TASKS OF CRAFTING AND EXECUTING STRATEGY 272

DRIVERS OF UNETHICAL BUSINESS STRATEGIES AND BEHAVIOR 273

Faulty Oversight, Enabling the Unscrupulous Pursuit of Personal Gain and Self-Interest 273

Heavy Pressures on Company Managers to Meet Short-Term Performance Targets 275

A Company Culture That Puts Profitability and Business Performance Ahead of Ethical Behavior 276

WHY SHOULD COMPANY STRATEGIES BE ETHICAL? 277

The Moral Case for an Ethical Strategy 277 The Business Case for Ethical Strategies 277

STRATEGY, CORPORATE SOCIAL RESPONSIBILITY, AND ENVIRONMENTAL SUSTAINABILITY 279 The Concepts of Corporate Social Responsibility and Good Corporate

Citizenship 280 Corporate Social Responsibility and the Triple Bottom Line 282

What Do We Mean by Sustainability and Sustainable Business Practices? 285

Crafting Corporate Social Responsibility and Sustainability Strategies 287

The Moral Case for Corporate Social Responsibility and Environmentally Sustainable Business Practices 289

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The Business Case for Corporate Social Responsibility and Environmentally Sustainable Business Practices 289

ILLUSTRATION CAPSULES 9.1 Ethical Violations at Uber and their Consequences 274 9.2 How PepsiCo Put Its Ethical Principles into Practice 279 9.3 Warby Parker: Combining Corporate Social Responsibility with Affordable

Fashion 283 9.4 Unilever’s Focus on Sustainability 288

Section D: Executing the Strategy

10 Building an Organization Capable of Good Strategy Execution 296 A FRAMEWORK FOR EXECUTING STRATEGY 298

The Principal Components of the Strategy Execution Process 298 What’s Covered in Chapters 10, 11, and 12 299

BUILDING AN ORGANIZATION CAPABLE OF GOOD STRATEGY EXECUTION: THREE KEY ACTIONS

300 STAFFING THE ORGANIZATION 302

Putting Together a Strong Management Team 302 Recruiting, Training, and Retaining Capable Employees 303

DEVELOPING AND BUILDING CRITICAL RESOURCES AND ORGANIZATIONAL CAPABILITIES 305 Three Approaches to Building and Strengthening Organizational

Capabilities 306

Developing Organizational Capabilities Internally 306 Acquiring Capabilities through Mergers and Acquisitions 307 Accessing Capabilities through Collaborative Partnerships 308

The Strategic Role of Employee Training 309 Strategy Execution Capabilities and Competitive Advantage 309

MATCHING ORGANIZATIONAL STRUCTURE TO THE STRATEGY 310 Deciding Which Value Chain Activities to Perform Internally and Which to

Outsource 311 Aligning the Firm’s Organizational Structure with Its Strategy 313

Making Strategy-Critical Activities the Main Building Blocks of the Organizational Structure 314

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Matching Type of Organizational Structure to Strategy Execution Requirements 314

Determining How Much Authority to Delegate 317 Centralized Decision Making: Pros and Cons 318 Decentralized Decision Making: Pros and Cons 319 Capturing Cross-Business Strategic Fit in a Decentralized Structure 320

Providing for Internal Cross-Unit Coordination 320 Facilitating Collaboration with External Partners and Strategic Allies 322 Further Perspectives on Structuring the Work Effort 322

ILLUSTRATION CAPSULES 10.1 Management Development at Deloitte Touche Tohmatsu Limited 304 10.2 Zara’s Strategy Execution Capabilities 310 10.3 Which Value Chain Activities Does Apple Outsource and Why? 312

11 Managing Internal Operations 328 ALLOCATING RESOURCES TO THE STRATEGY

EXECUTION EFFORT 330 INSTITUTING POLICIES AND PROCEDURES THAT

FACILITATE STRATEGY EXECUTION 331 EMPLOYING BUSINESS PROCESS MANAGEMENT

TOOLS 333 Promoting Operating Excellence: Three Powerful Business Process

Management Tools 333 Business Process Reengineering 333 Total Quality Management Programs 334 Six Sigma Quality Control Programs 335 The Difference between Business Process Reengineering and Continuous-

Improvement Programs Like Six Sigma and TQM 337 Capturing the Benefits of Initiatives to Improve Operations 338

INSTALLING INFORMATION AND OPERATING SYSTEMS 339 Instituting Adequate Information Systems, Performance Tracking, and

Controls 340 Monitoring Employee Performance 341

USING REWARDS AND INCENTIVES TO PROMOTE BETTER STRATEGY EXECUTION 341 Incentives and Motivational Practices That Facilitate Good Strategy

Execution 342

Striking the Right Balance between Rewards and Punishment 343 Linking Rewards to Achieving the Right Outcomes 345

Additional Guidelines for Designing Incentive Compensation Systems 346

ILLUSTRATION CAPSULES 11.1 Charleston Area Medical Center’s Six Sigma Program 337 11.2 How Wegmans Rewards and Motivates its Employees 344 11.3 Nucor Corporation: Tying Incentives Directly to Strategy Execution 347

