150 Unit 3 / Strategy Implementation CONCEPT AND NATURE After a company crafts its vision, mission, goals, and objectives (VMGO), the different busing and functional units have to formulate their own VMGO. The VMGO of the business and funchess units must be consistent with the overall corporate level strategy and other business units. fal business and functional level strategies must be efficiently implemented in order to achieve company's objectives. The implementation of the business and functional level strategies is made possible through the preparation of the following: 1. Programs 2. Budgets 3. Procedures The programs, budgets, and procedures at the business level must be anchored on the objectives of a business unit. In a similar manner, the programs, budgets, and procedures at the functional level must be anchored on the objectives of the functional units. Moreover, the objectives of the functional units must be consistent with the objectives of the business unit. For example, if the objective of the business level is to increase revenue by 30% this year and 50% the next year from its present level of P15 million, the production and operation unit has to pursue the objective of increasing its production output by 20% this year and 30% the following year. Figure 11.1 presents the vertical and horizontal consistency of the business and functional level objectives. The business and functional unit objectives serve as the backbone of the programs, budgets, and procedures. Corporate Objective To increase the company's revenue by 50% from its current level of P10 million through market penetration Business Level 1 - Objective Business Level 2 - Objective To increase the division revenue by 30% from its current level of To increase the company's revenue P4 million by 60%% from its current level of P6 million Production and Operation Objective Marketing Increase production Objective Financial Human Resource efficiency by 40% Increase the market share Objective Objective this year by 15% and salespeople by Increase bank borrowing Reduce employee 10% this year of P800,000 in the next absences and tardiness nine months this year from 8% to 2% this year Figure 11.1 An example of the hierarchy of objectives at the business and functional levelsChapter 11 | Strategy Implementation: Business and Functional Levels 151 pure ss All employees in the business and functional levels equally participate in the implementation business the business and functional level strategies with varying degrees of accountabilities and order to ponsibilities. The implementation is spearheaded by the business and functional level managers or supervisors as illustrated in Figure 11.2. Business and Functional Business and Functional Level Level possible throwed Strategy Formulation Business and functional level managers Strategy Implementation Competitive and various Programs, budgets, and functional level strategies operating procedures Figure 11.2 Middle- and lower-level managers formulate and implement strategies The programs, budgets, and guidelines serve as the roadmap in the implementation of business on the chipss and functional level strategies. The hierarchy of these elements is illustrated in Figure 11.3. The at the fundie elements contain information about the target, people involved, cost, expected completion time, and objectives &it expected output. r example to e next year Business and Functional Level Objective the objections What to accomplish and when functionallee f the process Programs Activities needed to achieve the objective Budgets Expected revenue and cost of the program Procedures Steps to accomplish the program Figure 11.3 The hierarchy of programs, budgets, and procedures Questions 1. How would you describe the vertical and horizontal consistencies of a company in the functional level strategy implementation? 2. Who are the people involved in the implementation of business and functional level strategies