Strategic Management: Formulation and Implementation

A General Framework For Strategy Implementation

The first step in implementation is identifying the activities, decisions, and relationships critical to accomplishing the activities.

There are six principal administrative tasks that shape a manager's action agenda for implementing strategy. In general, every unit of an organization has to ask, "What is required for us to implement our part of the overall strategic plan and how can we bets get it done?".

The specific components of each of the six strategy-implementation tasks:

  1. Building an organization capable of executing the strategy. The organization must have the structure necessary to turn the strategy into reality. Furthermore, the firm's personnel must possess the skill needed to execute the strategy successfully. Related to this is the need to assign the responsibility for accomplish key implementation tasks to the right individuals or groups.
  2. Establishing a strategy-supportive budget. If the firm is to accomplish strategic objectives, top management must provide the people, equipment, facilities, and other resources to carry out its part of the strategic plan. Further, once the strategy has been decided on, the key tasks to performed and kinds of decision required must be identified, formal plans must also be developed. The tasks should be arranged in a sequence comprising a plan of action within targets to be achieved at specific dates.
  3. Installing internal administrative support systems. Internal systems are policies and procedures to establish desired types of behavior, information systems to provide strategy-critical information on a timely basis, and whatever inventory, materials management, customer service, cost accounting, and other administrative systems are needed to give the organization important strategy-executing capability. These internal systems must support the management process, the way the managers in an organization work together, as well as monitor strategic progress.
  4. Devising rewards and incentives that are tightly linked to objectives and strategy. People and departments of the firm must be influenced, through incentives, constraints, control, standards, and rewards, to accomplish the strategy.
  5. Shaping the corporate culture to fit the strategy. A strategy-supportive corporate culture causes the organization to work hard (and intelligently) toward the accomplishment of the strategy.
  6. Exercising strategic leadership. Strategic leadership consists of obtaining commitment to the strategy and its accomplishment. It also involves the constructive use of power and politics, and politics in building a consensus to support the strategy.