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Strategy_Implementation_and_Control

Strategy_Implementation_and_Control - Strategy...

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Strategy Implementation
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- is the sum total of activities and choices required for the execution of a strategic plan. Strategy Implementation
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Most companies have strategies, but according to recent studies, between 70% and 90% of organizations that have formulated strategies fail to execute them. A Fortune Magazine study has shown that 7 out of 10 CEOs who fail, do so not because of bad strategy, but because of bad execution. In another study of Times 1000 companies, 80% of directors said they had the right strategies but only 14% thought they were implementing them well. Strategy Implementation
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1.Implementation took more time than originally planned. 2.Unanticipated major problems arose 3.Activities were ineffectively coordinated 4.Competing activities and crises took attention away from implementation 5.The involved employees had insufficient capabilities to perform their job Strategy Implementation 10 problems to implement a strategic change:
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6. Lower-level employees were inadequately trained 7. Uncontrollable external environmental factors created problems 8. Departmental managers provided inadequate leadership and direction 9.Key implementation tasks and activities were poorly defined 10. The information system inadequately monitored activities Strategy Implementation 10 problems to implement a strategic change:
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7 Ways to Fail Big (by Carroll and Mui, HBR) Siren How It Can Fail Example The Synergy  Mirage:  Seeking  synergies by  merging with  firms with  complementary  strengths  Culture and  systems clashes  may prevent  capture of  synergies.  Insurers Unum and Provident (operating in  the group and individual markets,  respectively) merged. But the two sales  forces had different skills and no desire to  collaborate on cross-selling. Costs and  complications raised prices. Unum undid the  merger; its stock price plummeted.  Faulty Financial  Engineering:   Using overly  aggressive  financial  practices to drive  growth  Flawed offerings  that prove  excessively risky  long-term can  result.  Green Tree Financial made a fortune  offering 30-year mortgages on trailer homes.  But trailers depreciate rapidly, leaving  owners owing more than the trailers are  worth. Defaults ultimately bankrupted the  company. 
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7 Ways to Fail Big (by Carroll and Mui, HBR) Siren How It Can Fail Example Staying the  Course:  Sticking to  your current  strategy despite  market changes  Executives may  underestimate  the significance  of market  changes.  Eastman Kodak stuck to print photo  processing in the face of a blatant danger  (digital photography) because traditional  processing’s margins were high. The firm’s  delayed move into digital cost it 75% of its  stock market value.  Pseudo  Adjacencies:   Selling new  products to  existing customers,  or existing  products to new  customers or  through new 
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