KEY TO IMPLEMENTATION AT ENTERPRISE: 1. STAFFING * hiring and promoting a certain kind of person * selection and use of employees * issues: * hiring new employees with new skills * terminating employees with inappropriate or substandard skills * training existing employees to learn new skills 2. LEADING * Specifying clear performance objectives and promoting a team-oriented corporate culture * Use of programs to better align employee interests and attitudes with a new strategy SUCCESSFUL INTEGRATION MANAGER: * Deep knowledge of the acquiring company A flexible management style * Ability to work in cross-functional project teams * Willingness to work independently * Sufficient emotional and cultural intelligence to work * well with people from all background A. STAFFING FOLLOWS STRATEGY 1. Hiring and Training Requirements Change * Training and development * reduction in scrap * overall cost savings 2. Matching the Manager to the Strategy EXECUTIVE TYPE * Executives with a particular mix of skills and experiences and paired with a specific corporate strategy a) DYNAMIC INDUSTRY EXPERT an aggressive new chief executive with a great deal of experience in a particular industry b) ANALYTICAL PORTFOLIO MANAGER * Someone with an analytical mind who is highly knowledgeable in other industries and can manage diverse product lines c) CAUTIOUS PROFIT PLANNER * a person with a conservative style, a production or engineering background and experience with controlling budgets, capital expenditures, inventories and standardization procedures d) TURNAROUND SPECIALIST * Challenge-oriented executive type e) PROFESSIONAL LIQUIDATOR Called on by a bankruptcy court to close the firm and liquidate its assets B. SELECTION AND MANAGEMENT DEVELOPMENT 1. Executive succession: insiders versus outsiders Executive Succession * It is the process of replacing a key top manager. 2. Identifying abilities and potential Performance Appraisal System * It is use to identify good performers with promotion potential. Assessment Center * Use to evaluate a person’s suitability for advanced position. Job Rotation * Moving people from one job to another. SIX BROAD COMPETENCIES THAT A COMPANY BELIEVES ARE NECESSARY: * Practice the HP way Lead change and learning * Know the internal and external environments * Lead strategy setting * Align the organization * Achieve results * C. PROBLEMS IN RETRENCHMENT DOWNSIZING * Sometimes called “rightsizing”. * The planned elimination of positions or jobs. * Used to implement retrenchment strategies. GUIDELINES FOR SUCCESSFUL DOWNSIZING: 1. Eliminate unnecessary work instead of making across-the-board cuts. 2. Contract out work that others can do cheaper. 3. Plan for long-run efficiencies. 4. Communicate the reasons for actions. 5. Invest in the remaining employees. 6.
Develop value-added jobs to balance out job elimination. D. INTERNATIONAL ISSUES IN STAFFING * When making international assignments, they focus on transferring knowledge and developing global leadership. * They make foreign assignments to people whose technical skills are matched or exceeded by their cross-cultural abilities. * They end foreign assignments with a deliberate repatriation process with career guidance and jobs where the employees can apply what they learned in their assignments. II. LEADING * Use abilities and skills most effectively and efficiently to achieve organizational objectives. Without direction, people tend to do their work according to their personal view of what tasks should be done, how, and in what order. A. MANAGING CORPORATE CULTURE * Can exert a powerful influence in the behaviour of all employees, it can strongly affect a company’s ability to shift its strategic direction. * Corporate culture has a strong tendency to resist change because its very reason for existence often rests on preserving stable relationships and patterns of behavior. 1. ASSESSING STRATEGY-CULTURE COMPATIBILITY When implementing a new strategy, a company should take the time to assess strategy-culture compatibility.
Consider the following questions regarding the corporation’s culture: 1. Is the planned strategy compatible with the company’s current culture? 2. Can the culture be easily modified to make it more compatible with the new strategy? 3. Is the management willing and able to make major organizational changes and accept probable delays and a likely increase in cost? 4. Is management still committed to implementing the strategy? 2. MANAGING CULTURAL CHANGE THROUGH COMMUNICATION * Communication is key to the effective management of change.
