Strategy Execution Module 1: Managing Organizational Tensions

Robert  Simons

Module Note | August 2016 (Revised May 2018)

Strategy Execution Module 1: Managing Organizational Tensions

Abstract

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.

Keywords: Management Control Systems; Implementing strategy; strategy execution; performance measurement; profit planning; organization design; profitable growth; management attention; organizational conflict; Human behavior; Strategy; Ethics; Goals and Objectives; Organizational Design; Management Analysis, Tools, and Techniques; Performance; Measurement and Metrics;

Language: English

Format: Print

14 pages

Purchase

Citation:

Simons, Robert. "Strategy Execution Module 1: Managing Organizational Tensions." Harvard Business School Module Note 117-101, August 2016. (Revised May 2018.)

Are a salesperson's struggles her own fault or the result of a problematic job design? Anna George works as a salesperson at Verona Group, a company that designs and wholesales high-end women's apparel. She had spent nearly 20 years in sales with another fashion label and was well regarded in the industry. Verona Group hired her to bolster its small but growing presence in the western United States. In her first two years with the company, however, George has missed her sales targets and received mixed scores from customers in Verona Group's annual customer service survey. When Emilio Chao, the head of Verona's sales force, looks at George's performance review and discusses George's situation with Catherine Edwards, Verona Group's head of human resources, he wonders whether the company should give George additional support that would help her be more successful. Or is George not a good fit for the company?

Module Note | December 2016 (Revised May 2018)

Strategy Execution Module 15: Using the Levers of Control to Implement Strategy

Robert Simons

This module reading pulls together key concepts and techniques from the Strategy Execution series into an integrated model—the levers of control. The four levers are: (1) belief systems, (2) boundary systems, (3) diagnostic control systems, and (4) interactive control systems. The module discusses how top managers use the levers of control to inspire commitment to the organization’s purpose; stake out the territory for experimentation and competition; coordinate and monitor the execution of today’s strategies; and stimulate and guide the search for strategies of the future. The power of this integrated approach to strategy implementation is illustrated in two contexts: the introduction of performance measurement and control systems over the life cycle of a growing business and the use of the levers by managers taking charge of a new business. 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.

Keywords: Management Control Systems; Implementing strategy; strategy; Execution; Levers of Control; Balancing innovation and control; Managing growing businesses; Turn around management; Human behavior; Organizational life cycle; Strategy; Management Systems; Performance; Measurement and Metrics; Management Analysis, Tools, and Techniques; Behavior;