Strategic Management Assignment 1 Final
1.0 Abstract
A study involving over 200 senior managers demonstrates that overall firm performance is strongly influenced by how well a firm’s business strategy is matched to its organizational structure and the behavioral norms of its employees (Eric, Stanley and Tomas 2004).
The sum total of how an organization goes about its work is its strategy. Structure and strategy are married to each other. When a company makes major changes, it must carefully think out every aspect of the structure required to support the strategy. That is the only way to implement lasting improvements. Every part of an organization, every person working for that organization needs to be focused on supporting the vision and direction. How everything is done and everything operates needs to be integrated so all the effort and resources support the strategy.
It takes the right structure for a strategy to succeed. Management that is solely focused on results can have a tendency to direct everyone on what they need to do without paying attention to the current way the organization works. While people may carry out these actions individually, it is only when their daily way of working is integrated to support strategy that the organization’s direction is sustainable over time.
This study looks at the relationship between organizational structure and strategy and how the former (organizational structure) is an instrument for implementation of the latter (strategy).
2.0 Introduction
Research on strategy and structure was initially triggered by Chandler 's (1962) seminal work on the emergence of multidivisional structure in diversified firms such as Du Pont and General Motors. Chandler 's basic argument is that structure follows strategy. Then Williamson (1975) provided a transaction cost analysis of the rationale underlying multiproduct firms ' adoption of M-form structure. Almost in the meantime, Rumelt (1974) published his work on strategy, structure, and performance of diversified firms. Most
A study involving over 200 senior managers demonstrates that overall firm performance is strongly influenced by how well a firm’s business strategy is matched to its organizational structure and the behavioral norms of its employees (Eric, Stanley and Tomas 2004).
The sum total of how an organization goes about its work is its strategy. Structure and strategy are married to each other. When a company makes major changes, it must carefully think out every aspect of the structure required to support the strategy. That is the only way to implement lasting improvements. Every part of an organization, every person working for that organization needs to be focused on supporting the vision and direction. How everything is done and everything operates needs to be integrated so all the effort and resources support the strategy.
It takes the right structure for a strategy to succeed. Management that is solely focused on results can have a tendency to direct everyone on what they need to do without paying attention to the current way the organization works. While people may carry out these actions individually, it is only when their daily way of working is integrated to support strategy that the organization’s direction is sustainable over time.
This study looks at the relationship between organizational structure and strategy and how the former (organizational structure) is an instrument for implementation of the latter (strategy).
2.0 Introduction
Research on strategy and structure was initially triggered by Chandler 's (1962) seminal work on the emergence of multidivisional structure in diversified firms such as Du Pont and General Motors. Chandler 's basic argument is that structure follows strategy. Then Williamson (1975) provided a transaction cost analysis of the rationale underlying multiproduct firms ' adoption of M-form structure. Almost in the meantime, Rumelt (1974) published his work on strategy, structure, and performance of diversified firms. Most
References: Chandler, A.D. (1962). Strategy and structure: Chapters in the history of the American industrial enterprise. Cambridge, MA : MIT Press. E Stanley Kavala‘The connection between strategy and structure’ International Journal of Business and Commerce Vol. 1, No. 6: Feb 2012[60-70] Eric M. Olsona, Stanley F. Slaterb, G. Tomas M. Hultc ‘The importance of structure and process to strategy implementation.’ Gary Dessler., Human Resource Management, Twelfth Edition (Pearson 2011) Mark Rhodes, managementhelp.org/blogs/strategic planning/2011/01/23/194/#sthash.oeu28Nyc.dpuf Mintzberg, The Strategic Process, Fourth Edition (Pearson 2011) Mintzberg, Henry (1987), ―Crafting Strategy‖, Harvard Business Review, July/August 1987. Moncrieff, J. (2001), ―Is Strategy Making a Difference?‖ Long Range Planning Review, 32(2) Mulcaster, W.R. (2009), "Three Strategic Frameworks," Business Strategy Series, Vol 10, No 1