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CHAPTER 09 - CORPORATE PLANNING AND IMPLEMENTATIONS - Coggle Diagram

- - - - 01 - POWER CULTURE - a culture that concentrates power among just a few people
        
        02 - TASK CULTURE - culture based on cooperation and teamwork
        
        03 - ROLE CULTURE - a culture in which each member of the staff has been given a clearly defined role or job title
        
        04 - ENTREPRENEURIAL CULTURE - a culture that encourages management and workers to take risks, to come up with ideas and test out new business ventures
        
        05 - PERSON CULTURE - a culture in which individuals are given the freedom to express themselves fully and make decisions for themselves
        
        01 - they may be some conflict between individual goals and those of the whole organisation but this is the most creative type of culture
        
        01 - success is rewarded in an organisation with this culture
        02 - however, failure is not necessarily criticised as it is considered an inevitable consequence of showing initiative and risk taking
        
        01 - associated with bureaucratic organisation
        02 - people in an organisation with this particular culture operate within the rules and show little creativity
        03 - the structure of the organisation is well defined and each individual has clear delegated authority
        04 - power and influence come from a person's position within the organisation
        
        01 - groups are formed to solve particular problems and there will be lines of communication similar to matrix structure
        02 - such teams are often develop a distinctive culture because they are empowered to make decisions
        03 - team members are encouraged to be more creative
        
        01 - associated with autocratic leadership
        02 - power is concentrated at the centre of the organisation
        03 - swift decisions can be made as so few people are involved in making them
    - - 01 - changing the value, beliefs and attitudes of the business is never easy
        02 - it can take several years before all workers and process have been converted into the new culture
        03 - it can mean directly challenging the way things have been done for years and there can be employee resistance towards it
        04 - it can involve substantial changes of personnel, job descriptions, and communication methods and work practices
        05 - much research has been done on analysing the best way to change an organisations culture
        -- KEY ELEMENTS TO THESE DIFFERENT APPROACHES ARE --
        01 - Concentrate on the positive aspects of the business and how it currently operates, and develop these. this will be much easier and more popular with employees than just trying to focus on the negative aspects
        02 - obtain the full commitment of all senior managers. if they cannot or will not change, it might be easier to replace them altogether. unless key personnel give examples of their behaviour they expect to see in other, change will be difficult to achieve
        03 - establish new objectives and a mission statement that accurately reflect the new values and attitude being adopted. these will be need to be communicated to all employees
        04 - encourage employee participation when discussing how the new culture should change the manner in which decisions are taken. the biggest mistake when trying to impose a new culture is without giving the employees the opportunities to suggest alternative ways of working
        05 - train employees in the new culture and the new value system of the business. if people believe in the change and understand its benefits, then it will become more acceptable to them.
        06 - change the employee reward system to avoid rewarding success using the old cultural ways. ensure appropriate behaviour is encourages and receives recognition. people need to be reassured that if they adjust to the new culture, they will gain from it
        
        CORPORATE CULTURE AND BUSINESS DECISION-MAKING:
        01 - for ex --> a business that has a power culture will not consult or communicate with employees affected by major strategic changes
        02 - these changes will be imposed on all employees
        03 - this approach may lead to resistance to change
        04 - the cooperation and teamwork of the workforce is unlikely to be obtained in the future
        05 - in contrast, businesses that operate with task or people based culture are more likely to encourage active participation in deciding on and implementing major strategic changes
        06 - consultation and participation through two-way communication could lead to employees willingly accepting change
        07 - contribute to a success culture change process
        08 - the other link between culture and decision-making occurs when the culture is either strong or weak
        09 - strong culture means that there is very widespread sharing of common beliefs, practices and norms within an organisation
        10 - if the culture is person culture, and based on listening to customers and empowering workers, then this helps the implementation of a strategy that leads to an improvement in customer service.
        11 - with business having weak culture, employees have no agreed set of beliefs and there is no pride in ownership of work
        12 - people may form their own groups within this type of organisation
        13 - this groups are based around cultures that conflict with the weakly held business culture
        14 - such situations provide little or no assistance to strategic decision-making or implementation
        
