Crafting and Executing Strategy Notes

Strategy Execution Process

• Involves creating a strategy support structure.
• Staffing the firm with needed skills and expertise.
• Developing and organizing work efforts to achieve best practices.

Strategic Management Process

• Crafting a strategy to achieve objectives and company vision.
• Key elements: speed and entrepreneurship in fast-paced markets.
• CEO's role: leading the strategy and business units.

Company Strategy-Making Hierarchy

• Corporate strategy: orchestrated by CEO and senior executives.
• Business strategy: orchestrated by senior executives of each business line.
• Functional area strategies: orchestrated by heads of major functional activities.
• Operating strategies: orchestrated by brand managers, plant managers, etc.
• Wealth management strategy required new functional area and operating strategies.

Managerial Tasks

• Developing and executing company strategies.
• Importance of a clear vision and strategic/financial objectives.

Strategy Making, Strategy Executing Process

• Crafting and executing strategy is ongoing, consisting of five interrelated stages:
  • Development of a strategic vision, mission statement, and core values.
  • Setting objectives for measuring firm performance and tracking progress.
  • Crafting a strategy to move the firm along its strategic course and achieve objectives.

Role of the Board of Directors

• Certifies CEO actions to shareholders.
• Provides insight and advice to top management.
• Debates key strategic decisions and actions.

Corporate Governance Failures

• Volkswagen example: absence of strong, independent directors led to malfeasance.
• Breakdown in management system linking business units to corporate governance.
• Lack of alignment with vision, mission, goals, core values, and objectives.