ARE 112 – Winter 2017
Notes #8 – Structures and Strategic Thinking
I. Class Notes
Exam #2 – Monday March 6th
Reading:
a. IBM book – should be substantially done by this week
b. The Duke Hospital case
c. The Deloitte case
3.
Assignments
a. #05 Strategic Analysis of Wile E. Coyote
b. #06 Change Management at Duke Children’s Hospital
c. #A – Analysis Assignment
d. #B – Written Assignment – after the second midterm exam
II. Quick Review
1.
2.
III. Structures – Just a Few Terms for Now
A. Functions
1.
Staff
2.
Line
B. Unity of command
1.
Often referenced to a military setting but a normal business setting
2.
Contrasted to matrix management system
C. Includes topics previously discussed:
1.
Authority
2.
Responsibility
3.
Span of control
Document1
-1-
ARE 112 – Winter 2017
Notes #8 – Structures and Strategic Thinking
4.
Teams
5.
Horizontal and vertical structures
6.
A component of the diagram from the first set of lecture notes
7.
Generally has focus on the processes – the business processes – of the organization
IV. Planning and Controlling – A Manager’s Environment
A. Terms
1.
Management – four tasks:
a. Planning:
i. Identifying and selecting appropriate goals
ii. and courses of action
b. Organizing: Structuring working relationships to achieve organizational goas – see below
c. Leading: Articulating a clear vision of the organizational goals so organizational members
can understand the part they play - after the second exam
d. Controlling:
i. Evaluating how well the organization is achieving its goals
ii. and taking actions to maintain and/or improve performance
iii. Problem solving
iv. Scorekeeping
v. Attention directing
2.
Organizational structure – two types
a. Organizational chart – the
“noun” version
i. Example
ii. Lines of authority – solid
lines
iii. Dashed lines – advisory or
collaborative relationships
iv. Horizontal lines – Working
relationship
v. Vertical lines – Reporting
relationship
vi. Can reflect the organizational culture – as seen in the IBM book
vii. Definition: An organization chart shows the structure and the relationships in an
organization. The organizational chart formal system of tasks and reporting relationships
that coordinated and motivates employees to work together.
b. Organigraph – the “verb” version
i. Definition: An organigraph is a graphical representation of a company's structure or
processes. It is used as an alternative to a traditional organizational chart as it does not
imply the same degree of linear hierarchy that an organizational chart does.
Organigraphs are used to expose critical associations and competitive opportunities as
opposed to viewing all parties, departments, and business units as separate entities. They
also can reveal relationships between departments, products, supply chains, and more
within an organization that might not otherwise be apparent.
ii. Business strategists, consultants, and academics use organigraphs to analyze the dynamics
of organizations.
iii. Organizational charts are used by managers to run the business
Document1
-2-
ARE 112 – Winter 2017
Notes #8 – Structures and Strategic Thinking
iv. Example
B. Organizational design – a verb: Where we get the
organizational structure.
The process by which managers make specific
organizing choices that result in a particular
organizational structure.
1.
2.
Driven by the organizational environment –
examples:
a. Technology
b. Human resources
c. Strategy
Types of organizational design
a. Divisional
i. Product
ii. Geographic
iii. Market
iv. Can be a combination of the above as
well
b. Functional - Examples
i. Finance
ii. Marketing
iii. Production
iv. Administration
v. Human Resources
c. Problem solving
i. Like the matrix management system
discussed earlier
ii. Project driven not process driven as
found in the functional or divisional
forms
3.
Control systems in the organizational structure
a. Behavioral control
b. Financial control
c. Bureaucratic control
d. Clan or social controls
Document1
-3-
ARE 112 – Winter 2017
Notes #8 – Structures and Strategic Thinking
V. The Idea of Strategic Thinking
A. A framework for strategic thinking
1.
Strategic intent – A disciplined approach to only do what
matters
2.
A systems perspective – What are my resources?
3.