        IMPORTANCE OF CORPORATE CULTURE
        01 - the impact of culture goes beyond the desire of most people to accept the same values
        02 - it can have a significant impact on how new strategies are decided and implemented
        03 - EXAMPLES HELP TO REINFORCE THE IMPORTANCE OF CORPORATE CULTURE --
        a - the values of a business establish the norms of employee behaviour - is it acceptable to provide illegal incentive to gain a large contract
        b - culture determines the way in which managers and workers treat each other - if the chief executive is open and receptive to new ideas from senior managers, then this approach is likely to filter through the whole organisation
        c - a distinctive organisation culture can support a business's brand image and relationships with customers
        ex--> bath and body works have now have a clear ethical trading culture after its takeover from loreal
        d - culture determines the way not just how strategic decisions are made and implemented but also the type of strategic decisions to be taken. a business with a people based culture would unlikely to take decisions that damage workers health and the environment
        e - corporate culture is linked to the performance and long term success of businesses. companies dedicated to continuous improvement with workers involvement have been shown to be more profitable in the long term
- - - - 01 - the overall objectives of the organisation to be achieved within a given time frame. these could be profit related, growth related or market share target related
        02 - the strategy or strategies used to attempt to meet these objectives. for ex --> to achieve sales growth, the business could consider the choices as analysed by the ansoff matrix:
        a - increase sales of existing products - market penetration
        b - develop new markets for existing products - market development
        c - research and develop new products for existing markets - product development
        d - diversify - new products for new markets
        
        the main objectives for key departments of the business dervived from the overall objective
        
        03 - once the strategies have been implemented, the results should be measured and evaluated
        04 - the results are then compared with the original objectives
        05 - they will also be used to determine the corporate objectives for the next period
        
        CORPORATE PLANNING IS A PROCESS OF
        
        01 - SETTING CORPORATE OVERALL CENTRAL OBJECTIVES
        
        02 - DECIDING THE STRATEGIES USED TO ACHIEVE THESE OBJECTIVES
        
        03 - IMPLEMENTING THE PLANNED STRATEGIES
        
        04 - MEASURING AND EVALUATING THE RESULTS AND COMPARED TO THE OVERALL CORPORATE OBJECTIVES USED TO DETERMINE THEIR EFFECTIVENESS AND SET FURTHER OBJECTIVES OR CHANGES NEED FOR THE NEXT PERIOD
        
        CORPORATE PLANNING - The process is used by companies to set long term plans to meet certain objectives such as business growth and higher return of capital employed
        
        POTENTIAL BENEFITS OF CORPORATE PLANS -
        01 - senior managers have a clear form of sense and purpose for what they are trying to achieve. strategies are chose with the best chance of achieving the objective which has been set.
        02 - the plan helps to communicate this sense of purpose and focus to all managers, employees and other shareholders. this is an important requirement for corporate plans to be effective. this benefit of planning is important to any business, no matter what its size
        03 - an important benefit for any corporate plan is the control and review proces. original objectives can be compared with the actual outcomes and then we can measure how well the business's performance matched its aims
        04 - the planning process itself is a very useful exercise. when effectively done, preparing and producing the corporate plan forces managers to consider the organisations strengths and weaknesses in relation to the business environment
        
        POTENTIAL LIMITATIONS OF CORPORATE PLANNING -
        01 - plans are great if nothing changes but even the best made plans are made obsolete by a rapid and dynamic unexpected internal and external changes.
        02 - part of the planning process is look ahead to consider how to respond to unforeseen events
        03 - however if a business puts a 5 year plan into effect and then refuses to make any variations or adaptions to it, no matter how much external environment factors might change, then inflexibility could be disastarous
        04 - corporate planning process should be adaptable and flexible as possible to allow corporate plans to continue to be relevant and useful during periods of change
        
        MAIN INTERNAL INFLUENCES ON A CORPORATE PLAN -
        01 - FINANCIAL RESOURCES - can the new strategies be afforded
        02 - OPERATING CAPACITY - will this be sufficient if expansion plant is approved by directors
        03 - MANAGERIAL SKILLS AND EXPERIENCE - this may be a major constraint on the plan's success, especially if diversification strategy is chosen
        04 - EMPLOYEE NUMBERS AND SKILLS - workforce planning is a key factor in the success of any corporate plan
        05 - CULTURE OF THE ORGANISATION
        
