The Three Buiding Blocks Of Business Strategy Implementation.
Strategy implementation is the term used to describe the last phase of the strategic planning process.Review the appropriateness of the choices you generated during the phase of identifying your best strategic options .
Johnson and Scholes a re-known publisher on strategy matters has developed a three step framework which will enable you to evaluate each of your chosen options and then choose your best business strategy. Namely:
This page has a detailed blue print of the key factors underlying each of the three questions you need to ask your self when assessing the best strategy implementation for your business.
The first consideration that you must make when evaluating a potential strategy is to consider whether or not it is suitable for your company.
Suitably appraise an identified strategy by matching it with results from your strategic analysis phase. Questions to answer are :
The issue of feasibility evaluates whether your chosen strategy can be implemented successfully. The resources your company has at its disposal will obviously determine this. Key resources are :
The final issue to address is whether the selected strategy will meet the expectations of the key stakeholders in the business.Typical issues to be looked at would include the level of risk and return resulting from the option.
Units of measure are:
Units of measure are:
Financial ratio analysis ( Uses key financial ratios to measure risk as depicted in your company’s balance sheet)
As a shop retailer, assume you were eager to grow quickly by funding shop fitting costs through delayed payments to your suppliers and also increasing your overdraft. In this case, a liquidity ratio measured against your current assets will depict reduced liquidity and increased financial risk to your business.
Sensitivity Analysis(Use a spreadsheet to question and change each of the important assumptions underlying your business options. E.g the sensitivity of profit to any of your assumptions).
Analysing Stakeholder reactions (Consider the impact of the reactions from key stakeholders and weight your strategy implementation accordingly. i.e shareholders, Bankers, Suppliers, Employees)
Strategic implementation can be a very wide and complex subject ranging from project management through to setting up business structures. However, as with strategic analysis and strategic choice from our planning process, it is possible to simplify the issues in to a number of key sub-headings:
Management of change
An expert on change management called Kurt Lewins developed a three-step approach, described below:
To be successful, Lewins recommends that you should consider adopting of the following management styles so as to improve acceptance of the change.
The discussion on strategy implementation is a composition of models that could help you produce a detailed and complex diagnostic report highlighting the key ingredients of feasibility, acceptability and suitability in lieu of other concerned stakeholders.
You may ask your CPA to review your case for comprehensive analysis, or contact us, for online support.
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