Organization Development and Strategy
Review and discuss concepts presented during the weekend’s presentations and the group discussions on dynamic strategy-making, organization development, and change. Incorporate and reference the textbook (Dynamic Strategy-Making, 9th Ed. by Greiner and Cummings), your presentation notes, and your personal application. Also review six articles specific to organization development and strategy. Give a one page review of each article. I am providing the powerpoint slides of the above mentioned presentation, my notes on the presentation, and 6 articles on which to write reviews as described above. I can also provide an audio file of the presentation.
These are the notes I took on the presentation given by Dr. Thomas Cummings on dynamic strategy-making.Professional Custom Writing Services from the Experts!
Bartlett – father of psychology; Sapir – father of linguistics
Slide 4: His background
Sociotechnical systems (began in the 70’s), at the time called semi-autonomous work groups, started the quality of work life movement. They started asking what’s the science behind quality of work life – productivity, absenteeism, etc. There were over 58,000 articles on the topic that proved correlation but not causation. So they came up with an experimental approach to work design. It would require changes in behavior, but companies were uncomfortable with the word experimental. This produced “organizational learning”. This led to “work design”. So they began “designing” high performance organizations. But some started realizing that the environment was rapidly changing and evolving. Between societies and organizations theres a trans-organizationsal system. Most of socitties problems cannot be solved by single orgs alone but by multiple orgs working together – which was called a trans-organizational system. Trans-organizational systems looks at – How do you bring organization to orgs that don’t even know they need to be organized. Whereas OD looks at how do you loosen up overly beurocratic orgs so that people can talk and get along, etc. So trans-organizational systems is the opposite approach of OD. He wrote my Cummings and Worley book! Check out Worely’s book on corporate agility. How do you develop a strategy for an organization in a rapidly changing environment? Dynamic strategy making – constantly changing strategy. The role of language in the history of OD – an article he’s working on now.
Preface, the big pic on corporate strategy.
What is strategy? How am I going to compete in an environment. What distinguishes me. Stategy ties an org. to its environment with business logic. How are you going to gain an advantage. It’s your engine for competing.
Why do orgs need strategy? Without it – how are you going to compete and move your firm forward? Without it, firms wander, energy is dispersed. Priorities are unclear, turf battles and destructive politics result. Management plays constant catch-up, always reacting and never out front. Decisions and investments lack coherence and consistency.
Creating and executing strategy is very challenging. So they’re very vague and abstract. People trying to design the strategy are overwhelmed by the complexity. There’s often a lack of participation by key stakeholder in formulating strategy. The link is not made to actions steps – people don’t behave it and act it out daily. Key executives interpret strategy differently. Executives don’t believe strategy is useful – they’re not educated in strategy concepts. Daily business and fire fighting (the “real work”) takes precedence.
How did they get to dynamic strategy making.
Learning from experience and research. Good social process is the answer – through the 60 and early 70’s – loosen people (buerocracy) up, get them to work together. In the 70’s, the answer became good work design. In the 80’s, they realized that all the good work design in the world isn’t the answer if the organization design isn’t good. So organization design became the answer. Then in the 90’s they realized that even if you have a well desgined organization, if you don’t have a good strategy you’re good org design will only get you to bankruptcy. At the time strategy was being thought of as a noun. They needed to see it as a verb – an ongoing process – strategizing. It’s not a specific outcome, a document. It’s a process of gaining competitive advantage. How you go about formulating strategy is just as important as the content of the strategy. In a dynamic environment, the content is going to have a short half life, so process is important. Implementation is also crucial – living it out daily. It needs to be a dynamic and continuous process, built into the organization. Thus, dynamic strategy making.
Strategy development: one has to link what the firm does well (your resource base) to specific opportunities in the environment. Strategy is not a well defined outcome, it’s a set of living guidelines, usually written but not rigid mechanical plan with excessive detail. It’s a holistic concept that includes: direction, objectives and initiatives, org values. IT is a system itself, not a separate add-on. The roles responsible for strategy making are your senior execs. That’s their job, although theiyre often doing other things. They need to embed this in the firm. So it has to be clear, concise and understandable, even to the shop floor. It has to excite and motivate people to move people together in a coherent direction to new levels of performance. It also has to be continuously looked at and changed.
Stages of Strategy Development: this is good to do in retreats of 2-3 days. This group should be determined by the head leader (CEO). It should be their chore team and should not be more than 10-12 people. This whole process should be repeated about every 3-5 years depending on the industry.
Stage 1 – strategic assessment –
Stage 2 – Statement of strategic direction (retreat day 1) – it’s short, concise, tells you how you’ll compete, and on what dimensions, what your goals are, how to measure them, what are your strategic innitatives, how you’re going to change the culture, etc….all on one page/ page and a half.
