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Strategic Management
, Sixth Edition
Charles W. L. Hill, University of Washington
Gareth R. Jones, Texas A&M University
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Chapter Summaries
Chapter 12: Implementing Strategy in Companies That Compete in a Single Industry
- Implementing a strategy successfully depends on selecting the right combination
of organizational structure, control systems, and culture. Companies need
to monitor and oversee the strategy implementation process to achieve superior profitability.
- The main issues in designing organization structure are how to group tasks,
functions, and divisions; how to allocate authority and responsibility; and
how to use integrating mechanisms to improve coordination between functions.
- Strategic control provides the monitoring and incentive systems necessary
to make an organizational structure work as intended and extends corporate
governance down to all levels inside the company. The main kinds of strategic control
system are output control and bureaucratic control, rewards systems, and
control through information technology.
- Organizational culture is the set of values, norms, beliefs, and attitudes that help to energize and motivate
employees and control their behavior. A company's founder and top managers help determine which kinds of values emerge in
an organization, and as such they should try to build a strong and adaptive culture to help increase performance over time.
- At the functional level, each function requires a different combination of
structure and control system to achieve its functional objectives.
- At the business level, structure, control, and culture must be combined in
a way that help them implement their business-level strategy and manage the
relationships among all the functions.
- Other specialized kinds of structures include the product, market, geographic,
matrix, and product-team structures. Each has a specialized use and is implemented
as a company's strategy warrants.
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