7/8/2021 Print Chapter 7 Choosing the Best Strategy age fotostock/SuperStock Learning Objectives By the time you have completed this chapter, you should be able to do the following: Select criteria appropriate to the company and its purposes, and appreciate that a wide variety of criteria exists. Use the criteria in a criteria matrix to evaluate strategic-alternative bundles to help select the best one. Recognize the differences between company, partial, functional, and operational objectives, and among objectives, goals, and strategies. Set company-wide objectives with more confidence. Decide on a strategic intent for the company and major programs required to implement the strategy. Understand why contingency planning is necessary and how to devise meaningful triggers and contingencies. Appreciate why the board of directors has to be kept informed and involved throughout the strategic decision-making process. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.3… 1/63 7/8/2021 Print This chapter explains how to choose the best strategy for the company from a number of viable alternatives using carefully selected criteria and how to argue persuasively for its adoption. It also shows how to arrive at the other strategic decisions and keep the board of directors involved through the process. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.3… 2/63 7/8/2021 Print Chapter 8 Operational and Budget Planning Fuse/Thinkstock Learning Objectives By the time you have completed this chapter, you should be able to do the following: Understand the differences between operational and budget planning. Learn what this planning entails and why it must be done. Appreciate broader operational issues such as systems and systems thinking, information systems, building consensus, and the role of policies. Understand who is involved in operational planning and issues involved in getting it done before the start of the new fiscal year. No strategy is useful unless it can be implemented, and no strategy can be implemented with any degree of success without doing operational and budget planning. This chapter explains how to do such planning, why it's important, and other important process issues. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.3… 3/63 7/8/2021 Print 8.1 Some Broad Operational Issues Some aspects of operational planning are more encompassing than just planning programs, projects, and tasks for people to do. These include systems and systems thinking, management-information systems, ensuring participation in the operational-planning process, and the need for consensus in decision making. Not only are they more encompassing but also are determinants of effective strategy execution and should therefore be taken into account. Systems and Systems Thinking For the most part, our world is made up of systems—from the galactic solar system of which we are a part, to the human body, which has many subsystems of its own, such as the immune, reproductive, digestive, and cardiovascular systems. A system is a set of interacting or interdependent components forming an integrated whole. Corporations are complex social systems, consisting of individuals and units that work together (or not) to produce products or services for their customers that ensure their survival. Complex systems are self-regulating systems; that is, they are selfcorrecting through feedback. In other words, systems must be responsive to feedback such as the company's sales figures, turnover, and other metrics in order to ensure their competitive edge and survival. Moreover, the systems approach to understanding organizations addresses the relationship between the operation and its environment. It does so by examining the nature of the boundaries between the organization and the outside world. The more permeable are an organization's boundaries, the more the organization is able to place its finger on the pulse of the SOMOS / SuperStock The world is made up of systems. Systems are a set of interacting or independent components forming an integrated whole. Corporations are complex social systems. competition, the marketplace, and industry trends. Boundaries may be created, for instance, by employer apathy toward employee development and small travel budgets; an organization that does not send employees to conferences and training, for instance, establishes a less permeable boundary between the organization and the industry. Systems with permeable boundaries are known as open systems and are preferred to closed systems for their greater functionality and innovativeness. Viewing an organization as an open system requires strategic thinkers to consider the complex interactions the system has with its environment, as well as the ways in which the different units within the organization (known as subsystems) import and export ideas, products, and other resources. Additionally, systems are characterized by subsystem interdependence. For example, to market a product, the marketing department must interact with the research and development team to learn what https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.3… 4/63 7/8/2021 Print it needs to know about the product, as well as the sales team to provide the sales strategy. In too many organizations, functional units act as if they were isolated from the others. For example, purchasing may order parts without knowledge of production rates and inventory levels. In both strategic and operational planning, systems managers must practice systems thinking, or the realization that affecting one part of the system affects other parts and furthermore that decisions must benefit the whole company and not just a particular functional area to the detriment of others. The performance of any system, including a company, is thus never equal to the sum of the performance of its parts considered separately, but rather the product of their interactions (Ackoff, 1986). In operational planning, plans should be coordinated between functional units of the organization, especially those between which there is an output-input relationship. The higher one's position in the organizational hierarchy, the more emphasis must be placed on having a system-wide perspective and maintaining awareness of the purposes and goals of the entire organization. Even at a basic operational level, tremendous coordination is needed. As Russell Ackoff (1986), one of the most influential management thinkers of our time, says, understanding how one unit's activities affect and are affected by other corporate activities is a benefit that "cannot be realized unless the planning is comprehensive, coordinated, and participative" (pp. 202–203). There is a class of system models called system dynamics, a detailed discussion of which is beyond the scope of this text. In simple terms, however, dynamic systems specifically take into account how an organization as a complex social system behaves and changes. They are used predictively and can be used to support strategic decisions. Not many companies employ such models, which take time to develop, calibrate, and learn to use. More important than the actual models is the thinking they require in terms of feedback loops; that is, these are positive if self-reinforcing in a positive direction or negative if self-reinforcing the other way. For example, make more product, sell more product, get more money, make more product, and so on is a positive feedback loop. When positive and negative feedback loops interact, depending on the data and kind of model created, results are often counterintuitive. Management-Information Systems (MIS) Every day, at every level in the organization, decisions are made. Earlier chapters focused on strategic decisions, while this chapter and the next focus on operational decisions. Simple decisions require a person's knowledge and experience or, in some organizations, an established policy may govern decisions in routine situations. Startup firms operate with the entrepreneur making all the decisions seemingly "off the cuff" as speed is of the essence and the entrepreneur knows what he or she is doing. The more complex decisions become, the less one person or even a group is able to act independently. Should special promotions in the Southern United States be continued for another month? That would depend on how effective the promotions had been in increasing sales, and without those data the right decision could not be made. Can production throughput be increased by 20% next year? Without https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.3… 5/63 7/8/2021 Print knowing the plant capacity, production costs, and sales forecasts, that question also couldn't be answered. And these are operational decisions. We already know that strategic decisions need a lot of data to be analyzed and processed before they are made, and even then no one will know if the right decision was made until a couple of years later when one can see how the company performed. With the exception of startups, no company can afford to be without a management-information system (MIS). By definition, it must supply the basic information needed by managers for making decisions. The extent to which it succeeds in doing this determines the quality of decisions made (Mason & Hofflander, 1972). Even before the advent of computers, there were information systems, usually in the form of reams of paper and information stored in people's minds. A management information system is more than a stream of unprocessed data that people can access. If it is just this, it is a databank, not an MIS. An accounting system is an example of a databank. Likewise, financial statements display data—the user determines what meaning they have. A management-information system must be tailored to the needs of the decision-makers it serves. Cloud computing has made management-information systems easy to create and maintain. These networked platforms make the MIS mobile, and data accessible from laptops, smartphones, and tablets. The usefulness of the information depends on its quality, timeliness, completeness, and relevance (Jones & George, 2007). What data are needed? In what form? Collected how often? Can anyone input data into the system? Can it be trusted? Can anyone use the system? In fact, it cannot be designed Goodshot/Thinkstock An information management system must be tailored to the needs of the decision makers it serves. The usefulness of the data depends on its timeliness, quality, completeness, and relevance. properly without first defining the kinds of decisions people make and the information that would best serve those decision-makers. Unfortunately, the reverse is often the case, where the MIS is built on data that can be easily collected and stored that people think will be useful for various decision-makers (Mason & Hofflander, 1972). Predictive information systems permit decision-makers to draw inferences and make predictions from the data. Asking the system "what if" questions given certain assumptions gets a response in the vein of "if that were done, then this is what can be expected to occur." The system cannot evaluate the outcome, just provides the information. A financial-planning-simulation model is a good example; other examples are not even computer-based but nonetheless function as a predictive information system, like a market-research group that analyzes data and answers decisionmakers' questions (Mason & Hofflander, 1972). A more advanced type of information system is a decision-making system, which embodies the organization's criteria for choice and actually makes decisions on which the organization can rely and https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.3… 6/63 7/8/2021 Print act. A linear-program model for optimizing distribution routes to minimize costs and use available trucks is a good example. So-called "action" information systems automatically make the correct