LEGO Mindstorms: Case Themes

STRATEGY AND ORGANIZATION

1. Identifying the key variables in an organization model and understanding how and to what extent they influence values and behaviors 2. Evaluating the linkage between strategy and organization in terms of: -Fit -Sustainability -Adaptability

Organizational variables
Personal Leadership Structure

Culture
Organizational Capabilities

Culture
People Policies Systems
Source: Fry and Killing Strategic Analysis and Action, 3rd Edition - Figure 9.3

 The Innovators Dilemma

Expecting achievement-driven employees in a large organization to devote a critical mass of resources, attention, and energy to a disruptive project targeted at a small and poorly defined market is equivalent to flapping ones arms in an effort to fly: It denies an important tendency in the way organizations work. The evidence is strong that formal and informal resource allocation processes make it very difficult for large organizations to focus adequate energy and talent on small markets, even when logic says they might be big someday Clayton M. Christensen

Key ideas
1. The purpose of an organizational model is to create and support behaviors consistent with strategic needs. This is the critical issue in evaluating an organization.
Therefore, there is no such thing as a perfect organization. There is just a perfect organization for a strategy. For different strategies, different organizations

Key Ideas (2)

2. The values and behaviors that we observe in an organization are the result of a complex set of forces. Any plans for change must comprehend this.

Key Ideas (3)

3. The choice of structure is a strategic choice. The choice of strategy, its formulation, will depend on structure.
Strategy and structure need to co-evolve

4. The fit between environmentstrategy-organization is dynamic

When your environment changes, you likely have to change your organization

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16/01/2014

Lululemon Strategic Analysis and Personal Action

Reading Environment, Strategy, Organization and Leadership Position Establishing priorities and developing an action plan

Personal Leadership

Structure

Culture
Organizational Capabilities

The transition from entrepreneurial to professional organization in a highly value-centered and high-growth context
What to keep and what to change

Culture
Staffing Policies Systems
Source: Fry and Killing Strategic Analysis and Action, 3rd Edition - Figure 9.3

Key points
Strategies and business models embedded in strong management or owner-manager values are a particular challenge
Formalizing the organization while sustaining a highly-value centered culture and context Growth possible while keeping the culture? How flexible and adaptable? Transferable?

Strategic management
Assessing the performance of the organization

On priorities: Strategy vs Organization

Difficult to fix strategy if the organization is sick

Implementing change

Strategic Management

Establishing strategic orientations

On becoming the leader

Being the CEO means being in front, so you depend on those behind you. Can you rely on them? or not? To start, remember you have two ears and one mouth.

Developing the competencies of the organization

16/01/2014

Implementation and action plan

Diagnosis Urgency/performance
Proaction Reaction Crisis Framework Priorities
Awareness and readiness Organizational changes Strategic changes Directive or participative Targets and tactics options
100 days / 1 yr

Assessing strategic performance for action

The first look: often a static perspective

Action Plan

Financial performance

Organizational commitment
Readiness/ awareness Capacity/ willingness to change

Style

Objective Target Tactic Timing

Market-based performance

Execution performance

Personal commitment
Am I ready? Can I?

Pace

Organizational climate

Assessing strategic performance for action

Achieving a dynamic perspective

Action Priority Variables

Reactive Performance Proactive Crisis

CHANGING THE ORGANIZATION Making the changes required to support strategic change

PUTTING STRATEGIC CHANGES IN PLACE Making the tangible strategic changes

X
BUILDING SUPPORT Building awareness, skills and commitment necessary to support change
Source: Fry and Killing Strategic Analysis and Action, 4th Edition

Time

16/01/2014

Leadership Style

The action plan

Benefits
Fast Efficient Economizes on initiator time, energy

Characteristics
Directive Directive Assumes Initiator understands problem, knows solution, has power Tactics focus on communication of reasons, instructions, expectations Participative Assumes that diagnosis and remedy will be developed in change process Tactics focus on collaborative exploration of causes, development of remedies, building commitment

Risks
Wrong diagnosis, wrong remedy Passive or active resistance Pseudo change High after-the-fact costs Too slow Potential to run off-track Avoidance of tough decisions

Objectives
(Expected results and metrics)

Target(s)
(Who? Individuals or groups?)

Tactics (How? Actions? Directive or participative?)

Timing
(When?)

1.

2.
Effective Flexible Develops and tests problem and people at same time

Participative

3.

Source: Fry and Killing Strategic Analysis and Action, 4th Edition - Figure 11.1

Ohlson Strategic Analysis and Personal Action Your first GM job after the MBA
The context of a troubles subsidiary with growth and profits challenges Your plan!

Ohlson Canada
quipe Stratgie MBA Dr. Serge Poisson - de Haro Dr. Louis Hbert

The first GM job

Understanding strategic context
Strategy, competition, market

Understanding organizational context

HQ Stakeholders / key players Business system and capabilities Organizational variables First GM job Time pressure Relationship with HQ and local management/staff Moving forward

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Understanding personal stakes

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The strategic context

Reactive Performance Proactive Crisis

The action plan

Objectives
(Expected results and metrics)

Target(s)
(Who? Individuals or groups?)

