You are on page 1of 129

Training Objectives

At the end of this training, participants will be able to: Know the difference between Conventional Management and Strategic Management. Understand what it means to think strategically. Understand the importance of Strategic Planning. Understand the relationship between Strategic Thinking and Strategic Planning. Outline the Strategic Planning Process. Know how to apply Strategic Thinking and Planning to their organization.
2

Dont curse the darkness light a candle


Chinese Proverb

Setting an example is not

the main means of influencing others, it is the only means.


- Albert Einstein

When people care deeply about their work, they dont need to be pushed into performing at their best.

in law, a man is guilty when he violates the right of another. In IEthics, he is guilty, if only he thinks of doing so
Immanuel Kant

A person who graduated, yesterday & stops studying today is uneducated tomorrow."
"

If you have your sight,

you are blessed. If you have insight, you are a thousand times blessed.
8

To do right is

wonderful. To teach others to do right is even more wonderful and much easier.

Self-pity is our worst enemy & if we yield to it, we can never do anything wise in this world
- Helen Keller
10

To be prepared is half the victory.


Miguel de Cervantes Saavedra
11

Treat people as if they were what they ought to be, & you help them to become what they are capable of being
- Johann Wolfgang von Goethe
12

The race is not always to the swift... but to those who keep on running.
13

Action may not always bring

happiness,
but there is

no happiness
without Action
- Benjamin Disraeli
14

Setting an example is not the main means of influencing others, it is the only means.
- Albert Einstein
15

The greatest discovery of our generation is that a human being can alter his life by altering his attitudes.
- William James

In order to be big, you have to think big. If you think small, you're going to be small.
- Emeril Lagasse

The mold of a man's fortune is in his own hands.


- Francis Bacon

If you do not believe in

yourself ... chances are nobody else will.

Being broke is a temporary

situation. Being poor is a state of mind.


- Mike Todd
Hastey kay fareeb main mut aa jouyio asad

Alam Tumam halqa dam I Khal haain

A unified, comprehensive, and integrated plan designed to ensure that the basic objectives of the enterprise are achieved. (Glueck, 1980:9) The pattern or plan that integrates an organizations major goals, policies, and action sequences into a cohesive whole. (Quinn, 1980)
A pattern of resource allocation that enables firms to maintain or improve their performance.

A good strategy neutralizes threats and exploits opportunities while capitalizing on strengths and avoiding or fixing weaknesses. (Barney, 1997:17)

Strategy is: A stream of decisions focused on a purpose. Looking long term. Capitalizing on change. Managing strategic risks. The creation of a unique and valuable position in your industry. Choosing what not to do. Creating a fit among an organizations activities.

Strategy is about finding a unique way to put the organizations activities (buying, selling, producing, hiring, firing, etc.) together that is hard or impossible for competitors to replicate and is valuable to customers.
43

Strategy is the larger vision in an organization that guides the plans for employees and managers. Strategy has its foundation in strategic thinking. It is the determination of the long-term goals and objectives of an organization and the courses of action and resources necessary for implementing these goals.

Strategic planning must anticipate unexpected events, randomness, and chaos to provide a good strategy.

44

Strategy involves envisioning & planning future. Means by which LT objectives achieved.

for

Business terms-represents broad formula of how org intends to succeed.

Details plan that needs to be followed to compete win.


Formulating strategy- continuous challenge, requiring evaluation of old practices & search for new ones.
Contd

45

Org Excellence

Marketing

Productivity

Technology

Strategy

46

Sustained, superior performance is attained by utilizing a combination of effective strategies and excellent execution

Strategy
Effective
Excellent
Long Term Success

Ineffective
Success Unlikely

Execution
Poor
Maybe successful For a while Failure

47

A company exhibits strategic intent when it relentlessly pursues an ambitious strategic objective & concentrates its competitive actions & energies on achieving that objective!

48

The very essence of Leadership is that you have to have a Vision. It's got to be a vision you articulate clearly & forcefully on every occasion.
Theodore Hesburgh, President of University of Notre Dame

Teamwork Stages of An Organization


Low >>>>>>>>>> Team Focus >>>>>>>>>> High
Stage 1 External Stage 2 Stage 3

Internal

Stage 1 Org -Low Team Focus


No vision, mission or strategic focus.

