STRATEGIC MANAGEMENT & BUSINESS POLICY
13TH EDITION
THOMAS L. WHEELEN
J. DAVID HUNGER
Staffing
• The implementation of new strategies
often calls for new human resource
management.
• Priorities and a different use of personnel.
Such staffing issues can involve hiring
new people with new skills, firing people
with inappropriate skills.
Prentice Hall, Inc. ©2012
10-2
Example on acquired companies
• The percentage of an acquired company’s
top management either quit or asked to
leave:
• Around 25% after the first year, 35% after
the second year, 48% after the third year,
55% after the fourth year, and 61% after
five years.
• Why they asked to leave?
Prentice Hall, Inc. ©2012
10-3
Staffing
Integration Managers
•
Prepare a competitive profile of the
company in terms of its strengths and
weaknesses
• Draft a profile of what the ideal
combined company should look like
• Develop action plans to close the gap
between actual and ideal
• Establish training programs to unite the
combined company and make it more
10-4
Prenticecompetitive
Hall, Inc. ©2012
1.
2.
3.
4.
5.
Successful Integration Managers
Deep knowledge of the acquiring
company
Flexible management style
Ability to work in cross-functional teams
Willingness to work independently
Sufficient emotional and cultural
intelligence to work in a diverse
environment
Prentice Hall, Inc. ©2012
10-5
Staffing Follows Strategy
•
Training and development
•
Executive types/skills match strategy
–
–
–
–
–
Dynamic industry expert
Analytical portfolio manager
Cautious profit planner
Turnaround specialist
Professional liquidator
Prentice Hall, Inc. ©2012
10-6
Selection and Management Development
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
Prentice Hall, Inc. ©2012
10-7
Forecasting Labor Supply
A. Forecasting the internal labor supply
means determining the number and
type of employees who will be in
the firm at some future date.
B. management tools:
Develped 2013
8
Forecasting Labor Supply
management tools:
1. Replacement charts: List each key
management position, who occupies it, how
long that person will likely stay in the job,
and who (by name) is qualified as a
replacement.
2. Skills inventories: Computerized information
systems containing information about each
employee’s education, work experience, and
career aspirations.
Develped 2013
9
Methods used in identifying Abilities and
Potential of staff
Performance appraisal system identifies good
performers with promotion potential
Assessment centers evaluates a person’s suitability
for an advanced position
Job rotation- ensures employees are gaining a mix of
experience to prepare them for future
responsibilities
Prentice Hall, Inc. ©2012
10-10
Problems in Retrenchment
Downsizing the planned eliminated of positions or
•
jobs
Can damage the learning capacity of an
organization
Prentice Hall, Inc. ©2012
10-11
Successful Downsizing
•
•
•
•
•
•
Eliminate unnecessary work instead of making
across the board cuts
Contract out work that others can do cheaper
Plan for long-run efficiencies
Communicate the reasons for actions
Invest in the remaining employees
Develop value added jobs to balance out job
elimination
Prentice Hall, Inc. ©2012
10-12
International Issues in Staffing
When MNCs operate abroad they have to ensure
their international success by considering the
follows:
•
Culture differences
•
Management styles match contingencies.
•
Human resource practices
•
Suboptimization: local subsidiary ignores the
needs of large primary corporation when the CEO
from the locals.
•
Communication and coordination
•
Lack of international management with experience
Prentice Hall, Inc. ©2012
10-13
International Issues in Staffing
• 80% of midsize and large companies send
their employees abroad.
• Payment for executive working in another
country range from 300000$ to 1$M
annually.
• 10-20% of Americans sent to work abroad
return early because of job dissatisfaction.
• One third of them who stay abroad do not
do well in their task.
Prentice Hall, Inc. ©2012
10-14
Implementation involves leading and coaching
people to use their abilities and skills most
effectively and efficiently to achieve
organizational objectives
Prentice Hall, Inc. ©2012
10-15
Managing Corporate Culture
•
•
•
Strong cultures are resistant to change
Optimal culture supports mission and
strategies
Change in strategy should be followed
by change in culture
Prentice Hall, Inc. ©2012
10-16
Accessing/reaching Strategy-Culture
Compatibility
1.
2.
3.
4.
Is the proposed strategy compatible with the
company’s current culture
Can the culture be easily modified to make it more
compatible with the new strategy
Is management willing and able to make major
organizational changes and accept probable delays
and a likely increase in costs
Is management still committed to implementing the
strategy
Prentice Hall, Inc. ©2012
10-17
Prentice Hall, Inc. ©2012
10-18
Managing Cultural Change Through
Communication
•
•
•
CEO and top management communicated the
strategic vision throughout the organization
Current performance was compared to competition
and constantly updated
Vision was translated into key elements needed to
accomplish the vision
Prentice Hall, Inc. ©2012
10-19
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: not forcing but accepted by both.
Separation of the two cultures
Deculturation: disintegration of one culture
resulting from pressure from the other to impose
its culture and practices
Prentice Hall, Inc. ©2012
10-20
Prentice Hall, Inc. ©2012
10-21
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
Prentice Hall, Inc. ©2012
10-22
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
Prentice Hall, Inc. ©2012
10-23
Prentice Hall, Inc. ©2012
10-24
Prentice Hall, Inc. ©2012
10-25
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)
Prentice Hall, Inc. ©2012
10-26
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
Prentice Hall, Inc. ©2012
10-27
Essential Ingredients of TQM
1.
2.
3.
4.
5.
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
Prentice Hall, Inc. ©2012
10-28
Dimensions of National Culture
1.
2.
3.
4.
5.
Power distance: how much they love power.
Uncertainty avoidance: ambiguous situations or
routine.
Individualism-collectivism
Masculinity –femininity: is the extent to which
society is oriented toward money and things
(masculine) or toward people (feminine).
Long-term orientation: oriented toward the long
versus the short-term.
Prentice Hall, Inc. ©2012
10-29
1. What skills should a person have for managing a business
unit following a differentiation strategy? Why? What should
a company do if no one is available internally and the
company has a policy of promotion from within?
2. When should someone from outside the company be
hired to manage the company or one of its business
units?
3. What are some ways to implement a retrenchment
strategy without creating a lot of resentment and
conflict with labor unions?
4. How can corporate culture be changes?
5. Why is an understanding of national cultures important
in strategic management?
Prentice Hall, Inc. ©2012
10-30