1. Business Model, Execution, & Corporate Responsibility Measures
CHAPTERS 1, 2, 9, & 10
Business Model, Execution, & Corporate Responsibility Measures

2. The Importance of a Company’s Business Model
A business model is management’s blueprint for delivering value to customers and earning an attractive profit
Is the strategy capable of delivering profits?
How will business provide customers with value and generate revenues sufficient to cover costs and produce profits?
What resources are needed to deliver value to customers?

3. Crafting vs. Executing Strategy
Crafting the Strategy
Primarily a market driven activity
Successful strategy making depends on
Attracting and pleasing customers
Selecting & building a company’s resources and capabilities
Making a profit balancing the first two elements
Executing the Strategy
Primarily an operations driven activity
Successful strategy execution depends on management’s ability to
Direct change
Improve operations
Build a strategy-supportive culture
Get things done and deliver good results 3

4. The Eight Components of Strategy Execution
Organization
Resources
Policies & Procedures
Continuous Improvement
Systems
Rewards & Incentives
Culture
Leadership

5. Staffing the Organization—Building Managerial Talent
Assembling a capable management team is a cornerstone of the organization-building task
Find people who can “make it happen” to fill each slot
Existing management team may be suitable
Core executive group may need strengthening
Promote from within
Bring in skilled outsiders when needed
Empower

6. Recruiting and Retaining a Capable Workforce
Tactics commonly used to staff an organization with the best people include
Careful screening of applicants
Investing in employee training
Providing promising employees with skill-stretch assignments
Rotating people through jobs in different functional areas or geographic regions
Striving to retain high-performers via promotions and pay increases
Coaching average performers to improve their abilities MD
PwC

7. Types of Organizational Structures
Departmental Structure—Organizes strategy critical activities into distinct functional, product, geographic, process, or customer groups
Divisional Structure—Organizes value chain activities involved in making a product or service available to consumers into a common division
Matrix Structure—Allow for dual reporting relationships between divisional heads and departmental heads
Sony
vs.
Bertelsmann
PwC

8. Authority in Decision Making
In a centralized structure
Top managers retain authority for most decisions
In a decentralized structure
Managers and employees are empowered to make decisions
Trend in most companies
Shift from authoritarian to decentralized structures stressing empowerment
Empowerment

9. Allocating Resources to Strategy Critical Activities
Allocating resources in ways to support effective strategy execution involves
Funding proposals that hold promise, while turning down those that don’t
Providing the proper amount of funding to support new strategic initiatives
New strategies call for the reallocation of resources
Bertelsmann

10. Instituting Strategy Supportive Policies and Procedures
Policies and procedures facilitate good strategy execution by:
Providing top-down guidance regarding how things need to be done
Enforcing consistency in how strategy-critical activities are to be performed
Promote a work climate that facilitates good strategy execution
Grading

11. Striving for Continuous Improvement in Internal Processes
Searching out and adopting best practices is integral to effective implementation
Benchmarking is the backbone of the process of identifying, studying, and implementing best practices
Expose yourself to new ideas/colleagues/ companies/industries/academia
PwC MD

12. Installing Information and Operating Systems
Good information and operating systems are essential for first-rate strategy execution
Information systems are needed to track and report:
Customer data
Operations data
Employee data
Supplier data
Financial data
RHMR
(CRM)
Bertelsmann
(SAP)

13. Using Rewards and Incentives
Reward systems should include both monetary rewards and non-monetary rewards
PwC
Monetary
Base pay increases
Bonuses
Profit sharing plans
Stock options
Piecework incentives
Non-Monetary
Praise and recognition
Stimulating assignments
Autonomy
Rapid promotion

14. Entrepreneurial Ventures
Corporate Culture
A corporate culture or work climate is the product of work practices and behaviors that define
“How we do things here”
Approach to people management
The chemistry of its work environment
Entrepreneurial Ventures
PwC
Bertelsmann
Sony
RHMR

15. Leading the Strategy Execution Process
Managers at all levels of the organization must:
Stay on top of what is happening
Be adept in determining what problems lie in the path of operating excellence
Push the organization for good results and operating excellence
“Feel the vibe”
MBWA
Solve
Problems
Inspire

16. Executing Strategy in a Responsible Way
Should there be a link between a company’s efforts to craft and execute a winning strategy and its duties to
Conduct activities in an ethical manner?
Demonstrate socially responsible behavior by being a committed corporate citizen?
Limit its strategic initiatives to those meeting needs of consumers without depleting resources needed by future generations 16

17. Ethical Behavior
Social responsibility calls for companies to strike a balance between
Its economic responsibility to shareholders
The legal responsibility to comply with the laws of the countries where it operates
The ethical responsibility to abide by society’s norms
The responsibility to create a corporate culture which properly values employees.

18. Corporate Citizenship
Corporate citizenship involves a company’s discretionary philanthropic activities to address the unmet non-economic needs of society
Good corporate citizens contribute to society in areas where government has fallen short or chosen not to focus its efforts

19. Corporate Sustainability
Corporate sustainability involves meeting the needs of today’s stakeholders in a manner that protects the environment and resources needed for future generations
Directed at improving a company’s triple bottle line (TBL)—its performance on economic, environment, and social metrics