Organizational Goals unclear. Disorganized with individuals doing whatever they think is the best for them or their unit. Weak core or NO CORE Values. Customer is An Afterthought.

Stage TWO Org


Moderate Core Value Development & Team Effort

Some teams formed. Some training at the interpersonal level. No real sense of Mission toward Corporate Objectives. Customer is important but customer satisfaction is not the: Goal of all Subgroups. Upper management does not understand modern tools-- but pretends to anyway.

Stage THREE Org A Learning Community Shared Vision (e.g., Xerox). Effective Teamwork & Strategic Planning. Core Values important & Well integrated into the Companys Corporate Culture. Internal and External Customers important. Willingness to use Quality Management Tools. Sense that everyone: Succeeds or Fails Together.

Levels of Strategy-Making in a Diversified Company


Corporate-Level Managers Business-Level Managers

Corporate Strategy
Two-Way Influence

Business Strategies
Two-Way Influence

Functional Managers

Functional Strategies
Two-Way Influence

Operating Managers

Operating Strategies
54

Functional Strategies

Game plan for a strategically-relevant function, activity, or business process Details how key activities will be managed

Provide support for business Specify how functional objectives are to be achieved

strategy

55

Operating Strategies
Concern narrower strategies for managing grassroots activities and strategically-relevant operating units Add detail to business and functional strategies

56

Thinking Strategically
About. . .

STRATEGIC PLANNING

In essence, strategic management is about growing toward Accomplishing your organizational goals.

57

Strategic Thinking

What are our strengths?

Who are we and who do we want to be?

What do we do well?

58

Strategic Thinking

Focuses on finding and developing opportunities to create value, by encouraging creative dialogue among people who can affect a companys direction.

Strategic thinking is a way of understanding the fundamental drivers of an organization, and challenging conventional thinking about them in constructive dialog.

59

Clarity of Purpose
Be clear about: Your organizations mission Your organizations vision Your organizations values Your customers

Who your customers are. What their needs are. What value you add in meeting those needs. What skills are required to add that value.

Note: These should all be articulated in the organizations Mission Statement.

60

Missing activity at any org among Different activities require different approaches 5 Purposeful Activities
(Gerald Nadler)

1. Learning 2. Research 3. Planning and Design 4. Evaluation 5. Operating & Supervising

Important Thoughts
Planning is a Process, not an event. The norm is for Strategic Planning to Fail, because the way things are is very powerful! Planning takes time!

Strategic Panning in any Org

The Process of Developing Strategies to reach a defined Objective for Your org.
(Wikipedia)

Strategic Planning
Systematic process through which an org agrees on & builds commitment among stakeholders to priorities that are essential to its mission & are responsive to the environment.

Pre-Requisites to Planning
Senior leadership commitment Who will do what? What will each group do? How will we do it? When is the best time?

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

65

Strategic Planning is ongoing, not used just when considering major changes

Why Do Strategic Planning?

If you fail to plan, then you plan to fail be Proactive about the future

What is Strategic Planning?


A Long-term, Future-oriented Process of Assessment, Goal-setting, & Decision-making that: Maps an explicit path between Present & a Vision of the future. It relies on careful consideration of an org's Capabilities & environment, & leads to Priority-based resource allocation & Other Decisions.

Strategic Thinking & Planning Process of deciding the Optimal alignment between unlimited needs & Limited resources to achieve your Priorities.
Center for Organizational Effectiveness

Strategic Plan
A Program of Action, that addresses the Orgs Strategic issues (fundamental questions or challenges) & is driven by the orgs Vision/ mission/ purpose.

Good strategic planning allows an organization to develop a sustainable, competitive advantage.

How is sustained, superior performance attained?

71

What is Strategic Planning?

Process to establish priorities on what you will accomplish in the future Forces you to make choices on what you will do & what you will not do Pulls entire organization together around a single game plan for execution Broad outline On where resources will get allocated

Strategic Planning
Not easy stuff. Takes experience & knowledge to facilitate & participate. Can not be rushed. The approaches used can vary, but there are some essential parts.

