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Strategy formulation: corporate strategy
Strategy formulation: corporate strategy
Strategy formulation: corporate strategy
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Diagnosing Change
Review of Change Diagnostic Model (20 pts)
The Star Model was developed by Jay Galbraith to analyze an organization’s effectiveness by focusing on strategy, structure, process, rewards and people. Strategy is the direction and the basis for decisions that people will make. Structure is the authority given to people and the groupings of activities. Process is the coordinated activities throughout the organization. Rewards link individual’s actions to organizational objectives. People practices are the selection, development and management of individuals in the organization.1
Rational for Choice of Model (20 pts)
The Star Model is an appropriate choice for analyzing the changes that GE and United Airlines underwent because both companies made significant organizational changes for strategic advantage. Both companies implemented changes that touched many aspects of their organizations. The Star Model matches these companies’ changes by using a broad, comprehensive approach to analyze these changes.
General Electric
Strategy: The strategy GE pursued was that of realigning the business offerings that it had within its portfolio. The core of GE’s strategy is based on five pillars5: technological leadership, services acceleration, enduring customer relationships, resource allocation and globalization.
Structure: The GE 2006 Annual Report4 identifies the six segments of their organization as: Infrastructure, Commercial Finance, Healthcare, NBC Universal, Industrial, Plastics. GE chose to exit the Insurance segment of their organization.
Process and team integration: GE has developed an organization called GE Capital Services that specializes in the process of acquisition and integration. They h...
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2. UAL Corporation, 1993 Annual Report, p.2.
3. Gilson, S. (2001). Creating Value Through Corporate Restructuring. p451
4. Invest and Deliver GE 2006 Annual Report. Retrieved from http://www.ge.com/ar2006/mda_conop.htm
5. Brokaw, L. (2012). GE Talent Management: Aligning Hiring With Strategy. Retrieved from http://sloanreview.mit.edu/article/ge-talent-management-aligning-hiring-with-strategy/
6. Ashkenas, R. (1998). Making the Deal Real: How GE Capital Integrates Acquisitions. Retrieved from http://hbr.org/1998/01/making-the-deal-real-how-ge-capital-integrates-acquisitions/ar/1
7. Welch, J. (2001). Letter to Share Owners. Retrieved from http://www.ge.com/annual00/letter/page4.html
8. Sesack, B. (2013). Overcoming Staff Resistance to Change. Retrieved from http://www.pppmag.com/article/1281/March_2013/Overcoming_Staff_Resistance_to_Change/