slide 15.1 johnson, whittington and scholes, exploring strategy, 9 th edition, © pearson education...
TRANSCRIPT
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Slide 15.1
Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Slide 15.1
Strategy in Action 15: The Practice of Strategy
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Learning outcomes (1)
• Identify key people involved in strategising, including top management, strategy consultants, strategic planners and middle managers.
• Assess which people should be included in addressing different strategic issues.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Learning outcomes (2)
• Evaluate different approaches to strategising, including analysis, issue selling, decision-making structures and communicationg.
• Recognise key elements in methodologies used in strategising, including strategy workshops, projects, hypothesis testing and writing business cases and strategic plans.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
The pyramid of strategy practice
Figure 15.1 The pyramid of strategy practice
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
The strategists – top managers and directors
Chief Executive Officer
Top management team
Non-executive directors
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategy skills
Three qualities senior managers need to contribute to high-level strategy-making: Mastery of analytical concepts and techniques; Social and influencing skills; Group acceptance as a player – respect.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
The strategists – strategic planners
Strategic planners, sometimes known as strategy directors or corporate development managers are managers with a formal responsibility for co-ordinating the strategy process.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Tasks performed by strategic planners
Information and analysis
Managers of the strategy process
Special projects
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
The strategists – middle managers
Four roles middle managers have in relation to the management of strategy: Information source – knowledge and experience; ‘Sense-making’ of strategy – translating strategy
into a message that is locally relevant; Reinterpretation and adjustment of strategic
responses as events unfold; Champions of ideas that can be the foundation of
new strategies.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Middle managers and strategy
Middle managers increase their influence on strategy when they have: Key organisational positions. Access to organisational networks. Access to the organisation’s ‘strategic
conversation’.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
The strategists – roles of strategy consultants
Analysing, prioritising, and generating options
Transferring knowledge
Promoting strategic decisions
Implementing strategic change
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategy consultants
Three ways to improve outcomes from strategy consulting: Professionalise purchasing of consulting
services; Develop supervisory skills to manage consulting
projects; Partner effectively – project teams should
include a mix of consultants and managers from the client organisation.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
The access/execution paradox
Figure 15.2 The access/execution paradox
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Who to include in strategy making?
Figure 15.3 Who to include in strategy making?
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategic issue-selling
Strategic issue-selling is the process of gaining the attention and support of top management and other important stakeholders for strategic issues.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategic issue-selling
Figure 15.4 Formal channels for issue-sellingSource: Adapted from W. Ocasio and J. Joseph, ‘An attention-based theory of strategy formulation: linking micro and macro perspectives in strategy processes’, Advances in Strategic Management, vol. 22 (2005), pp. 39–62
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Aspects of strategic issue-selling
Issue packagingFormal or
informal channels
Sell alone or in coalitions
Timing
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Guidelines for strategicdecision-making
Build multiple simultaneous alternatives Track real-time information Seek the views of trusted advisors Aim for consensus, but not at any cost
(challenge through conflict can be useful) Harness intuition
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Guidelines for developing intuitive capabilities
• Recognise the importance of intuition (i.e. ‘open up the closet’)
• Don’t mix up your ‘I’s (instinct, insight and intuition)
• Elicit good feedback
• Get a feel for your batting average – benchmark your intuitions
• Use imagery not just words
• Play devil’s advocate
• Capture and validate your intuitions
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Managing conflict
• Rulebook – establish clear boundaries, encourage dissent, keep debate professional.
• Referees – the leader must be open to differing views and enforce the rules.
• Playing field – each side must have a chance to win, there must be a clear basis for resolution.
• Gaps to exploit – each group should have a specific objective.• Relationships – individuals must deliver on their commitments and
behave with integrity.• Energy levels – Ensure sufficient tension to promote useful debate,
but monitor this. Leaders must understand what people care about.• Outcomes – Ensure leader gives bad news without damaging
relationships. Ensure dignity in losing and risk-taking is rewarded.
Source: Adapted from S.A. Joni and D. Beyer, ‘How to pick a good fight’, Harvard Business Review, Dec. 2009, 48–57.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Elements of a communications strategy
Focus Impact
MediaEmployee
engagement
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategy methodologies
Strategy workshops
Strategy projects
Hypothesis testing
Business cases and strategic plans
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategy workshops
Strategy workshops (or strategy away-days) involve groups of executives working intensively for one or two days, often away from the office, on organisational strategy.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategy workshops
Workshops designed to question existing strategy or develop new strategy should: Employ strategy concepts and tools. Use a specialist facilitator to focus discussion
and ensure participants contribute. Enjoy the visible support of the workshop
sponsor (who may well be the CEO). Diminish everyday functional and hierarchical
roles – to remove inhibitions and get away from normal routines.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategy workshops and action
If workshops are going to lead to effective action then there should be:
• an agreed list of actions which are then widely circulated,
• project groups established to follow up,
• nesting of workshops in a series and
• visible commitment by top management to workshop outcomes.
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Strategy projects
Strategy projects involve teams of people assigned to work on particular strategic issues over a defined period of time.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategy projects – requirements
A clear brief or mandate
Top management commitment
Milestones and reviews
Appropriate resources
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Hypothesis testing
Hypothesis testing is a methodology used particularly in strategy projects for setting priorities in investigating issues and options.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Business cases
• A business case provides the data and argument in support of a particular strategy proposal, e.g. investment in new equipment.
• A business case should: Focus on strategic needs. Be supported with key data. Provide a clear rationale. Demonstrate solutions and actions. Provide clear progress measures.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Strategic plans
• A strategic plan provides the data and argument in support of a strategy for the whole organisation.
• A strategic plan has the following elements: Mission, goals and objectives statement. Environmental analysis. Capability analysis. Proposed strategy. Resources required. Required changes in structures, systems and
culture.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Summary (1)
• The practice of strategy involves choices about– who to involve in strategy,– what to do in strategising activity and– which strategising methodologies to use
• Chief executive officers, senior managers, non-executive directors, strategic planners, strategy consultants and middle managers are all involved in strategising. Their degree of appropriate involvement should depend on the nature of strategic issues.
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Johnson, Whittington and Scholes, Exploring Strategy, 9th Edition, © Pearson Education Limited 2011
Summary (2)
• Strategising activity can involve analysing, issue-selling, decision-making and communicating. Managers should not expect these activities to be fully rational or logical and can valuably appeal to the non-rational characteristics of the people they work with.
• Practical methodologies to guide strategising activity include strategy workshops, strategy projects, hypothesis testing and creating business cases and strategic plans.