decisions that are acted upon immediately, like process-control applications (Mason & Hofflander, 1972). One example is measuring the flow of a fluid and regulating a valve to maintain the flow at a predetermined level—an automatic control system. From this brief overview, it's easy to see why management-information systems are easier to develop for operational decisions than for strategic decision making. However, integrated systems are found in many companies today that support operations, such as manufacturing resource planning II (MRPII) and its successor, enterprise resource planning (ERP) systems. MRPII systems, used in manufacturing companies evolved from the earlier material requirements planning (MRP), which uses forecasts from sales and marketing to determine demand for raw materials (Figure 8.1). MRP and MRPII systems draw on a master-production schedule, which is a breakdown of specific plans for each product on a line. While MRP coordinates the purchase of raw-materials, MRPII generates a comprehensive production schedule that takes into consideration machine and labor capacity and coordinates production runs with the arrival of materials. An MRPII output is a final labor and machine schedule (Monk & Wagner, 2006). Figure 8.1: Overview of MRP II Source: Adapted from Gunasekaran et al. (2000). ERP is a process that aims to consolidate a company's departments and operations into one computer system that serves each department's individual needs (see Figure 8.2). The goal of ERP is to create one software solution that serves to integrate the various moving parts of a company into a unified whole, through which information can be shared, acted upon, and reviewed on a company-wide basis. ERP is https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.3… 7/63 7/8/2021 Print mainly used in large organizations that can afford the considerable initial cost. An oft–cited example of an ERP software is customer-ordering and delivery. A customer's order transitions seamlessly from sales, the origin point of the deal, to inventory and warehousing, where the deal is packaged and delivered, to finance, where invoicing, billing, and payments are handled, and on to manufacturing, where the purchased product can be replaced if necessary. Most of these operations, however, involve recording and updating data, not making decisions involving judgment or prediction. In companies with such integrated information systems, operational planning can be facilitated using data from the system and updated in real time as conditions change. For example, integrated systems in supermarkets typically include supply-chain, inventory, and finance/accounting management based on Figure 8.2, but not human-resource management (HRM) or customer-relationship management (CRM) systems. The emphasis is squarely on cost-control, which includes not stocking items not in demand and not being stocked out of any item in demand. Used for that limited but important purpose, the system is useful since margins are quite thin overall. JB Reed/Bloomberg via Getty Images Federal Express uses a communication system that allows it to coordinate handling an average of 5.2 million packages and delivering them with nearly 60,000 vehicles. Larger companies find they cannot operate without some sort of sophisticated information system. Federal Express (FedEx) has communication systems that allow it to coordinate nearly 60,000 vehicles handling an average of 5.2 million packages a day. Its own controllers can override the flight plans of over 650 aircraft should bad weather or other emergencies arise. Its series of e-business tools allows customers to ship and track packages online either on its own or the company's website, create address books, generate custom reports, reduce internal warehousing and inventory-management costs, purchase goods from suppliers, and respond quickly to customer demands (Thompson, Gamble, & Strickland, 2004). Information systems often extend beyond the company to suppliers, also. Walmart is without peer in terms of managing its supply chain. For example, its computers transmit daily sales to Wrangler, a supplier of blue jeans. From the information transmitted and "married" to Wrangler's own systems, the clothing manufacturer can ship specific quantities of specific sizes and colors to specific stores from specific warehouses—lowering logistics and inventory costs for both supplier and customer and leading to fewer stockouts (Thompson, Gamble, & Strickland, 2004). Figure 8.2: Overview of ERP https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.3… 8/63 7/8/2021 Print Source: Enterprise Resource Planning, from SoftWeb Solutions. Reprinted by permission. Building Consensus Operational planning is, in essence, a string of decisions that have to be made quickly at whatever level that planning is done. Unless there is consensus, that is, complete agreement, on a decision by a group of people, majority rule takes over. There's nothing intrinsically wrong with that, except that it introduces the possibility that a minority is not committed to the decision. So how can consensus be built when there is a difference of opinion? If time allows, it pays to get more data on the alternatives to aid in the decision-making process; however, that is not always possible. It may be that the lack of consensus is due not just to different opinions, but also to different positions and political ploys. It is frequently easier to get managers and people to agree first that consensus is desirable (as well as possible) than it is to obtain it (Ackoff, 1986). The additional time and effort it takes to achieve consensus is more than compensated for by the surge in motivation after agreement has been reached. Spotlight on Group Decision Support Systems https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.3… 9/63 7/8/2021 Print Operational planning requires the kind of consensus and buy-in that challenges even the most competent and cooperative human communicators. One solution that many organizations use to streamline this process is the Group Decision Support System (GDSS). GDSS has a long history of development and applications in team-related tasks. Although the sophistication of the interface and the platforms for these technologies have improved over the years, the documented outcomes of GDSS implementation on decision making and group communication have remained stable over close to 30 years of research. Today, most GDSS are supported by a web-based platform that collects, organizes, and interprets the thoughts and reactions of individuals participating in a group decision-making effort (Roszkiewicz, 2007). GDSS replaces whiteboards and flipcharts with a projected image, and can tabulate rankings and evaluations (offering anonymity when desired by meeting leaders and participants) that individuals input through their keyboards, laptops, tablets, smartphones, or specialized handheld "clickers" compatible with the system. In many ways, the GDSS helps level the playing field among meeting participants—the shy individual hesitant to disagree or advocate for an alternative position; the dominant, outspoken opinion leader; the fault-finder; the devil's advocate; and so forth. Although all these roles are important to group decision making, their individual communication styles often steer meetings down the wrong course and lead to outcomes that are unrelated to the best interest of the organization. These problems and other human-communication problems, such as groupthink, interpersonal conflict, and retaliation/retribution may be magnified by the popularity of web conferencing, where participants contend with apprehension about using technology, distractions, and lowered personal cues, which research has shown to be important communication outcomes (Walther, Loh, & Granka, 2005). GDSS introduces discipline and structure into discussions that can go wrong due to human differences— without turning human participants into androids. Participants have equal opportunities to express themselves in brainstorming sessions by posting comments and thoughts to the projection screen, and vote via automated polling. But meetings supported by GDSS are far from silent; the meeting facilitator is now freed from the tasks of recording notes and votes and can facilitate more meaningful conversation. Research indicates that variables such as trust, group synergy, participation, openness, truthfulness, listening, and perceptions of cooperation are enhanced in GDSS-supported group environments (Aiken & Martin, 1994). Further, the accuracy and efficiency of decision making improve when GDSS is implemented (Poole & Holmes, 1995). As agreements and consensus are reached, the facilitator can encourage the group to continue the dialogue with the sophisticated graphs and other visuals that GDSS produces quickly and seamlessly as people participate. Some studies indicate that strategic decision-making time can be cut in half when GDSS is employed. GDSS-supported meetings yield results that are reliably defensible through the patterns identified and statistics https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 10/63 7/8/2021 Print compiled by the system. And, because GDSS also serves as a cloud repository for meeting communication, participants can retrieve the ideas later. In summary, research indicates that the implementation of online GDSS decreases negative interpersonal communication dynamics and enhances the efficacy and quality of decision making and information gathering. GDSS has applications for a wide range of organizational decision-making tasks, but can play a critical role in accurate and efficient strategic and operational planning where consensus is important. Questions for Critical Thinking and Engagement 1. You may already have experience with GDSS; even the clicker-based response systems used in some classrooms represent a form of this type of technology. If you have experience with some type of GDSS, what is your reaction to it? Describe how the technology was utilized by your group, and with what outcomes. 2. Describe a group decision-making experience you have had which might have been enhanced by the use of GDSS. Describe the challenges your group encountered, and explain how GDSS might have mitigated or prevented them. 3. Although there are many benefits to GDSS implementation, these technologies are not a panacea. What barriers to their use might exist? What unintended problems might they introduce into the group decision-making process? The Role of Policies A policy is a company directive designed to guide the thinking, decisions, and actions of managers and their subordinates (Pearce & Robinson, 2005). Policies play several roles and serve several purposes. First, it saves higher management from wasting time making decisions that could be as well handled lower down the hierarchy. Second, it empowers people lower in the organization to make those decisions, often where they should be made. Third, they address issues that crop up frequently, so the amount of time saved is considerable. Finally, the decisions themselves could save the company money by, for example, limiting the kinds of services offered ("Sorry, sir, our policy is to ..."). In addition, policies establish indirect control over independent action immediately; promote uniform handling of similar activities; ensure quicker decisions through using standardized answers; institutionalize basic aspects of organizational behavior; Associated Press/Terry Gilliam Wendy's Hamburgers' purchasing policy allows managers to buy locally produced fresh meat and produce from local producers https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 11/63 7/8/2021 Print clarify what is expected and facilitate smooth execution of strategy; provide predetermined answers to routine problems (Pearce & Robinson, 2005). rather than from company-owned sources. Examples of policies include Wendy's purchasing policy that allows local store managers to buy fresh meat and produce locally rather than from company-owned sources. IBM has a strict marketing policy of not giving free IBM PCs to any person or organization. Packaging-materials giant Crown, Cork, & Seal's R&D policy is not to do any basic research. Polaroid Corporation has longstanding financial policies of never taking on any debt and never making an acquisition. Electronic Data Systems (EDS) for many years had a customer-service policy of empowering any employee to drop whatever that person was doing to answer a customer's call and take care of the problem, at least by passing it to a more qualified person for help (Pearce & Robinson, 2005). Policies should be developed in written form, widely distributed throughout the company, and discussed at all meetings once finalized. In written form, employees can constantly refer to them as an authoritative source until they become second nature. Finally, policies are as useful for what they don't cover as for what they do. For instance, many banks have policies that state that a loan will not be given to a customer who is already overextended. Discussion Questions 1. Corporations and all organizations are systems; yet they themselves contain many systems. Is this possible? Explain. 