Why is Strategic Planning Necessary?


Strategic planning is necessary to identify the organizations objectives/priorities and the means by which they shall be achieved.

1.

Planning strategically helps: Focus talents and energies. Assess and adjust direction in light of performance and a changing environment. Do a better job. Being strategic is to be clear about objectives, resources and expected results, and combining these in response to the wider political context in the long and medium term.
74

2.

The Strategic Planning Process


1. The strategic planning process asks managers to ask themselves what they want the future of their division, department, organization to be, or what they must do to ensure the desired future is achieved. Managers involved in the process may influence it by providing information and suggestions in their areas of responsibility.

2.

3.

Managers must know the process and results since their own departments objectives should be derived from the strategic plan.

Note: In high performance organizations, strategic planning never ends.


75

Fundamental Questions to Ask


Where are we now? (Assessment) Where do we need to be? (Gap / Future End State) How will we close the gap (Strategic Plan) How will we monitor our Progress (Balanced Scorecard)

What Strategic Planning is Not


One-off, brief activity Production of a document or report that nobody reads Tactical getting from A to B Affects and is engaged in by a single unit Something done by an individual Divorced from an orgs broader missions/goals Divorced from reality Reactive to the environment Operates under unrealistic assumptions

Strategic Planning
Is
Is not A dead document Day to day activities and operations A wish list Divorced from other plans and goals of the campus

Process To identify broad goals Stakeholder driven Responds to a defined and understood environment

In modern organizations, executives include every level of the organization in developing and implementing the overall strategy.

79

Strategic Planning
.

Strategic planning is a process that reviews market conditions, customer needs, competitive strengths and weaknesses, sociopolitical, legal, and economic conditions, technological developments, and the availability of resources to assist the organization in its planning for opportunities or threats.

80

Strategic Planning Process


Start
Get executive buy-in Environmental Scan

Assemble team and resources

Stakeholder Input

Stakeholder Buy-In

Executive Buy-In

Draft Plan

Plan

Implement Plan

Evaluation and Monitoring

Developing A Strategic Plan


To develop a strategic plan, you must think strategically. Start by answering three key questions:

1. Where are we now? Part of this can be answered by using financial analysis. Use other tools to assess what strategic resources, capabilities and core competencies you have.
2. Where are we going? If no changes are made, where will the organization be in 5 years? What about 10 years? Are the answers satisfactory? If not, what specific actions must be taken to ensure change?

3. How will we get there? Strategic planning is about doing things that fulfill the vision you have for the organization It is about goals and objectives and deciding what things need to be done.
82

Major Components of the C Strategic Plan / Down to Action


Vision
Mission Goals Objectives O1 AI2 M3 T1 AI3 O2 What we want to be Why we exist

omponents

Strategic Plan Action Plans Evaluate Progress

What we must achieve to be successful


Specific outcomes expressed in measurable terms (NOT activities) Planned Actions to Achieve Objectives Indicators and Monitors of success Desired level of performance and timelines

Initiatives
Measures

AI1

M1 M2 T1 T1

Targets
2/23/2013 12:38 PM

83

Contd

Planning process charts path to objectives & systems that will follow-up on performance. Many orgs mgrs-spend more energy on planning component of strategic planning than on strategizing. When this happens, they tend to lose sight of what they should be doing as opposed to what they have been doing.

84

Contd

Strategizing Entails Envisioning, brainstorming for ideas, thinking about future, & analyzing existing conditions & trends in society, industry, & marketplace. Result in vision, mission, & set of objectives that will set direction of org.
Contd

85

Operational Effectiveness vs. Strategy

Operational

Doing Things Right.


Effectiveness:

Strategy:

Doing the Right Things

86

Sustained superior performance should be the goal of every organization!

