STRATEGIC MANAGEMENT & BUSINESS POLICY
12TH EDITION
THOMAS L. WHEELEN
J. DAVID HUNGER
C9
Organizing
C9
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Staffing &
Directing
C10
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Staffing
The implementation of new strategies and
policies often calls for:
• Hiring new people with new skills;
• Firing people with inappropriate skills;
• Training existing employees to learn new skills.
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Staffing follows strategy
•Growth Strategy
•New people may need to be hired or trained.
•Experienced people with necessary skills need to be
found for promotion to a newly created managerial
positions.
•Growth through Acquisition Strategy
•It may find that it needs to replace several managers in
the acquired company.
•Retrenchment Strategy
•A large number of people may need to be laid off.
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Staffing follows strategy
Changing Hiring and Training Requirement
•Overall Lower Cost Strategy
•71% of 51 leading companies rated training as important
and very important.
•155 companies revealed 19% higher productivity.
•Double training resulted in 7% reduction in scrap.
•Differentiation Strategy
•Motorola spends 4% of its payroll on training to ensure
the highest quality possible in all its operation.
•Retrenchment Strategy
•To be successful in downsizing, the company must invest
in training
the remaining employees.
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Staffing follows strategy
Matching the Manager to the Strategy
Career Life Cycle for Top Executives –
–Learning Stage
Experiment intensively with product lines to learn
about their business.
–Harvest Stage
Reduce experimentation and increase performance.
–Decline Stage
Reduce experimentation further and performance
decline.
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Staffing follows strategy
Matching the Manager to the Strategy
Experimentation & Performance
Career Life Cycle for Top Executives
Learning
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Growth
Harvest
Decline
Time
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Staffing Follows Strategy
Matching the Manager to the Strategy
•
Executive types
–
Dynamic industry expert
An aggressive CEO with a great deal of experience in that
particular industry – concentration strategy
–
Analytical portfolio manager
A CEO with an analytical mind, highly knowledgeable in
other industries, can manage diverse product lines –
diversification strategy
–
Cautious profit planner
A CEO with a conservative style, experience with
controlling budgets - stability strategy
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Staffing Follows Strategy
Matching the Manager to the Strategy
•
Executive types
– Turnaround specialist
Weak companies in an attractive industry tend
to turn to a challenge oriented executive to save
the company
– Professional liquidator
If a company cannot be saved, a professional
liquidator might be called on by a bankruptcy
court to close the firm and liquidate its assets
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Selection and Management Development
Executive Succession: Insiders versus Outsiders
Executive succession- replacing a key top manager
•
•
•
Succession planning
Identifying candidates below the top layer of management
Measuring internal candidates against external candidates
Providing financial incentives
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Selection and Management Development
Identifying Abilities and Potential
•Executive Succession
The process of replacing a key top manager
–Insiders
90% of Fortune 100 companies appointed insiders.
–Outsiders
10% of Fortune 100 companies appointed outsiders.
Outsiders introduce significant change and high
turnover.
Firms in trouble, undertaking turnaround strategy
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outsiders.
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Selection & Management Development
Identifying Abilities and Potential
•Performance appraisal system
to identify good performers with promotion potential.
•Assessment centers
to evaluate a person’s suitability for an advanced
position.
•Job rotation
moving people from one job to another to ensure
that employees are gaining the appropriate mix of
experiences to prepare them for future
responsibilities.
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Selection & Management Development
Identifying Abilities and Potential
Performance appraisal Form –
1. Performance Assessment
1. Overall Evaluation
2. Strengths
3. Opportunities for Improvements
2. Career Interests
1. Employee’s Interests
2. Manager’s Assessment
3. Review
1. Approvals (by immediate boss and his boss)
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Employee’s
Signature and Comments
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Selection & Management Development
Identifying Abilities and Potential
Performance appraisal Form –
4. Personal Data
–
–
–
–
Education – College or University
Languages
Employment History with the Company
Other Experience
5. Objectives
1. Prior Year’s Objectives
2. New Objectives
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Problems in Retrenchment
Downsizing the planned eliminated of positions or
•
jobs
Can damage the learning capacity of an
organization.
