Paper Example on Strategic Control for Successful Implementation of Strategic Plan

Introduction

Implementation of a strategic plan involves the execution of findings and recommendations to achieve the desired purpose at the end of a trading period for the case of a business. During the implementation process, precise control mechanisms are necessary to put the execution process in check. The control measures are essential because the strategic plan is a speculation of what might happen in the future concerning what already occurred in the past. We need to exercise strategic control in implementing SLP3 revised strategy for the year 2017. This initiative is vital because if there are no measures put in place, the strategic plan may fail its mandate.

The implementation of any strategic plan involves the structural design, people within and around, cultural diversity and control systems of a company. Therefore, to achieve its intended purpose, the strategy must successfully work through these elements. The involvement of these elements shows that for a plan to work, people involved with the company must execute it while their culture accepts it. Moreover, the physical design of the company must accept it while the systems in place take control of its implementation.

Structural Design

Design of a company dramatically influences the implementation of its strategies. The plan involves the model of communication tree from junior staff through senior management and vice versa. At Wonder Co Company, we embrace the decentralized system of transmission communication and dissemination of job responsibilities by specialization. We speak at departmental levels and channel our reports to senior staff for analysis and decision-making. This mode of structuring at our company has been of significant achievement in strategic implementation, unlike in a centralized system where most decisions come from a few senior staff. This achievement, therefore, confirms that our structural design meets the requirement of the same element in the success of implementing the 2017-revised strategy.

Culture

The relationship between the perception of a company and its strategic plan is essential to the culture. We cannot have a punishing tendency when the strategy has the opposite innovation plan that seeks to achieve differentiation. Culture supports strategy in shared values, norms, and work symbols. Shared values when in agreement with the vision and the style of management instilling moral values works well to see the company achieve its plan's objectives. At the company, we have a work-oriented culture that embraces value addition incompetence of employees and motivational packages to all. Referring to the strategic plan that we are implementing for the year 2017, customer-oriented products delivery will be our core values. These values will give staff a platform to display their abilities and competencies as required by the company's work culture.

People

People are the executors of the implementations process in any company, and therefore a company should select a group of people with diverse competences and expertise for the exercise. Various competencies and unique capabilities are dependent on people; further, they are the primary requirements for a comprehensive strategy to yield fruits for its intended purpose. In this regard, Wonder company should maintain its culture of balancing staff. This initiative is vital because there is a universal gain to retain a particular number of employees and bringing onboard new ones. We need new employees with raw skills so that they grow within the company as they display the skills and gain the necessary experience for a better service provision experience. Additionally, we also need to retain old workers because they need to teach newcomers the conceptual aspects of work. However, they may sometime be problematic when they refuse to learn and familiarize with emerging issues and new trends, for example, the outcomes of CVP analysis discussed in SLP3.

Moving into the financial year 2017, the company must take caution with retaining old employees but not necessarily doing away with all of them. As the implementation continues, the company should also take caution over the need to hire employees with needed skills externally. This caution is necessary because the gain from them may be faster, but no guarantee that those employees will fit within the set company's work culture. Importantly, any company cannot successfully implement its strategic plan, whether with the right employees or not without necessary motivating them. Wonder Company has it as a norm, and in 2017; strategy implementation with proper gains that the CVP analysis predicts better motivational packages is underway.

Control Systems

Systems must be working because they are the heart of the implementation of any strategy. They may include execution of research activities, development of internal structures and consumer engagement. Three elements of system control make it easier for the implementation process, i.e. information, measurement and reward, and accounting and budgeting.

Information Systems

In information systems, there is a technology that plays a vital role in the implementation process. Communication and information systems will enhance staff engagement, market research, and formulation of consumer preferences reports for decision-making purposes (Royo-Vela, & Hunermund, 2016). For instance, proper information systems used in analyzing and formulating a revised SLP3 strategy will work extensively. Hence, enhancing coordination within the company to ensure that its implementation within the 2017 trading period is successful.

Measurement and Reward Systems

Measurement and reward systems, on the other hand, helps in shaping employee behaviour in that they have to work in a certain way to individual achieve a reputation and motivational gift. The company, therefore, tends setting goals that workers must attain to make sure things by the end of a trading period, and this will continue working into 2017. The targets may be on the specific increase in supply and market share and timely report submission on daily performance (Alegre, Baptista, Cabrera Jr, Cubillo, Duarte, Hirner & Parena, 2016). Wonder company seeks to employ some of these measures according to the revised strategy SLP3.