2. Following on from (1), how might one manage the smaller systems to improve the functioning of the larger one? 3. How can "systems thinking" improve operational decision making? 4. If some management-information systems are simply databanks, are they really systems? Explain. 5. Many manufacturing companies have realized significant savings from using MRPII or similar systems. What would you tell them about investing to upgrade those systems into ERP or more comprehensively integrated systems? How might the additional costs be justified? 6. In a public company, why is the accounting-information system the only system that must be audited? Would it make sense to audit other parts of the system? Why or why not? 7. Can an information system provide a company with a competitive advantage? If so, how? 8. The point was made that consensus in decision making means total buy-in to the decision and smoother implementation. How might you tell the difference between real consensus and several people just "going along" with the majority? 9. If consensus is desirable to achieve, whatever happened to dissent? Isn't dissent also considered a spur to better decision making? Discuss. 10. A bank has a policy of not validating a customer's parking receipt unless a transaction has been completed. One day, a customer wanted to see a bank officer who happened to be out of the office. When he asked to have his parking permit validated, the teller refused. What should the teller do—stick to the policy and risk losing a customer or make an exception? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 12/63 7/8/2021 Print https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 13/63 7/8/2021 Print 8.2 Operational Planning Operational planning involves preparing detailed organizational plans for the coming fiscal year. It includes programs, projects, and activities that the company is already doing as well as new ones required by any change in strategy. Detailed plans by organizational unit are part of operational plans. Finally, it includes coordinating all these activities to make sure they support stated strategies. The iterative nature of the operationalplanning process means that, in practice, draft versions of plans could go up and down the hierarchical chain more than twice (Figure 8.3). The model depicted also combines operational and budget planning into the same process, which is what happens in most companies; however, because the two are significantly different, they shall be discussed separately. Operational Efficiency Case Study: General Dynamics Not Found The requested URL was not found on this server. Additionally, a 404 Not Found error was encountered while trying to use an ErrorDocument to handle the request. General overview of the operational issues implementing a new system. System dynamics explored. Also addresses building consensus, keeping frontline employees involved in the process. At the conclusion of the strategic-planning process, the vice presidents of the different functions, in functionally organized companies, take the strategic decisions to their department and, with their key managers, draft functional objectives to be achieved by the end of the next fiscal year. In other types of organizations, key operational units get to do the same thing. For example, in marketing, examples of operational objectives (with the addition of the quantitative element) might be to improve salespersons' "hit rate" of converting sales visits into orders, increase advertising effectiveness, increase the effectiveness of each distribution channel, and improve the effectiveness of market research. Production objectives could be built around issues of throughput, quality, cost-reduction, and even outsourcing. The directives then go to the actual operating units that must meet those objectives—the sales supervisors or actual sales force for a smaller company, the advertising department, market research, production or plant operations, quality control, and so on. Their challenge is to decide what must be done to meet that objective by the end of the fiscal year. This may mean continuing to do what they have already been doing, changing what they have been doing, or even changing the objective if it appears to be impossible. They must develop a series of tasks and specify who will be accountable to do what, when, and for how much, with a clear output and summary of their efforts. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 14/63 7/8/2021 Print The operating units then submit their draft plan to their managers, who coordinate with other plans in the functional area, and modify if necessary the objectives and budgets. These then go to top management, who reviews them with knowledge of other plans from the other functional areas. Because no first draft is ever perfect and usually goes over budget, the plans are sent back down for revision. In practice, the revision process Belinda Images/SuperStock Operational planning concerns detailed organizational plans for the upcoming year, including programs, activities, and projects the company is already doing or will start to do in the future. takes place in a succession of meetings, at the end of which planning documents are revised. After one or two more iterations, top management approves and finalizes the operational objectives, budgets, and tasks before the fiscal year begins. Only if they have changed significantly might the board get involved again. For smaller companies, project-management software exists to help in planning projects, especially ones with lots of smaller tasks that must be done both sequentially and in parallel. Project Evaluation and Review Technique (PERT) has been around for a long time, and is an operational tool useful in planning, scheduling, costing, coordinating, and controlling complex projects such as constructing buildings, assembling a machine, and R&D projects (Siegel, Shim, & Hartman, 1992). Its most valuable use is helping project managers determine when a project will be finished and the likelihood that it will be completed on time. Each task is mapped on a network diagram clarifying which tasks must be completed before it can be completed, and which other tasks require its completion first. With this information, PERT calculates and identifies a critical path through the network which is the path that takes the longest time to complete (Siegel, Shim, & Hartman, 1992). To avoid missing a deadline, changes could be made, and PERT would keep recalculating a new critical path until the project could be finished on time. Figure 8.3: Operational-planning process https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 15/63 7/8/2021 Print Source: From Stanley C. Abraham, Strategic Planning: A Practical Guide for Competitive Success, p. 162. Copyright © Emerald Group Publishing Limited. Reprinted by permission. Online project-management solutions are widely available. Most web-based project-management tools offer the same basic options, including task-allocation and tracking, resource-allocation and management, risk management, scheduling timelines and deadlines, document archives, and communication. Online project-management solutions offer users transparent, easy access to files and communications, which in turn enables improved teamwork, enhanced time-management, and improved task efficiency. Reward Systems One more thing that must be done and that can't be done until the detailed departmental plans are finally approved is to put in place a reward system that will be sure to motivate the achievement of operational, and hence strategic, objectives. This is a system of rewards that incentivizes people to excel and achieve beyond expectations, often mis-termed a "reward and incentive system." Rewards are primarily (but not exclusively) financial and vary by hierarchical position. The following are typical, although specific company experiences can vary: Stock connection/SuperStock For CEOs and top executives, rewards are typically tied to companywide objectives such as growth in revenues and earnings, profitability ratios such as NPM, ROA, and ROE, and stock-price performance. They may include performance bonuses, stock options, increases in base pay, profit-sharing, and perks such as mortgage loans, use of a private jet or first- After detailed departmental plans are approved, an incentive and rewards program will help motivate employees to achieve operational objectives. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 16/63 7/8/2021 Print class travel, contribution to retirement plans, and so forth. Some incentives such as restricted stock may include provisions called golden handcuffs because they tie the executive to the company by prohibiting the sale of shares for a specified time period; if the executive leaves before that period is up, the shares are forfeited (Pearce & Robinson, 2005). The rewards given to middle managers are typically tied to functional or operational objectives such as sales of product lines or in a particular region, quality, throughput, cost savings, new product development, weighted average cost of capital, and myriad others. These include performance bonuses, promotions, raises, profit sharing, and possibly stock options. Employees' and supervisors' rewards are generally tied to contributing to the achievement of functional or operational objectives as team players, and may include some combination of profit sharing, bonuses for exceptional and timely work, and raises. Other rewards, while nonfinancial, are nonetheless important. Intangible rewards range from frequent words of praise (or constructive criticism), to special recognition at company gatherings or in its newsletter, increased autonomy, and more challenging assignments. The financial rewards are based on accurate measurements of company performance that, in turn, typically depend on a reliable and up-to-date MIS. Some companies pay out rewards quarterly, but most do so annually. In creating the system, executives have to guard against the temptation of functional departments to set their functional and operational objectives too low in order to increase their rewards for achieving those objectives. Some experts maintain that companies should never offer a promotion as a reward for two reasons: It destroys the company's carefully constructed compensation system, and promotions should be given only to individuals that are ready to assume the greater responsibility of the higher position. The following is a useful checklist for designing an incentive-compensation (reward) system: The performance payoff should be significant—perhaps 10%–12% of base pay, while 20% will command the attention of the potential recipient. Incentives should extend to all workers, not just the top executives. The reward system should be administered with scrupulous care and fairness. All individuals should know what the reward system is at the beginning of the year or else they won't be appropriately motivated. Incentives and the performance targets on which they are based should not be impossible to achieve. Payoffs should occur as soon as possible after results have been acknowledged. Confine payoffs only to results achieved. Payoffs should not be made for behaviors such as putting in long hours for a long period, or even going the extra mile but coming up short. Once an exception is made for one person, they will be made for more, and the reward system will quickly get out of hand (Thompson, Gamble, & Strickland, 2004). Payoffs should never be made when the company's profits are below a level to make them possible or for average or below-average performance. Discussion Questions https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 17/63 7/8/2021 Print 1. Some organizations (like some universities, for example) are content to keep doing what they have always done. In fact, the strategy and companywide objectives eventually comprise their operational plans added together. How would you persuade such organizations to do planning the other way round? 