«Linking Strategic Planning and Management Manpower Planning by Laurence J. Stybel A corporate strategic plan is merely an expensive report until it ...»
CALIFORNIA MANAGEMENT REVIEW
Vol. 25, No. 1, FaU 1982
Copyright © 1982, The Regents of the University of Califomia
Linking Strategic Planning
by Laurence J. Stybel
A corporate strategic plan is merely an expensive report until
it is put in the hands of a manager who can execute it. A
pairing ofMaccohy's management classification scheme and
a product-life-cycle concept yields a model that can match
strategic-business-unit operational requirements and the leader most likely to succeed.
A well-developed strategic plan is merely an expensive report. It becomes a viable tool when it is placed in the hands of a manager competent to execute the plan. While the link between corporate strategic planning and management manpower planning seems obvious, a recent Business Week article suggests that companies are only now seriously trying to develop formal ties between the two systems. ^ The purpose of this article is to outline a conceptual model which can be used by companies in the high-technology sector to achieve this type of linkage.
Management manpower planning refers to the identification of current and future job requirements, assessment of intemal humanresource capability in relation to those requirements, and institutionalization of management development/management succession framework.
Maccoby's Scheme In his book. The Gamesman, Harvard University researcher Michael Maccoby provides a useful framework for the high-technology sector. ^ The material was based on a series of interviews with 250 hightechnology managers who worked for two of the industry's major firms. Maccoby's research format involved extensive interviews with
STRATEGIC AND MANAGEMENT MANPOWER PLANNING 49these managers, including psychological assessments. In addition, the research team interviewed colleagues, superiors, subordinates, and spouses. This methodology allowed Maccoby to obtain more in-depth material than most high-technology companies could feasibly expect to collect on their own people.
According to Maccoby, high-technology managers can be classified as "types." Each personality type represents an ideal and most managers exhibit varying degrees of personality combinations.
Nevertheless, Maccoby argues that his classification represents a well-defined scheme, capable of differentiating managers. His four types are Craftsmen, Jungle Fighters, Company Men, and Gamesmen.
Craftsmen—They are technically proficient individuals who enjoy the process of creation or innovation. They want to "build the best" and are perfectionists. Craftsmen in research and development are the foundation for survival in the high-technology sector since they create future products. Nevertheless, they tend to make relatively poor senior management material. Their desire for perfection results in a tendency towards inaction when business requirements demand quick reaction time. While they have a valued depth of knowledge, they fail to develop the conceptual breadth necessary to plan and control different functions with sometimes confiicting goals.
Jungle Fighters—The goal of Jungle Fighters is to achieve personal power and to be admired by others as superior. They also derive satisfaction in being feared. There are two types of Jungle Fighters. "Lions" are courageous, charismatic managers who lead by example. They are willing to take major risks and will be persistent in the face of obstacles. While they are highly effective in terms of developing empires where none had existed, they are poor organization builders. The development of an organization requires a willingness to share power, something which Lions are reluctant to do.
They tend to staff their organizations with "Yes Men" and to stifie truly independent thinking. "Foxes" are another breed of Jungle Fighter. They lack the Lion's charisma, although they also seek to dominate their environment. Foxes achieve their goals through manipulation of others, secrecy, and betrayal. Given the highly interdependent nature of the high-technology industry. Foxes seldom achieve true organizational power. They do, however, manage to instigate minor and major internal political crises.
Craftsmen seldom trust Jungle Fighters, although they do form useful short-term political alliances with them. Jungle Fighters vdll allow Craftsmen to become prima donnas within their technical area of expertise if they obey Jungle Fighters in all other areas.
50 LAURENCE J. STYBEL Company Men—Most of the 250 managers studied by Maccoby were classified as Company Men. Such people have the goal of being an integral part of a powerful, protective organization.
Company Men are good team members and will take the necessary time to create a viable organizational structure. They can be trusted to follow the corporate game plan according to the rules which have been established. Company Men enjoy implementing formal management systems and keeping the people on their team happy.
They are, however, chronic worriers who are afraid to fail. Highrisk situations tend to scare them. They would rather play it safe.
Because of this, relations between Company Men and Craftsmen pushing innovation tend to be strained.
Gamesmen—Maccoby believes the present and future leadership of large organizations rests with Gamesmen. Such people view business as a competitive contest, and their personal objective is to be a winner. But it is a different type of winning than that which is defined by Jungle Fighters. Jungle Fighters seek personal glory. Gamesmen want to be superstars on a winning team. Because of their team orientation, Gamesmen are willing to allow for the development of subordinates and to encourage aggressive risk taking. Craftsmen tend to enjoy working for Gamesmen because of their openness to subordinate growth and new ideas.
As mentioned earlier, few managers are stereotyped in terms of only one style. Most will exhibit various combinations, with one style being paramount most of the time and under most circumstances.
Weaknesses of Maccoby's Framework One of the strengths of Maccoby's classification scheme is that it is comprehensive. Few companies have the time or money necessary to conduct such an extensive psychological investigation. But Maccoby's psychological orientation also contains weaknesses which limit the practical utilization of this model.
