Implementation as the Most Difficult Aspect of Strategic Management - Coursework Example

Running Head: Implementation: the most difficult aspect of Strategic Management Student’s Name: Instructor’s Name: Course Code and Name: Institution: Date assignment is due: Implementation: the most difficult aspect of Strategic Management Introduction Strategic management is an ongoing process of specifying the mission, vision and objectives of an organization, developing plans and policies in the form of programs and projects, and allocating resources for their implementation. Strategic management provides managers of businesses with a clear picture of the overall direction that the business out to take in order to achieve strategic consistency. When the actions being implemented are consistent with the management’s expectations, then there is strategic consistency. Implementation is the most difficult aspect of strategic management. This is because all stakeholders need to take time to understand with great accuracy, the nature of goals, objectives, mission, vision, plans and policies that need to be achieved in order for the business to achieve a certain end. Moreover, circumstances keep changing, and employees as well as managers have to adapt to these new circumstances in order to achieve the set business objectives. Some of the circumstances that may change include economic environment, new competitors, new technology and a new social-political environment. Every business strategy should be sustainable in order to succeed. Sustainability entails the overall rationale for coming up with the strategy. Sustainability of a business strategy can be determined by simply determining whether key strategic issues have been addressed by the strategic position of the organization. A strategy that makes little economic sense is not sustainable one. The lack of economic can be as a result of the organization’s inability to obtain economies of scale within an experience economy. This report highlights how implementation is the most difficult aspect of strategic management. In order to support the theoretical notions assessed with regard to this contention, the case study of Lend Lease Australia, a leading international real estate company based in Australia. One of the business’s strategic management tasks was entitled: The Green Building Strategy, whereby a building popularly known as ‘The Bond’ was build using environmental-friendly measures. The report assesses the difficulties faced in implementing The Green Building Strategy during the construction of ‘The Bond. How difficulties arise during implementation Implementation is the most difficult aspect of strategic planning mainly because the activities involved are more complex and time-consuming than in planning. Many managerial activities have to be carried out, and each activity can be carried out in different ways. For implementation to take place, people management skills are needed. Moreover, it takes perseverance in order for managers to oversee the launch of different business initiatives (Hamel, 2002). During this process, resistance to change is sure to be experienced among some stakeholders. A major difficulty relating to implementation arises from the fact that strategic management is not a cleanly cut-out, step-by-step process. Rather, it is a ‘messy’ iterative process, which requires a lot of dedication and hard work from majority of people within the organization in order for it to continue forward in a sustainable manner (Hubbard, Rice & Beamish, 2008). The goal groups involved in the implementation process are difficult to manage. Goal groups are simply cross-functional teams that are established in order to work towards the development and implementation of different goals as well as the strategies and objectives associated with these goals (Gupta & Govindarajan, 1984). They are cross-functional because of the fact that each of the outlined goals touches on different aspects of an organization. Implementation becomes a hectic task to achieve chiefly because of the need for coordination between goal groups and senior leadership (Dess, Lumpkin & Eisner, 2007). People management skills are needed for all these people to be inspired to work towards the achievement of the set strategic business objectives that have been set out. Unfortunately, strategy implementation skills are not easy to master (Douglas & Judge Jr., 2001). This makes them a real challenge that managers have to contend with; they are by far more challenging than elements of strategic analysis and strategy formulation. Although companies spend colossal sums of money on strategic analysis and strategy formulation, only less than half of these strategies end up being implemented. Observers put the success of implementation at a much lower level: less than 10 per cent of all strategic plans formulated. When strategies are not implemented, they are considered little more mere academic exercises. Managers who are not systems thinkers cannot be efficient implementers of business strategies. They need systems thinking skills in order have the ability to coordinate many interconnected efforts that are aimed at transforming many intentions into a strategic action. They also need to be able to take care of all factors that impede strategy implementation. Without the adoption of a cross-functional approach, it is difficult for any strategy to be implemented well. Functional excellence ensures that the greatest possible business contribution is derived from the strategy that has been planned. For this goal to be achieved, a broad view of all functions being implemented has to be visualized in the process of creating the overall strategy. It is difficult to maintain innovativeness during the implementation of a strategy. This is because, in most cases, strategy analysts may overlook the element of innovation while drafting the policies, rules, objectives, projects and programs that will go with the implementation of the all tasks in a cross-functional context (Viljoen & Dann, 2003). Furthermore, implementation marks the beginning of a long, treacherous journey towards the installation of performance management systems that have to be embedded in a particular political-administrative context. For this reason, the decisions taken as well as their practical implementation have to stem from a highly complex combination of cultural traditions, environmental factors, and diverse interests, most of which may be organizationally-based. It is impossible for consensus to be arrived at on what ought to be the starting point in implementing a given strategic management task. Likewise, disagreements tend to arise with regard to the contribution of prior experiences in creating different organizational reform initiatives. Before an implementation process can begin, few business managers appear able to conduct initial studies of how the implementation process should be brought into successful, sustainable conclusion. In scholarly circles, there is a general consensus that the involvement of personnel is rarely appreciated during the implementation process of strategic management (White, 2004). From this observation, it can be deduced that key training programs relating to the implementation process should be undertaken in businesses, local governments and not-for-profit organizations. In the absence of these programs, managers tend to encounter resistance from employees, who do not clearly understand what their roles in the long-term undertaking are. Implementing strategy: capabilities, systems and structure The capabilities, systems and structures that are adopted in the implementation of strategy require the adoption of a project management approach. There has to be a compelling business case in order for the planned project to be undertaken successfully. Participants must at all times know what their contribution to the overall strategic management objectives really is. Many teams lack motivation because they fail to understand the effect of their tasks on the bottom line goals that are being pursued. Alternatively, they tend to fall into the ‘this too can pass’ syndrome. A project management approach to different capabilities, systems and structures entails a successful conversion of intent into a will to achieve. Project leaders as well as their managers have to communicate clearly to every member at the start of the new project, what his expected contribution is towards the development goals of the organization. In other words, the implementation process can only be undertaken successfully if different tasks were clearly defined as individual projects that are coordinated from a central position. Using this approach, it is easy for participants in each project to relate their contribution to that of other employees who are working on other projects. Implementation roles bring the issues of cost and time into sharp perspective (Johnson, Scholes & Whittington, 2005). In situations where even the top managers are not aware of the exact financial and temporal implications of a certain business strategy, many loose ends may be discovered by unscrupulous who may decide to sabotage a business strategy or to use it for their own selfish interests. There is need for a clear understanding of all measures and standards against which each employee’s contribution will be measured. The strategic management tools that are used during implementation are sometimes misconstrued as a replacement of sound judgment (Mintzberg, Ahlstrand & Lampel, 1998). The tools may be those that involve financial management and scope control. Other aspects that may be negatively influenced by lack of judgment include estimation, team-building, information sharing and contracting. Some managers turn implementation of strategic business management plans into adventures, whereby they learn by doing. Although this approach is important in terms of maintaining a practical approach, it can result in many mistakes that may lead to heavy losses. Novice implementers with no knowledge on how to turn their newly acquired knowledge may make many mistakes in their first attempts to perfect the implementation. They may fail to learn from the mistakes of other people who have handled similar strategic plans in the past. The case study of Lend Lease Australia: The Green Building Strategy Lend Lease Australia is an Australian real estate company that has operations in other parts of the world. The company, which was founded on 1951 under the name civil & Civic, embarked on a building project entitled ‘The Bond’ in 2002. The building project was planned to be undertaken as a green project, whereby environmental concerns would be addressed at all levels, thereby resulting in a green building. The company’s core business, though, is to develop, construct and manage real estate assets belong to both private and public enterprises. Prior to the start of implementation of The Bond project, sustainability was not really a mandated requirement the development projects undertaken by Lend Lease. Therefore, environmental issues were being considered in the process of design only on an ad hoc basis. In situations where features relating to sustainability were incorporated in any Lend Lease Buildings, this was based merely on individual commitment and not corporate dedication. However, with The Bond, sustainability was being perceived as a key future are of growth in terms of business practices among all players in the construction industry. The Bond was being considered a milestone in the company’s history. It marked the transition from a personal to an organizational approach in the company’s commitment to issues of sustainability. The transition was a response to demands from the community for environmental and social responsibility by stakeholders in the construction industry. The determination to make The Bond a sustainable project was facilitated during a workshop that comprised a small group known as the ‘Sustainability Design Group’. The Bond Project was set up in one of the most areas