Thinking in time – This is vision - to be discussed later in
these notes
4.
Intelligent opportunism – How do you connect your
resources to your vision?
5.
Hypothesis-driven – Contingency thinking: What happens
when we get there
B. How do we “put wheels” on strategic thinking?
Strategic management tools – different than the lens we used to view strategy
1.
a. Mission: What we do – this is a focus on the strategic business units –
SBU’s and is an internal view. This is the mission statement for IBM
Global Financing:
“The mission of Global Financing is to facilitate clients’
acquisition of IBM hardware, software and services.”
b. Vision: How we see ourselves and how we want our stakeholders to
see us – this has a focus on the marketplace and is generally
organizational-wide in its scope
“IBM's vision is to be the world's most successful and important
information technology company.
i. Successful - in helping our customers apply technology to
solve their problems. And successful in introducing this
extraordinary technology to new customers.
ii. Important - because we will continue to be the basic resource
of much what is invented in this industry."
c. We saw these two topics in our strategic lenses from prior classes
2.
The company's business model is built to support two principal goals - from IBM:
a.
“Helping clients succeed in delivering business value by becoming more
innovative, efficient and competitive through the use of business insight and
information technology (IT) solutions;
b.
and, providing long-term value to shareholders.
c.
The business model has been developed over time through strategic investments
in capabilities and technologies that have the best long-term growth and
profitability prospects based on the value they deliver to clients. The company's
strategy is to focus on the high-growth, high-value segments of the IT industry.”
C. Mission and vision face the marketplace – that was where Lou was looking.
1.
The marketplace includes customers, other stakeholders, new customers, new
products, social issues and more on a long list.
2.
And it faces forward – into the future
Document1
-4-
ARE 112 – Winter 2017
Notes #8 – Structures and Strategic Thinking
VI. Creativity and Innovation
A. Creativity:
1.
generate new and original ideas – the “R” in research and development
2.
that are actionable – the “D” in research and development
B. Areas or the focus of creativity:
1.
2.
3.
Productivity – generally called “process R&D”
New products
New structures
C. Creativity needs: Expertise, motivation, and creative thinking skills and abilities.
D. Innovation: applying new ideas to the organization
1.
Invent – the application of the new idea from the “creative process” for the organization
2.
Develop – makes the new idea practical
3.
Diffuse – puts the idea into the hands of the end user
4.
Integrate – makes the new idea permanent in the organization
5.
Monitor – tracking of the innovation to validate its continued use
E. Why we use the terms: R & D – research and development
1.
2.
We want to “link the idea to the deed” this is an old saying
Deed means accomplishment or result
VI. The Deloitte Case – “Sometimes it takes a revolution”
VII. The Business Case:
From Wikipedia, the free encyclopedia
“A business case captures the reasoning for initiating a project or task. It is often presented in a
well-structured written document, but may also sometimes come in the form of a short verbal
argument or presentation. The logic of the business case is that, whenever resources such as money
or effort are consumed, they should be in support of a specific business need. An example could
be that a software upgrade might improve system performance, but the "business case" is that better
performance would improve customer satisfaction, require less task processing time, or reduce
system maintenance costs. A compelling business case adequately captures both the quantifiable
and non-quantifiable characteristics of a proposed project. Business case depends on business
attitude and business volume.
Business cases can range from comprehensive and highly structured, as required by formal project
management methodologies, to informal and brief. Information included in a formal business case
could be the background of the project, the expected business benefits, the options considered (with
reasons for rejecting or carrying forward each option), the expected costs of the project, a gap
analysis and the expected risks. Consideration should also be given to the option of doing nothing
including the costs and risks of inactivity. From this information, the justification for the project is
derived. Note that it is not the job of the project manager to build the business case, this task is
usually the responsibility of stakeholders and sponsors.”
Assignment #7: State in just one sentence a business case for what happened the Deloitte case and
the Duke hospital case. Very simple, just the idea of why what happened.
Document1
-5-