Institutionalizing Strategy

To emphasize systems, style, staff, skills, and super-ordinate goals, we need to look at how strategy is institutionalized. An institution is a collection of values, norms, roles and groups that develops to accomplish a certain goal. The institution of education, for example, developed to prepare children to be productive members of society. To institutionalize a business strategy, business leaders must also develop a system of values, norms, roles and groups that will support the accomplishment of strategic goals. So, strategy is institutionalized if it is connected to the culture, the quality system, and the other driving forces in the organization.

We have seen that the drive toward TQM can be institutionalized. Another aspect of organizational life that is also undergoing increasing institutionalized is an emphasis on ethics development. Both shift organizational attention from detection and control to coordination and strategic impact. The ultimate outcome of this shift in focus is an enhanced quality of work environment for employees and increased quality of products and services for customers.

The role of the CEO:

Because chief executive officers (CEOs) spend most of their time developing and guiding strategy, their personal goals and values inevitably shape organizational strategy. For examples, Walt Disney valued family entertainment and conceived the idea of a “magical little park” that would amuse and educate both children and their parents. His vision resulted in Disneyland, which opened in 1955. Although Disney died in 1966, his values and vision have continued to shape his company, as evidenced by the completion of his plans for Disney World (opened in 1971) and Epcot Center (opened in 1982). Usually how ever a change in CEO is associated with a change in strategy. Although current Disney CEO Michael Eisner has continued to develop the theme parks, he has moved away from Walt Disney’s strategy of offering mainly G-rated films for children to create Touchstone Pictures, which offers PG and PG-13 films that appeal to wider audiences.

Their role in strategy formulation makes CEOs especially important to strategy implementation. First, they interpret strategy, acting as final judges when managers disagree on implementation. Second, CEOs enact through their words and actions the seriousness of an organization’s commitment to a strategy. Third, CEOs motivate, providing intangible incentives beyond pay or bonuses. By appealing to members’ values, beliefs, and loyalties, CEOs can mobilize support for a strategy.

Jim Henson and the Magic of the Muppets:

Because the head of an organization can be central to its direction and culture, an unexpected death such as that of Muppet-creator Jim Henson can challenge the survival of an organization. In August 1989, Walt Disney Co. had announced plans to buy the licensing and publishing businesses of Jim Henson Productions and give Muppet creator Jim Henson an exclusive 15 year production arrangement. While affectionate speculations abounded concerning a possible love triangle between Mickey Mouse, the amorous Miss Piggy, and an ever elusive Kermit, negotiations continued with Disney offering a reported $150 million to $200 million.

Less than six weeks later, Brain Henson, Jim’s son, was named president of Jim Henson Productions, and Cheryl Henson, Jim daughter, was named vice president for creative affairs. My father had wonderful goals and wonderful dreams, Brain noted. And that was seen in virtually everyone in the company. So in some ways he is still there in everyone. We have lost our focus temporarily, but we will get that back right away, He is still there.

Brain recognized the important role his father played as the provider of the company’s creative inspiration. He therefore endeavored to protect his father’s vision, while at the same time, building the company. It is not one man’s vision, asserted Brain they are a company with a creative team at the top and his father built a company around him; He is spreading that.

The greatest challenge for Jim Henson Productions lay in figuring out how to be creative without Jim Henson. According to screenwriter Jerry Juhl this translated into “getting back to center”. You could deal with it corporately figure out offices and things like that.

But Jim Henson Productions was able to get back on track. Although the deal with Disney fell through, several joint projects continued, including a 3-D Muppet film and live stage show for the Disney theme parks, and Disney’s video arm introduced the Jim Henson Video label of Muppet programs on video cassette. In addition, in December 1992, the company released The Muppet Christmas Carol, its first feature film project.

Future plans for Jim Henson productions remain uncertain. This does not indicate failure. They still do not know where they are going to be three years from now. But that was always how it was operated, said Brian. He constantly wanted to see what felt fresh what new ideas came along. And then he would have the courage to try and see if the new idea worked. In this way, Brian has carried on the tradition of his father.