that the members of the implementation team had worked on. Although it was possible for site remediation work to be sub-contracted, the company’s implementers opted to carry out the project themselves since they were not convinced that the contractors would be able to comply with all the required standards. The main environmental issues that the Bond Project had to address included indoor environmental quality, greenhouse gas emissions, and workspace design. After accumulating competencies relating to energy efficiency, the next challenges by the personnel at Lend Lease entailed minimizing the social and environmental impacts of the project. The resounding success of The Bond project resulted in drastic changes being made at Lend Lease. For instance, today, every project undertaken at the company has to adhere to sustainability during the review process. Implementation-related challenges faced during The Bond Project The company faced many challenges relating to the organization of personnel, logistical planning, formulation of courses of action, and maintenance of motivation among all employees. During the start of the project, the company was facing many problems in foreign markets, particularly in the USA. The company’s image was also facing a downturn while its stock price was falling drastically. In the USA, the company’s entry into the country’s financial market had been extremely poorly conceived, leading to huge losses. From the perspective of corporate sustainability, this was the best time to rethink the strategies that were being adopted. The search for new headquarters was influenced by the need for increased opportunities relating to sharing of knowledge and information and accessibility to transport hubs. On the other hand, a consideration of all these factors sometimes appears to go contrary to the requirements of environmental and social sustainability. Moreover, the deadline of mid 2004 had to be met. This is the time when the lease for the old headquarters would expire. Although cultural and financial matters had not been accounted for during the planning process, they took center stage during the early phases of implementation. The senior management had to make the best decision in choosing the right location for the building. The search narrowed down to two locations: the Darling Wharf and The Bond. The former was the preferred option. However, The Bond was finally opted for since the site could be easily secured for development, just in time for the achievement of the deadline. Matters of stakeholder engagement also took centre stage once all issues of design and planning had been taken care of. The needs of the stakeholders had to be taken care of in terms of their work environment. There was a big challenge of handling staff members for the whole project. The company had never before handled such a high number of employees. Maintaining stakeholder engagement in a project of The Bond’s magnitude was a hectic task, not to mention the tight deadline within which this task had to be accomplished. The right capabilities, structures, and systems had to be put in place before the task could be embarked on. The main benefit of creating the right systems, structures and capabilities is that the various task forces that were created could comfortably handle different issues in a motivating environment. Eight different task forces were therefore created in order to address issues such as environment, leadership, finance, technology and coordination. The Green Building Strategy was conceived in such a way that the community had to be engaged owing to the nature of considerations that needed to be put in place. Community engagement was required for the simple reason that the local people knew the environmental sustainability issues that affected them at a local level most. A communication development manager was therefore appointed. His responsibility was to ensure that all the expectations of the community were met, if not exceeded. The element of giving back to the community was at the centre of the building’s design, and the community engagement manager was tasked with ensuring that The Bond would depict Lend Lease as a ‘good neighbour’. The main challenge during efforts to fast-track this strategic goal was developing a social network of many actors, relationships and ideas before identifying the right people to interview. A sceptical attitude from the local community representatives was the first hurdle. Although some neighbours focused on short-term issues such noise in the construction process, community liaison was expected to evolve. However, this was only achieved with the community engagement manager switched his strategy and started focusing on ‘issues management’ roles. The Community Engagement Strategists also had to keep track of the local government representatives on a monthly basis for purposes of regulation and inspection. This was a difficult part of the implementation process since the views of the local government officials had to assessed and kept at par with those of the community. Concurrent measures had to be put in place in order to ensure that the strategic interests of Lend Lease were not overshadowed. The flexibility aspect of the implementation process brought to the fore many leadership challenges. Community engagement personnel had to consult with the local people whenever an activity extended beyond the permitted working hours. The leadership challenges had to be tackled effectively since their outcomes determined the success of corporate social responsibility efforts. Success in this area would translate into a positive impact in the overall business strategy. The company’s level off endowment with regard to organizational capability and resources was accurately determined during the implementation process of The Bond project. Putting up a ‘healthy building’ was a real challenge that would put to test the level of efficiency of different types of resources at the company’s disposal. The Bond was supposed to not only