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Implementation involves leading and
coaching people to use their abilities and
skills most effectively and efficiently to
achieve organizational objectives
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Managing Corporate Culture
Managing Diverse Cultures Following an Acquisition
•
•
•
•
Methods of managing two different cultures
Integration- balanced give and take of cultures
Assimilation- domination of one culture over the other
Separation of the two cultures
Assimilation- disintegration of one culture resulting from
pressure form the other to impose its culture and
practices
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Action planning
Action plan- what actions are going to be taken, by
whom, during what time frame, and with what
expected results
1.
2.
3.
4.
5.
6.
Specific actions to be taken to make the program operational
Dates to begin and end each action
Person 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 plans
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Action planning
Importance of Action plans
•
•
•
Serve as a link between strategy formulation and
evaluation and control
Specifies what needs to be done differently from
current operations
Evaluation and control processes appraise
performance and identify remedial actions
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Action planning
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Action planning
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Management by Objectives (MBO)
Management by Objectives (MBO)encourages participative decision making through
shared goal setting and performance assessment based
on achieving stated objectives.
•
•
•
•
Establishing and communicating organizational
objectives.
Setting individual objectives.
Developing an action plan to achieve objectives.
Performance review (periodic and annual).
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Total Quality Management (TQM)
Total Quality Management (TQM)philosophy that is committed to customer satisfaction and
continuous improvement.
Objectives
1.
2.
3.
4.
Better, less variable quality of the product and service
Quicker, less variable response in processes to customer needs
Greater flexibility in adjusting to customers’ shifting
requirements
Lower cost through quality improvement and elimination of
non-value added work
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International Considerations in Leading
Dimensions of National Culture
Hofstede’s Cultural Dimension Theory:
Collected from 60 IBM subsidiaries worldwide.
1. Power distance
2. Uncertainty avoidance
3. Individualism-collectivism
4. Masculinity-femininity
5. Long-term orientation
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International Considerations in Leading
The GLOBE (Global Leadership and Organizational
Behavior Effectiveness):
Collected from 17,000 respondents, 825
organizations, 61 countries.
1.
2.
3.
4.
5.
6.
7.
8.
9.
Uncertainty avoidance (UA)
Power distance (PD)
Collectivism 1
Collectivism 2
Gender egalitarianism
Assertiveness
Future orientation
Performance orientation
Human orientation
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Uncertainty avoidance (UA)
The extent to which a society
feels threaten by uncertain
and ambiguous situations.
National Culture (H-Scores)
- Career Stability
- Formal rules
- Clear-cut measure of
performance
Power distance (PD)
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The extent to which a society
accepts an unequal
distribution of power in
organizations.
National Culture (H-Scores)
- Autocratic
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- Top-down communication
Masculinity-femininity (M-F)
The extent to which a society
is oriented toward money and
things or toward people.
National Culture (H-Scores)
- Men domination
- Emphasize performance &
independence
-Individualism-collectivism (I-C)
The extent to which a society values
individual freedom and
independence of action compared
with a tight social framework and
loyal to the group.
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National Culture (H-Scores)
Individual success through
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competition
Long-term orientation (LT)
The extent to which a society is oriented toward the long
versus the short term.
Highest Scores on Long Term
• Hong Kong
• Japan
Lowest Scores on Long Term
• Pakistan
National Culture
• Emphasize on hardwork,
education, persistence &
thrift.
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Assertiveness
The extent to which
individuals are assertive,
confrontational and
aggressive in social
relationships.
National Culture (H-Scores)
Gender egalitarianism
The degree to which an
organization or society
minimizes gender role
differences and gender
discrimination.
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National Culture (H-Scores)
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Performance orientation
The extent to which a society
encourages and rewards
group members for
performance improvement
and excellence.
National Culture (H-Scores)
Human orientation
The extent to which a culture
encourages and rewards
people for being fair,
altruistic, caring and kind to
others.
National Culture (H-Scores)
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Generate EFAS and IFAS tables
Divide participants into 6 groups
• Read the case “Enterprise Rent-A-Car” (p. 348-350) and answer
the following questions:
• What is the Enterprise’s business strategy? Please define and
elaborate its strategy and target group.
• Please outline the strategy implementation of “Enterprise Rent-ACar” in term of action program, staffing, and leading.
• Please define Enterprise’s culture and explain
how they create and maintain the culture.
• Send a representative to present your group’s
answer.
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