Effective Implementation of Transformation Strategies

The three chapters in this section demonstrate that, although it can be helpful at times to separate strategy formulation from the strategy implementation stage for pedagogical and communication purposes, when strategy is approached in this way, the wrong mindset ends up being adopted across the organisation. The process becomes the focus rather than the strategic outcomes the organisation needs to achieve. As a result, the organisation falls short of its potential to draw on its people’s drive, passion and talents to pursue opportunities and solve the organisation’s problems.

Strategy research has been focused on rational and detached ways of thinking, which has led strategists to perform formulation and implementation in a one-dimensional manner. In other words, the work is performed in an emotionless manner, as if procedural instead of developmental in nature, and in isolation from the people who contribute. In order to make sense of this for the practicing manager, I review approximately 60 articles on strategic thinking (cognition) focusing on emotions, the contributors to strategy work and the nature of the work. Fascinatingly, the literature conceives of strategic cognition as overwhelmingly controlled by our historical form of cognition from when we lived in the forest. Additionally, strategists and their team members are described as highly emotional, emotionally contagious, intuitive and interactive Homo sapiens—NOT as calm rational managers! This review demonstrates that the focus on rationality and detachment actually promotes negative and damaging ways of thinking, which is experienced by the strategy team as debilitating psychological harm. However, strategists can use emotional contagion in order to spread positive ways of thinking that are experienced by the team as psychological pleasure. Such pleasure actually enhances passion and creativity, suggested to produce more unique and valuable products. This is what strategists need to know about strategy! This expanded view of strategic cognition provides new implications and questions for strategy research and education.

This chapter develops strategic management from a strong process point of view to postulate how strategy implementation can be understood. We will do that by basing ourselves on Theodore Schatzki’s Theory of Practice. This allows us to understand strategic management as a continuous implementation process that generates both persistence and change. Consequently, strategy formulation then becomes another implementation activity, instead of it being seen as something separate preceding strategy implementation. Strategic management then refers to all activities that direct and channel the process that is continuously going on anyway into a desired pattern.

The relations between strategy and organisational change constitute one of the most significant challenges of management theory and practice. Broadly defined complexity-related studies, including cybernetics and systems thinking, were expected to provide instruments for a better understanding of relations between strategic management and organisational change. One of the most challenging problems in relations between strategic management and organisational change is strategy implementation. In the initial concepts of strategic management, the implementation was treated just as an easily identifiable stage: strategic analysis—strategic decision—strategy implementation. As a result, the following question arises. How have the ideas from broadly defined complexity-related studies been helpful in a better understanding of the relations between strategy implementation and organizational change? The analysis presented in this chapter aims at giving preliminary answers to the above question. In addition to the traditional arguments favouring applications of complexity-related ideas in management, the argument about time perspective can be added. The status quo of applications of complexity-related concepts in management allows for a more comprehensive assessment than was possible in the 1990s and at the beginning of the twenty-first century when the fascination of chaos and complexity theories too often led to excessive and naïve expectations.

Consistent with the notion that strategies are made up of an amalgam of strategies and, as a result, must be implemented with this in mind, the two chapters in this section explain the role of a financial strategy in markedly different ways. The first chapter in this section emphasises the importance of managing and transforming capital effectively while the second chapter defines how organisations operationalise their strategic priorities using strategic management accounting principles and analysis techniques. Both chapters clarify how the contemporary organisation can achieve high levels of strategic alignment by implementing an effective financial strategy.

This chapter argues that a financial strategy is more likely to be a positive catalyst for strategic change if it defines in explicit terms how the financial capital the organisation gains access to should be structured and transformed into human, risk and resource capital. This is because these categories of applied capital reflect the organisation’s unique institutional context and what it is key stakeholders want from the organisation. The problem for managers is that people can be employed, risks balanced and resources levered at organisations in a great number of ways. The capital-centric transformations achieved could represent value to different groups of stakeholders in vastly different ways at different times. It is also all too easy to assume that the same methods for acquiring and allocating financial capital are suitable to use indefinitely when this is not the case. This chapter draws on the relevant extant institutional, firm theoretic, corporate finance, corporate governance, organisational design and strategic management literatures, as well as an instructive framework to explicate these arguments. The chapter concludes with a discussion of the implications of its findings for researchers and practice.

