Copley Company_By.Era

8/7/2019 Copley Company_By.Era

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Strategic Planning


2/33

` Rohit Chandnani 15

` Nikhil Chandra 16

` Samadhan Damdhar 20

` Joanne DSouza 26

` Umakant 27

` Vineet Dubey 28


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`Manufacturerofcutting tools and other industrial parts

` Established in 1919

` Rapid progress in 1960 and 1970

` 8 Divisions with considerable autonomy

` Initiated formal planning in 1977


4/33

KEY EVENT KEY IMPACT/EFFECT


5/33

Russel Wilde initiates

Formal Planning

Growth throughM&A

Objectives & Potential

Stanley Burton asks for

10 yrfinancial forecast(ROI , Sales, Profit,

Cash Flow)

Analysis useful as

indicated large cashflows, Mature markets &

cyclicalsensitivity.

DirectorofCorporate

Development-CharlesSagan, reports to Burton

Structural change.

Sagan concerned withGrowth through M&A.

Sagan begins reporting

toAlbert. Chairman,

Samuel Savage, asks for

5 yr sales forecast.

Structural change.

Sagan &Albert agree

Planning as way of life.

Unnecessary forecast.


6/33

` No defined corporate goals

` Unnecessary voluminous data asked for

` Inconsistent leadership

` Planning Range 10 years: period too long


7/33

Corporate Planning

Committee with Sagan

as ChiefCoordinator.

Weekly meetings to

define Process ofFormal Planning &

Corporate Goals

Guide move towards

formal planning.

Well represented

committee, insights of

technology, economictrends and finance.

Critical issues tackled.

Memofrom Albert to

division heads statingplan ofaction.

Survey divisional history

& attitude to aid in

preparing Provisional

Plans

Clear communication to

various divisionsexplaining need &future

course ofaction


8/33

Visit to divisions to

introduce concept of

formal planning by Albert

& Sagan.

Divisions to submit 5-yrplans by Oct 1981.

Consistent Effort to

introduce concept.

Divisions to decide role

ofstaff in process &

format of5 yr- No cleardirections.

November -Planning

Review Meetings to

evaluate plans.December Planning

Response Meetings to

comment on plans.

MixedResponses.

Lack ofUniformity,

Lack ofConsistency in

attendance, Lack ofrepresentation from

other divisions.

Unable to effectively

mould attitudes.


9/33

` Corporate Goals still not developed

` Formal Planning Structure beginning toform

` Timely communication

` Lack ofuniformity

` Unable to create a consensus


10/33

Corporate Planning

moved up, Creation of

new stafffunctions,

Creation ofadditional

divisions, designations

Organizational

Changes that impacted

planning process- were

temporarily disruptive.

Numbers Orientation to

Strategic Concepts.

3 Phase Planning Cycle

Strategy Development,

Quantitative, Action.

Further Changes in

process,

Clear Communication

about planning cycle &

objectives ofprocess.

Completion ofPhase 1.

Business Downturn

Staffdepts to continue

planning process

Reduced efforts.

Discontinuation of

Cycle.


11/33

` Corporate Goals still not defined

` Lack ofcommitment towards plans

` Uncoordinated structural changes

` Irrelevant tohave planning process in staffdepartments

before line departments


12/33

Committee Inactive-

efforts toformulate

Corporate Goals.

Sagan working with

Albert, while planninginfluenced by Tyler.

Revised formats for

Product Group strategy

and review meetings.

Further changes in

leadership & structure

of planning activities.

No Goals defined.

Pre Meeting to explain

strategy & review

Product Line Study.

Presentation ofdivisional

plan.

New format to ensure

congruence in

planning. But strategy

revealed for the first time

in pre meeting


13/33

Sagan working with

Albert, while planning

influenced by Tyler.

Revised formats for

Product Group strategyand review meetings.

Further changes in

leadership & structure of

planning activities.

Efforts toformulate

Corporate Goals.

Pre Meeting to explain

strategy & review

Product Line Study,

followed by divisional

plan presentation.

New format to ensure

congruence in

planning. But strategy

revealed for the first time

in pre meeting

2-day conference to

review divisional plans.

Goals formulated.

