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Competing For Advantage
Part I – Strategic Thinking
Chapter 2 – Leading Strategically
Individual Strategic Leaders and Influences on Their Decisions
Key Terms Strategic Leadership策略領導– the
ability to anticipate預測 , envision預想 , maintain flexibility, and empower授權 others to create strategic change as necessary
Qualities of Legendary CEOs傳奇品質
Visionary有遠見 have a clear view of what they want to accomplish
Transformational轉型 act as agents代理 of change
Strategic Leadership策略領導力
Multifunctional多功能Managerial管理 InfluentialChange tolerant變化容忍Uncertainty tolerantMotivational動機
Skill Hierarchy技能等級
Capable能力
Contributing
Competent能幹
Effective
Executive執行Transformational轉型
Strategic Leadership Style策略領導力風格
Directive approach指導的做法 a traditional "commander" style that might be most
appropriate when rapid decisions need to be made
Collaborative approach合作的方式 in general, usually yields better results when managers
share and evaluate a greater amount of relevant information in their decision making.
Delegation授權 effective style when implementation of strategy can be
improved by independent manager decision making
Managerial Discretion and Decision Biases經理自主權和決策偏差
Key TermsDiscretion – latitude緯度 for actionHeuristics啟發– rules of thumb經驗法則 used in decision making
Hubris 傲慢自大– excessive pride, leading to a feeling of invincibility無敵
Constraints on Decision Making
tolerance for ambiguity, commitment to the firm, interpersonal skills容忍模糊性,致力於企業,人際交往能力
industry structure行業結構 , rate of market growth市場增長速度 , degree of product differentiation產品差異化程度
Decision-Making Biases偏見
Reliance on a limited set of heuristics經驗法則 Reliance on previously formed beliefs先前形成的信念
Focus on limited objectives目標 Exposure to limited decision alternatives決定選擇 Insensitivity to outcome probabilities結果可能性 Illusion of control控制假象
Top Management Teams高層管理團隊
Key Term Top Management Team – group
composed of the CEO行政總裁 and key managers who are responsible for setting the direction of the firm and formulating and implementing制定和實施 its strategies
Factors that Influence the Effectiveness of Top Management Teams
Top management team heterogeneity 異Yì質性
The CEO and top management team power
Executive succession processes繼承高管的過程
Top Management Team Heterogeneity
Key Term
Heterogeneous異質性 Top Management Team – managerial group composed of individuals with different functional不同職能backgrounds, experiences, and educations
Heterogeneous Top Management Team Challenges
Cohesion凝聚力 - integrating diverse opinions and behavior
Communication - can inhibit comprehensive and long-term strategic planning
Comprehensive examination檢查 of threats and opportunities
Effect of CEO Succession and Top Management Team on Strategy
Key Strategic Leadership Responsibilities and Actions
Positioning
Key Terms Scope – breadth of a firm's activities
across products, markets, geographic regions, core technologies, and value creation stages
Five Elements of Strategy
Acquire, Develop, and Manage Key Resources
Key Terms Organizational Culture – complex set
of ideologies, symbols, and core values that are shared throughout the firm and influence the way business is conducted
HR Practices Linked to Strategic Success
Managing intellectual capital Investing in capital resourcesBuilding effective commitments to
organizational goals Incorporating international experience
into the skill sets of employees
HR Practices Linked to Strategic Success (cont.)
Employing effective training and development programs to promote strategic vision and cohesion
Establishing effective reward plans Instituting continuous learningLeveraging the firm's expanding
knowledge base
Effective Cultural Qualities
Entrepreneurial opportunism Employee autonomy Innovativeness Risk taking Proactiveness Competitive aggressiveness
Overcoming Cultural Difficulties
Effective communication
Effective problem solving
Effective staffing
Effective performance appraisals
Effective reward systems
Mintzberg’s Managerial Roles
Determine and Communicate Strategic Direction
Key Terms Strategic Direction – definition of a firm's
image and character over time, framed within the context of the conditions in which the company operates
Sustainable Development – concept that a firm can and should operate without adversely influencing its environment
Novartis’ Mission Statement
Novartis Stakeholders
Customers
Employees
Shareholders
Society
Long-Term Vision
A core ideology to motivate employees through the company's heritage
An envisioned future to encourage employees to stretch beyond their comfort zones
Guiding Employee Decision Making
Strategic direction
Values and ethical practices
Actions for an Ethical Culture
Employ ethical strategic leaders Establish and communicate specific goals to describe the
firm's ethical standards Continuously revise and update the code of conduct based
on stakeholder input Disseminate the code of conduct to all stakeholders to inform
them of ethical standards and practices Develop and implement methods and procedures to use in
achieving the firm's ethical standards Create and use explicit reward systems to recognize bold
acts that demonstrate ethical behavior and decision making Create a work environment in which all people are treated
with dignity
Strategy Implementation
I/O economics framework – develops structures, systems, and programs to reinforce the external positioning of the business
Resource model – makes optimal use of and supports the resources and capabilities that provide a competitive advantage
Stakeholder perspective – includes activities such as collecting information from stakeholders, assessing their needs and desires, integrating this knowledge into strategic decisions, effectively managing internal stakeholders, and forming interorganizational relationships with external stakeholders
Balanced Controls
Key Terms Controls – formal, information-based
procedures used by managers to maintain or alter patterns in organizational activities
Balanced Scorecard – framework that allows strategic leaders to verify that they have established both financial and strategic controls to assess firm performance
Control Systems
Financial Controls focus on short-term financial outcomes produce risk-averse managerial decisions
Strategic Controls focus on the content of strategic actions encourage decisions that incorporate
moderate and acceptable levels of risk
Controls in Balanced Scorecard Framework
Ethical Questions
What are the ethical issues influencing managerial discretion? Has the current business environment changed the influence of ethics on managerial discretion? If so, how?
Ethical Questions
Is there a difference between stakeholders’ current view of an ethical strategic leader and the early 1990s perspective of an ethical strategic leader? If so, describe the differences between the two views.
Ethical Questions
What should a newly appointed CEO from the external managerial labor market do to understand a firm’s ethical climate? How important are the CEO’s efforts to understand this climate?
Ethical Questions
Are ethical strategic leaders more effective than unethical strategic leaders? If so, why? If not, why not?
Ethical Questions
Assume that you are working in an organization that you believe has an unethical culture. What actions could you take to change that culture to make it more ethical?
Ethical Questions
Is corporate downsizing ethical? If not, why not? If corporate downsizing is ethical, what can strategic leaders do to mitigate the negative effects associated with reducing the size of their firm’s labor force?