The strategy making, strategy
executing process
Developing
a Strategic
Vision
Setting
Objective
Crafting a
strategy to
achieve the
objectives
and vision
Implementi
ng and
Executing
the strategy
Revise as needed in light of actual
performance, changing conditions, new
opportunities and new ideas
Monitoring
developments,
evaluating
performance and
making corrective
adjustments.
Strategic Vision
 The route acompany intends to take in
developing and strengthening its business. It
lays out the company’s strategic course in
preparing for the future
Developing a
Strategic Vision
Internal Consideration
 What are the company’s ambitions? What industry
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standing should the company have?
Will the company’s present business generate
sufficient growth and profitability in the years ahead
to please shareholders?
What organizational strengths ought to be
leveraged in terms of adding new products or
services and getting into business
Is the company stretching its resources too thin by
trying to compete in too many markets or segments,
some of which are unprofitable?
Is the company’s technological focus too board or
too narrow? Are any changes needed?
Strategic vision as a managerial tool
 Must provide understanding of what
management wants its business looklike
 Must provide managers with a reference
point in making strategic decisions and
preparing the company for the future
 Must say something definitive about how the
company’s leaders intend to position the
company beyond where it is today
Characteristic of an effective worded
strategic vision
 Graphic
 Directional
 Focused
 Flexible
 Feasible
 Desirable
 Easy to communicate
What covers compare to mission
statement
 Strategic Vision is the company’s future
strategic course, the direction we are headed
and what our future product/market/
customer/technology focus will be (where we
are going)
 Mission statements provide a brief overview
of the company’s present business purpose
and raison d’etre (who we are, what we do
and why we are here)
Communication the strategic vision
 An effectively communicated vision is a valuable
management tool for enlisting the commitment
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of the company’s personnel to actions that get
company moving in the intended direction
Expressing the essence of the vision in a slogan
Breaking down the resistance to a new strategic
vision
Recognizing Strategic Inflection Point
Understanding the payoffs of a clear vision
statement
Setting
Objective
Setting Objective
 Objectives are an organization’s performance
targets – the result and outcomes
management wants to achieve. The function
as a yardsticks for measuring how well the
organization is doing
 Setting stretch objectives to avoid ho-hum
result
 Need for a balanced score card
Strategic performance foster better
financial performance
 Financial performance are lagging indicators
where strategic performance signs of leading
indicators
 Expressed Strategic intent as the “contract”
of the management
 Objective setting needs to be top-down
rather than bottom-up
Crafting a
strategy to
achieve the
objectives
and vision
Strategy crafting
 Masterful strategies come mostly by doing thing
differently from competitors where it counts – out
innovating them, being more efficient , being more
imaginative, adapting faster
 In most company crafting and executing strategy is a
team effort in which every manager has a role for the
area he or she heads.
 Giving people an influential stake in crafting the
strategy they must later help implement and execute
not only builds motivation and commitment but also
means those people can be held accountable for
putting the strategy into place and making it work –
the excuse of “it wasn’t my idea to do this” won’t fly
Start at the top
 Mid-level and front-line managers cannot
craft unified strategic moves without
understanding the company’s long-term
direction and knowing the major components
of the overall and business strategies that
their strategy making efforts are supposed to
support and enhance
Company’s Strategy Making Hierarchy
CEO & other senior
executive
General managers,
different line business
Major functional
activities
Operating managers
Corporate
Strategy
Business
Strategy
• The companywide game plan for managing
asset of business
• How to strengthen market position and built
competitive advantage
• Action to build competitive capabilies
Functional
area Strategy
• Add relevant detail to the hows of overall
business strategy
• Game plan for managing a particular activity
Operating
Strategy
• Add detail and completeness to business and
functional strategy
• Managng specific lower echelon
Cause of disarray strategies
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Weak leadership
Too few strategy guidelines coming from top
Less unified collection strategies
Less communicated vision, personnel doesn’t
buy in the company’s longterm direction and
overall strategy
 Less review (due-dilligence) of lower level
strategies for consistency supported of higher
level strategy (synchronization, adjustment
on both direction may needed)
Strategic Plan
 Consists of Company’s future direction
(strategic vision), performance targets and
Stragegy to achieved
Implementi
ng and
Executing
the strategy
Strategy Execution is
an Operations oriented
 The activities that ‘make-things-happen’
 The most demanding and time consuming
part of the strategy management process
 Each manager has to answer to, “what has to
be done in my area to execute my piece of
the strategic plan, and what actions should I
take to get the process underway”
 Can take several months to several years
Principal aspect s of strategy execution
 Staffing with needed skill and expertise
 Allocation of resources, esp. at the critical point to
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success
Policies and procedures
Best practises, continuous improvement, reassess
Installing information and operating system foe
enabling better carry out
Motivating people, modifying duties if needed
Rewards and incentives
Culture and conducive work climate
Exerting the internal leadership
Monitoring
developments,
evaluating
performance and
making corrective
adjustments.
Revise as needed in light of actual
performance, changing conditions, new
opportunities and new ideas
Strategy monitoring issues
 Managing strategy is an ongoing process, not
an every now and then task. A company’s
vision, objectives, strategy and approach to
strategy execution are never final
 If downturn in performance, whether related
to poor strategy or to poor execution or both?
All have to be revisited antime
Role of board directors (komisaris, Ind)
 Be inquiring, critics and ovesee the company’s
direction, strategy, and business approaches
 Evaluate the caliber of the executive’s strategy
making and strategy executing skills
 Institue a compensation plan for top executives
that rewards them for actions and results that
serve stakeholder interests, and most especially
those of shareholders
 Oversee the company’s financial accounting and
financial practices
Equipped with strong independent
directors
 Well informed about company’s performance
 Guides and judges the CEO and other executives
 Has the courage to curb inappropriate or unduly
risky management actions
 Certifies to shareholders that the CEO is doing
what the board expects
 Intensely involved in debating the pros and cons
of key decisions and actions
 Do not being a rubber-stamp of the CEO