87

Assessment

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

88

SWOT Analysis
An analysis of a businesses internal & external Environments

SWOT Analysis

Strengths Weaknesses Opportunities Threats


2/23/2013 12:38 PM Matt H. Evans, matt@exinfm.com 90

Assessment

Strengths
Strengths Those things that you do well, high value or performance points Strengths can be tangible: Loyal customers, efficient distribution channels, very high quality products, excellent financial condition Strengths can be intangible: Good leadership, strategic insights, customer intelligence, solid reputation, high skilled workforce. Often considered Core Competencies Best Leverage points for growth without draining your resources

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

91

Weaknesses

Assessment

Weaknesses Those things that prevent you from doing what you really need to do Since weaknesses are internal, they are within your control. INCLUDE: Bad leadership, unskilled workforce, insufficient resources, poor product Quality, slow distribution and delivery channels, outdated technologies, lack of planning, . . .

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

92

Opportunities

Assessment

Opportunities Potential areas for growth & higher performance External in nature marketplace, unhappy customers with competitors, better economic conditions, more open trading policies, . . Internal opportunities should be classified Strengths Timing: May important for capitalizing on opportunities
2/23/2013 12:38 PM Matt H. Evans, matt@exinfm.com 93

Threats
Threats Challenges confronting org, external in nature

Assessment

Threats can take a wide range bad press coverage, shifts in consumer behavior, substitute products, new regulations, . . .

May be useful to classify or assign probabilities to threats.


More accurate you are in identifying threats, better position you are for dealing with sudden ripples of Change.
2/23/2013 12:38 PM 94

If an organizations strategic plan is properly executed, the scope, range, issues, and the time perspectives will differ from department to department, but all plans will be derived from the strategic plan and this will guide the achievement.

95

Change
It may be hard for an egg To turn into a bird. It would be a jolly sight harder for it to learn to fly while remaining an egg. We are like eggs at present, and you cannot go on indefinitely being just an ordinary decent egg. We must be hatched or go bad.
--C.S. Lewis

96

What Is Strategic Management?

Strategic management is about anticipating, driving, and capitalizing on change:

Anticipating:
Driving: Capitalizing:

seeing the future


shaping the future making the most of the future
97

Conventional Thinking vs. Strategic Management Thinking: Conventional


If it aint broke. . . Dont fix it.

Strategic Management:

If it aint broke. . . You havent looked hard enough. Fix it anyway!


Tom Peters - Thriving on Chaos
98

Thinking

The Strategic Management Cycle

Doing

Planning

99

Strategic Management - Where To Start?


In any strategic planning process, you must start by developing a Strategic Plan. A strategic plan is the roadmap that will take the organization from where it is today to where it wants to go in the coming years. Having a plan is as important to the organizations future as architectural plans are to building a home. Strategic Planning has its foundation on the statements that describe who we are, where we want to go, and how we will strive for our goals. They include:

Mission Statement Vision Statement Value Statement


100

Mission, Vision and Value Statements


Mission Statement: Serves to identify the overall purpose of an organization.
Identifies customers/stakeholders. Helps identify customer and stakeholder needs, expectations. Leads to the development of performance measures.

Miami-Dade Countys Mission:

"Delivering excellent public services that address our community's needs and enhance our quality of life."

101

Mission Statement:
Describes orgs purpose, customers, products or services, market, philosophy & basic tech. Specifies reasons for which business is established FP& Light Mission: To supply safe, reliable, reasonable priced electric service to its customers Provides: Foundation for establishing goals, plans, priorities, & work assignments.
Contd
102

Characteristics of a Mission Statement


Defines current business activities Highlights boundaries of current business Conveys Who we are, What we do, & Where we are now Company specific, not generic so as to give a company its own identity Companys mission is not to make profit ! Real mission is alwaysWhat will we do to make profit?

103

Mission, Vision and Value Statements


The Vision Statement:

The key to a Strategic Plan is the vision.


`

A vision is where we want to be, what we are working towards. It describes what we strive for everyday. Miami-Dade Countys Vision Statement:

Delivering Excellence Every Day

104

Planning Should Have

A Vision:
Future

Now Mission drives the work. Plan drives the action.


2/23/2013 12:38 PM 105

Strategic Vision

Where are do we want to go? What are the implications for our campus and organizational goals? What problems are we trying to solve? What problems should we be trying to solve?

