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strategic Challenges and Performance Improvement



Strategic challenges abound for any management team, and the management system must allow decision makers to keep pace with the daunting task of meeting the company’s daily challenges. A poignant example of a company that was presented with a serious strategic challenge is Yum! Brands, which acquired the Pizza Hut company after it was shed by parent corporation Under PepsiCo, the company culture centered on competitive, fast-moving managers eager for quick growth. Under Yum! Brands, the culture had to change its focus to concentrate on the staid, reliable, and mundane workings of a restaurant. The need to communicate the new culture and to place new emphasis on the restaurant and food service business immediately challenged company leaders to change corporate attitudes. The company struggled with the changeover, but the primary tool for effecting that change was the management system and its built-in methods for communicating the new culture. The new Yum! way of doing business was communicated to every employee via a management system designed to reach all levels of employees.

Linked tightly with both strategic challenges and the management system are performance improvement challenges. Rarely are strategic challenges unrelated to improving a company’s performance. To meet challenges effectively, studies have shown that the management system must be implemented so as to be sustainable and “linked to the overall enterprise strategic plan” Making a continuous bid for improvement is also the challenge of the top management, regardless of how well automated systems are integrated. To make permanent and effective improvements, both aspects must interplay successfully .Stakeholder Groups

The management system should be designed to provide a balance among the stakeholders and to show how the differing needs of stakeholders can affect the financial well-being of the company Many times the needs of different groups, although each is independently of value to the company, can conflict unless compromises are struck among different factions. The management system has a major role in providing information on where to build those compromises.Customers and Users

The customers or end-product users of any company’s product can be the largest of the stakeholder groups. Customers must be an integral and perhaps driving force behind the design of a management system, because the company must be able to retain and access as much information as possible about the customer base. The implications for management system design are huge, especially with a sizable company. Companies are themselves linked inexorably to their computer systems, and the information systems that run the organization have to be scaled for the size of the user base, which can vary from dozens to thousands of people. The design of the databases and local area networks alone can cost millions, and if the systems are not designed to accommodate the user base, it can literally shut down the enterprise. Companies that cannot satisfy their customer base simply because the management system does not provide the right means of communication can easily disappear in a market that offers customers a number of other choices. However, the system must also provide an equitable interface with the producers of the product line—the employees.