In the past, management accounting was the set of techniques accountants used to analyse and reinterpret financial data to help other managers understand the decisions they needed to make to achieve their organisation’s goals. Because the decisions made were mostly centred on the different ways the organisation could achieve greater levels of efficiency, management accounting was not considered to be very strategic. However, with the increasing need to establish links between strategic management and operations through financial information to understand if strategy is being effectively implemented, an evolution occurred. Management accounting turned into strategic management accounting, a function that was designed to help managers make strategic management, operational management, organisational design, financial and capital management decisions or combinations of these. This chapter elaborates on what this involves with a special emphasis on how integral strategic management accounting is when enabling the organisation’s decision-makers to effectively implement a strategy.

The three chapters in this section shed light on the different problems managers need to solve when they develop and implement their organisation’s customer value creation strategies. More to the point, they demonstrate that customer value cannot be created successfully, including systematically over time unless the organisation’s customer value creation internal and external contexts are understood. Accordingly, the three chapters each in their own way, illustrate why it is important for managers to create and deliver value to customers by proactively and constructively learning about the context by which all customer-related decisions should be made and implemented.

Increasing numbers of reports reveal that planet Earth is at significant risk. There are mounting calls to address the damage caused by the unprecedented demand for land, energy and water and environmental destruction, which is attributed to escalating population growth and unparalleled, rising rates of economic growth. Society and its organisations now are expending the Earth’s resources much faster than they can be replenished. Consequently, over the past two decades, sustainability has become an important business issue; growing attention is being paid to organisations’ ecological and environmental performance; and to their impact on the climate and on local and global communities. A number of researchers broadly claim that organisations need to move from Traditional Business Models and adopt Sustainable Business Models, and to deliver a sustainable value proposition aligned with stakeholders’ economic, environmental and social expectations. To achieve this, organisations should expand their perceived stakeholders from customers and shareholders to include all other stakeholders who may be directly or indirectly affected by the organisation’s activities, such as the broader society and the environment. Organisations’ cultures have considerable influence on their attitudes to environmental and social sustainability; their commitment to sustainability; and their environmental and social performance. In order to develop and implement Sustainable Business Models, organisations need to understand their underlying cultural values and develop sustainability-related cultural characteristics. This chapter explains the role of organisational culture and its desired characteristics and discusses actions organisations can take to change their culture. It also discusses steps for embedding sustainability principles across the organisation.

An examination of the marketing and management literatures will very quickly reveal that customer value has been defined in a great many ways. As a result, it would be easy to assume this creates more problems than it solves. This chapter argues that this need not be the case. This is because the different approaches for defining customer value are much more suited to solving some customer value creation-related dilemmas and conundrums than others. With this in mind, three popular and widely employed categories of definitions of customer value are discussed to demonstrate this point: customer value is (1) the amount customers are willing to pay, (2) an equity position that customers perceive they have in an organisation and (3) an inherently multidimensional concept. An analysis of the pros and cons of each approach shows that the third approach is potentially the most enabling when systematically learning about customers, and developing and implementing the organisation’s customer value strategy, including when partnering with many external parties. To demonstrate this point, two frameworks are developed in this chapter using Woodruff’s (1997) very versatile multidimensional definition of customer value. The frameworks illustrate how this highly respected definition can be applied to build a boundary-spanning, customer value learning, co-creation and co-delivery (platform-based) system as an active participant within an institutionally complex ecosystem.

This paper seeks to identify the strategic processes and mechanisms of value creation and value capture (VCVC). To this end, drawing on the management literatures that focus on strategic value creation, that is, resource-based theory, competitive positioning theory and stakeholder orientation theory, some theoretical insights are presented. The results of a research study carried out among 316 organisations in Poland are also presented. This research identified the VCVC processes and mechanisms that can significantly impact organisational performance. It was found strategic and market leadership potential, the control of unique resources, the ability to observe and imitate competitors, the quality of stakeholder relations and the ability to protect value by establishing suitable appropriation mechanisms have the highest influence on organisational performance. The paper concludes by discussing the implications of these findings for research and managerial practice.

The three chapters in this section make it abundantly clear that the resource strategy is especially important to get right for two special reasons. First, the resource strategy explicates how the organisation’s financial, customer value creation and non-market strategies are to be implemented using the resources (tangible and intangible assets and capabilities) at the organisation’s disposal. Second, it enables the process of organisation (coordination) in itself, including the way in which the organisation will implement its specific strategies while ensuring its day-to-day operations.

