Unit 4: Integrating Ethics into Business Strategy
Now that we have addressed strategy analysis and how to formulate a strategy, we will address how to implement and monitor the strategy. Some companies will develop the strategy but do not provide the necessary resources to support the strategy. This is an imperative step in the strategy process. Besides assigning resources to the chosen strategy, organizations must create a culture that encourages their human resources to support the strategy, which will be a topic in this unit. For example, how do leaders create a culture that supports the implementation of the strategy? Finally, after formulating and implementing a strategy, leaders need to monitor it to make sure it is working! If it isn't, they will make adjustments along the way. Because of this, we will talk about how to measure strategy and the adjustments that can be made along the way.
Completing this unit should take you approximately 24 hours.
Upon successful completion of this unit, you will be able to:
- apply the steps in the strategic management process, including strategic analysis, strategic formulation, strategic implementation, and strategic evaluation and control;
- explain how resource allocation, such as time and financial capital, is fundamental to business strategy implementation;
- explain how factors such as entrepreneurial orientation and learning organizations constitute a business' culture; and
- determine which measurement techniques and evaluation criteria would be most appropriate for a given business and ethics strategy.
4.1: Steps to Implement Business Strategy
Now that we have addressed considerations for creating a business strategy, it is time to learn how to implement the strategy. There are many factors to implementing a strategy, such as dividing resources to be effective. As you read, consider how a manager might monitor each step of the process to ensure effective implementation.
This page discusses the strategic management process. Consider the types of resources you've learned about to determine strategy as you read.
4.2: Determining Needed Resources
One of the most important factors in implementing a strategy is determining what resources are needed and distributing them effectively to meet your goals. This section will focus on the different resources you may need and appropriate resource allocation. As you work through the sections, consider if some resources might be more important than others, depending on the industry.
This text takes an entrepreneurial approach to strategy and planning. As you read this article about an organization with a mission to combat worldwide homelessness, consider how this same approach would apply to medium and large already-established businesses.
4.3: Securing Financial Resources
Implementation of the strategy will most likely require financial resources. As you read through this section, think about the various financial resources you may need, such as financial resources for new product development and new marketing strategies. Part of determining financial resources is also budgeting appropriately.
The alignment of finances is extremely important when implementing a strategic plan. After you read the article, you should be able to determine the differences between capital expenditures and start-up costs.
There are many reasons for financial budgeting, but these become especially important when shifting resources needed to implement a strategy. As you read, see if you can identify the different types of budgets.
4.4: Implementing Marketing Strategies
Marketing is a vital resource to help companies implement their strategy. This section will address marketing strategy, goal setting, and aligning marketing strategy with the strategic mission. As you read, consider how a marketing manager needs to be familiar with the overall strategic goals to successfully sell products and services.
As you already know from previous units, setting goals and objectives is important in the strategic planning process. In This text, look for examples of marketing objectives. How can you tie these into the overall company strategy?
Marketing strategies can align with the overall organizational strategy. Read this resource to understand how good corporate-level objectives inform the marketing strategy and objectives.
4.5: Implementing Ethical Human Resources Strategies
Human resources, usually the most valuable resource at any company, must support the efforts of the strategy implementation. As you read, consider the variety of ways the human resource function can accomplish this.
Since human resources are usually the most valuable asset of an organization, they have strategic plans that need to align with the overall vision and mission of the organization. Look for the various human resource functions needed to be effective at supporting the strategic goals of an organization as you read this resource.
Read this article, which provides examples of effective selection and placement strategies for human capital. Every company has its own personality and philosophy, and companies need to hire individuals whose needs and ethics match those of the organization.
Read this resource, which discusses the elements of a pay system from an individual and a company perspective. How and at what level a manager sets pay for an employee is critical in creating incentives and communicating expectations for that employee's performance.
Read this resource, which discusses how to harness technology to improve performance. By creating workplace systems that increase the likelihood of great performance, companies can optimize and streamline many of their services. This text also provides information on creating and supporting succession plans, which are career tracks and advancement protocols that incentivize an organization's human capital.
Read this resource, which discusses how the company Kronos Inc. has used technology to help screen potential candidates and reduce employee turnover. Managers are charged with making strategic decisions, often with minimal time to respond. This case study provides an example of a solution that one company created to improve management decision-making.
4.6: Operational Resources
Depending on the type of strategy chosen, operational resources may play an important role in strategy implementation. This can include supply chain management to create competitive advantages. As you read through this section, consider the role operational resources might differ for a product-based company versus a service-based one.
There are many discussions surrounding the importance of the Board of Directors taking a guiding role in developing strategy. As you read this text, consider the challenges boards face in carving out a significant role in the strategy process.
This resource explains the connection between operations and strategy. There is, or should be, a direct connection between this functional area and the organizational plan. The strategy provides the foundation for the operational decisions made on a daily basis. In other words, as an operations manager, you choose tactics based on the developed organization's corporate, business, and functional level strategy. Take time to complete the action checklist activity at the end of the chapter.
This resource explains the nature of planning and the importance of analysis to create differentiated products or services or higher levels of efficiency. Understanding the nature of strategic planning and the types of analysis used during the strategic planning process are important for operation managers.
Understanding supply chain management is essential for understanding an overall company strategy. As you read this resource, consider the competitive advantages gained using supply chain management.
Read this text about the Keystone XL pipeline. What operational considerations Keystone should the organization have taken into account regarding ethics and social responsibility in this situation? Read the critical thinking questions and consider how you might respond.
Is it ethical to dump toxic waste in countries that allow it? As you read, consider the differences between unethical and illegal. Is something legal always ethical? Then, review the critical thinking questions and consider how you might respond.