2/23/2013 12:38 PM

106

Vision is the art of seeing things invisible. It's okay to lose sight of the shore as long as you don't lose sight of the inner course.

2/23/2013 12:38 PM

107

Vision

Components

How org wants to be perceived in the future what success looks like an expression of desired end state Challenges everyone to reach for something significant inspires a compelling future Provides a long-term focus for the entire organization

2/23/2013 12:38 PM

108

Your successful past will block your visions of the future.


- Joel Barker

Creating a better future starts with the ability to envision it.

2/23/2013 12:38 PM

109

Mission Statement

Components

Captures Essence of why the org exists Who we are, what we do Explains the basic needs that you fulfill Expresses the core values of the org Brief & to the point Easy to understand If possible, convey Unique nature of your org & the role it plays that differentiates it from others
2/23/2013 12:38 PM 110

An effective mission statement : Should be able to tell: Your org story and ideals in: Less than 30 seconds.

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

111

Vision Statement Examples


I have a dream. Martin Luther King, Jr.

By the end of the decade, we will put a man on the moon. John F. Kennedy
2/23/2013 12:38 PM 112

Mission, Vision and Value Statements


The Value Statement: Value statements are grounded in values, and define how people want to behave with each other in an organization. They represent an organizations highest priorities and deeply held driving forces. They are statements about how the organization will value customers, suppliers, and the internal community. They are an organizations core beliefs and behavior guidelines.

Values are also known as Core Values and as Governing Values, and Guiding Principles.

113

Mission, Vision and Value Statements


Miami-Dade County Value Statements or Guiding Principles:

Customer-focused and customer-driven. Honest, ethical and fair to all Accountable and responsive to the public. Diverse and sensitive. Efficient and effective. Committed to development of leadership in public service. Innovative. Valuing and respectful of each other. Action-oriented.

114

Vision

Vision is paramount component in core of strategy. Vision provides picture of different reality for future. Without vision business wanders aimlessly. Vision statement - answers question, What do we want to become? - business direction -LT view of what it wants to accomplish -who it wants to serve, & what it would like to be. Inspire of org to be committed & to work toward achieving future objectives.
Contd

115

Contd

Powerful visions of leading companies:


3M: Be innovative & satisfy our customer. Microsoft: Information at your fingertips. Florida Power & Light Company (FPL): We want to be best managed electric utility in USA. GE: To be no. one or two in every business. Fed Ex: When it absolutely, positively, must get there overnight, use FedEx. Oracle: Enabling information age.
Contd

116

Contd

FP & L Vision Statement say


During next decade we want to become best-managed electric utility in US & excellent company overall & be recognized as such. FPL, specifies period of time of one decade to realize visions.
Contd

117

Components

Goals
Describes a future end-state desired outcome that is supportive of the mission and vision. Shapes the way ahead in actionable terms. Best applied where there are clear choices about the future. Puts strategic focus into the organization specific ownership of the goal should be assigned to someone within the organization. May not work well where things are changing fast goals tend to be long-term for environments that have limited choices about future.

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

119

Components

Developing Goals
Cascade from top of Strategic Plan Mission, Vision, Guiding Principles. Look at your strategic analysis SWOT, Environmental Scan, Past Performance, Gaps . . Limit to a critical few such as 5-8 goals. Broad participation in development of goals: Consensus from above buy-in at execution level. Should drive higher levels of performance n close a critical performance gap.

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

120

Components

Examples of Goals
Reorganize entire org for better responsiveness to customers We will partner with other businesses, industry leaders, and government agencies in order to better meet the needs of stakeholders across the entire value stream.

Manage our resources with fiscal responsibility and efficiency through a single comprehensive process that is aligned to our strategic plan.
Improve the quality and accuracy of service support information provided to our internal customers. Establish a means by which our decision making process is market and customer focus.

Maintain and enhance the physical conditions of our public facilities.


