Case Study Description of Strategy Execution Module 1: Managing Organizational Tensions
This module reading lays the foundation for executing strategy using performance measurement and control systems. Properly applied, these systems can overcome the organizational blocks that impede the potential of all people who work in modern organizations. This module explains why managers rely on profit plans and performance measurement systems to implement their strategy and explores the five organizational tensions that managers must resolve to ensure success: (1) balancing profit, growth, and control, (2) balancing short-term results with long-term sustainability, (3) balancing the expectations of different constituents, (4) balancing opportunities and attention, and (5) balancing the motives of human behavior. While this module is designed to be used alone, it is part of the Strategy Execution series. Taken together, the series forms a complete course that teaches the latest techniques for using performance measurement and control systems to implement strategy. Modules 1 - 4 set out the foundations for strategy implementation. Modules 5 - 10 teach quantitative tools for performance measurement and control. Modules 11 - 15 illustrate the use of these techniques by managers to achieve profit goals and strategies. View the full Strategy Execution series at: hbsp.harvard.edu/strategyexecution.
Swot Analysis of "Strategy Execution Module 1: Managing Organizational Tensions" written by Robert L. Simons includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Balancing Module facing as an external strategic factors. Some of the topics covered in Strategy Execution Module 1: Managing Organizational Tensions case study are - Strategic Management Strategies, Conflict, Corporate governance, Motivating people, Organizational structure, Performance measurement, Strategy execution and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Strategy Execution Module 1: Managing Organizational Tensions casestudy better are - – increasing household debt because of falling income levels, technology disruption, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing, increasing commodity prices,
central banks are concerned over increasing inflation, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Strategy Execution Module 1: Managing Organizational Tensions
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Strategy Execution Module 1: Managing Organizational Tensions case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Balancing Module, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Balancing Module operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Strategy Execution Module 1: Managing Organizational Tensions can be done for the following purposes –
1. Strategic planning using facts provided in Strategy Execution Module 1: Managing Organizational Tensions case study
2. Improving business portfolio management of Balancing Module
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Balancing Module
Strengths Strategy Execution Module 1: Managing Organizational Tensions | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Balancing Module in Strategy Execution Module 1: Managing Organizational Tensions Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Balancing Module are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Highly skilled collaborators
– Balancing Module has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Strategy Execution Module 1: Managing Organizational Tensions HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Strategy & Execution industry
– Strategy Execution Module 1: Managing Organizational Tensions firm has clearly differentiated products in the market place. This has enabled Balancing Module to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Balancing Module to invest into research and development (R&D) and innovation.
Strong track record of project management
– Balancing Module is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High brand equity
– Balancing Module has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Balancing Module to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Balancing Module has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Strategy Execution Module 1: Managing Organizational Tensions - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Balancing Module is present in almost all the verticals within the industry. This has provided firm in Strategy Execution Module 1: Managing Organizational Tensions case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to recruit top talent
– Balancing Module is one of the leading recruiters in the industry. Managers in the Strategy Execution Module 1: Managing Organizational Tensions are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Balancing Module has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Analytics focus
– Balancing Module is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Robert L. Simons can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Operational resilience
– The operational resilience strategy in the Strategy Execution Module 1: Managing Organizational Tensions Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Superior customer experience
– The customer experience strategy of Balancing Module in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Strategy Execution Module 1: Managing Organizational Tensions | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Strategy Execution Module 1: Managing Organizational Tensions are -
Slow decision making process
– As mentioned earlier in the report, Balancing Module has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Balancing Module even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High operating costs
– Compare to the competitors, firm in the HBR case study Strategy Execution Module 1: Managing Organizational Tensions has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Balancing Module 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Balancing Module is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Balancing Module needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Balancing Module to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Strategy Execution Module 1: Managing Organizational Tensions HBR case study mentions - Balancing Module takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Workers concerns about automation
– As automation is fast increasing in the segment, Balancing Module needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Skills based hiring
– The stress on hiring functional specialists at Balancing Module has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Strategy Execution Module 1: Managing Organizational Tensions, in the dynamic environment Balancing Module has struggled to respond to the nimble upstart competition. Balancing Module has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Balancing Module has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Products dominated business model
– Even though Balancing Module has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Strategy Execution Module 1: Managing Organizational Tensions should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Balancing Module products
– To increase the profitability and margins on the products, Balancing Module needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Balancing Module has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Opportunities Strategy Execution Module 1: Managing Organizational Tensions | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Strategy Execution Module 1: Managing Organizational Tensions are -
Loyalty marketing
– Balancing Module has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Balancing Module in the consumer business. Now Balancing Module can target international markets with far fewer capital restrictions requirements than the existing system.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Balancing Module to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Using analytics as competitive advantage
– Balancing Module has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Strategy Execution Module 1: Managing Organizational Tensions - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Balancing Module to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Balancing Module can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Balancing Module can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Balancing Module can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Balancing Module to increase its market reach. Balancing Module will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Balancing Module is facing challenges because of the dominance of functional experts in the organization. Strategy Execution Module 1: Managing Organizational Tensions case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Buying journey improvements
– Balancing Module can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Strategy Execution Module 1: Managing Organizational Tensions suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Low interest rates
– Even though inflation is raising its head in most developed economies, Balancing Module can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Learning at scale
– Online learning technologies has now opened space for Balancing Module to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Creating value in data economy
– The success of analytics program of Balancing Module has opened avenues for new revenue streams for the organization in the industry. This can help Balancing Module to build a more holistic ecosystem as suggested in the Strategy Execution Module 1: Managing Organizational Tensions case study. Balancing Module can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Strategy Execution Module 1: Managing Organizational Tensions External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Strategy Execution Module 1: Managing Organizational Tensions are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Strategy Execution Module 1: Managing Organizational Tensions, Balancing Module may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Balancing Module in the Strategy & Execution sector and impact the bottomline of the organization.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
High dependence on third party suppliers
– Balancing Module high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Stagnating economy with rate increase
– Balancing Module can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Balancing Module needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Environmental challenges
– Balancing Module needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Balancing Module can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Balancing Module can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Strategy Execution Module 1: Managing Organizational Tensions .
Regulatory challenges
– Balancing Module needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Balancing Module.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Balancing Module with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Balancing Module demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Weighted SWOT Analysis of Strategy Execution Module 1: Managing Organizational Tensions Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Strategy Execution Module 1: Managing Organizational Tensions needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Strategy Execution Module 1: Managing Organizational Tensions is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Strategy Execution Module 1: Managing Organizational Tensions is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Strategy Execution Module 1: Managing Organizational Tensions is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Balancing Module needs to make to build a sustainable competitive advantage.
