Introduction

Organisations are complex entities.

They have systems and subsystems.
These subsystems are often their
functional deppts such as marketing
and operations.
Functional strategies are carried out
through functional and operational
implementation.
Functional implementation is done
through functional plans and policies in
different functional areas.



Functional strategies
Functional strategy deals with a relatively
restricted plan designed
to achieve objectives in a specific funtional
area, allocation of resources among
different operations within that functional
area and coordination among different
functional areas.



.



Functional strategies are derived from
business and corporate strategies
and are implemented through
functional and operational
implementation.
A key task of strategy implementation
is to align or fit the activities and
capabilities of an organisation with
its strategies.



Vertical and horizontal fit
Strategies operate at different levels
and there has to be congruence and
coordination among these strategies.
Such congruence is the vertical fit.
Then there has to be congruence and
coordination among different
activities taking place at same level.
This is horizontal fit.
Corporate
level
strategies
Marketing
plans and
policies
Financial
plans and
policies
Operations
plans and
policies
HRM plans
and polcies
Information
mgmt plans
and policies
Business level
strategies
Functional level
strategies
Vertical and horizontal
fit
vertical fit

horizontal fit





VERTICAL FIT

Any functional strategy becomes
strategic when it is vertically fitted
to the upper level business and
corporate strategies .
Types of functional
strategies
Strategic marketing management
Strategic financial management
Strategic operations management
Strategic human resource
management
Strategic information management
Horizontal fit
The consideration of horizontal fit
means that there has to be an
integration of all operational
activities undertaken to provide a
product or service to a customer.
This has to take place in the course
of operational implementation.

Just like corporate and business
startegies , functional strategies are
not implemented directly. They have
to be first defined in terms of plans
and policies. So , functional
implementation takes place through
functional plans and policies.











Functional plans and
policies

For effective implementation ,
strategist have to provide directions
to functional managers regarding the
plans and policies to be adopted.
Nature of functional
plans and policies
Functional strategies operate below
the business strategies .
Within functional strategies there
might be several sub-functional
areas.
They are in the nature of tactics to
make strategy work.
Need of functional plans
and policies
They are developed to ensure that-
Strategic decisions are implemented by
all parts of organisation.
Basic available for controlling activities
in different functional areas.
Similar situations occuring in different
functional areas are handled in a
consistent manner
Development
The process of development of
functional plans and policies
whether formal or informal is
similar to that for strategy
formulation . Environmental factors
and organisational plans and policies
affect the choice of functional plans
and policies.
Configuration of functional
plans and policies
Financial plans
and policies
Operational
plans and
policies
Integration
of functional
plans and
policies
Marketing
plans and
policies
Personnel
plans and
policies
Information
mgmt plans
and policies
Financial plans and
policies
These are related to to the availability
, usage and management of funds.
Significant decisions to be taken are-
sources of funds
Usage of funds
Management of funds


Marketing plans and
policies
These are related to the marketing
mix factors-
Product
Pricing
Place
Promotion

Integrative and systematic
factors
This part of plans and policies related to
marketing management deals with
factors such as
Marketing mix
Segmentation
Targeting
Positioning
Market standing
Company image etc.
Operational plans and
policies
These are related to

Production system
Operations planning and control
Research and development
Corporate level srategies
Business level strategies
Cost leadership/differentiation/focus
Nature of product
/service
Nature of market Manner
Operations system objective
Operations system structure
Operations plans and policies


production system operations
planning and control

Research and development
Personnel Plans and Policies
Personnel Plans and Policy relates to
the -
Personnel system,
organizational and employee
characteristics,
and industrial relations.


Personnel System





Plans and Policies related to the Personnel
system deal with factors like manpower
Planning, Selection, Development,
Compensation , Communication and Appraisal.
The importance of such Plans and Policies
lies in the role that personal system play in
providing and maintaining human resources.

Organizational and
employee
characteristics


It include factors , such as, the corporate
image , quality of managers, staff and
workers, perception about the image of
the organization as an employer,
availability of development opportunities
for employees, working conditions, and so
on.





It deal with issues such as union
management
relationship, collective bargaining,
safety, welfare
and security, employee satisfaction
and morale, and so on.
Industrial Relations
Information Management
Plans and Policies
Information capability factors relate
to the design and management of the
flow of information within and from
outside into ,an organisation.
If managed properly information
management can augment their
capability to develop strategic
advantage

factors within information
management system

Acquisition and retention of information
Plans and policy with regard to the acquisition
and retention of information deal with factors
such as the sources, quantity, quality, and
timeline of information; retention capacity; and
security of information.
Processing and synthesis of information
Plans and policies formulated for the
processing and synthesis of information deal
with factors such as data base management,
computer systems, software capability, and
ability to synthesis information.