2. How does an organization specifically benefit from doing operational planning? (Contrast with an organization that might do no operational planning.) 3. Some smaller organizations operate "on the edge" and are forever "putting out fires." Operational planning isn't even in their lexicon. If you had an opportunity to talk to the president of such a company, what would you say? How might the conversation go? 4. Restricted stock or "golden handcuff" awards designed to keep executives from leaving also have the effect of fostering risk-averse decision making because of the downside risk borne by the affected executives. Can you see any way of countering this effect? 5. Restricted-stock deals always benefit executives that have them whether or not the firm performs well. Does this way of discouraging an executive from leaving make sense to you? Why or why not? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 18/63 7/8/2021 Print 8.3 Budget Planning Budget planning is the process of matching available organizational financial resources (cash on hand, a line of credit or loan, and any investment) with what the organization needs to spend to implement its strategies. It includes revising requests for money from organizational units until their requests and available resources match. What each organizational unit is finally approved to spend constitutes its budget. Wavebreakmedia Ltd/Wavebreak Media/Thinkstock In corporations, the finance department begins The finance department begins the process by coming up the process of estimating the company's financial resources and arriving at a budget with a comfortable estimate of financial resources that is that upper management can implement. the sum of what the company has and could obtain (through additional borrowing or equity investment). Given knowledge of each department's current spending and the spending implied by the new strategic initiatives, it further arrives at a tentative budget total for each department or cost/profit center. That budget figure is given to each departmental vice president, who makes it available to departmental managers as they do their planning for the year. When they come up with their initial plan to meet the functional objectives, they itemize every dollar it might cost to do so. If their estimate equals or comes in under the budget figure, there is no problem. If their estimate exceeds the budget figure, they try to adjust as much as they can, but more often will say that the job can't be done for the budgeted amount. As Figure 8.3 shows, the department may get their plans back from an upper-management review with a mandate to reduce spending in some way to match the budget. Either departmental members become creative and find a way to deliver the mandated reductions or they respond that the only way to get the two numbers to match is to modify the objectives. Of course, the latter reply must include their reasoning for the position, and their supervisor then becomes their advocate. The revised plans are resubmitted where the CEO and top management have the benefit of looking at all the departmental plans and budgets. At this point, they can be persuaded that implementing the strategy will indeed take more money than they thought and see whether they can raise the additional capital. If they can, then higher budgets are approved that match the estimated spending from all departments, and the budget-planning process ends. If they can't, then some or all departments are told that they must meet their objectives with the available budget. For example, if adding 10 salespeople was in the marketing plan to help marketing reach its sales objectives, then it might have to get the same objective accomplished with fewer salespeople. The process ends when departmental budgets finally match available financial resources together with their commitment to achieve their functional objectives. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 19/63 7/8/2021 Print Normally, operational and budget planning should be enough to enable each organizational unit and, by extension, everyone in the organization, to know what they have to do and accomplish during the coming fiscal year. However, some organizations also engage in profit planning, which is the process of arriving at an estimate, month by month, of the profit (NIBT) the whole organization intends to achieve. For each month, the total company budget is subtracted from estimated revenues; the sum of the monthly profits equals the overall NIBT objective for the coming year. Profit planning is not widely used and is considered unnecessary by some strategic planners. Reducing Costs The budget-planning process can also be thought of as a process for reducing costs. Not only does it ensure that spending will be covered by real financial resources but also is a forcing function for reducing costs. It's human nature to take the easy route or continue doing what you have always done. That will happen unless someone requires it to be done for less. The very requirement forces the consideration of alternatives. Entrepreneurs are often faced with this problem when writing their business plan and trying to seek startup capital. Their first pass at a cash-flow projection often shows that the business might not make enough money, or even make any money at all, which is certainly not what the entrepreneurs or potential investors want to hear. All the assumptions must be reexamined and, with more research and thought, revised figures are produced of both the revenue model and the expenses. If the revised business plan looks better but still doesn't come close to achieving the 20%–40% ROI required by typical investors, at this point the entrepreneur considers any and all alternatives to achieving the targeted revenues for less cost. More attractive margins, at least on paper, won't be possible until he or she is forced to consider lower-cost alternatives. Having had to put so much thought into the revised estimates also makes defending them easier. For this reason, top management's first instinct in this process is to force functional and operational units to try to reduce costs. The budget-planning process is so valuable because it forces people to try to lower costs, which wouldn't happen any other way. Discussion Questions 1. What risk is the organization running when it approves expenses that exceed available financial resources? 2. Departments of a city or other public entity are well known for trying to spend their entire budget allocations so that they will be funded again the following year at least at the same level. If they don't, they might be viewed as not "needing" their budget allocation and so be allocated a lesser amount. What is wrong with this process? 3. What do you think might happen when, midway through the year, expected financial resources fail to appear (for example, when some funding from a government agency is slashed)? What options might an organization in this position have? 4. Whose responsibility is it in the organization to reduce costs? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 20/63 7/8/2021 Print 5. How does an individual or departmental unit know that something that person or group is doing can, indeed, be done at lower cost? 6. Following on from (5), if there is a way of knowing, why don't all corporations avail themselves of it all the time? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 21/63 7/8/2021 Print 8.4 Participation in Operational Planning Just as it's a mistake to do strategic planning only with the participation of the top-management group, so also is it a mistake to do operational planning with just middle managers. To be sure, middle managers bear the brunt of the responsibility for operational planning because they will be called upon later in the year to implement the plans. But make no mistake, everyone in the company is and ought to be involved, not only in operational planning but also in carrying out the plans. By virtue of their size, small companies have no option but to involve everyone. Yet exceptions abound. The production manager for a small garment manufacturer complained of being left out of the planning process entirely. The company was being squeezed by its large customers who were forcing the price down to maintain their own profitability. The customers used the approach that if this firm could not supply at the desired price there would be lots of other suppliers that would. The president and co-owner of the company was the one Digital Vision/Thinkstock who made the bids to these large clients for future Involving all employees in the organization business. Time and again, he bid at a price point that was makes it easier to avoid things that block new below cost, because he was convinced that he wouldn't initiatives or are no longer useful in helping the company be more efficient and productive. get the business otherwise, and he never checked first with the production manager who could have advised him of current costs and margins. The result was that it put enormous additional pressure on reducing manufacturing costs while margins all but eroded. This scenario was repeated many times, and this was a management team of only two people. In large companies, it is all too common not to involve the rank and file in operational planning. In many companies, information is only divulged or passed down on a "need to know" basis, much as in the military or police departments. People at the bottom just do what they are told; it's part of the job. As the discussion of organizational change in Section 2.10 made clear, however, smooth and enthusiastic implementation of any task is not possible unless those who are to do the work are involved in the planning. This is much easier said than done. It depends to a large extent on the kind of culture that exists in the company. Cultures that are command-and-control or bureaucratic are by their very nature not inclined to involve everyone as they should, mainly because, as befits those cultures, they have been able to do what they do without such involvement. Open, adaptive, innovative, nimble organizational cultures as discussed in Section 2.9 would not be able to progress without involving everyone and seeking their input, especially in planning and suggesting new ideas. This culture of openness requires the implementation of participative leader-member behavior, which encourages supportive-relationship behavior and the open sharing of ideas during decision-making and strategic and operational planning. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 22/63 7/8/2021 Print Another reason to involve everyone in the organization is to make it easier to get people to stop doing things that either get in the way of new initiatives or are no longer useful in helping the company be more efficient and productive. Change involves "forgetting" about and dropping old habits if new ones are to take their place. Change will stall or not take hold to the extent that people cannot or won't forget what they used to do. It is therefore wise to involve everyone; make sure they understand what they have to do and why; how their job, role, and expectations are changing; how and why they will benefit from the changes; and have a mechanism such as muscle memory for repeating the new imperatives often until force of habit takes over, and the changes and improvements become second nature. Discussion Questions 1. The ease with which everyone in the organization can be involved depends on its culture. Might involving everyone actually change the culture? Comment. 2. This section advocated involving everyone. Surely not everyone? Would this include the people loading boxes in the shipping dock? The janitors? The mailroom clerk? The secretaries? Comment. 3. Following on from (2), if you don't agree that everyone should be involved, where might your cutoff be? Give reasons for your answer. 4. Following on from (3), if you advocate a cutoff, explain why that might be superior to involving everyone. 5. "Muscle memory" is unquestionably valuable when a new habit must be learned. But how can one get rid of an old habit that has also been engrained in the organization's "muscles"? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 23/63 7/8/2021 Print 8.5 Getting It Done in Time The operational-planning process should be timed so that by the time the new fiscal year starts, all the strategic decisions, operational plans, and budgets have been completed. Final approval of the plans and budgets should be completed within a couple of weeks of the start of the fiscal year. Bear in mind that both strategic and operational planning take place in addition to people's regular daily activities. But how long should the strategic- and operational-planning processes take? There is no simple answer. Consider four scenarios—among many—beginning with the best or ideal situation: The company is used to doing strategic planning, and much of the required research is done throughout the year. It is performing well and is used to transforming strategic decisions into operational plans and can get those plans approved in one iteration. The two processes together, especially for small to mid-size companies, take no more than two months. Like the scenario just described, but for a well-performing larger company with more divisions and vertical layers, coordinating operational and budget planning takes longer but still gets done within 2-1/2 months. For a company that is not performing very well, has financial problems, but has some experience with strategic and operational planning. This company is constantly putting out fires, lurching from crisis to crisis; strategic and operational planning take back seats, if done at all. If anything is done, it will probably be done badly, with changes continuing to be made after "approvals" have been given. The time frame needed for planning is impossible to estimate. There are companies, of course, that are run autocratically, with the CEO telling everybody what to do and being the only one to approve anything. In this situation, the combined processes shouldn't take long at all, perhaps two to four weeks. This was not included as a scenario in the preceding list because, although it might take the least amount of time, it doesn't qualify as a "best" or "ideal" scenario. However, it often works in that kind of organization. Sometimes, the process takes longer than anticipated, and the deadline of the new fiscal year is missed. What usually happens is that the full operational-planning process is aborted, and whatever stage it has reached is hurriedly approved. After all, the start of the new fiscal year can't be changed. One way around this dilemma is to shorten the approval cycle. Instead of going all the way up the hierarchy for every approval cycle, as shown in Figure 8.3, plans should only go to a higher level when they are refined much further. This will shorten the operational-planning cycle. Angela Waye/Hemera/Thinkstock Budget preparation should take two to four weeks, depending on the size of the company. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 24/63 7/8/2021 Print For an organization that has not previously done operational planning, two months is a reasonable allowance for the first time. In each successive year, familiarity with the process and everyone's ability to produce better plans should enable the company to be more accurate in scheduling the process without any drop in quality. It is best to start strategic planning as late in the fiscal year as possible while leaving enough time for decent operational and budget planning. The time frame of three months, mentioned earlier, is a whole quarter and really, too long to devote to planning, mainly because conditions will have changed during such a long planning process. For a large organization that has many layers and planning units, operational planning does take more time than anyone would like. Should a company ever abandon the operational-planning process if time is running out? The short answer is no. As long as management approves what should be allocated and achieved during the first month of the fiscal year, there will be that additional month to finish the process properly. In the next chapter we shall consider some tools that large organizations can use to speed up both strategic and operational planning and keep the "intrusion" of planning in people's busy lives to a minimum. Discussion Questions 1. Suggest one way in which operational and budget planning could suffer if the process were rushed. 2. Imagine that the operational-planning process was well into its third month and already extant conditions had changed. What should the company do? For example, should plans at the lowest levels be changed first or only those plans most affected by the changed conditions? 3. Following from (2), should just the plans be changed or budgets as well? 4. With more experience in operational and budget planning, it should be possible to get it done in less time each year. Exactly how important is getting it done quicker? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 25/63 7/8/2021 Print Summary This chapter explained the context and importance of operational and budget planning. Operational planning focuses on planning the projects, programs, tasks, and activities the company needs to implement its strategies, and includes both what it already does as well as additional programs it must do the next year. Budget planning focuses on getting all operating units to spend what they need to spend to do what they must do without exceeding the total financial resources that the company has or may have at its disposal for the coming year. As plans take shape for each operational or functional unit, they inevitably undergo changes until their estimated costs match the estimated financial resources allocated to that operational unit. Operational planning is carried out more effectively when everyone involved in the process understands that everything is part of a larger system, that anything they do affects other parts of the system, and vice versa. That understanding, called systems thinking, is critical in operational planning. In the same vein, having access to the right information for management decision making and action is vital—companies couldn't operate without such information. Many such systems are nothing more than databanks, forcing the user to make sense of and interpret the data. Transforming them into systems such as MRP II (manufacturing resource planning II) for manufacturing companies or the more encompassing ERP (enterprise resource planning) make such data far more useful, but they require considerable investment, not only in capital, but also in transforming the way people work and learn. Operational decisions should be based on consensus at each decision-making level, which means complete agreement. Getting a majority vote, for example, means there is a minority that disagrees with the decision, which in turn means that implementation will be that much more difficult. The chapter also discussed the role of policies in an organization. These are in effect rules that guide behavior in often-encountered situations. That way, in such situations people will make the correct decision all the time. Having the policies in writing allows people to refer to them at any time and gives them the force of law (which, in the company, they are). Policies can cover, for example, how customers and the environment and suppliers are treated, as well as mundane subjects like what can and can't be included in an expense report. Operational planning must take into account the company's current policies. Operational planning itself is the process by which objectives are translated into projects, programs, tasks, and activities that get progressively more detailed the further down in the organization the process goes. Budget planning is done at the same time. Operational units must develop their plans while staying within the budget allocated to each one, requiring first drafts to undergo several revisions in order to balance these two requirements and as they go up and down the organizational hierarchy. One of the unheralded benefits of budget planning is the creativity unleashed in order to reduce costs. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 26/63 7/8/2021 Print Finally, everyone in the company should be involved in operational and budget planning, not just the managers and supervisors. When this happens, new ideas have a chance to surface, consensus is more likely, and implementation goes more smoothly. Operational and budget planning have to be done fairly quickly just before the start of the new fiscal year. Doing this is difficult without compromising the process and because involvement is an additional burden on top of day-to-day responsibilities. The risk with taking up to three months to do operational and budget planning is that conditions will change during the process, requiring plans to be further changed as a result. Experience helps, as does revising plans first before submitting them up the ladder for approval. Concept Check Key Terms action information systems Automatically make (the right) decisions that are acted upon immediately. budget planning The process of matching available organizational financial resources (cash on hand, a line of credit or loan, and any investment) with what the organization needs to spend to implement its chosen strategies. It includes revising requests for money from organizational units until their requests and available resources match. What each organizational unit is finally approved to spend constitutes its budget. consensus Complete agreement. critical path The path through the network that takes the longest time to complete. databank A stream of unprocessed data that people can access. decision-making system Embodies the organization's criteria for choice and actually makes decisions on which the organization can rely and act. ERP (enterprise resource planning) A process that aims to consolidate a company's departments and operations into one computer system that serves each department’s individual needs. management-information system (MIS) A system that must supply the basic information needed by managers for making decisions. