Strategic Initiatives

Launching the Strategy into Motion

Ali Divandari
The last piece in the puzzle
of using the
Balanced Scorecard as a
strategic management
system is the development
and prioritization of
initiatives that will help you
achieve your targets.
 In the previous sessions we described how to translate a strategy into strategic themes,
objectives, measures, and targets that represent what the organization wants to accomplish.
Strategic initiatives represent the HOW.
❑ Newton’s First Law applied
to organizations states that
an organization at rest will
remain at rest.
❑ Newton's Second Law
states that a force is needed
to accelerate a mass into
motion.

Strategic initiatives
represent the force that
accelerates an organizational
mass into action.
The authors’ survey of management practices indicates that 50
percent of organizations do not link strategy to short-term
plans.

60% of organizations don't link their financial budgets to strategic

priorities.
Initiatives are the specific programs, activities, projects, or actions
you’ll embark on to help ensure you meet or exceed your
performance targets.

Employee engagement, customer relationship management,

facilities upgrades, growth initiatives, and infrastructure
modernization are all examples of the projects.
Southwest Airlines
 Domino's Pizza
TurnAround Campaign
❑ Create awareness and strengthen
relationships with customer regarding
Domino's new recipe - Domino's has
heard your feedback and is doing
something about it.

❑ Change Attitude and behavior by

getting new customers interested in
trying the new pizza recipe and
winning back old customers lost to
their competition.
 Organizations use three processes to manage their portfolios of strategic initiatives:

Initiative
management
process
model
Four steps will lead us to prioritized strategic initiatives:

1. Perform an inventory of all current initiatives taking place within the organization right now.
2. Map those initiatives to the objectives of our Strategy Map.
3. Seriously consider eliminating nonstrategic initiatives, and develop missing initiatives.
4. Prioritize the remaining initiatives.
By mapping key initiatives to objectives, management can:

❑ Re-balance, fill “gaps” and rationalize initiatives to better support the strategy
❑ Allocate resources to those initiatives that best support the achievement of the strategy

Mapping Initiatives to Objectives

 Companies test the
alignment of their
initiatives to strategic
themes and objectives
 Half my initiatives
achieve strategic goals.
I just don’t know
which half.
A senior executive.
Many organizations now have a standard
initiative proposal template that includes
the following:

❑ Description of the initiative

❑ The strategic theme or objective it is
intended to support
❑ The expected results
❑ Resource, cost, and time
requirements
 Fund The Strategy

Establish a budget for strategic expenditures

(STRATEX) to fund the strategic initiative portfolios.
 STRATEX is designed to
enhance the intangible assets
that provide organizational
capabilities, such as training and
customer databases.

STRATEX funding is so important that it deserves

a separate authorized line item in the company's
internal budget or financial forecast.
Establish Accountability

Select theme owners and theme

teams to execute the portfolios
of strategic initiatives; review the
performance of strategic
initiatives in achieving targeted
results.
 A portfolio of
strategic initiatives
should be developed
for each theme
 A Mechanism for Theme
Ownership, Funding, and
Accountability

Most strategic themes are cross-

functional and cross-business-unit. They
do not, therefore, fall within the existing
responsibility of any senior executive.

For each strategic theme, a company will

generally assign one or two executive-
team members as theme owners, with
responsibility for overseeing execution of
their assigned theme in addition to their
“day jobs” as business or functional unit
heads.