12 Corporate Culture and Leadership 352 INSTILLING A CORPORATE CULTURE CONDUCIVE TO

GOOD STRATEGY EXECUTION 354 Identifying the Key Features of a Company’s Corporate Culture 355

The Role of Core Values and Ethics 355 Embedding Behavioral Norms in the Organization and Perpetuating the

Culture 356 The Role of Stories 357 Forces That Cause a Company’s Culture to Evolve 357 The Presence of Company Subcultures 358

Strong versus Weak Cultures 358 Strong-Culture Companies 358 Weak-Culture Companies 359

Why Corporate Cultures Matter to the Strategy Execution Process 360 Healthy Cultures That Aid Good Strategy Execution 361

High-Performance Cultures 361 Adaptive Cultures 362

Unhealthy Cultures That Impede Good Strategy Execution 363 Change-Resistant Cultures 364 Politicized Cultures 364 Insular, Inwardly Focused Cultures 364 Unethical and Greed-Driven Cultures 365 Incompatible, Clashing Subcultures 365

Changing a Problem Culture 365 Making a Compelling Case for Culture Change 366 Substantive Culture-Changing Actions 367 Symbolic Culture-Changing Actions 368 How Long Does It Take to Change a Problem Culture? 368

LEADING THE STRATEGY EXECUTION PROCESS 369

Staying on Top of How Well Things Are Going 370 Mobilizing the Effort for Excellence in Strategy Execution 371

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Leading the Process of Making Corrective Adjustments 372 A FINAL WORD ON LEADING THE PROCESS OF

CRAFTING AND EXECUTING STRATEGY 373 ILLUSTRATION CAPSULES 12.1 PUMA’s High-Performance Culture 362 12.2 Driving Cultural Change at Goldman Sachs 369

PART 2 Cases in Crafting and Executing

Strategy Section A: Crafting Strategy in Single-

Business Companies 1 Airbnb in 2020 C2

John D. Varlaro, Johnson & Wales University John E. Gamble, Texas A&M University-Corpus Christi

2 Competition in the Craft Beer Industry in 2020 C7

John D. Varlaro, Johnson & Wales University John E. Gamble, Texas A&M University–Corpus Christi

3 Costco Wholesale in 2020: Mission, Business Model, and Strategy C18

Arthur A. Thompson Jr., The University of Alabama

4 Ford Motor Company: Will the Company’s Strategic Moves Restore its Competitiveness and Financial Performance? C43 Marlene M. Reed, Baylor University Rochelle R. Brunson, Baylor University

5 Macy’s, Inc.: Will Its Strategy Allow It to Survive in the Changing Retail Sector? C51 Alen Badal, University of Liverpool John E. Gamble, Texas A&M University-Corpus Christi

6 TOMS Shoes: Expanding Its Successful One For One Business Model C59

Margaret A. Peteraf, Tuck School of Business at Dartmouth Sean Zhang and Carry S. Resor, Research Assistants,

Dartmouth College

7 lululemon athletica’s Strategy in 2020: Is the Recent Growth in Retail Stores, Revenues, and Profitability Sustainable? C68

Arthur A. Thompson, The University of Alabama Randall D. Harris, Texas A&M University-Corpus Christi

8 Under Armour’s Strategy in 2020: Can It Revive Sales and Profitability in

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Its Core North American Market? C86

Arthur A. Thompson, The University of Alabama

9 Spotify in 2020: Can the Company Remain Competitive? C112 Diana R. Garza, University of the Incarnate Word

10 Beyond Meat, Inc. C124

Arthur A. Thompson, The University of Alabama

11 Netflix’s 2020 Strategy for Battling Rivals in the Global Market for Streamed Video Subscribers C140

Arthur A. Thompson, The University of Alabama

12 Twitter Inc. in 2020

C161

David L. Turnipseed, University of South Alabama

13 Yeti in 2020: Can Brand Name and Innovation Keep it Ahead of the Competition? C173

Diana R. Garza, University of the Incarnate Word David L. Turnipseed, University of South Alabama

14 GoPro in 2020: Have its Turnaround Strategies Failed? C184 David L. Turnipseed, University of South Alabama John E. Gamble, Texas A&M University–Corpus Christi

15 Publix Super Markets: Its Strategy in the U.S. Supermarket and Grocery Store Industry C198 Gregory L. Prescott, University of West Florida David L. Turnipseed, University of South Alabama

16 Tesla’s Strategy in 2020: Can It Deliver Sustained Profitability?

C212

Arthur A. Thompson, The University of Alabama

17 Unilever’s Purpose-led Brand Strategy: Can Alan Jope Balance Purpose and Profits? C238 Syeda Maseeha Qumer, ICFAI Business School Hyderabad Debapratim Purkayastha, ICFAI Business School Hyderabad

18 Domino’s Pizza: Business Continuity Strategy during the Covid-19 Pandemic C249 Debapratim Purkayastha, IBS Hyderabad Hadiya Faheem, IBS Hyderabad

19 Burbank Housing: Building from the Inside Out C260 Christy Anderson, MBA Student, Sonoma State University Armand Gilinsky Jr., Sonoma State University

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