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 27/63 7/8/2021 Print manufacturing resource planning II (MRPII) A comprehensive production schedule that takes into consideration machine and labor capacity and coordinates production runs with the arrival of materials. An MRPII output is a final labor and machine schedule. Information about production costs, including machine time, labor time, materials used, and final production numbers, is delivered to accounting and finance via the MRPII system. muscle memory Repeating something often enough so that muscles learn what needs to be done and it becomes second nature (they can perform the activity without conscious thought). The concept is applicable to organizations. operational planning Involves preparing detailed organizational plans for the coming fiscal year. It includes programs, projects, and activities that the company is already doing as well as new ones required by any change in strategy. It includes detailed plans by organizational unit. Finally, it includes coordinating all these activities to make sure they support stated strategies. policy A company directive designed to guide the thinking, decisions, and actions of managers and their subordinates. predictive information systems Permit decision-makers to draw inferences and make predictions from the data. PERT (project evaluation and review technique) An operational tool useful in planning, scheduling, costing, coordinating, and controlling complex projects. reward system A system of rewards that incentivizes people to excel and achieve beyond stated objectives. system A set of interacting or interdependent components forming an integrated whole. systems thinking The realization that affecting one part of the system affects other parts and that what is done must benefit the whole and not just a particular part at the expense of other parts. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 28/63 7/8/2021 Print Chapter 9 Implementation Ivelin Radkov/iStockphoto/Thinkstock Learning Objectives By the time you have completed this chapter, you should be able to do the following: Recognize good operational plans and distinguish them from weak ones. Appreciate the value of tracking progress on all operational plans. Appreciate the value of face-to-face meetings with middle managers to discuss negative variances. Know why emergent strategies occur and how they might affect a company's current strategy. Manage, improve, and evaluate an existing strategic-planning process. Understand the "strategy paradox," showing how a company's strength in execution can be simultaneously its Achilles' heel. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 29/63 7/8/2021 Print Implementing a strategy in the real world isn't a leisurely swim across a calm pond on a sunny day, but rather like crossing from one bank of a raging river to the other, encountering hidden eddies, fog, driving rain, lightning, and riptides along the way. While not impossible to reach the other bank (the goal), the task often becomes difficult and one of overcoming obstacles and making constant adjustments without losing focus or sight of the goal. Implementation is like that. Even the most brilliant strategy is worthless if it cannot be implemented. This chapter focuses on strategy execution and its difficulties, and part of it is devoted to assessing, improving, and managing the strategic-planning process itself. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 30/63 7/8/2021 Print 9.1 Plans by Organizational Unit When an organizational unit gets its plans and budget approved by the level it reports to and on upward, exactly what is it that gets approved? An operational plan is a document that specifies the projects or tasks that must be accomplished to achieve particular operational objectives. Details specified in operational plans include the names of those who will be involved and the individual responsible for each one, what equipment will be needed, when each will start and end, and the estimated costs for each one. Given the level of detail required it should come as no surprise that an operational plan can run to many pages if a large number of projects must be detailed, such as manufacturing hundreds of product lines. It takes contributions from everyone who will be involved in that unit's operations to create such plans. They will make sure that continuing current operations are included in the plans, which is easily done. What adds a level of complexity and difficulty is incorporating additional tasks demanded by a change in strategy. Consider the following scenarios, which illustrate the difficulty in creating operational plans when asked to do more than simply repeating what was done the previous year: Production. A specific higher level of throughput is required to satisfy increased demand, which will soon require capacity expansion. Can the increased capacity requirement be met by adding additional shifts, physically expanding the size of the plant, or building a new plant? Can some of the additional production be outsourced? How many new machines must be added and of what kind? How many new people must be hired and trained, and how long might all of this take? Also, consider the scenario where a whole new product line has been designed and now has to be Semen Barkovskiy/Hemera/Thinkstock produced in addition to producing all the other Research and development is essential to a product lines. How can this best be accomplished? company's ability to compete. It requires new initiatives to keep up with technology and In both scenarios, production capacity has to be develop new products. increased. Research & Development. Technology advances are affecting the company's ability to compete. This requires new initiatives to keep up with technology as well as continue with applied research associated with developing new products. This could mean expanding staff and facilities or forging strategic alliances with particular universities that have the requisite capabilities to help the company. Another option might be finding a company with the needed technology and licensing it. Yet another possibility might be to start a conversation with top management about possibly acquiring a small high-tech company with these capabilities and patents. What is the best way to do this? Marketing. The decision to expand from being a regional consumer-products company (B2C) to a national business presents a host of operational challenges. Should the company continue to https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 31/63 7/8/2021 Print handle its own distribution or find a national distributor? How many new retail outlets would it need to find to reach potential customers? Would it need to lease additional distribution centers or warehouses? Which specific parts of the "rest of the country" should be targeted first, second, and so on until the company covers all of its targeted areas? What advertising media would be most appropriate, and does going national require television advertising? Should more emphasis be placed on online rather than brickand- mortar sales? How can this sales objective be realized most expediently? Finance. Consider two scenarios: In the first, the company has decided to invest in either a new integrated information system or a significant development of the existing one. How many more software engineers and programmers will be required? Could part of the new system be licensed and then customized? Without intimate knowledge of the completed system, how can building it be planned for? Should a consulting firm be engaged with the requisite experience? Will IT staff need to be hired and trained for the other functions? In the second scenario the company's cash needs for the coming year exceed what it can normally access. How can it raise more cash? Should receivables be factored? Should a larger line of credit be negotiated? Should payables be delayed? If appropriate, should some customers be asked to prepay? Is there a way to maintain negative working capital to free up the most cash? Ideally, operating units will have been working on these kinds of changes over a much longer period, using the formal operational-planning period at the end of the fiscal year to finalize its plans and match available resources before the new fiscal year begins. And its plans must be done in some sort of networked way or using Gantt charts to show which projects or tasks can be done independently of others and which are integral to a particular sequence. A Gantt chart is a graphic depiction of a project schedule. Gantt charts show the beginning and end dates of each project component. Some charts also illustrate the dependency relationships between component activities, or the dependency of one activity upon the completion of another. Gantt charts may be used to provide up-to-date schedule status using percent-complete shadings (Figure 9.1). Gantt charts can also be combined with PERT software to produce a critical path of projects. When that is done, the total plans for a particular unit should be summarized according to the review period set by the company. Typically this is each month. The review cannot begin until all the requisite data have been collected and organized, which usually takes a week after the end of the month. Actual results are then compared to plan (expected performance and budget) along the following dimensions: For each project completed during the period, data show whether the objective was achieved, current and total costs, and whether the deadline was met. For each ongoing project, data show progress toward achieving the objective, current and cumulative costs, and a probability that the deadline will be met. The project leader initially does such a review, with copies given to middle managers on up to functional heads. If the data are input into a computer system, then those managers will all have access to monthly summaries. Figure 9.1: Example of a Gantt chart https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 32/63 7/8/2021 Print Discussion Questions 1. Clearly, it's much tougher to translate a change in strategy into operational plans than it is to continue with an established strategy. In your opinion, is it acceptable to submit a plan that's full of uncertainties? Explain your point of view. 2. Can you think of anything else that should be part of a good operational plan? 3. Now that you know more about what is involved in coming up with a good operational plan, do you believe that strategic planning should be done solely by top management? 4. To what extent, if any, does strategic-planning experience help an operational manager develop operational plans to support the company's strategies? 5. To what extent should managers be aware of what's going on in other parts (e.g., functions) of the company while preparing operational plans? 6. If quality or effectiveness of a project is important, how can these be incorporated into an operational plan? Or should a separate project be developed to assess those attributes, requiring additional expenditures? