1、,Lecture 5 Strategy and Operations Management,Continuing Professional Development,Lecture Series Contents Autumn Term - Strategy,Learning Objectives,At the end of this session you will be able to:,“Directors behaviour is influenced by interpersonal relationships, by perceptions of position and prest

2、ige, and by the processes of power.”Tricker, B. (2012) Corporate Governance. Principles, Policies and Practices, 2nd edn. Oxford University Press.,Department of Electronics,“The experience and prestige of board members does not guarantee a successful board.”Tricker, B. (2012) Corporate Governance. P

3、rinciples, Policies and Practices, 2nd edn. Oxford University Press.How was this the case for Enron?,Department of Electronics,Enrons audit committee included: - one of Americas best-known accounting academics - a member of the British House of Lords who was chairman of the UK Press Complaints Counc

4、ilTricker, B. (2012) Corporate Governance. Principles, Policies and Practices, 2nd edn. Oxford University Press.,Department of Electronics,Successful boards:all the directors, executive and non-executive alike, form a cohesive team in which independent, tough-minded individuals work together with tr

5、ust and mutual understanding. To achieve that needs leadership.Tricker, B. (2012) Corporate Governance. Principles, Policies and Practices, 2nd edn. Oxford University Press.,Department of Electronics,Key roles:The Chairman links the board with the Executive Directors, working predominantly through t

6、he CEO (Chief Executive Officer)The CEO leads the Executive Directors in developing and implementing strategy and policy,Department of Electronics,Culture of the Board - Lots of different culturesSome factors include:traditionscorporate visioninnovationcontroldecision-takingleadershipcommitmentadapt

7、abilitycollaborationconflictrelationshipsstatustrust,Department of Electronics,Different Board StylesTricker, B. (2012) Corporate Governance. Principles, Policies and Practices, 2nd edn. Oxford University Press.,Department of Electronics,To discuss:What could the CEO and Board of Directors have done

8、 differently to prevent the collapse of Enron?Why do you think that they didnt take these actions?,Department of Electronics,Stakeholder Theory:Freemans (1984) definition of the stakeholder is any group or individual who can affect or is affected by the achievement of the organisations objectives.,D

9、epartment of Electronics,ActivityIn your groups, using Freemans definition of a stakeholder, identify as many of Enrons stakeholders as you canWrite each stakeholder on a post-it note ready for the next activity,Department of Electronics,Stakeholder PowerIn your groups, using Freemans definition of

10、a stakeholder, identify as many of Enrons stakeholders as you canWrite each stakeholder on a post-it note ready for the next activity,Department of Electronics,Stakeholders and their demands:,Department of Electronics,Stakeholder PowerWinstanley et al. (1995) propose a simple tool to enable a manage

11、r to understand where a stakeholder group might hold, and seek to exercise, power. They argue that power can be applied in two distinct ways: 1 criteria power the power to define the goals, aims and purpose of the organisation 2 operational power the power to determine how the product or service off

12、ered by the company is provided by the allocation of a range of resources.,Department of Electronics,The stakeholder power matrix (Winstanley et al., 1995),Department of Electronics,The stakeholder power matrix - Monsanto example (sourced from Open University,Business School),Department of Electroni

13、cs,Corporate Social Responsibility European Commission,Department of Electronics,Corporate social responsibility (CSR) refers to companies taking responsibility for their impact on society. As evidence suggests, CSR is increasingly important to the competitiveness of enterprises. It can bring benefi

14、ts in terms of risk management, cost savings, access to capital, customer relationships, human resource management, and innovation capacity. CSR is defined by the European Commission as the responsibility of enterprises for their impacts on society”,http:/ec.europa.eu/enterprise/policies/sustainable

15、-business/corporate-social-responsibility/index_en.htm,But for all the good examples of CSR, there are some very high-profile cases where a firms actions have smacked of, at best, lip-service and narcissism or, at worst, dishonest public relations.Such appears to be the case with a Texan energy gian

16、t back in the 1990s.It gave millions to local charities and was forever winning national awards for its CSR work.Unfortunately, the business was called Enron, and collapsed in 2001 with debts of $31.8bn (18bn), after it was revealed that its boss had orchestrated a giant fraud.The boss in question,

17、chief executive Jeffrey Skilling, was recently jailed for 24 years for the crime.Critics of CSR argue that Enron is a case in point - that CSR is irrelevant if the essential business practice of a firm is dishonest.,Department of Electronics,http:/news.bbc.co.uk/1/hi/business/6102108.stm,Department of Electronics,Fuller references: Freeman, R.E. (1984) Strategic Management: A Stakeholder Approach, Boston, MA, Harper Collins. Pearce, J.A. (1982) The company mission as a strategic tool, Sloan Management Review, Spring, pp. 1524. Pearce, J.A. and Robinson, R.B. (2003) Formulat