Tactics (How? Actions? Directive or participative?)

Timing
(When?)

1.

2.

3.
Time

Targets, Objectives, Tactics, Timing

PROACTIVE CHANGE REACTIVE CHANGE

Key pts
The first GM job Time pressure Need to digest lots of information, make a call and start moving quickly Understanding the context to manage and minimize personal risks Understanding leadership in action What authority? What control? Manage one on one or a group? Stay the course or implement change?

CRISIS CHANGE

Objectives

Develop support and direction

Organizational Changes

Buy time

Make Strategic Changes

Targets

Supporters

Pivotal Groups

External

Internal

Style

Participative

Mixture

Participative

Directive

Timing

Jog

Run

Sprint

Sprint

Key pts (2)

Managing a sales subsidiary: Growth and profits expectations at the HQ can be disconnected from the local realities and facts The local GM need to find ways to meet those expectations considering local means and constraints To the extent possible, the GM can use (and get!) HQ resources, competences and support for implementing locally Managing local resistances and insure organizational alignment

2014-02-28 !

Montreal Racks ! Strategic Analysis and Personal Action

! Reading Environment, Strategy, Organization and Leadership Position

! The case of a crisis situation

! Firm requiring a swift turnaround in a situation of limited strategic capabilities and high urgency, where its ST survival is at stake.

Key points!
! Building a turnaround plan
! ! ! ! ! ! ! ! ! Buy time and addressing concerns of key stakeholders Developing a financial plan Get Ops back in shape and under control Reduce complexity and strategic scope Fix organization & HR Objectives without actions or tactics No priorities Actions or tactics with ambiguous or uncertain impacts No ultimate destination

! What a good plan must avoid

! Still, if the outcome of a turnaround is going to be extreme fragility, it may make little sense to proceed, even if you can win the day...

1 !

2014-02-28 !

Key elements of turnaround strategies!

! Top management changes
! Strategic inertia of incumbent management ! Such changes precede downsizing

! External advice and expertise

! Overcoming competence and capability gaps

! Retrenchment
! Consolidation of strategic and financial situation ! Reducing the firm to position most likely to be successfull

! Transformation
! Developing an entirely new strategic model ! Ouf!

Strategic management!
Assessing the performance of the organization

Implementing change

Strategic Management

Establishing strategic orientations

Developing the competencies of the organization

2 !

2014-02-28 !

Implementation and action plan!

Diagnosis ! Urgency/performance
! Proaction ! Reaction ! Crisis Framework ! Priorities
! Awareness and readiness ! Organizational changes ! Strategic changes ! Directive or participative ! Targets and tactics options

Action Plan

! Organizational commitment
! Readiness/ awareness ! Capacity/ willingness to change

Style

!Objective !Target !Tactic !Timing

Calendar

! Personal commitment
! Am I ready? Can I?

Assessing strategic performance for action"

The rst look: often a static perspective!

Financial performance

Market-based performance

Execution performance

Organizational climate

3 !

2014-02-28 !

Assessing strategic performance for action"

Achieving a dynamic perspective!

Reactive Performance Proactive Crisis

Time

Action Priority Variables!

CHANGING THE ORGANIZATION Making changes required to support strategic change

PUTTING STRATEGIC CHANGES IN PLACE Making tangible strategic changes

BUILDING SUPPORT Building awareness, competencies and commitment necessary to support change
Source: Fry and Killing Strategic Analysis and Action, 4th Edition

4 !

2014-02-28 !

Potential Action Priorities!

Variable Category Support Variables Organization Variables Strategy Variables

Potential Objectives Improvements in awareness, capability, willingness. Implementation of changes in leadership, structure, systems, staffing. Implementation of changes in goals, product market focus, competitive premise, business system focus. Improved profits, revenues, market share, costs, etc.

Performance Variables

Source: Fry and Killing Strategic Analysis and Action, 4th Edition

The action plan!

Objectives
(Expected results)

Target(s)
(Who? Individuals or groups?)

Tactics (How? Actions? Directive or participative?)

Timing
(When?)

1.

2.

3.

5 !

2014-02-28 !

Targets, Objectives, Tactics, Timing!

PROACTIVE CHANGE REACTIVE CHANGE CRISIS CHANGE

Objectives

Develop support and direction

Organizational Changes

Buy time

Make Strategic Changes

Targets

Supporters

Pivotal Groups

External

Internal

Style

Participative

Mixture

Participative

Directive

Timing

Jog

Run

Sprint

Sprint

Source: Fry and Killing Strategic Analysis and Action, 4th Edition

Summary Characteristics!
Proactive
Prevailing Conditions
Strategic Performance Time Pressure Need for Change Internal Commitment for Change Management Capability Healthy Little Uncertain Low High Sliding Have to Get Started Becoming Clearer Mixed Mixed Critical Urgent Clear High Low

Reactive

Crisis

Management Issues
Strategic Organizational Is Change Necessary? Lack of Commitment Credibility Where to Start? Dealing With Resistors Power Achieving rapid pace of change Who to Rely On? History and intersts; IOUs

Personal

Source: Fry and Killing Strategic Analysis and Action, 4th Edition

6 !