        MAIN EXTERNAL INFLUENCES THAT AFFECT A CORPORATE PLAN -
        01 - MACROECONOMIC CONDITIONS - expansion may need to be held off during a recession
        02 - CENTRAL BANK AND GOVERNMENT ECONOMY POLICY CHANGES
        03 - LIKELY TECHNOLOGICAL CHANGES - plans could be outdated pretty quickly due to the rapid technological advancements
        04 - COMPETITORS ACTIONS - the competitive nature of the market
- - - - BENEFITS OF CONTINGENCY PLANNING -
        01 - it reassures, customers and local residents that concerns for safety are a priority
        02 - it minimises the negative impact on consumers and suppliers in the event of a major disaster
        03 - the public relation response is much more likely to be speedy and appropriate with senior managers explaing what the company intends to do, by when and how
        
        LIMITATIONS OF CONTINGENCY PLANNING -
        01 - it is costly and time consuming, including the need to train employees and have practice runs in the event of a fire, it failure, terrorist attack and an accident involving company vehicles and so on
        02 - it needs to be constantly updated as the number and the range of potential disasters can change over time
        03 - employee training needs to increase if labour turnover is high
        04- avoiding disasters is still better than planning for what to do if they do occur.
- - - - 02 - RECOGNISING MAJOR CAUSES OF CHANGE
        
        03 - UNDERSTAND THE STAGES OF THE CHANGE PROCESS
        
        04 - DO NOT JUST TRY TO CONTROL CHANGE BUT LEAD IT
        
        01 - All strategic changes must be managed - this means that:
        a- new objectives need to be established that recognise the need for change
        b - resources of finance and labour need to be available for the change to be implemented
        c - appropriate action need to be taken to implement the planned changes
        02 - managing change effectively is important to sucessful implementation but managing change is not the same as leading change
        03 - leading strategic change is much more than just managing resources
        04 - change leadership involves having a greater vision than just making sure the right resources are available to deal with change
        LEADING CHANGE MEANS -->
        A - dynamic leaders who will shake an organisation out of its situation and away from resistance (corporate inertia)
        B - innovation of workers and managers so that change is seen as a positive force for improving people's lives (motivation leads to significant changes in the behaviour of workers)
        C - ensuring that acceptance of change is part of the culture of the organisation
        D - getting the visible support of all senior managers to help the change process become accepted at all levels and in all departments of the business.
        
        01 - PROJECT CHAMPIONS -
        01 - appointed by senior management to help drive a programme of change through the business
        02 - a champion will come from middle or senior management
        03 - they need to have enough influence within the organisation to make sure that things are done
        04 - essentially the cheerleaders of the project and not necessarily involved in the day-to-day running of the new scheme but smooth the path of the project team planning the change
        05 - they will speak in support of the changes being suggested at meetings of senior managers
        06 - they try to ensure that sufficient resources are available and that everyone understands the project's goals and objectives
        
        02 - PROJECT GROUPS OR TEAMS
        01 - problem-solving through team building and using the power of project groups is a structured way of making a breakthrough in a difficult change situation
        02 - project group should work with the manager responsible for introducing the change
        03 - a team meeting of experts should discuss and decide on an appropriate action plan being developed and agreed on
        04 - the responsibility for carrying the plan out still lies with the original manager
        05 - however, they will be better equipped to solve the problem that was preventing change from being effectively implemented
        
        2 more items...
        
        PROJECT CHAMPION - a person appointed by senior management to support a project and drive it foward by explaining the benefits of change and assisting and supporting the team putting the change into practice
        
        Senior managers should follow this checklist:
        
        01 - WHERE WE ARE NOW AND WHY IS CHANGE NECESSARY - important to recognise why a business needs to introduce change from its current situation
        02 - NEW VISION AND OBJECTIVES - for substantial changes, a new vision for the business may be needed. this must be communicated to those affected by the change
        03 - ENSURE RESOURCES ARE AVAILABLE FOR CHANGE TO HAPPEN - starting a change and figuring out there is little finance to support it could be disastarous
        04 - GIVE MAXIMUM WARNING OF THE CHANGE - employees should not be surprised by the change as this can build resistance to it
        05 - INVOLVE EMPLOYEE PARTICIPATE FOR THE PLAN FOR CHANGE - this will encourage them to accept the change lead to proposals from them to improve the change process
        06 - COMMUNICATE - importance of communication with the workforce runs through all these other stages
        
