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TOP MANAGEMENT TEAM: Strategic Direction • Responsible for effecting long term strategic decisions and strategic change Formulate Implement Strategies Strategies Strategic Directions of TMT Influences the Ability to engage in effective strategic change. 2 TOP MANAGEMENT TEAM: Strategic Direction HETEROGENOUS TMT: Diverse Backgrounds, Expertise and Knowledge • The more heterogenous a team The greater the capacity to provide effective strategic leadership stronger actions, stronger response to fight competition • They must function cohesively – otherwise difficult to implement strategies • Hetorogenous TMT: • Formulate Value Added Winning Strategies • Function Cohesively & Minimize Disputes • Associate Positively with Innovation & Change 3 DETERMINING STRATEGIC DIRECTION • Developing a long term vision of the strategic intent 5-10 Yrs ahead • The interactions of “TMT COMPOSITION” and “CEO SUCCESSION” on strategy CEO SUCCESSION INTERNAL EXTERNAL HOMOGENOUS Stable Strategy Ambiguous Case: TMT No change expected as COMPOSITION members think and Slight Change in behave alike team & Strategy Stable Strategy Strategic Change HETEROGENOUS with Innovation STRATEGIC CHANGE More Likelihood of change if team members are heterogenous and CEO is Appointed from outside Innovate & Engage in Change 4 EFFECTIVE STRATEGIC LEADERSHIP: KEY ATTRIBUTES 1. EXPLOITING AND MAINTAINING CORE COMPETENCIES • Core competencies relate to functional skills (Marketing, HR, Finance) • Develop and exploit core skills to implement strategies • Significant assets that can be applied across business units 2. DEVELOPING HUMAN CAPITAL • Enhance knowledge & skills of workforce • Building commitment to goals • Participation in internal & external Programs to develop abilities • Effective training and development workshops • Continuous learning and leveraging knowledge base • Competency Mapping Fitment Restructuring Phase T & D 5 3. SUSTAINING ORGANISATION CULTURE: • Ideologies, Values that is shared throughout the firm and influences the way business is conducted • Regulates and controls employees behaviour • Enthrepreneurial orientation (e.g. compaq-USA) More authority, Independence & enrichment innovative and aggressive • How do you change culture & re-engineer business?? (i) An incredibly difficult task if TMT Homogenous (ii) Changing culture to support selection of different strategies and implementation of the same 6
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