5/21/2011

Strategic Planning

In real life, strategy is
actually very
straightforward. Pick
a general direction
and implement like
hell.”
Jack Welch, Chairman
and CEO, General
Electric between
1981 and 2001

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5/21/2011

• “We have a strategic
plan, It´s called doing
things.”
Herb Kelleher, Cofounder and CEO of
Southwest Airlines
between 1971 and
2008

• “Strategy is 10 per
cent vision and 90
per cent
execution.”
Percy Barnevik,
CEO and
Chairman of
Asea Brown
Boveri between
1988 and 2002

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5/21/2011

Revolutionary Strategy
• When Strategic Planning isn’t Strategic
– It should not be just an annual ritual
– It should challenge the limits of industry
– It should harness the creative potential of a large
portion of the organization
– Planning is not the same as strategizing
– Planning is programming not discovering
– Strategy discovery is not incrementalism

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5/21/2011 Revolutionary Strategy • Principle 2 Strategy Making must be Subversive – Revolutionaries are subversive and enlightened – Be a rule maker not a rule taker Revolutionary Strategy • Principle 3 The bottle neck is at the top of the bottle – the top is where least diversity of experience lives – the top is where there is greatest investment in the past – the top is where there is great reverence in industry dogma 4 .

5/21/2011 Revolutionary Strategy • Principle 4 Revolutionaries exist in every Company/Organization – They are the maligned middle managers – Allow them to participate in the strategising process Revolutionary Strategy • Principle 5 Change is not the problem. Only a hero leader can lead change – The responsibility for change belongs to the entire organization not only the elite 5 . engagement is – Revolutionary strategies are killed by executive assumptions of …other people are against change…they are the one against change.

3.5/21/2011 Revolutionary Strategy • Principle 6 Strategy making must be democratic – Strategy creation must involve the entire organization – A process that facilitates participation of the creative power of the organization is key … Strategy Emerges as Innovation: 1. 4. New Passion will be founded on discovering wealth creating strategies. New perspectives or lenses will allow new insights 5. New voices must be allowed to participate 2. New experiments on many small low risk experiments will allow new strategies to emerge 6 . New conversations with new people must happen.

5/21/2011 Different forms of Strategizing • Strategizing is about setting institutional goals and finding the best means to achieve the goals • Strategies are the best means which an organization can achieve its desired ends ADAPTIVE STRATEGIZING 7 .

principles and ideologies • The Way of Doing things 8 . philosophies.5/21/2011 IDEOLOGICAL STRATEGIZING Ideological Strategizing • Organizations exist because they espouse a definite set of beliefs.

5/21/2011 Ideologically Driven Organizations • Have Strong cultures and Governing bodies • Strength in Numbers • Discipline • Protective Isolation • Low Profile when weak. High visibility when gaining strength CREATIVE STRATEGIZING 9 .

SEQUENTIAL AND ANALYTICAL STRATEGIZING TOP DOWN APPROACH VISION MISSION OBJECTIVES KEY RESULT AREAS PERFORMANCE INDICATORS 10 .5/21/2011 RATIONALE.

5/21/2011 SWOT ANALYSIS BOTTOM UP PLANNING STRATEGIES Opportunities (O) and Threats (T) EXTERNAL ENVIRONMENT ASSESSMENT OPERATING PLANS AND ACTION PROGRAMS Strengths (S) and Weaknesses (W) INTERNAL ENVIRONMENT ASSESSMENT ACTIVITIES & TASKS RESOURCES REQUIRED 11 .

5/21/2011 TOP DOWN APPROACH VISION MISSION OBJECTIVES KEY RESULT AREAS PERFORMANCE INDICATORS OPERATING PLANS AND ACTION PROGRAMS STRATEGIES ACTIVITIES & TASKS RESOURCES REQUIRED BOTTOM UP PLANNING SWOT ANALYSIS Opportunities (O) and Threats (T) EXTERNAL ENVIRONMENT ASSESSMENT Strengths (S) and Weaknesses (W) INTERNAL ENVIRONMENT ASSESSMENT VMOKraPISPATRes • • • • • • • • • • Vision Mission Objectives Key Result Areas Performance Indicators Strategies Programs Activities Tasks Resources 5 to 10 Year Picture of the future Reason for being / Purpose Direction / Measurable End Result Specific Manifestations objectives met Numerical Translation of KRAs Best Way s of Doing Things done by multi functional groups done by groups in a department done by individuals Human and Financial 12 .

5/21/2011 The Three Foundations • Environmental Analysis – What can or can’t be done • Internal Analysis – What we are able or unable to do • VMOKraPI – What we want or not want to do What influences What? • VMOKRAPI • Driven mostly by External Analysis • Answers …What • Driven mostly by Internal Analysis • Answers … How • SPATRES EA PI SPAT Res V M O Kra HR Org chart FR Budget IA 13 .

5/21/2011 Three Rules • Never use IA to determine Vision • Use IA to determine the near future Performance indicators but use EA to determine the 3rd to 5th year Performances • Use IA to determine the Human Resource and Financial Strategies PI SPAT Res V M O Kra HR FR Budget IA EA External Environment • Organization and/or Agenda Exists within an environment that impels 14 .