FINALLY!!!


14/33

` Corporate Strategy communicated just before

presentation ofdivisional plans

` No goal congruence created

` Positive Indicators:

hMore precise data

hStructured format

hMore emphasis on analysis & discussion

hGradual shift to emphasis on Line Management


15/33

7 NumberofYears where Goals were Undefined

4 NumberofPlans

4NumberofChanges in Structure

3 NumberofRevisions in Planning Process


16/33


17/33

` Undefined Corporate Goals

` Redundant & Ineffective Data Collection

no answerhad yet been given to the

second question (what are the appropriate

Corporate Goals for Copley?)

Divisional Plans were seen as optimistic

extrapolations ofpast operating trends.

voluminous documentation required to

present a divisional strategy as one

reason forfailure to identify with the

planning output.


18/33

` Inconsistencies in Processes

` Lack ofCommitment

i ision mana ers ha been lannin

to lar el satisfy the re uirements set by

the lannin staff& ha faile to become

committe

it eci e a ainst rocee in with the

uantitati e hase ori inally sche ule for

the fall

Short Term s. Lon Term

Goal Con ruence???

Data Orientation s. Quantitati e


19/33

` Lack ofGoal Congruence

` Limited Focus on Line Functions

1982: Line Departments tofocus on

reviving business rather than formalplanning process

it decided against proceeding with

plans but recommended that staff

departments begin planning process by

analysing past trends & identifying

resources

Sagan vs. Tyler

Growth throughMergers &Acquisitions


20/33

` Numerous Organisational Changes

Samuel K Savage

(Chairman of the Board)

Stanley Burton

(President)

Albert(Vice President)

Charles N Sagan(Director Corporate Development)

Tyler

(Cutting Tool Division Head)


21/33


22/33

Samuel K Savage

(Chairman of the Board)

Albert

(President)

Tyler

(Vice President)

Charles N Sagan

(Director Corporate development)

Organization Structure 1982

Inclusion ofseven persons into new corporate executive Positions proved out tobe

disruptive to planning effort

Two VPs(Six Divisions)


23/33

Samuel K Savage

(chair man of the Board)

Albert

(President)

Tyler

(Exec. Vice President)

Fred Fisher

(Director Corporate develo

B

(Division GM)

Organization Structure 1984

A

(Division GM)


24/33

` Other Issues:

hUnprepared for Business Fluctuations

hFrequent Changes

hTime Consuming Efforts

hUnnecessary Paperwork

hUnclear Leadership

hProblems due toorganisational changes:

x Assimilating acquired company

x Organising split ofCutting Tools Division


25/33

` Formulated organisational goals

` Reduced & precise data collection

` Encouraged discussion for evaluation ofplans

` Use ofstrategic analytical tools eg: SWOT

` Increased involvement of line departments


26/33

ManagementControl

HumanResource

Management

OrganizationStructure

CultureStrategy Per formance

Formulated

corporate goals &

strategies based on

divisional plans

Developed a

schedule for

communicating &

evaluating plans

Organisational

Structure put in

place firmly

Ifprocesses are followed,organisation structure is

maintained and MCS

enforced Strategic

Planning can be a

success.


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Goal

Strategy

Policies

Implementation ofPolicies

Efficient and Effective

Performance ofIndividual Task

STRATEGY

FORMULATION

MANAGEMENT

CONTROL

TASK

CONTROL


29/33

Corporate Goals

Strategic Planning

Budgeting

Controllability

Performance Measurement

SatisfactoryReward

Strategic ormulation

IfDissatisfactory


30/33

Corporate Goals

Strategic Planning

Budgeting Per formance Measurement

SatisfactoryReward

Strategic Formulation

IfDissatisfactory

Divisional Goals

Should be developed by Top

Management along with

Divisional Heads


31/33

` Written Descriptions ofOrganisational Goals &

Strategies

` Systematic & Process Oriented

` Less Paperwork, More Discussion &Analysis

`Developing

Alternatives rather than

Making Projections


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` Involvement ofLine Functions in Planning

` StaffFunctions as Catalysts &Advisors

` Commitment ofTop Management

` Clear Leadership & Organisational Heirarchy


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