Retrieval and usage of information
It deals with factors such as availability and
appropriateness of information formats, and
the capacity to assimilate and use
information.
Transmission and dissemination of
information
The plans and policies with regard to the
transmission and dissemination of information
deal with factors such as, speed, scope, width,
and depth of coverage of information, and
willingness to accept information.
Integrative,systematic $
supportive factors
It deals with the availabilty of IT
infrastructure , its relevance and
compatibility to organisational needs
, upgradation of facilities , willingness
to invest in state of the art systems,
availability of computer professionals
and top management support.
Integration of
functional plans and
policies

Functional tasks are derived from that the
key activities that have to be performed for
the implementation of the corporate and
business strategies. The functional areas in
any organization are therefore, based on
the segregation of the key activities.
Integration of functional
plans and policies
Financial plans
and policies
Operational
plans and
policies
Integration
of functional
plans and
policies
Marketing
plans and
policies
Personnel
plans and
policies
Information
mgmt plans
and policies
Need for
internal
consistency
Relevance to
development of
organizational
capability
Making trade-
off decisions
Determination
of intensity of
linkages
Timing of
implementation
of functional
plans & policies
INTEGRATION
OF
FUNCTIONAL
PLANS AND
POLICIES
Five Considerations in
integrating functional
Plans & Policies
Need for internal
consistency
It arises due to the segregation of
key organizational tasks. Internal
consistency in the various functional
plans and policies ensures that the
different functional areas do not work
at cross-purpose but operate in
consonance. Absence of internal
consistency may lead to a suboptimal
implementation of strategy.
Relevance to
development of
organizational
capability
The development of organizational
capability, specially in terms of
strategic or competitive
advantages, is relevant to the
integration of functional plans and
policies.
Making trade-off
decisions
The formulation and implementation of
functional plans and policies involve trade-
off decisions. This is due to the inherent
nature of the functional areas. Marketing-
orientation in functional plans and policies
is in some ways contradictory to
operation-orientation.
Determination of
intensity if linkages
The intensity if linkages that exist
between the different functional areas
are an important consideration in
determining the level of coordination
that should exist between different
functional areas.
Timing of
implementation of
plans and policies
Integration of functional plans and
policies is dependent on the timing of
their implementation. The different
functional plans and policies have
therefore, to be implemented at the
appropriate time so that they dovetail
with each other.
Operational
implementation
Operational implementation deals with the
nitty-
gritties of strategy. This is the time for
action
as this is the stage at which the most
tangible
works gets done. Obviously, the scope of
operational implementation would be very
wide.
It would cover practically everything that is
done in an organization.
Operational imlementation plays a key
role in achieving effectiveness
Strategic
plan
Activating
startegies
Managing
change
Achieving
effectiveness
Evaluation and
control
Functional
implementation
Operational
implementation
Operational
effectiveness:
Productivity
Processes
People
Pace

Monitoring
Operational
effectiveness
Porter considers operational effectiveness as
necessary but not sufficient to the success of
strategy. He explains the term as performing
similar activities better then rivals perform
them. Operational effectiveness includes but is
not limited to efficiency. It refers to any
number of practices that allow a company to
better utilize its inputs by, for example,
reducing defects in products or developing
better products faster.
Productivity




Processes






People



Pace
Operational
effectiveness
The four Ps of operational effectiveness


Productivity
Productivity is the measure of the relative
amount of input needed to secure a given amount
of output. The Significant modern practices
observed here are of:
Just in time manufacturing, Cycle time reduction,
Group technology , Optimized production
technology , Flexible manufacturing system ,
Cellular manufacturing , Total productive
maintenance , Lean manufacturing


Processes
Processes are courses of action used for
operational implementation . Processes are often
implemented through methods.
Business process reengineering
Enterprise-wide resource planning
Quality management processes
Benchmarking, value chain and
Supply chain management.
People
People are the stakeholders in the organization.
The significant people are the investors,
employees, suppliers, and customers. Among
these employees play a direct and central role in
operational implementation.
Strategic recruitment
Performance management
Training and development
Performance appraisal and retention management
Separation management

Pace
Pace is the speed of operational implementation
and is measured in terms of time. Efficiency is
the parameter often used to express the pace of
operational implementation . Efficiency is the
amount of work done per unit time.
Time study
Time nature of managerial work
Network analysis and activity charts
Time based management


Applying opl
impln practices


It is important to remember that any technique
has a history, background, context, and
requirements. A technique cannot be applied
blindly. There are essential pre-requisites to
applying a technique and then there are the
consequences.