4.7: The Role of Culture in Strategy Implementation
To have an effective strategy, management must ensure the culture is right. This section will address the many ways culture ties to business strategy and can help support the strategy or hinder it. Look for resounding themes. Are there one or two theories on creating a culture that seems to come up the most?
After you've read this text, you should be able to explain the perspectives on culture from a business management perspective.
Company culture is an important part of ensuring the implementation of the strategic plan. As you read this resource, consider the vital role of communication in organizational culture.
As you read this resource, consider the quote by Peter Drucker, "culture eats strategy for breakfast". What does this mean? How can you ensure there is a culture that fits with the strategy you've created?
Consider these examples of creating cultural change in organizations. What is the difference between for-profit and non-profit organizations? Are the factors of implementing culture to support strategy the same?
How does organizational culture affect business strategy? This case study will focus on this question. As you read, look for the specific elements of organizational culture and how they fit into the overall company strategy.
4.8: Entrepreneurial Orientation
There are many actions management can take to ensure employees act in an entrepreneurial orientation – thereby making strategy implementation more successful. Look for themes related to successful companies that employ this philosophy.
There are many examples of organizations with the philosophy of "thinking and acting entrepreneurially". By encouraging this type of environment, companies can be more innovative. After you read, you should be able to discuss the elements required for an entrepreneurial organization.
4.9: Learning Organizations
Creating a learning organization can help support business strategy implementation. As you read, consider if you've ever worked for an organization focused on learning and its benefits to your organization.
As you watch this video, consider the importance of individual learning and how that contributes to organizational learning. By the time you finish the video, you should understand the components required to create a learning organization.
As you watch this video, look for the steps to create and sustain a learning organization. After viewing this resource, you should be able to discuss how learning organizations can support the business strategy.
4.10: Rewarding Ethical Behaviors
As you will read in this section, part of strategy implementation is ensuring an ethical culture. How has a company you worked for rewarded ethics? Was it effective?
In this resource, look for the role of leadership in creating an ethical workplace. Consider how ethics support an overall business strategy as you read.
4.11: Strategy and Employee Communication
Sometimes companies fail to do one of the most important things when implementing strategy: communicate the strategy to employees. The information here will address the various methods you can use to communicate strategy to your employees and address the various roles managers should take in employee communication.
Employee communication is necessary, especially when it comes to strategy, so all employees know the organizational goals. As you read this resource, consider the various methods you can use to communicate strategy to employees.
4.12: Motivating People
There are several methods managers can use to motivate employees. This type of motivation can assist with successful strategy implementation. As you read through the various methods, try to identify what methods may work best with the different personalities of employees. Is there one method that might motivate everyone? Why or why not?
Employee values motivate employees. Read through this resource, then consider your values and how your values affect what motivates you at work.
- This resource highlights that diversity can enhance performance and drive innovation.
After you read, you should be able to identify the types of power management can use to influence others. Which is the best type of power to use when attempting to incentivize employees?
While employee motivation often comes from internal employee values and management style, you can use several other methods to reward employees when they have been successful at strategy implementation. Consider the types of rewards you have been offered at work before. Did you find them motivating or not?
As you read this resource, look for the human resource aspects of this case. What did IXL Learning do wrong? Did Adrian Duane do anything wrong? Then, review the critical thinking questions at the end of the case.
4.13: Empowerment
Empowering employees can help the implementation be much more successful when you implement your strategy. When employees are empowered, they have a sense of ownership, which causes them to make the best decisions for the organization. As you read, consider companies' methods to empower employees.
Read this article and consider the following questions: What is empowerment? Why is empowerment important to organizations and employees? How can an organization's culture encourage or discourage employee empowerment? Do you feel empowered in your work environment? Why or why not?
Read this article and consider the following questions: What are some of the benefits of empowering employees? How important is employee empowerment to improving an organization's productivity? Does the company you currently work for, or one you are familiar with, empower employees? If so, how does this philosophy benefit the organization?
4.14: Pay for Performance Systems
We already know employees are motivated by different things, and of course, pay is one of those things. This section will address the types of pay systems that you can use to reward performance. As you read, remember that pay is only one factor that can be used to reward employee performance.
This text addresses why you should put reward systems into place for employees. Once you read, you should be able to identify the difference between intrinsic and extrinsic rewards and the conditions that need to be present for pay to be a motivator to employees.
We've already discussed the different types of rewards employees can be given for successful strategy implementation. Now, we will address the types of pay systems that you can implement to reward performance. As you read this information, look for best practices in pay-for-performance design systems.
4.15: Measurement Strategy
The last step in implementing your strategy is to measure the plan's effectiveness and adjust as needed. This section will discuss some ways to measure the success of your plan. As you read, compare the difference between competitive measures and financial measures. Is one more valuable than the other?
After you read, you should understand the difference between performance measures and performance referents. Are you able to have a performance measure without a performance referent? Why or why not?
When an organization uses a competitive strategy, it can use several forms of measurement. As you read this article, consider which method might be the most effective for your industry.
This article addresses many of the performance indicators companies use and how they might utilize them to see if their strategy is on track. As you read, consider the categories of performance measures such as financial/non-financial and strategic/operational.
This video addresses additional performance measures. As you watch, look for the importance of market-driven factors of performance, such as customer satisfaction and market penetration.
Study Guide: Unit 4
We recommend reviewing this Study Guide before taking the Unit 4 Assessment.
Unit 4 Assessment
- Receive a grade
Take this assessment to see how well you understood this unit.
- This assessment does not count towards your grade. It is just for practice!
- You will see the correct answers when you submit your answers. Use this to help you study for the final exam!
- You can take this assessment as many times as you want, whenever you want.