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 33/63 7/8/2021 Print 9.2 Tracking Performance Using Metrics Two old adages underscore why the use of metrics is so vital in organizations: "What gets measured gets managed." "You can't improve what you can't measure." By way of illustration, consider the true example of a nonprofit organization that provided educational workshops for high-school students in an effort to reduce the teen crime rate in the area around the city in which it operated. The directors were asked how they knew how the organization was performing and what information was reported to its sponsors periodically. They said they kept records of student attendance at every workshop they gave, the number of workshops each week and at which school, who gave the workshops, and the content of each workshop. In other words, what they said they were going to do and what they did was what was measured and reported. But how effective were the workshops? What was the purpose for developing and giving them? Did the teen crime rate decline over the couple of years that this organization was giving its workshops? And even if they did—which no one knew—was it because of the workshops? In this example, the donor was as much at fault as the people in the organization for not insisting on better measures and better data. Clearly, like many other organizations, this one measured what is easy to measure, not what needed to be measured. Unfortunately, those running the programs didn't know, or had never considered, the difference. There are many ways to measure performance, but the more systematic and reliable the method is, the more credible the data will be in supporting strategic plans and their implementation. Organizations mistakenly measure the results of their activities or effort, not progress toward achieving objectives. Although impact measurement is important, process evaluation is critical to strategic management. Evaluating progress at numerous stages throughout implementation allows the manager and his or her team to make adjustments and modifications to the strategy. Operational objectives, discussed in Chapter 8, must be Fancy Collection / SuperStock The manager's job is to collect and organize current project data by project. set carefully. Making good progress toward objectives that were set too low is of little value and won't implement the strategy properly. Setting them too high de-motivates the workforce and is just as bad. So let us assume that "stretch" objectives—set at just the right level but that demand a little more from everyone to achieve—have been set all the way down the line, plans were devised for every unit that matched its budget allocations, and that it was these plans that are now being carried out by everyone in the organization. https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 34/63 7/8/2021 Print How does top management monitor whether everything is "on track" or "on plan?" The manager's job is to collect and organize current project data for the review period, by project, in their respective areas of responsibility. The example shown in Figure 9.1 is a step in the right direction, but has to be summarized for the month. For example, the figure shows an almost instantaneous picture for daily monitoring, a time frame and level of detail required only by the people actually doing the work. From such daily reports and the status of projects at the end of the month, a manager would need to extract and summarize information on each major project, being careful to note which projects were on schedule and under budget and which weren't and by how much. The latter could constitute a separate "exception" report of negative variances (discussed in more detail later), which are projects that have slipped their schedule or are over budget, together with additional information on how much extra it might cost to get all of them back to meeting their deadline. The Budget as a Control System Recall the vignette about Pacifica Corporation recounted in a box in Section 2.9. As part of the rapid change in its culture, five original managers, including the CFO, were replaced. The CFO was let go when it was discovered he had no idea how to budget. For six entire months, he had fooled the CEO into believing that everything was on track. Whenever he was asked if expenses were "on budget," the CFO would say "Yes," and people believed him. After about six months, with costs clearly skyrocketing, the CFO was asked again if expenses were on track with the original budget. The real answer was no: Every month, as costs had outpaced the set budget, the CFO had simply raised the budget to match expenses. Rather than taking action to decrease costs, he had consistently told everyone that things were "on budget." The budget is a control system in that it allows management to compare actual performance to a standard, measure the variance, take action to reduce the variance, reset or update, and test again. Another example of a control system is a packaging machine that automatically fills boxes with a precise weight of cereal and signals the operator the moment the filled weight exceeds or falls short by a preset small amount, enabling immediate adjustment of the machine. In the case of a budget as control system, action is taken only if expenses exceed the budget. Further, cumulative expenses are compared to cumulative budgets so that an operational unit that has overspent one month can "make up" and spend less than its budget in the following month (Figure 9.2). One of the hallmarks of a good control system is that corrective action is taken as soon as it is found to be needed. Why wait until the end of the year to discover that you have gone over budget? At the other end of the scale, should you check every week? That makes no sense, either. Monthly checking is about right, and most information systems can provide such information monthly, either as needed onscreen or in a customized monthly report sent to all operational managers. In large organizations that have federal contracts, for example, government auditors closely examine expense reports, time sheets, and invoices related to programs. So, for example, when a contractor https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 35/63 7/8/2021 Print requests increased funding, budget controls are in place to quickly advise regulators as to the legitimacy of the request. In this way, the government can determine when increased expenses are justified, or when to tell its contractors to cut costs. Addressing Negative Variances Managers in well-run corporations make a point of meeting with their direct reports regularly to go over progress and discuss any problems. One focus of the meeting should be variances and any exception reports that detail differences between plans or standards and actual performance. A negative variance is an instance where a project's progress is delayed and could miss a deadline, or where its budget has been exceeded, or where performance comes up short of a quantitative standard or expectation. Figure 9.2: The budget as control system What can be accomplished in such a meeting between a manager and a direct report? First, the manager should learn about the particular circumstances surrounding negative variances of some projects, what might have caused the delays or budget overruns, and which other projects might be in jeopardy as a result. They should ask questions and listen carefully to the responses. Both the manager and direct https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 36/63 7/8/2021 Print report should note questions to which an answer could not be provided because the direct report didn't have the necessary information. Second, the manager and direct report should discuss potential solutions to the negative variances. Some projects can be pulled back on track through either the direct report getting project personnel to acknowledge problems and solve them, helping them to find solutions, and trying to remove obstacles that might be delaying progress. Also, if budgets are overrun, a new lower budget that compensates for the overrun must be communicated to project personnel. The manager should focus on projects where there is a direct relationship between schedule and budget. That is, where speeding them up will cost more, and conversely, where reducing age fotostock/SuperStock Well-run corporations have their manager's report in every month to track progress and discuss any problems that have arisen. the budget results in unacceptable delays. It is in precisely such situations that any critical-path software becomes invaluable, because it lets a project leader or supervisor try out different alternatives until both parameters (project time and budget) meet expectations. Third, the manager should insist that the direct report file—within the next couple of days—a revised plan containing the points that were discussed that will bring projects and budgets back in line. Finally, meetings represent an opportunity for the manager to strengthen a relationship with the direct report. In most cases, the meeting is just between the two of them (although inviting other project managers who are in a better position to provide explanations is also common). What is the direct report most worried about? Is the communication between them as "open" as it needs to be? What's really going on? Taking the time to delve a little deeper and offer guidance and counseling is often well worth the time. Be mindful of a couple of potential red flags: Some managers don't like hearing or dealing with bad news and might even tell their reports they don't want to hear it. So if a supervisor is repeatedly told that "everything is okay," he or she might well suspect that it's not. The manager will have to dig deeper and even go to chat informally with the direct report's colleagues and team members. A manager also needs to be sensitive to whether a direct report is losing control of the team or his or her responsibilities. If the employee feels overwhelmed and relatively powerless to stem the tide, a real problem exists. This kind of face-to-face meeting with a direct report goes on up and down the hierarchy. Typically, a manager might have a half dozen to a dozen direct reports, some fewer, some more. A manager should schedule all meetings with direct reports over the course of a day or two before meeting with his or her own supervisor, taking on the role of "direct report." https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 37/63 7/8/2021 Print If this description of the organization conveys the idea that this is one massive control system, that is exactly the intent. During execution or implementation of a strategy, doing the work and controlling the work—its quality, timeliness, and adherence to a budget—is vital. And in the spirit of a good control system, actual performance is compared to a standard, the variance noted (especially negative variance), solutions developed, and a correction applied as soon as possible. Data collected about performance, especially as part of an information system, are essential, but a control system needs more; that's why the face-to-face meetings are imperative and why everyone in the hierarchy must follow through and put the corrections into effect to improve performance the following month. This description also gives the impression that managers take part in many meetings, and that too is by design. With so many meetings to prepare for and attend, when do managers get time to do their real work? Perhaps this is the fallacy. Recall the definition of a manager as "someone who gets work done through other people." The time spent in meetings is the work. Whether that time is wasted or not is another issue and goes directly to whether the person conducting the meeting is an effective manager. Managing well is difficult, challenging, time-consuming, but ultimately very satisfying. The job gets done on time and within budget, and your direct reports grow and develop into productive, congenial team members. Discussion Questions 1. It's easy to measure what training was given, to whom, by whom, how often, and whether it was within budget. What measures would you suggest to determine the effectiveness of such training? Is it important? 2. Midway through the year, all managers are told that budgets need to be slashed. What is their likely response? Do all operational managers line up to "make their case" for not cutting budgets on their projects? Do vice presidents and other senior-level managers make the decisions as to where and what to cut? 3. With each manager receiving a monthly report about project progress and budget compliance, what additional benefit is gained from a face-to-face meeting? 