5/21/2011 Most Trend Spotters Late Trend Spotters Early Trend Spotters Stubborn Trend Stoppers Relevant Macro Environment Factors SOCIAL Demographics Structure of Society and Relationships 15 .

5/21/2011 TECHNOLOGICAL COMPETITIVENESS QUALITY GOODS AND SERVICES LOWER COST. ETC ECONOMIC All productive forces generated by capital. land and labor from both the formal and informal sectors of the economy 16 .

AND HABITATS WHICH MANY STAKEHOLDERS ARE COMPETING FOR • POLITICAL POWER STRUCTURES AND FORCES WHICH INFLUENCE AN ENVIRONMENT/S GOVERNANCE SYSTEM AND ITS EXTERNAL LINKAGES 17 .5/21/2011 ECOLOGICAL AN AREA’S NATURAL RESOURCES. ECOSYSTEMS.

CRITICAL THINKING a. MAGNITUDE. IMPORTANCE AND URGENCY 3. MAPPING THE TERRAIN 2. ANALYSIS SYNTHESIS CLASSIFY DATA DATA SIEVING CRITERIA OF RELEVANCE. Forecasting and Scenario Setting 10 Levels of Internal Assessment 18 .5/21/2011 TESTED TECHNIQUES IN ENVIROMENTAL ANALYSIS 1. c. b. d. Moving Through the Terrain (Strategies and Tactics 4.

or expertise in a specific subject area or skill set 19 . ability.5/21/2011 First Level of Assessment Performance Outputs and Outcomes • Objectives vis-à-vis mandates (VMG) • Result Based Performance Indicators Second Level of Assessment Competency of People (Capabilities and Capacities) • A core competency is fundamental knowledge.

5/21/2011 Third Level of Assessment Resources of the Organization • Resource Allocation and Utilization Fourth Level of Assessment Organization’s Management Processes • • • • • • • Planning and Budgeting Organizing and Staffing Evaluating and Monitoring Leading and Directing Coordinating and Orchestrating Controlling Compensation and Rewarding 20 .

client orientation and performance 21 . Method. Machine. People – Operations Function (5Ms): Material. attitudes. cohesiveness. Promo and Ad. ethics. Placement. Retooling. Product. Manpower – Human Resource Management Function • Recruitment. relationships. value systems. Recycling – Finance Function: Sources and Uses – Programs and Projects Sixth Level of Assessment • Teams and Individuals – – – – – – – – Management Styles. Price. Packaging.5/21/2011 Fifth Level of Assessment Major Programs and projects and Functions • Example in an enterprise – Marketing Function: 7Ps Positioning. Retaining. Management.

Networks. Working Conditions and Environmental Surroundings Eight Level of Assessment • Organizational Linkages. Partnerships and Communications – Good and Bad – Support and Detractors – Outsourcing partners.5/21/2011 Seven Level of Assessment • Physical Facilities and Set up. consortium partners 22 .

5/21/2011 Ninth Level of Assessment • Leadership and Top Management – Ability to set directions – Device Strategies – Implement Action Programs – Elicit support and performance from the staff – Make good and timely decisions – Articulate policies and guidelines – Establish a healthy organizational culture Tenth Level of Assessment • Strategic Fit or VOSP Consistency 23 .

Decision Making Implementing Programs Activities Tasks Motivating Evaluating Controlling Rewarding VISION MISSION OBJECTIVES KRAs PIs Structures Systems Resources Leading Staffing Relating Supporting Capabilities Attitudes PEOPLE How to Do Strategic Planning 24 .5/21/2011 STRATEGIES ORGANIZATION Planning.

(Gluck. Kaufman.. . .5/21/2011 Strategic Management • Strategic management is a systems approach to identifying and making the necessary changes and measuring the organization’s performance as it moves toward its vision. that links strategic planning and decision making with the day-to-day business of operational management. . and Walleck. . . system . management . • . . 1982) 25 . .

– implementation. – deployment.5/21/2011 • five processes of strategic management – pre-planning. The Strategic Management Model Pre-Planning Pre Planning Activities Strategic Planning Organizational Assessment Gap Analysis Mission Measurement And Evaluation Mission Vision Strategies Guiding Principles Objectives Strategic Foundations Develop Measureme nt Plan Vision Guiding Principles Resource Allocation Deployment Implementation Commuicate Progrss Track Status Take Actions Strateigc Goals Develop Action Plans Phase 2 Communicate the Plan Phase 1: Complete the Plan 26 . – strategic planning. and – measurement and evaluation.

5/21/2011 Questions The Animal Story 27 .

5/21/2011 The Animal Story The Animal Story 28 .

It’s something we do something about • Strengths are not enough to win • Good strategy brings everyone into Paradise • Good Strategy is participated in by everyone in the organization • No pain no gain • Small resource but big impact • Use natural things in the environment 29 .5/21/2011 Lessons in Visioning • Visions are founded in OTSW • Visions are articulated and shared with everyone in the organization Lessons in Strategy • Strategy is not something talked about.

divide the work and give orders. don't drum up the men to gather wood. Instead.Antoine de SaintExupéry 30 .5/21/2011 • "If you want to build a ship." . teach them to yearn for the vast and endless sea.