Stage 3 – reality check and commitment – go back to the firm for about three weeks
Stage 4 – Finalize Strategy Statement and Design Implementation Plan (retreat day 2) –
Slides 13 & 14:
What dynamic strategy making looks like, breakdown this flowchart on the following slides:
Stage 1: SWOT analysis – a page or two of bullets. You do a SWOT analysis on the firm and present it at the begining of day 1. The content is important and that’s what you talk about – what got you to the bullets. It includes industry data for comparison and maybe you hire a consulting firm to collect this but then you interpret it for them.
Stages in strategy development chart, broke down in the following slides:
Strategy statement – Puprose: it defins a logic for gaining competitive advantage. It establishes a rational for securing and allocating limited resources. Provides a structure and foucs for action-taking. Inspires employees toward higher levels of achievement. Format: brief, succinct statements (1-4 pages). Sometimes written in prose with complete sentences; but better in bullet points initially.
What you’re doing here is basically OD process consulting. Break people down into subgroups.
How are you going to compete. Gets very specific, economic, very strategizing. Deal with tie-breakers…what distinguishing you from others (in the customer’s eye). Once we have an agreement on these things, everything flows from this. This will take you to the end of day one. Start the next day with a paper on everyone’s place with the statements you agreed on. You spend the whole day basically talking about, do we really agree on this – now that everyone has had a chance to sleep on it. You have to all be committed to it. Then come up with Financial and rallying goals. Now that you have this, what should the organization look like, down to the last detail. What do the org values look like. Notice how this is a focusing process. You end up with strategic initiatives.
Slide 18: Chart
Steps in creating strategy statement – Step 1: Competitive Logic and tie breakers
It’s translating your strengths into a formula for how you’re going to compete, one that’s logical, for how you’re going to compete in a way that sets you apart from competitors. Tiebreakers: what three or four features from a customers point of view, in rank order, will likely determine key customer purchases in the future. Which of these features best fit with our competencies?
Slides 21 & 22:
Examples of competitive logic and tiebreakers. Strategy says what you’re not going to do as much as what you are going to do.
NONE OF THIS WORKS WITHOUT A COMPETANT, AGGRESSIVE SENIOR LEADER, PERIOD. DON’T WASTE YOUR TIME.
Steps in creating strategy statement, step 2: Financial and rallying goals. Unless you can tie these strategic objectives to measurable goals, how are you going to know if you’re accomplishing anything. They have to be tied to measurable goals.
Financial goals: Criteria – the goals have to be consistent with competitive logic. They must be understandable and easily communicated. They can be affected by a large number of operating managers. They are easy to measure and tied to compensation. See examples
Rallying goals: These have to complement your competitive logic. They have to evoke emotion. They have to be positive and beneficial to many employees. Must be easily communicated. See Examples. All these things tie employees, day to day, to the competitive logic – what sets me apart from my competitors and what am I doing right now today that is tied to these goals.
Step 3 in creating a strategy statement. Does the org design support the competitive logic?
Design the firm so it directs, reinforces, motivates the behavior to enact the competitive logic, every day. Key org design compoenents: org structure, work design, information and control systems, HR systems (rewards, selection and development), management and decision making processes.
At this retreat you’re not going to get into massive details about org design, but you’re going to ask yourself what would this org design look like if we’re going to make this competitive logic work. Org design is to group tasks and people around work, that’s it.
Examples of organization guidelines for org design.
Slide 29 & 30:
Management values. How should key decisions be made, and by whom? How shouldmanagement interact with and treat employees. How should employees work together to accomplish goals. How should members of the organization conduct themselves with customers, etc. You’re going to go through these at the retreat and then ask where are at with these right now versus where we want to be. Address that gap. Do we want to make that gap one of our strategic initiatives.
Step 4 in creating strategy statement – creating strategic initiatives.
What specific thrusts are we going to do to enact the statement of strategic direction. They should strike at the heart of the statement and make it come alive. They should be 3-5 specific themes everybody can get behind and move in same direction. See examples on slide 32. These are strategic initiatives. Out of these you’ll have to create action plans. That’s where you start to see this come alive.
Examples of Statements of Strategic direction:
Slides 34 – 39: see slides for detailed examples of examples of statement of strategic direction through layout of strategic initiatives and action steps.
Stage 3 of strategy development: reality check and commitment. Go back to the firm for about 3 weeks and review and input from middle management and other stakeholders.
Questions applied to strategic statement (during the 3 weeks back at the office):
See slides for questions. These questions lead to next retreat.
Slide 42: Stage 4 of strategy development – at next retreat
Finalize strategy: modify and finalize strategy statement; develop action plans and responsibilities; plans to communicate the statement to the company. Determine what kind of time cycle makes sense to repeat this strategy development cycle. It can’t be so frequent that you don’t have time to live it out. It has to become built into the structure, logic, behaviors and daily activities of the firm.
Action Plans and responsibilities. Plan of specific actions needed to implement each strategic initiative. Identify 2-3 specific actions necessary for implementation. See slide for examples.
Communication plan. Shows who in the company communicates the plan to whom to keep everyone on the same page with the plan and moving in the same direction.
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