4. If you were a manager who had to oversee people and projects, would you look forward to your monthly face-to-face meetings? Under what circumstances might you dread them? If you can think of any, how could you improve the situation? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 38/63 7/8/2021 Print 9.3 Emergent Strategies There is one type of strategy that occurs only during operational execution. Emergent strategies, first proposed by Henry Mintzberg of McGill University, arise as a result of an organization's response to unexpected events as a strategy is being implemented. In Mintzberg's terms, an intended strategy is akin to the "best" strategy that was developed in Section 6.4 and chosen in Section 7.2. Such a strategy, when implemented, is then called a deliberate strategy. If it fails for whatever reason, it is considered an unrealized strategy (Figure 9.3). As the deliberate strategy is executed, a pattern may emerge that was not intended when the strategy was first proposed. Actions that were taken one at a time take on a cumulative effect and become a strategy. For example, a supplier serving restaurants has an opportunity to serve a hotel, and later another hotel, and so on until it becomes clear over time that the company has diversified into the related market of hotels. That is an emergent strategy that was never a part of the strategy the company set out to implement. Combined with the deliberate strategy of serving restaurants, it evolves into the realized strategy of serving the hospitality industry. This is also sometimes referred to as an umbrella strategy. There is much validity to viewing strategy in this way, from how it's formulated to what actually happens in practice. Real life is messy and rarely do plans actually happen the way they are intended. Few strategies are purely deliberate, just as few are purely emergent; the former allows for no learning while the latter means no control (Mintzberg, Ahlstrand, & Lampel, 1998). Reality is some combination of the two. Accepting the notion of emergent strategies allows the organization to learn from customers and to increase its capacity to experiment with new ideas. That is not to say that learning doesn't occur without an emergent strategy; one of the important byproducts of the strategic thinking and planning process is to increase strategic learning and to update everyone's mental models in a similar way. The very act of implementing a strategy involves all kinds of learning, which benefits the next round of strategic planning. Figure 9.3: Deliberate and emergent strategies https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 39/63 7/8/2021 Print Source: From Stanley C. Abraham, Strategic Planning: A Practical Guide for Competitive Success, p. 157. Copyright © Emerald Publishing Group Limited. Reprinted by permission. Keeping one's eyes open for a pattern that signals an emergent strategy is another way for a company to stay agile and flexible. In times of constant and rapid change, taking advantage of opportunities "on the run" as well as formally through strategic thinking is a sign of a healthy company. Should the emergent strategy become so powerful as to swamp the deliberate strategy, the company can always have an impromptu strategic-planning meeting and, with the board's approval, acknowledge what is happening and capitalize on it with full budgetary support. Discussion Questions 1. Is it possible for a company to experience emergent strategies all the time? Is that the same as saying that it has no strategy? Explain. 2. Mintzberg and his associates characterize deliberate strategies as exhibiting control but no learning, whereas emergent strategies exhibit the opposite. Do you agree? Why or why not? 3. Do you believe that companies in general find it difficult to realize an intended strategy? If so, is it because of emergent strategies cropping up all the time or simply poor execution? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 40/63 7/8/2021 Print 9.4 Managing the Strategic-Planning Process Strategic planning is usually carried out by a group of people in a company, and a formal process needs to be established to get such a group to coordinate their efforts and work as one. What follows is a set of guidelines for setting up and managing the strategic-planning process in a company, building on the discussion in previous chapters, which describe a process for doing strategic thinking and strategic planning. Insofar as the abilities of different companies to perform strategic planning and implement a formal process vary greatly, such guidelines are difficult to write. A few basic assumptions were made in formulating them: Most small- to medium-sized organizations do not have a good understanding of strategic planning and therefore either do not perform it at all or do something they "think" is strategic planning. Companies that do strategic planning and use a formal process could benefit by benchmarking their process with these guidelines. Many companies do strategic planning without reflecting on whether it is done well or provides the organization with value. That is, they do so without the benefit of any strategic thinking. Before the process of strategic planning is begun, it would be a useful exercise for members of top management to assess the company's inventory of needs. One device that could accomplish this is a brief questionnaire such as the following strategy quiz. Table 9.1: Strategy Quiz: How strategic is your organization? Answer each question either with a Yes or No by checking the appropriate column next to it. Your answers will be scored based on the number of "No" responses. Questions Yes No 1. Are you realizing the full potential of your company and people? 2. Do you have a five-year vision for your company? 3. If so, do you believe your company can achieve it? 4. Are you pleased with your company's profitability over the past three years? 5. Do you believe the value of your company is increasing over time? 6. Are your company's sales or revenues growing fast enough? 7. Do you have enough money (including ability to borrow) to get the job done? 8. Do you have a significant advantage over your competitors? 9. Are your products or services competitive? https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 41/63 7/8/2021 Print 10. Do you know what your costs are? 11. Are you getting new products to market quickly enough? 12. Does your company do strategic planning every year? 13. Can you state what your company's strategy is and why it will work? 14. Do you have at least three opportunities you are deciding whether to pursue? 15. Do you know what your company's principal problems are? 16. If so, do you know what to do about them? 17. Do you have a set of measureable objectives you are trying to achieve? 18. Are you getting the most out of your people? 19. Do your employees know where the company is going and how it will get there? 20. Is your company culture collaborative, innovative, and trusting? TOTAL Source: Stan Abraham, www.futurebydesign.biz (http://www.futurebydesign.biz/) Whose Responsibility Is It? In small companies that perform strategic planning, the CEO or owner typically drives the process. Occasionally this role is acknowledged as the CEO's most valuable contribution. For example, Livescribe, a market leader in digital pens, hired a new CEO for the specific task of strategic planning (Takahashi, 2012). Sometimes, he or she might use a consultant or an executive within the organization to conduct the process and help the group decide on the strategies. Most small companies and new ventures, however, do no strategic planning for the simple reason that there is only one strategy possible, and the company's energies are focused on executing it. Examples are restaurants, retail outlets, or small service businesses. Such companies address strategic planning only when faced with several choices or intense competition and, for the first time, are put in a position of not knowing what to do. Kablonk/SuperStock In smaller companies, the CEO usually does the strategic planning, but in larger companies the In midsize to large companies, the job of controlling the process is typically delegated. Ideally, there would be a director of strategic planning to manage the process. Absent such a position, https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 42/63 7/8/2021 responsibility is delegated to a VP or group of individuals. Print responsibility would go to whoever the CEO believes can do a good job or has some experience with strategic planning such as the CFO or a functional vice president. If no one wants the assignment or feels able to do it, someone from outside may be brought in to do it. If manufacturing, R&D, and distribution can be outsourced, so can facilitating the strategic-planning process. However, only planning and conducting the process and achieving its purposes should be subcontracted to a consultant. The actual decisions cannot be; the CEO and managers, who alone are accountable for acting on those decisions and achieving the company's objectives, must make them. Some organizations, such as Air France (Air France, n.d.), form ad hoc or standing committees to focus on strategic planning. Others, like Mitsubishi (Mitsubishi Electric, n.d.), employ a vice president or C-level executive to direct strategic planning and related initiatives. The person in charge should make sure all those involved understand what they have to do and give them time to do it. Part of the process is creating standard reporting formats that everyone understands and that facilitate comparisons with later years. At the outset they should establish a schedule for the process and then enforce it unless a company crisis intervenes. The individual managing the process must remember that these planning tasks are superimposed on people's regular jobs and are likely to produce negative attitudes and reactions. Only if those involved see the activity as crucial for the company and worthy of being taken seriously by everyone will they be motivated to do a good job. Choosing the Process Whatever process the company uses for strategic planning must meet certain criteria. Key company managers, particularly the person in charge of the process, must understand it—what it is, what is involved, who should be involved, why it is needed, and how to realize the benefits from using it. The process must be perceived as appropriate and feasible for the company in terms of sophistication, complexity, and culture. The company must be prepared to commit to the process and its outcomes. All involved must agree to take it seriously and implement those strategies and decisions that result from the process. The person in charge should explore several different approaches, or invite several consultants who specialize in this area to discuss their approaches. Hiring a consultant to help with doing strategic planning the first time is prudent. Ceding this control (and worry) frees managers and executives to participate in the process. Furthermore, a consultant can control the quality of the discussion and strategic ideas that are proposed, as well as ensure that real data and analyses are used as much as possible rather than opinions and conjecture. Finally, a consultant can act as facilitator to make sure that all voices are heard, not just one or two people who might dominate discussions. A neutral facilitator is more likely to ensure that people are not just saying what they think the CEO wants to hear, which is a major problem in many companies. Ideally, a consultant should be trusted and one with whom the CEO is comfortable— someone who can do a good job of https://content.ashford.edu/print/AUMGT450.12.2?sections=ch07,ch08,sec8.1,sec8.2,sec8.3,sec8.4,sec8.5,ch08summary,ch09,sec9.1,sec9.2,sec9.… 43/63 7/8/2021 Print guiding participants in the strategic-planning process that i...
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