Week 8 organising for success

3BM020 Organisational Strategy and Decision Making Week Organising for success Promoting ethnic diversity on campus We need a group of students to work with an expert in race equality in higher education - to share your views and experiences and tell us what you would like to see happen at the University This is a students-only event At the end, senior members of the University management team will listen to you and use your feedback to influence change across the University, and make York St John a better place for everyone in our community Please join us! Booking is not essential but to help with numbers please register – scan QR code or contact Marije Davidson, Equality and Diversity Adviser E: m.davidson@yorksj.ac.uk or Whatsapp: 07880 921743 Monday 21 st November 1.30 - 3pm Students’ Union coffee lounge Housekeeping • Abstract, citations, reference page, appendices – Not included in the word count • 12 Temple Hall today – session on employability • Week 10 – check seminar changes, however you can stay in your own groups if these changes not suit you Outcomes covered in this session • • • Contextualise ‘real world’ strategy issues Identify key challenges for organising success Analyse strengths, weakness and choices associated with organisational structures In the news – ‘real world’ examples Resources can be physical – including stores: what is the strategic rationale for this decision? Why is such an approach needed? Has M&S been over reliant on the sources of previous success? Have core competencies become core rigidities? In the news – further expansion from week from week from week from week In the news – further expansion from week from week from week In the news – labouring the point “From week x….” Various ways/routes to understand and interpret strategy Strategy does not mean one thing – interpretation, built from supported analysis, matters You, however, have to be strategic with your assessment(s) Consider what you are trying to in the context of the report– we tell you to be selective and focused: • • • Demonstrating quality understanding is essential Making links between concepts, supported by relevant examples, supporting evidence and a critical writing style is key Using appropriate concepts will depend on such issues as the position of your company, what it does, how it does it, what others in the industry do, how well it is received, how long it has been in operation – and many other things One article, lots of Strategy Stuck in the middle? Strategic leadership +turbulence +strategic drift +emergent +transformational PESTLE Social and Technological Organising for success • Ability to execute strategy can be more important than strategy itself (Kaplan and Norton, 2001) • The fatal problem with strategy implementation is the de facto success rate of intended strategies In research studies it is as low as 10 percent (Judson, cited in Raps, 2005) • Despite 97% of directors having a 'strategic vision', only 33% reported achieving 'significant strategic success' (Source: Why only one third of UK companies achieve strategic success? - I Cobbold & G Lawrie, 2GC Ltd., May 2001.) Project-based Structure (1) • • • Teams created, undertake the work, then dissolved For large expensive items or limited time events Constantly changing organisational structure – – • Collection of project teams Created and steered by small corporate group Set up ad hoc taskforces – – for new elements of strategy to provide momentum Project-based Structure (2) • Advantages – – – – • Flexible Good accountability and control (clear tasks/defined time) Effective knowledge exchange Attract international members due to short project times Disadvantages – – – Possible lack of coordination Proliferation of projects Breaking up teams hinders knowledge accumulation Processes • • • Of greater importance for the success or failure of strategy Formal systems and controls Informal ways in which people interact Processes can be thought of as controls on the organisation’s operations and can therefore help or hinder the translation of strategy into action Processes • Typical processes: – Direct supervision – Planning and control systems – Performance targets – Market mechanisms – Social/cultural processes (norms) • The ‘softer’ processes within organisations – the social processes and self-controls – are of major (and probably growing) importance in most organisations – Self-control (personal behaviour and motivation) Processes • “Strategy implementation requires an integrative point of view Not only the organizational structure, but cultural aspects and the human resources perspective are to be considered as well” (Raps, 2005:142) Relationships and Boundaries • Relationships – – • Between organisational units and the centre (parenting) Outside firm, e.g outsourcing and strategic alliances Centralisation vs Devolution – “the extent to which the centre of an organisation delegates decision making to units and managers lower down in the hierarchy” • Boundaries – Outsourcing Strategy & Structure • ‘Structure follows strategy’ (Chandler 1962) – – • See also Contingency Theory: the successful organisation designs its structure to match its situation ‘Strategy follows structure’ (Hall & Saias 1980) – • Adapt the organisation according to the strategy Existing organisational structure determines strategic opportunities ‘Structure follows strategy as the left foot follows the right’ (Mintzberg 1990) – Reciprocal relationship Strategy before structure: Chandler’s contribution • Alfred Chandler (1987) studied a number of leading North American companies during the early 1900’s He concluded: – As companies grow in size and complexity, they need a general office to handle the planning and co-ordinating work – The general office was concerned with long-term strategy of the company – Once the strategy was formulated, the general office then designed a suitable organisation structure to implement the agreed strategy specific criticism of strategy before structure • Strategy & structure need to develop at the same time in an experimental way: as strategy develops, so does structure The organisation learns to adapt to its changing environment & to its changing resources, especially if the change is radical • If the strategy process is emergent, then the learning & experimentation involved may need a more open & less formal organisation structure Building the organisation’s structure • Environmental factors such as market change and complexity will impact on the proposed structure • In general, increased change and complexity suggest more flexible, less centralised structures • Mintzberg -There are six main types of structure Mintzberg’s six organisational configurations Mintzberg’s criticism of his own work • Some organizations not fit our categories: – It is difficult to imagine a more machinelike organization than McDonald’s: why then, does it seem to be rather innovative, at least in its own context? – 3M or Hewlett-Packard are often held up as innovative in form, but also have tight control systems Innovative adhocracies are not supposed to rely on tight controls The choice of management style and culture • Every organisation has the choice of changing its culture and style when it changes its strategy • In many cases, a change of style is essential when a fundamental change of strategy is proposed • • • The content of the culture and style depends on the strategies proposed There needs to be a degree of strategic fit between the two areas Importantly, culture and style take time to change and may move more slowly than the proposed strategy Summary • Organising for success concerns organisational configuration – • Successful organisation depends on response to key challenges – • Structure, Processes, Relationships Control, Change, Knowledge, Globalisation Many structural types (e.g functional, divisional, matrix) – – – Organisational processes facilitate strategy Focus on inputs or outputs Direct or indirect bibliography/reference • • • Johnson, Scholes & Whittington Exploring Corporate Strategy Lynch, R Corporate Strategy th th edition (2008) edition (2009) Mintzberg, Lampel, Quinn & Ghoshal The Strategy Process, th international edition (2003) • Chandler, A Strategy & Structure: Chapters in the History of the American Industrial Enterprise (1987) ... news – further expansion from week from week from week from week In the news – further expansion from week from week from week In the news – labouring the point “From week x….” Various ways/routes... strategic success'' (Source: Why only one third of UK companies achieve strategic success? - I Cobbold & G Lawrie, 2GC Ltd., May 2001.) Organising for success • A recent commercial for a major... Strategic leadership +turbulence +strategic drift +emergent +transformational PESTLE Social and Technological Organising for success • Ability to execute strategy can be more important than strategy