Maccoby views organizations as complex "psychostructures." Different personality types are required at different levels of the organization, and he believes there is an undescribed "natural selection" process at work which helps to insure that the right personality reaches the right level. Thus, Craftsmen tend to stay in technical or staff areas. Company Men tend to dominate middle management, Gamesmen achieve the highest positions, and Jungle Fighters either dominate their organizations or are shunted aside. There is, in fact, nothing "natural" about this selection process. It was probably preplanned through a management selection system. Selection systems can be formal or informal. Companies that elect to postpone a formalSTRATEGIC AND MANAGEMENT MANPOWER PLANNING 51 ized management manpower planning system are, in effect, opting for an informal management planning system which dictates seniority as the basis for promotion. Seniority is, after all, the least objectionable basis to make promotion decisions. Such an informal system tends to insure the Company Men will achieve the highest levels of power, since they are the ones most likely to have the persistence to maintain ±eir time in grade. The utility industry is a classic example of where this has occurred, and it could happen to certain large, hightechnology companies in time.
A second problem with Maccoby's framework is that he views "psychostructures" as complex hierarchies frozen in time. Given the rapidly changing nature of business conditions in the high-technology sector, this picture is unrealistic. Such organizations are managerially dynamic systems with changing requirements over time. This idea is best illustrated by an overview of strategic planning and the role of the product life cycle (PLC) as a conceptual tool in strategic planning.
Strategic Planning and the PLC Bruce Henderson describes strategic planning as the process of relating the firm to its competitors in terms of a competitive system in equilibrium. The plan should include a means of upsetting the competitive equilibrium and reestablishing it again on a more favorable basis. It is a dynamic framework which changes through time. ^ Under strategic planning, products or strategic business units (SBUs) are identified in terms of market share and growth potential. Long-range capital allocations and short-term operational goals are based on individual PLCs.
The PLC is a well-known tool used by marketers and strategic planners to identify the relation of product to marketplace and what must be done to maintain or destabilize market equilibrium. According to Harvard professor Theodore Levitt, there are four stages of the PLC: development, growth, maturity, and decline.'^ Market Development—During this phase, a product has been brought to the market before there is a proven demand for it, and often before it has been fully proven technically. A demand for the product must be created.
Most new products never go beyond the market-development phase. Sometimes this is because the company fails to provide the necessary capital resources; sometimes it is because the SBU manager lacks the persistence necessary to keep subordinates and superiors motivated in the face of initial obstacles.
Growth—The usual characteristic of a successful new product is a 52 LAURENCE J. STYBEL gradual rise in its sales curve during the market-development phase.
At some point in this rise, there is a marked increase in customer demand and sales take off. During the growth phase, potential competitors introduce copies of the product or make functional design improvement over the existing product.
This highly competitive phase requires the development of an innovative management team, capable of expanding the sales force and distribution system, increasing manufacturing capacity, and developing product innovations. It is important that the SBU manager be someone capable of quickly altering the operational game plan in light of new competitive developments.
Maturity—During this phase, market share remains essentially stable, and sales growth is on par with the increase of the existing customer population. The strategic focus during this period tends to be on harvesting profits and protecting the product against competition. These objectives are usually achieved by holding costs of production down. It is particularly important during this phase to have strong financial control systems.
Decline—During this phase, market share begins to shrink due to oversaturation of the product. As demand declines, there is an endemic overcapacity. Production becomes concentrated in the hands of fewer competitors as profit margins are depressed.
In the absence of a likelihood of moving the product out of decline through product innovation or identification of new market segments, it will be necessary to find a buyer for the product or to begin shrinking production and sales capacity. During this phase, it is necessary that the SBU manager not be afraid to make necessary and sometimes painful business decisions. The manager will have to think and act boldly.
Matching Managers and Strategies Integrating Maccoby's managerial classification scheme with a product-life-cycle perspective offers high-technology firms a model for placing SBU managers in areas where the business requirements are most likely to focus on management personality strengths. Because I the PLC not only describes business requirements at one phase but also predicts managerial requirements when the product enters the next phase, the model can include the desired managerial type to become second-in-command of the SBU. In this way, a formal management manpower planning system can insure smooth management continuity as the SBU moves from one phase of the PLC to the next.
Market Development—This phase typically requires an SBU
STRATEGIC AND MANAGEMENT MANPOWER PLANNING 53manager capable of brute persistence in the face of initial technical and market obstacles. The person should be eager to be on the forefront of a high-risk operation. A charismatic and persuasive leader is well suited to this role. Given the importance of the engineering function at this phase of the PLC, a Lion-type Jungle Fighter who is also a Craftsman is probably ideally suited for this role.
Henry Ford is a classic example of this type of individual. Failing that, a Lion-type Jungle Fighter with sound back-up by Craftsmen would be appropriate.
Growth—Lions, however, are not particularly effective in terms of developing the integrated technical/managerial team needed in the growth phase. Gamesmen are probably best suited to this role. They will have the necessary orientation to develop an organization which can respond rapidly to a rapidly changing competitive environment.
They have the additional advantage of being able to work well with Craftsmen.
Maturity—During the maturity phase, emphasis is placed on squeezing the greatest efficiency out of operations. Corporate Men are best suited for the task because they have the required persistence to effectively carry out a long-term game plan which focuses on control through formal administrative systems. Their inherent desire for stability corresponds well with the business requirements of a mature market. As Corporate Men do not relate well with Craftsmen, it is assumed that the business strategy employed during the maturity phase would be to focus on increasing efficiency of existing operations, rather than on technological innovations.