

What are the critical 1. 1. 1. 1.

measurements 2. 2. 2. 2.
3. 3. 3. 3.
4. 4. 4. 4.

The Balanced Scorecard

 Summary of the ‘4-stage Implementation Plan’
Stage 1. Stage 2. Stage 3. Stage 4.

State strategic Gather Actions and Completion and

goal required corresponding evaluation
resources timelines
What is the the What are the What is the When is the process
precise objective resources sequence of complete? When is the
to be achieved? needed? implementation? end arrived at? How
Needs to be a Financial, What happens will it be known? How
SMART objective Physical, Human, before, during will it be measured?
Technological and after the What constitutes
required? process? What is success? What is
What is the the pace and stakeholder
supply-chain? nature of evaluation?
change?

Planned Output Input Process Actual Output

Questions?
End of session