Significant Problems Encountered in Implementing a New Strategy in a Business

Strategy is a process and could be considered in fewer than three stages. These are: strategic analysis; this is the stage where through analysis the strategist identifies the opportunities threats, strengths and weaknesses in the environment; the strategic formulation stage, where a choice is made and the strategy implementation stage is the stage where the strategy is translated into action.

Implementing a strategy or strategy implementation is defined as “the translation of strategy into organisational action through organisational structure and design, resource planning and the management of strategic change”.

Analysing the definition, it becomes obvious that strategy implementation is somewhat complex. Therefore, the successful implementation of a strategy would be how well the various components in carrying it out are successfully integrated and interact.

To identify significant problems encountered in implementing a new strategy in a business, a critical look at the components to be applied in implementing the strategy would be a good pointer. These are considered below: Organisational structure and design; and strategy implementation; translating the strategy into organisational action by using the structure of the organization will also be dependent on the type of structure in use in the organization. This is so because the needs of a multinational organization are different from those of a small business. It is also possible that the extent of devolution or centralisation can influence strategy implementation.

For example using a matrix structure which often takes the forms of product and geographical divisions or functional and divisional structures operating in tandem; the time taken for decisions to be made may be much longer than in more conventional structures. The organisational structure and design aspect of the strategy implementation deals with how the human resources in the organization are mobilised and organised to bring about the corporate strategy. The main significant problems encountered through the usage of organisational aspect in strategy implementation is the fact that most of the employees can leave the firm if they feel that they are being ‘used’ in actual fact if they are not motivated. This is particularly so where the CEO or senior management imposes the strategy on the employees.

Another problem encountered here is the way and manner information is passed down or up the ranks. If there is a blockage which impedes the flow of information processes it means that decisions would be made based on outdated or obsolete information. This can be solved by devolving the central command for easy flow of information among all rank and files especially in implementing a new strategy in a business. Recognition must be given to organisational structure and design’s set up where operational and strategic decisions are made, there should be compromise if implementing a new strategy will succeed in any business.

The next aspect in strategy implementation – resource planning sets out resources and competences need to be created. It deals with the identification of resources needed and how those resources will be deployed and controlled to create the competences needed to implement the strategies successfully. This resource configuration is dependent on: protecting unique resources i.e. where a strategy depends on the uniqueness of a particular resource such as patent; and it must be protected; by legal means; fitting resources together, (mix resources to create competence) business process re-engineering (to create a dynamic improvement in performance) and exploiting experience by learning and improving continuously to improve competence.