have an ecologically sustainable structure but also an environment that is socially sustainable for the local community as well as the occupants. The factors to be considered included cleanliness, thermal comfort, ventilation and air quality, rapid response, outside awareness, noise, and furniture. The social organization of the people working inside the building easy to plan but the implementation bit of the business strategy proved challenging. Whereas issues of rapid response and social alignment during coffee breaks were properly executed, the issue of food consumption was overlook. This resulted in the creation of a culture that allows excessive use of food within the building. Many employees are discouraged by the available amenities from having lunch away from the building. In terms of strategic organizational performance, Lend Lease’s main challenge was breaking silos during the building process. Staff members had to be ‘reblocked’ and ‘restacked’ in order for group members to be distributed vertically across floors as well as horizontally on floors. These new organizational structures were aimed at facilitating daily interaction across different organizational boundaries. In such a way, information would be shared, and a creation of knowledge would be created, thereby creating a culture of collaboration. The resistance that was encountered during the creations of these ‘blocks’ and ‘stacks’ was immense. This resistance to change management shows that an issue that appears to be simple during planning process could turn out to be problematic during the implementation phase. The Bond business strategy of Lend Lease brought with it many benefits to the company as well as the local community. The project has enabled the company reposition itself as an industry leader in promotion of Green buildings. Internally, Green Buildings have been portrayed in a unique manner through different sustainability criteria involving project design, authorization and review processes. New developments were put in place in a manner that clearly showed that a rigorous assessment of sustainability has been done prior to approval. However, Paul Edwards, the Head of Sustainability at Bovis Lend Lease argues that there is need for both the public and the industry to be educated in order for Lend Lease to make steps ahead in promoting Green Building practices. If this does not happen, Paul fears that Lend Lease may outstrip all the client support that is needed for it to sell all its projects as well as the industry knowledge required to build them. The Bond is both a business strategy and a good example of Ecologically Sustainable Design. Those inside the Lend Lease view the Bond as more of a business strategy than a green building. For outsiders, it appears that the case is vice versa. According to an industry expert, who preferred to remain anonymous, Bond has a very long tradition of building iconic buildings, something it does every decade. Lend Lease, according to the industry expert, uses these developments as a platform for showcasing technology, skills, and various business practices. The Bond appears to fit perfectly into this tradition, and for this reason, it is a key business strategy for Lend Lease. In the view of Maria Atkinson, Land Lease Global Head of Sustainability, today’s delivery model for Australia’s building industry is fragmented and flawed. Goals and accountabilities are separated for each stakeholder: the builder, the owner, the facilities manager, and the occupier. Instead of the accountabilities being distinct, they should overlap in a manner that nurtures independence. The main consequence of this fundamental flaw is difficulty in determining a holistic cost of construction and refurbishment. For businesses such as Lend and Lease, these difficulties are felt during the implementation of business plans such as the Green Building Strategy. Recommendations for improving Lend Lease’s Green Building Strategy Despite the public interest that The Bond attracted, the business strategy was far from perfect. The strategy implementation process led to the dismantling of existing employee relations and creation of new ones. It will definitely take some time before these new relations are cemented in the company’s undertaking of daily business activities. It would be better if future strategies were implemented in such a manner that the existing employee-employer relations are not disrupted or disorganized. Another limitation of the strategy is that the financial costs were way higher than what had been planned for. The extra costs add to the financial strain that the company had been experiencing since early 2001. It is clear to tell with certainty whether the additional costs incurred during the unforeseen activities relating to community engagement will be recouped within a reasonably short time. Moreover, it is not clear whether the money will be recouped wholly as a result of the positive image and the attention gained from the completion of The Bond project. It is good for business strategists to give estimates of direct and indirect benefits resulting from business strategies. This would make it easy for profitability to be assessed. Conclusion In summary, implementation is the most difficult aspect of strategic management, as the case study of The Green Building Strategy of Lend Lease shows. Many issues that are overlooked during the evaluation, analysis and planning stages end up exerting profound influence on the activities undertaken when ideas and plans are being converted into actions. Additionally, there is no clear-cut procedure of undertaking the implementation process. Managers of business strategies should research on closely related business strategies that have been carried out in the past. Such a research may give them a clear idea of the inevitable changes that they will have to encounter and account for during the implementation process. References Dess, G., Lumpkin, G. & Eisner, A. (2007). 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