BUSINESS POLICY AND STRATEGY
BUSINESS POLICY AND STRATEGY MGMT 485W
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This 8 page Class Notes was uploaded by Gerardo Kuhic on Monday September 28, 2015. The Class Notes belongs to MGMT 485W at Old Dominion University taught by Anil Nair in Fall. Since its upload, it has received 12 views. For similar materials see /class/215354/mgmt-485w-old-dominion-university in Business, management at Old Dominion University.
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Date Created: 09/28/15
Chapter 11 0 Leadership 0 The process of transforming organizations from what they are to what the leader would have them become I Implies that there is o Dissatisfaction with the status quo 0 Vision of what should be 0 Process for bringing about change 0 Emotional Intelligence Daniel Goleman I Leadership 0 Technical skills 0 Cognitive abilities reasoning o Emotionalintelligence I Emotional intelligence is the capacity for recognizing one s own emotions and those of others I Effective leaders consistently have high E Q o EQ Emotional Quotient I Self awareness o ability to recognize and understand your moods emotions and drives 0 Hallmarks Self confidence realistic selfassessment self deprecating sense of humor I Self Regulation 0 ability to control or redirect disruptive impulses and moods o The propensity to suspend judgment to think before acting o Hallmarks Trustworthiness and integrity comfort with ambiguity Openness to change I Motivation 0 Passion to work for reasons that go beyond money or status propensity to pursue goals with energy and persistence o Hallmarks Strong drive to achieve optimism even in the face of failure organizational commitment I Empathy 0 Ability to understand the emotional makeup of other people 0 Skills in treating people according to their emotional reactions 0 Hallmarks Expertise in building and retaining talent cross cultural sensitivity service to clients and customers I Social Skill 0 Proficiency in managing relationship and building networks 0 An ability to find common ground and build rapport o Hallmarks Effectiveness in leading change persuasiveness expertise in building and leading teams 0 Strategic Leader I Strategic leaders formulate and implement strategies I Characteristics of strategic leaders that help strategy formulation and implementation 0 Determine direction 0 Design organization 0 Nurture culture 0 Dedicated to excellence 0 Strategic Leadership Always a wish list I Formulation 0 Vision 0 Direction 0 Flexible Challenge existing frame of reference 0 Ask BigQuestions I Multifunctional Entire enterprise I Seek information analyze and make decisions 0 Good judgment bias free I Handle uncertainty I Implementation 0 Network with external stakeholders Lobby o EmpowerlnspireDirect 0 Set cultural norms 0 Develop human and social capital I Learn I Ethical I Styles may vary 0 Command coach motivate and inspire boss evaluate and control facilitator empower and enable sponsor o Managerial Discretion I External Environment 0 Industry Structure 0 Rate of market growth I OrganizationalCharacteristics 0 Size and age 0 Resource availability 0 Culture I Characteristics of the Manager 0 Tolerance for ambiguity 0 Commitment to the firm o Managerial Labor Markets Or where should you get your new CEO from Selecting internal candidates for management positions helps to build on valuable firmspecific knowledge Selecting an outsider often brings fresh insights and may energize the firm with innovative new ideas 0 Top Management Teams Top management teams are comprised of the key managers who are responsible for formulating and implementing the organization s strategies dominant coalition A heterogeneous top management team can draw on multiple perspectives when evaluating alternative strategies and building consensus A top management team must also be able function effectively as a team in order to implement strategies A heterogeneous team makes this more difficult Chapter 10 o OrganizationalStructure 0 Organizational Structure refers to the formalized patterns of interactions that link a firm s tasks technologies and people I Structure helps implement and forumlate strategic plans I Structure determines the efficiency with which work gets done I Most importantly the structure determines how organizational members perceive their organizational world 0 Types of structure I Simple Structure 0 OwnerManager makes all major decision directly and monitors all activities 0 Advantages I Highly informal and the coordination of tasks is accomplished by direct supervision I Decision making is highly centralized Little specialization of tasks few rules and regulations and informal evaluation and reward system I Decisions do not take that long to be made 0 Disadvantages I Informality may lead to problems I Employees may not clearly understand their responsibilities I Employees may not take advantage of the lack of regulations I Recruiting and retaining talent may become very difficult because of flat structure I Difficult to maintain when firm grows in size and complexity I Functional Structure 0 All major functions of the firm such as production marketing RampD and accounting are grouped internally 0 Advantages I Enhancement of coordination and control within each of the functional areas I Decision making in the firm will be centralized at the top of the organization I Enhancement of the organizationallevel perspective across the various functions Functional structure providesfora more efficient use of managerial and technicaltalent sincefunctional area expertise is pooled in a single d partment Careerpaths and professional development in specialized areas are facilitated o Disadvantages Values and orientations amongfunctional areas may 39 d c mmunication and coordination epa tsviewthemselves as isolated self contained units with little need for interaction and Narrow functional orientations may lead to shuncterm thinking based largely upon what is best forthe functional area structure may overburden top executives because conflicts have a tendency to be quotpushed up to thetop ofthe organization sincethere are no managerswho are responsible forthe specific product lines to establish performance standards acrossthe entire organization Chief Executive 0 icer or President Manager Marketing Manager Manager HampD Production Persunnel Lowerclevel managers specialists and operating personnel I Divisional form 0 Products projects or product markets are grouped internally Types 0 Cooperative M Form I Related constrained strategy trying to expose synergy I Advantages Separation of strategic and operating control 0 Division managers can focus their efforts on improving operations in the product markets for which they are responsible Corporate officers can devote their time to overall strategic issues for the entire corporation Problems associated with sharing resources across functional departments are minimized Development of general management talent is enhanced I Disadvantages Duplication of activities 0 Can be very expensive 0 Create role conflict and ambiguity because employees have to report to two bosses Conflict in brand images Cooperative Multidivisional Structure 6 g Campbell Chief ExeCthive Officer I I I I I I I I Corporate Corporate Strategic Corporate corporate Finance Planning NIarketing I I I Resources D1Vls10n DlVlSlOIl D1v1s10n l l l l l Finance Production I IEngineering I Accounting I Resources o SBU Strategic Business Unit Related linked strategy some areas are connected but not all An organizational form in which products projects or product market divisions are grouped into homogeneous units to achieve some synergies Advantages o SBU makes the task of planning and control by the corporate office more manageable 0 With greater decentralization of authority individual businesses can react more quickly to important changes that in all divisions reported directly to the corporate office Disadvantages o Difficult to achieve synergies across SBUs 0 Additional level of management increasesthe number of personnel and overhead expenses 0 Additional hierarchical level removes the corporate office further from the individual divisions SBU s Structure I I I I Strategic Strategic Strategic Strategic Business Business Business Business Unit A Unit B Unit 7 Unit D l ll I Division Division Division Strategic Business Units SBUs are used to organize related businesses into groups for strategy development 0 Competitive M Form holding Organizational form that is a variation of the divisional organizational structure in which the divisions have a high degree of autonomy both from other divisions and from corporate headquarters Also referred to as conglomerate because there is no attempt for synergy Advantages 0 Cost savings associated with fewer personnel and the lower overhead resulting from a smaller corporate office and fewer hierarchical levels 0 Increased motivational executives o Respond quickly to market opportunities and threats Disadvantages o Inherent lack of control and dependence that corporatelevel executives 0 Not enough additional managerial talent ready to quickly fill key positions Competitive Multidivisional Structure ChieLEgecu tive Officer Corporate Finance Strategic Planning Division Division Division Division Finance Production Engineering ales amp g Marketing Human Resources Accounting