Accounting and Budgeting Systems

Accounting and budgeting systems are complicated. Therefore they are slow in implementation. For this reason, Wonder Company invested in ways of getting such systems and putting them in place for the success of its strategic plan implementation. The most significant investment has been the research on and formulation of a four-year strategy and its implementation between 2013 and 2016. It is the analysis of the outcomes of the implementation of this strategy that led to the formulation of a revised SLP3 to further enhance the better application in 2017. To understand what pricing, R&D allocation, and product discontinuity criteria to follow in the trading period of 2017, we refer to SLP3 recommendations. The CVP analysis helps us in the simulation process to make the right decisions on which accounting and budgeting systems to put in place. The resultant sequence becomes the most desirable that I would recommend for Wonder Company I the next financial year for successful implementation of SLP3 revised strategic plan.

Simulation

Taking into consideration the different products, W1, W2, and W3 in the unit sales table as shown;

Year 2014 2015 2016

Sales W1 2,068,658 1,821,723 1,006,936

Sales W2 2,659,768 2,473,436 931,337

Sales W3 232,629 325,068 450,850

Figure 1.

We will first look at profits gained for W1 in 2016;

Assuming that;

P = 1000

C = 140

Margin cost = 110

R&D cost = 20% allocation of 1,000,000 budget = 200,000

Other Fixed Costs = 70,000,000

Total fixed Cost = R&D allocation + Other Fixed Costs = 70,000,000 + 200,000

= 70,200,000

Unit sales volume for W1 2016 = 1,006,936 (from fig.1)

Therefore, P = (p - c) V - F

P = (1000 - 140) 1,006,936 - 70,200,000

= (860) 1,006,936 - 70,200,000

= 865,964,960 - 70,200,000

=795,764,960

Repeat this process for W2 in the same year;

Assuming that;

P = 1000

C = 140

Margin cost = 110

R&D cost = 20% allocation of 1,000,000 budget = 200,000

Other Fixed Costs = 70,000,000

Total fixed Cost = R&D allocation + Other Fixed Costs = 70,000,000 + 200,000

= 70,200,000

Unit sales volume for W2 2016 = 931,337 (from fig.1)

Therefore, P = (p - c) V - F

P = (1000 - 140) 931,337 - 70,200,000

= (860) 931,337 - 70,200,000

= 800949820- 70,200,000

= 730,749,820

Repeat the same process for W3

P = 1000

C = 140

Margin cost = 110

R&D cost = 20% allocation of 1,000,000 budget = 200,000

Other Fixed Costs = 70,000,000

Total fixed Cost = R&D allocation + Other Fixed Costs = 70,000,000 + 200,000

= 70,200,000

Unit sales volume for W3 2016 = 450,850 (from fig.1)

Therefore, P = (p - c) V - F

P = (1000 - 140) 450,850 - 70,200,000

= (860) 450,850 - 70,200,000

= 387731000- 70,200,000

= 317531000

In the stimulation process illustrated above, profits vary with constant R&D allocation and pricing (Anderson, & Leese, 2016). The test seeks to understand the effect of introducing new commodities in the market, and it realizes that the change is not uniform. This lack of uniformity may be due to other factors not put into consideration. From the SLP3 analysis, we understand that W1 was the earliest good in the market, and over the years, it has contributed to most of the sales that the company has so far. Notably, W2 may have had a drastic drop in sales due to default issues whose solution are in W3. Therefore, W3 acts as a better option for W2, the two commodities. W1 and W2 are steadily falling in sales while W3 is steadily rising in sales. This tendency is a clear indication that moving into the future W3 will yield the company most of the profits and the company is capitalizing on it to generate maximum benefits in 2017.

Importantly, note that the text above only covers the situations where R&D allocations and pricing kept constant. There is a significant implication on reducing the R&D allocation and altering the pricing of these commodities. When R&D percentage allocation minimizes the value of total fixed cost directly reduces, this implies that the total amount of profit earned will increase. However, the reduction should not be objective because as a measurement system requirement, the allocation of expenditure funds is necessary, and it should be adequate. Lastly, the diminishing sales of commodities in the table above give a head start on when to discontinue the supply of certain products. Moving into the future trading periods, Wonder Company should consider the process of discontinuity of W2 and W1 sequentially based on how they will perform in the next trading period.

Conclusion

From the illustrations of the elements of strategy implementation, Wonder Company now can make viable implementation decisions to see the effectiveness of SLP3. It is commendable that some items are already working and there is a need for emphasis and modification. Goal-oriented implementation of SLP3 revised edition as advised will see the company make mega sales with minimum costs incurred.

References

Alegre, H., Baptista, J. M., Cabrera Jr, E., Cubillo, F., Duarte, P., Hirner, W., ... & Parena, R. (2016). Performance indicators for water supply services. IWA publishing.

Anderson, J. A., & Leese, W. R. (2016). A Formula for the Units to Satisfy an Operation's Desired Rate of Return in CVP Analysis--A Conceptual Approach. American Journal of Business Education, 9(2), 87-100.

Royo-Vela, M., & Huner...