MGAD40H3 : Managing Strategic Risk - ch.13
2 May 2011
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Document Summary
Communicate effective boundaries and internal control systems. Remove ability to rationalize actions risky to the firm. Managing tensions of short-term vs. long-term, self-interest vs. organizational success results in innovation that enhances firm value and strategy. Core values: beliefs that define basic purpose, direction, principles: guides responsibilities to customers, employees, stockholders, communities, top mgmt view tradeoffs. Inspirational leaders: articulate vision, explain how to contribute to achieve vision, enthusiastic support for effort, encourage public recognition and reward for success. Formalize communication of core values by articulate formal beliefs systems. Belief systems: explicit set of organizational definitions that senior managers communicate formally and reinforce systematically to provide basic values, purpose, and direction for the organization. Controlling human behaviour: tell people what to do through command and control approach, hold ppl accountable for outcomes, leave to initiative and creativity to perform job effectively. Define boundaries by telling what not to do.