Strategic changes in organisations are difficult to achieve without effective leadership and communication. Strategic change also typically affects many different people with differing and often conflicting priorities. The success of a large-scale organisational change will thus depend on (1) how well the strategy of the organisation is described and explained to all these different people, (2) what the implementation of the strategy involves and (3) how different people are likely to be impacted. This chapter introduces, describes and explains a framework that aims to increase the probability of completing a large-scale organisational change successfully. The framework addresses 5 key elements of strategic organisational change: the Change itself, the Leaders of the change, Articulation of the change, the Symbolism of the change and the response of Stakeholders to the change (CLASS). The CLASS framework can be used to first communicate a strategic change and then shape or guide its implementation. The application of this framework will enable organisational leaders to clearly classify, communicate and subsequently shape the type of strategic change that they aim to implement. As a result, the CLASS framework will ultimately lead to many more large-scale organisational changes being completed successfully.

Achieving the maximum benefits from strategic investments is high on the priority list for organisations, yet many organisations lack a structured and consistent approach and language for implementing their strategic objectives. The adoption of increased structure in project selection, coordination and execution would seem to many like increasing bureaucracy at the expense of delivery. A lack of effective structure in project implementation leads to people being overstretched and projects failing to deliver on intended outcomes. Establishing a structured approach to project management including the development of a strategic roadmap followed by Portfolio, Programme, Project and Benefits Management, offers a potential solution that provides clarity and transparency in project selection, stakeholder engagement, resource allocation, project delivery and benefits realisation. As organisations mature in their adoption of a structured project management framework (PMF), this enables greater levels of success in the achievement of strategic goals.

This chapter explains the challenges family firms encounter when merging with or acquiring other organisations. Prime among these challenges are the heightened emotional and personal investment that employees and owners have with the organisation. The relational bond between a family firm and its employees is often strong; when the dynamics of this relationship change, this is experienced acutely by organisational members. However, since family firms are characterised by a high level of organisational trust, it should be possible to achieve merger or acquisition success if the right approach is adopted, which acknowledges the different nature of this trust relationship. High trust means that employees are vulnerable because they have positive expectations that the organisation acts with the best of intentions towards them. This means that when a change in trust referent occurs, it is not enough to focus on whether two organisations can be effectively combined/integrated across strategic key areas; it is critical to ensure that the new workforce is given the time and appropriate level of support to affirm and reaffirm trust in one another.

It would be easy to assume that non-market strategies are only necessary for organisations operating primarily in the non-market environment. However, this would be wrong. All organisations are impacted by the non-market environment to some extent. The non-market and market environments are subject to continual institutional change too. Much of this change depends on individual stakeholders’ objectives. These may be of a personal nature or something that the stakeholder wants to achieve on behalf of an institution. Therefore, as the two chapters in this section each distinctly conclude, organisations with integrated non-market and market strategies are likely to be higher performing than those without integrated strategies.

This chapter identifies how Australian nonprofit disability service providers have implemented the Australian National Disability Insurance Scheme (“NDIS”), what role strategy has played, and to what extent they have been successful. Using the results of 46 interviews, the chapter develops a framework to assist nonprofit disability service providers in implementing successful transformational change. The framework specifically explicates the leadership and organisational cultural aspects which are critical when rolling out this kind of initiative, that is, changing from what was previously a supply-driven system to a demand-driven disability services system. This is in the context that the NDIS funds the disability support costs Australia-wide rather than using an insurance scheme predicated on individual contributions through traditional insurance premiums. The scheme ensures that those with permanent or significant disabilities receive the support they require, using the service providers of their choice. The scheme does not distinguish between those born with a disability and those who acquire one. It acknowledges the fact that in the past there were often large discrepancies between how different individuals’ services were funded, based on whether they were born with a disability or if it was acquired later in life, and to what extent, on this basis, the disability entitled an individual to some form of insurance-based compensation. The NDIS roll-out commenced nationally on 1st July 2016 and, when fully rolled out, it will provide in excess of 550,000 Australians who have permanent and significant disability with funding for supports and services. Roll-out was to be completed by 2020 but, as at 7 August 2020, 400,000 are currently in Plans of which 150,000 are receiving supports for the first time (NDIS, 2020). Users and service providers continue to face challenges regarding the NDIS implementation, and these challenges provide the focus for this research.

This chapter builds on the idea that all organisations—whether a for-profit or not-for-profit organisation, small or large, simply structured or very complex—need to have a non-market strategy and, most importantly, a clearly articulated set of processes in place for implementing it. The problem is the practice of strategy has evolved with a strong market bias. With this in mind, this chapter examines what could represent a best practice approach when formulating and implementing a non-market strategy allowing for the fact that institutional and stakeholder management considerations have traditionally been treated as unconnected issues.