Презентация на тему: MODERN STRATEGIC ANALYSIS Theme 4. Strategy implementation. Strategy of Growth

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MODERN STRATEGIC ANALYSIS Theme 4. Strategy implementation. Strategy of Growth
Organisation’s life cycle
Phases of a company growth
Phase 1. Development through creativity
Leadership crisis
Phase 2. Development through direction
Autonomy crisis
Phase 3. Development through delegation
Phase 3. Decentralisation and centralisation
Phase 3. Three types of decentralisation
Control crisis
Phase 4. Development through coordination
Micro-case study “Delta-M” or “Who is responsible for what?”
Micro-case study “Delta-M” or “Who is responsible for what?”
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Первый слайд презентации: MODERN STRATEGIC ANALYSIS Theme 4. Strategy implementation. Strategy of Growth

Dr. Prof. Aleksandr Kozlov 01 /1 1 /201 6

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Слайд 2: Organisation’s life cycle

2 Organisation’s life cycle Size of an organisation Time Entering Growth Maturity Declining New development

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Слайд 3: Phases of a company growth

3 Phases of a company growth Size of company Large Small Age Young Mature Crisis of leadership Growth through creativity Crisis of autonomy Growth through direction Growth through delegation Crisis of control Growth through coordination Crisis of mutual understanding Evolution revolution Growth through collaboration

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Слайд 4: Phase 1. Development through creativity

4 Phase 1. Development through creativity The company’s founders are usually entrepreneurially oriented, their energy is absorbed entirely in making and selling products Communication among employees is frequent and informal Long hours of work are rewarded by modest salary Control of activities comes from immediate marketplace feedback

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Слайд 5: Leadership crisis

5 Leadership crisis As a company grows larger production range require knowledge about efficiencies of manufacturing Increased number of employees can not be managed through informal communication New accounting procedures are needed New employees are not so motivated as “pioneers”

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Слайд 6: Phase 2. Development through direction

6 Phase 2. Development through direction A functional organisational structure is introduced to separate production and marketing Accounting system for inventory, production and purchasing are introduced Budget and performance standards are adapted Communication becomes more formal

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Слайд 7: Autonomy crisis

7 Autonomy crisis Low-level managers are restricted by centralised hierarchy They feel torn between following procedures and taking initiative of their own Necessity to coordinate decisions with bosses slow down a decision-making process

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Слайд 8: Phase 3. Development through delegation

8 Phase 3. Development through delegation Much greater responsibility is given to managers Profit centers and bonuses are used to motivate managers The top executives at headquarters restrain themselves to managing by exceptions, based on periodic reports from the field

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Слайд 9: Phase 3. Decentralisation and centralisation

9 Phase 3. Decentralisation and centralisation Decentralisation is the process of transferring and assigning of decision-making authority to the lower level of hierarchy Centralisation is the process of transferring and assigning of decision-making authority to the higher level of hierarchy 9

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Слайд 10: Phase 3. Three types of decentralisation

10 Phase 3. Three types of decentralisation Deconcentration. Weakest form of decentralisation, proposing redistribution of decision-making authority to the lower levels of the same centralised and totally controlled structure Delegation. A more extensive form of decentralisation, proposing the transfer of decision-making authority to the lower levels not wholly controlled Devolution. The transfer of decision-making authority to autonomous units and groups 10

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Слайд 11: Control crisis

11 Control crisis The top executives sense that they are losing control over a highly diversified field operations Autonomous field managers prefer to run their units without coordination with the rest of organisation

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Слайд 12: Phase 4. Development through coordination

12 Phase 4. Development through coordination Units are merged into product groups Capital expenditures are very carefully weighted Each product group is treated as an investment center and evaluated on ROI basis Certain technical functions such as data processing personnel training centralised at headquarter

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Слайд 13: Micro-case study “Delta-M” or “Who is responsible for what?”

“ Delta-M” is company set up by four former researchers in 2003. The main product is specialised clothing for workers, operating in different types of aggressive environment: firemen, worker at oil processing plants etc. They started from two small rooms, the first for manufacturing of fabric and other one for sewing with five sewing machines. Five first years were very successful. The annual sales growth was close to 30 %, the owners were working hard like real team, supporting each other, keeping all management functions in their hands. In the year of 2008 staff of “Delta-M” achieved 70 employees, working in two workshops and designing bureau. In the year of 2007 happened unpleasant surprise: growth of sales in the second half of this year was close to zero. Team of owners applied to consulting company for advice. During the first meeting after rituals of mutual presenting the consultant asked owners: “Who is responsible for sales?”. And was shocked by given answer, better to say, answers. It was like chorus : “It’s me!”. “What about designing?” – the same result. 13 13

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Последний слайд презентации: MODERN STRATEGIC ANALYSIS Theme 4. Strategy implementation. Strategy of Growth: Micro-case study “Delta-M” or “Who is responsible for what?”

Questions. Identify the stage of growth of “Delta-M” Suggest the real reason for low growth of sales in the second half of the year of 2007. Propose the actions to be done by owners of “Delta-M” 14

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