Companies in which major cultural changes have taken place successfully had the following characteristics in common: * The CEO and other top managers had a strategic vision of what the company could become and communicated this vision to employees at all levels. * The vision was translated into the key elements necessary to accomplish that vision. 3. MANAGING DIVERSE CULTURES FOLLOWING AN ACQUISITION The choices of which method to use should be based on: a) How much members of the acquired firm value preserving their own culture and b) How attractive they perceive the culture of the acquirer to be.
FOUR GENERAL METHODS OF MANAGING TWO DIFFERENT CULTURES 1. INTEGRATION * Involves a relatively balanced give-and-take of cultural and managerial practices between the merger partners, and no strong imposition of cultural change on either company. * It mergers the two cultures in such a way that the separate cultures of both firms are preserved in the resulting culture. 2. ASSIMILATION * Involves the domination of one organization over the other. The denomination is not forced, but it is welcomed by members of the acquired firm, who may feel for many reasons that their culture and managerial practices have not produced success. . SEPARATION * Characterized by a separation of the two companies’ cultures. * Structurally separated, without cultural exchange. 4. DECULTURATION * Involves the disintegration of one company’s culture resulting from unwanted and extreme pressure from the other to impose its culture and practices. * Most common and most destructive method of dealing with two different cultures. It is often accompanied by much confusion, conflict, resentment and stress. * Primary reason why so many executives tend to leave after their firm is acquired. B. ACTION PLANNING ACTION PLAN States what actions are going to be taken, by whom, during what timeframe, and with what expected results. * Informations included in the resulting action plan: * Specific actions to be taken to make the program operational. * Dates to begin and end each action. * Person (identified by name and title) responsible for carrying out each action. * Person responsible for monitoring the timeliness and effectiveness of each action. * Expected financial and physical consequences of each action. * Contingency plan. C. MANAGEMENT BY OBJECTIVES MANAGEMENT BY OBJECTIVES An organization-wide approach to help ensure purposeful action toward desired objectives. * MBO links organizational objectives and the behavior of individuals. * The MBO process involves: * Establishing and communicating organizational objectives. * Setting individual objectives (through superior-subordinate interaction) that help implement organizational ones. * Developing an action plan of activities needed to achieve those objectives. * Periodically (at least quarterly) reviewing performance as it relates to the objectives and including the results in the annual performance appraisal.
Advantages * It provides the opportunity to link the objectives of superiors and subordinates. * It links corporate business and functional objectives, as well as the strategies developed to achieve them. * MBOs can reduce the amount of internal politics operating within a large corporation. * People are less likely to jockey for power if the company’s mission and objectives are clear and they know that the reward system is based on achieving clearly communicated, measurable objectives. Disadvantage * MBOs may be incapable of rapid response to environmental change. D.
TOTAL QUALITY MANAGEMENT TOTAL QUALITY MANAGEMENT * an operational philosophy committed to customer satisfaction and continuous improvement. * Committed to high quality/excellence and to being the best in all functions. * Aims to reduce costs and improves quality * Used as a program to implement both an over-all low cost or a differentiation business strategy. Four objectives of TQM: 1. Better, less variable quality of the product and service. 2. Quicker, less variable response in processes to customer needs. 3. Greater flexibility in adjusting to customers’ shifting requirements. . Lower cost through quality improvement and elimination of non-value adding work. TQM’s essential ingredients are: * An intense focus on customer satisfaction. * Internal as well as external customers. * Accurate measurement of every critical variable in a company’s operations. * Continuous improvement of products and services. * New work relationships based on trust and teamwork. E. INTERNATIONAL CONSIDERATION IN LEADING Dimension of Natural Culture 1. Power Distance (PD) * The extent to which a society accepts an unequal distribution of power in organizations. . Uncertainty Avoidance (UA) * The extent to which a society feels threatened by uncertain and ambiguous situations. 3. Individual-collectivism (I-A) * The extent to which the extent to which a society values individual freedom and independence of action compared with a tight social framework and loyalty to the group. 4. Masculinity-femininity (M-F) * The extent to which society is oriented toward money and things (masculine) or toward people (feminine). 5. Long-term Orientation (LO) * The extent to which society is oriented toward the long versus the short-term.