Learning Center
Plans & pricing Sign in
Sign Out

Build execution into strategy


									         Group 3
    Mayra Garcia
 Lindsey Pacatte
  David Hayward
Garrett Matthews
    Nick Watkins
     Cory Logan
   Strategy is best carried out when everyone is
    on board with it
   Everyone, from top management down to
    front line employees, need to understand why
    they are implementing change
   Implementation can be hindered if people do
    not understand why things are being changed
   Employees must understand why changes are
    being made
   Build execution into strategy from the start
   Reach for fair process in policy
    implementation of new strategies
•   Lubber liquid coolants example

    – choosing right coolant is a delicate process

    – strategy to eliminate complexity & costs

    – sales process was dramatically simplified
   Strategic move was doomed from the start

    ◦ sales reps saw the shift as a direct threat

    ◦ felt their contributions went unappreciated

    ◦ worked against the expert system

    ◦ deal with management risk up front
   What is Fair Process?
    ◦ Means Procedural Justice or the fairness of the
      steps or processes taken to resolve a dispute or
      allocate resources
   How does this Procedural Justice affect
    ◦ People who believe what they are doing is right will
      be more effective and efficient
   In essence Fair Process is management’s
    expression of procedural justice

   We see that when Fair Process is implemented
    in the strategy-making process, the
    employees can believe that upper
    management is trustworthy
Formulation   Fair Process

               Trust and
 Attitudes    Commitment

 Behavior      Voluntary

 Execution      Exceeds
   1st Principle
   Engagement
   Involving individuals in the strategic decisions
   Communicates respect for Individuals
   Sharpens everyone’s thinking
   Results in better strategic decisions
   2nd Principle
   Explanation
   Understand why final strategic decisions are
   Allows employees to trust manager’s
   Powerful feedback loop
   3rd Principle
   Expectation Clarity
   State clearly the new rules of the game
   To achieve fair process matters most about
   Must to taken together lead to judgment of
    fair process.
   Elevator Systems Manufacturer
    ◦ Elco’s Chester and High Park plant
    ◦ 1980s, sales in the elevator industry had declined
    ◦ Office space lead to a vacancy rate of 20%
   Solution
    ◦ Create and execute a blue ocean strategy
    ◦ Offer buyers a leap in value while lowering cost
    ◦ Replace its batch-manufacturing system with a
      cellular approach
   The Process
    ◦ Install system at the Elco’s Chester plan first
      Had decertified their own unions
      Ideal work force for the change
      Expected a positive spillover effect on High Park
   The results
    ◦ Elco’s Chester Plant
      Change led to disorder and rebellion
      Cost and quality were in free fall
      Wanted to unionize

    ◦ High Park
      Accepted the strategic shift
      Felt they were treated fairly
      Willingly participated in the execution
   A closer look- Elco managers violated all 3
    principles of fair process
    ◦   Failed to engage employees in the decision
    ◦   Manager was always absent
    ◦   Managers didn’t explain why the decision was made
    ◦   Managers also neglected to make clear what was
        expected under the new process
   Elco’s Chester
    ◦   Process undermined employees’ trust
    ◦   Only saw negative side
    ◦   Fights erupted
    ◦   Employee’s rejected the transformation
   High Park
    ◦ Introduced consultants to employees
    ◦ Held plant-wide meetings
    ◦ Calmed employees from the thought of layoffs
   Why does fair process matter?
   Why is fair process important in shaping
    people’s attitudes and behavior?
   Why does the observance or violation of fair
    process in strategy making have the power to
    make or break a strategy’s execution?
                                  Fair Process   Violation of Fair Process

Intellectual & Emotional Recognition                              Intellectual & Emotional Indignation

       Trust & Commitment                                               Distrust & Resentment

 Voluntary Cooperation in Strategy                                   Refusal to Execute Strategy
   Intellectual and Emotional Recognition

   Trust and Commitment

   Voluntary Cooperation in Strategy Execution
   Intellectual and Emotional Indignation

   Distrust and Resentment

   Refusal to Execute Strategy
   Commitment, trust, and voluntary
    cooperation are not merely attitudes or
    behaviors; they are intangible capital
   Trust brings heightened confidence in one
    another’s intentions and actions
   Commitment enables people to override
    personal self-interest in the interest of the
   Commitment, trust, and voluntary
    cooperation allow companies to stand apart
    in the speed, quality, and consistency of their
    execution and to implement strategic shifts
    fast at low cost
   The question raised by management is how
    to create trust, voluntary cooperation, and
    commitment deep within the organization

To top