        07 - INTRODUCE INTITAL CHANGES THAT BRING QUICK RESULTS -
        08 - FOCUS ON TRAINING - this will allow employees to feel that they are able to make a real contribution to the changed organisation
        09 - SELL THE BENEFITS - employees and other stakeholders may benefit from these changes so these need to explained to them
        10 - REMEMBER THE EFFECTS ON INDIVIDUALS - a soft human resource approach will bring future rewards of employee loyalty, if the workforce has been supported and communicated with
        11 - CHECK ON HOW INDIVIDUALS ARE COPING AND SUPPORT THEM -some people will need more support than others. not supporting employees will damage the busines if it leads to low-quality output or poor customer service because of poor motivation
        
        MAJOR CHANGES OF CHANGES
        01 - TECHNOLOGICAL ADVANCES IN NEW PRODUCT AND NEW PROCESSES
        
        EX OF CHANGE -
        A - PRODUCTS - GAMES, AI, MACHINE LEARNING, HYDROGEN POWERED CARS
        B - PROCESSES - ROBOTS IN PRODUCTION, CAD IN DESIGN OFFICES, CAM, AND INVENTORY CONTROL
        
        MANAGING CHANGE -
        A - need for labour retraining
        B - purchase of capital equipment
        C - additions to product portfolio and other products to be dropped
        D - need for quicker product development, which may need new organisation strcutures and teams
        02 - MACROECONOMIC CHANGE: FISCAL POLICY, INTEREST RATES, FLUCTUATIONS IN THE BUSINESS CYCLE
        -EXAMPLE OF CHANGE-
        A - changes in consumer disposable incomes and demand patterns that result from this
        B - boom and recession conditions, which require excess capacity or rationalisation
        
        MANAGING CHANGE -
        A - need for fleixble production system including staff flexiblity to cope with demand changes
        B - explain need for extra capcity or the need to rationalise
        C - deal with redundancies in ways the encourage workers who remain to accept the change
        
        03 - LEGAL CHANGES
        
        EXAMPLES OF CHANGE -
        A - changes to what can be sold or when -- > ex 24 hour licenses for restaurants
        
        MANAGING CHANGE - employee training on company policy, ex --> selling certain goods to children
        
        flexible working hours and practices
        
        04 - COMPETITORS ACTIONS -
        EX OF CHANGE -
        A- new products
        B - lower prices based on high competitiveness on costs
        C - higher promotion budgets
        MANAGING CHANGE -
        A - Encourage new ideas from employees
        B - if employees accept the need for change, then they will accept the change itself
        C - ensure resources are available to meet the challenge
      - 01 - strategic change is a continous adoption of business strategies in response to changing internal and external forces
        02 - change happens whether we encourage it or not
        03 - managers need to control it to make sure that it is a positive change for the business and not a negative one
        04 - business must have a vision, clear objectives, strategy and an adaptable process for change management
        05 - change in business is the rule and not the exception
        06- it is a continous and accelerating ongoing process
        07 - business as usual will become increasing rare as globalisation, economic environment and technological advancements continue to rapidly change where it requires businesses to reposond
        08 - EVOLUNTIONARY OR INCREMENTAL CHANGE OCCUR OVER TIME, an example is trend towards cars powered by electricity has been happening for several years
        09 - evoluntionary changes can be anticipated or unexpected
        10 - the decisions being taken to ban diesel cars from some city are announced years in advanced
        11 - in contrast a sudden oil change is unexpected
        12 - incremental and evoluntionary changes are easy to manage and anticipate
        13 - DRAMATIC AND REVOLUTIONARY CHANGE - especially unanticipated causes much more problems
        14 - ex --> civil conflict in Bolivia and Venezula in 2010 forced many holiday companies to re-establish themselves in other markets of other countries
        15 - in extreme cases, these dramatic changes might lead to totally rethinking the operation of an organisation
        16 - this is called BUSINESS PROCESS RE-ENGINEERING
        
        BUSINESS PROCESS RE-ENGINEERING - fundementally rethinking and redesigning the process of a business to achieve a dramatic imrpovement in performance