Meaning of strategy Implementation

Strategy implementation is a managerial exercise of translating decision into action. Implementation is done with proper feasibility and acceptability studies. Implementation requires support of all managers and employees of the business.

Implementing strategy affects an organization from top to bottom. It affects all the functional and divisional area of the business significantly. Implementation strategy includes allocation of resources to new courses of action.

Implementation strategy may need a change in organizational structure to handle new activities. Implementation may need training personnel for devising appropriate training to make implementation faster with perfection. Generally it is said that it is easy to say about implementation but it is tough to do in time. Here to do means implementation of formulated strategy.

 

Steps in Strategy Implementation

Implementation strategy includes following five steps in a sequence:-

• Step 1 Action
• Step 2 Efficiency
• Step 3 Operational process            
• Step 4 Motivational and leadership skill
• Step 5 Coordination at middle and lower level

 

Contrast between Strategy Formulation and

 Strategy Implementation

Strategy Formulation		Strategy Implementation
BEFORE ACTION	Strategy formulation is positioning forces before the action	DURING THE ACTION	Strategy implementation is managing forces during the action
EFFECTIVENESS	Strategy formulation focuses on effectiveness	EFFICIENCY	Strategy implementation focuses on efficiency
INTELLECTUAL PROCESS	Strategy formulation is primarily an intellectual process	OPERTIONAL PROCESS	Strategy implementation is primarily an operational process
INTITUTIVE AND ANALYTICAL SKILL	Strategy formulation requires good intuitive and analytical skills	MOTIVATION AND LEADERSHIP SKILL	Strategy implementation requires special motivation and leadership skills
Co-ordination among the executives at the top level	Strategy formulation requires coordination among the executives at the top level	Co-ordination among executives At middle and lower level	Strategy implementation requires coordination among the executives at the middle and lower levels

 

Strategy implementation is fundamentally different from strategy formulation. Strategy formulation and implementation can be contrasted in the following ways:

 

 

Linkage between Formulation and Implementation

In real life, the formulation and implementation processes are intertwined or linked with each other. Two types of linkages exist between these two phases of strategic management. The forward linkages deal with the impact of strategy formulation on strategy implementation while the backward linkages are concerned with the impact of strategy implementation on strategy formulation.

Forward Linkage: Forward linkage means the organizational structure and leadership will be agreed to change in the light of the requirements of the modified or new strategy. Top management must be ready to change leadership styles in the light of the requirements of the modified or new strategy. In this way, the formulation of strategies has forward linkages with their implementation.

Backward Linkages: Organizations tend to adopt those strategies which can be implemented with the help of the present structure, present leadership combined with some additional effort. While dealing with strategic choice, remember that past strategic actions also determine the choice of strategy. It means leadership or structure will not change significantly rather strategy has to be modified which suits to existing structure, leadership.

 

Issues in Strategy Implementation

Practically, everything in the business world is included in the issues of strategy implementation.

The strategist has to equip himself with wide range of knowledge, skills, attitude and abilities. Implementation task includes resources allocation, design structure, formulation of functional policies, deciding leadership style.

Management issues central to strategy implementation include Establishing annual objectives, Devising policies, Allocating resources, Altering an existing organizational structure, Restructuring and reengineering process, Revising reward and incentive plans, Minimizing resistance to change, Developing a strategy-supportive culture, Adapting production or operations processes, developing an effective human resource system and, if necessary, downsizing. Training for world class performers -Firms should provide training for both managers and employees to ensure that they have and maintain the skills necessary to be world-class performers.

However following are issues in strategy implementation in sequential manner,

• Project implementation
• Procedural implementation
• Structural implementation
• Resource allocation
• Functional implementation
• Behavioural implementation

It should be noted that the sequence does not mean that each of the above activities are necessarily performed one after another. Many activities can be performed simultaneously, certain other activities may be repeated over time; and there are activities, which are performed only once. Thus, there can be overlapping and changes in the order in which these activities are performed.

 

Relation between Formulation and Implementation

Relation between formulation and implementation may be understood based on the following two matrix:

1. Strategy formulation and implementation matrix.
2. Principal combination of efficiency and effectiveness.

It is crucial to realize the difference between the two because they both require very different skills. Thus, organizational success is a function of good strategy and proper implementation. Following matrix in the figure below represents various combinations of strategy formulation and implementation:

Strategy Formulation and Implementation Matrix:

 

Strategy Formulation and Implementation Matrix

Let us plot strategy implementation on X axis and

Strategy formulation on Y axis.

Strategy implementation have two column,

These are weak and excellent.

Strategy Formulation have two rows,

These are flawed and sound.

Strategy Formulation and Implementation Matrix

Strategy implementation is weak and strategy formulation sound. This can be because of various factors or issue such as

• Lack of experiences,
• Missing action plan,
• Not using resource efficiently,
• Poor operational process,
• Missing leadership and motivation,
• Missing coordination and team work etc.
• Companies have to plan to solve these issue to move from

Square A to square B Here, strategy implementation is excellent and strategy formulation is sound. Square B is the most ideal situation where wish will be fulfilled.

This combination will take company to the desired state.

This is the best combination of strategy formulation and implementation

In square C, Strategy implementation is weak and strategy formulation is flawed.

It is reserved for complete failure. As it is weak on implementation and flawed in formulation both in implementation stages and at formulation stages. Here, the company has to move for business process redesign.

 

After business process Redesign Company will work on formulation and implementation. Company will make an attempt to make formulation sound and implementation excellent. With this efforts the company will move from square C to square D.

Square D Here, Strategy implementation is excellent and strategy formulation is flawed.

In this combination there is Implementation skills but flawed in formulation skill,

When a company finds itself in Square D, the first thing they have to redesign strategy formulated before readjusting with their implementation or execution skill.

Principal Combination of Efficiencies and Effectiveness

 

Principle Combinations of Efficiency and Effectiveness

To be effective is to do the right thing,

While to be efficient is to do the thing right.

An emphasis on efficiency rather than on effectiveness is clearly wrong.

When organizations lack strategic decision there has been a tendency to look inwards in times of stress. Management starts cost cutting and closing unprofitable divisions. Management start focusing on efficiency rather effectiveness. It is duty of top management to formulate strategy which suits to organization resources and environment

Cell 1: THRIVE -In this cell strategic management is effective and operational management is efficient. An organization in cell one is well placed and thrives, since it is achieving what it aspires to achieve with an efficient output-input ratio.

This is the most ideal cell.

Cell 2: DIE SLOWLY- In this cell strategic management is ineffective and operational management is efficient. An organization in cell 2 will die slowly. There must be new strategic direction.

Cell3: SURVIVE– In this cell strategy formulation is effective and operational management is inefficient. In this cell company can still survive for some time.

Cell 4: DIE QUICKLY- In this cell strategic management is effective and operational management is inefficient. An organization in cell 4 will die quickly. There must be new strategic directions well as new planning for increasing the efficiency in operational management. Then only company will go to cell 1.