This includes evaluating an organization’s external and internal environments and analyzing its competitors.
During an external environment analysis managers look into the key external forces: macro & micro environments and competition.
Or market development strategy may require an additional division to be added to the company.
Every new strategy changes the organizational structure and requires reallocation of resources.
In an organization, strategies are chosen at 3 different levels: Components: Annual Objectives, Policies, Resource Allocation, Change Management, Organizational chart, Linking Performance and Reward Tools used: Policies, Motivation, Resistance management, Leadership, Stakeholder Impact Analysis, Changing organizational structure, Performance management Even the best strategic plans must be implemented and only well executed strategies create competitive advantage for a company.
Successful situation analysis is followed by creation of long-term objectives.It also redistributes responsibilities and powers between managers.Managers may be moved from one functional area to another or asked to manage a new team.Communication in strategy implementation is essential as new strategies must get support all over organization for effective implementation.The example of the strategy implementation that is used here is taken from David’s book, chapter 7 on implementation The first point in strategy implementation is setting annual objectives for the company’s functional areas.Business' vision answers the question: What does an organization want to become?Without visualizing the company’s future, managers wouldn’t know where they want to go and what they have to achieve.The other very important part of strategy implementation is changing an organizational chart.For example, a product diversification strategy may require new SBU to be incorporated into the existing organizational chart.Usually, tactics rather than strategies are changed to meet the new conditions, unless firms are faced with such severe external changes as the 2007 credit crunch.Measuring performance is another important activity in strategy monitoring. Managers have to compare their actual results with estimated results and see if they are successful in achieving their objectives.