2/23/2013 12:38 PM Matt H. Evans, matt@exinfm.com 121

Components

Objectives
Relevant - directly supports goal Compels org into action Specific enough so we can quantify n measure results Simple n easy to understand Realistic n attainable Conveys responsibility n ownership Acceptable to those who must execute May need several objectives to meet a goal
2/23/2013 12:38 PM Matt H. Evans, matt@exinfm.com 122

Components

Goals vs. Objectives


GOALS Very short statement, few words OBJECTIVES Longer statement, more descriptive

Broad in scope Directly relates to the Mission Statement

Narrow in scope Indirectly relates to the Mission Statement

Covers long time period (such as 10 years)


2/23/2013 12:38 PM

Covers short time period (such 1 year budget cycle)


Matt H. Evans, matt@exinfm.com 123

Examples of Objectives

Components

Develop a customer intelligence database system to capture and analyze patterns in purchasing behavior across our product line. Launch at least three value stream pilot projects to kick-off our transformation to a leaner organization. Centralize the procurement process for improvements in enterprise-wide purchasing power.

Consolidate payable processing through a P-Card System over the next two years.

Monitor and address employee morale issues through an annual employee satisfaction survey across all business functions.

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

124

Guiding Principles and Values


Every organization should be guided by a set of values and beliefs Provides an underlying framework for making decisions part of the organizations culture Values are often rooted in ethical themes, such as

Components

honesty, trust, integrity, respect, fairness, . . . .


Values should be applicable across entire org Values may be appropriate for certain best mgt practices best in Terms of Quality, Exceptional customer service, etc.

2/23/2013 12:38 PM

125

Examples of Guiding Principles & Values


We obey the law and do not compromise moral or ethical principles ever! We expect to be measured by what we do, as well as what we say.

Components

We treat everyone with respect and appreciate individual differences. We carefully consider the impact of business decisions on our people and we recognize exceptional contributions.

We are strategically entrepreneurial in the pursuit of excellence, encouraging original thought and its application, and willing to take risks based on sound business judgment.

We are committed to forging public and private partnerships that combine diverse strengths, skills and resources.

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

126

Examples of Guiding Principles & Values


We obey the law and do not compromise moral or ethical principles ever! We expect to be measured by what we do, as well as what we say.

Components

We treat everyone with respect and appreciate individual differences. We carefully consider the impact of business decisions on our people and we recognize exceptional contributions.

We are strategically entrepreneurial in the pursuit of excellence, encouraging original thought and its application, and willing to take risks based on sound business judgment.

We are committed to forging public and private partnerships that combine diverse strengths, skills and resources.

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

127

Examples of Guiding Principles & Values


We obey the law and do not compromise moral or ethical principles ever! We expect to be measured by what we do, as well as what we say.

Components

We treat everyone with respect and appreciate individual differences. We carefully consider the impact of business decisions on our people and we recognize exceptional contributions.

We are strategically entrepreneurial in the pursuit of excellence, encouraging original thought and its application, and willing to take risks based on sound business judgment.

We are committed to forging public and private partnerships that combine diverse strengths, skills and resources.

2/23/2013 12:38 PM

Matt H. Evans, matt@exinfm.com

128

Summary
In essence Strategic Thinking and Planning involve several factors:

Thinking long term Understanding the organizations vision Understanding the organizations mission Understanding the organizations values Knowing who is going to do what Organizing for action Implementing strategy for action Evaluating progress Continuous improvement

129

Applying These Steps to Your Situation


1. Confront the brutal facts of your situation. Ask yourself the tough questions. Is your department or organization meeting its business goals? Are revenues growing, flat, or declining? Is the organization profitable?

2.

3.

Is there clarity of purpose? Is the direction realistic? Be willing to make major changes. Does the department or organization have a competitive advantage?
Does the department or organization have distinctive competencies in the skills critical for success?
130

4.
5.

Putting Theory Into Practice


1. 2. 3. Start by formulating the time-bound objectives of a program, activity, or action (including identifying comparative advantages for the organization). Establish clear relationships to the organizational strategic objectives (i.e. organizations mission and vision). Specify relationships of your programs or activities to the organizations development goals.

4.
5.

Formulate expected results, together with indicators (especially where results are of a qualitative nature).
Formulate a strategy to attain objectives.

6.
7.

Specify the resources and inputs required (in terms of staff, external advice, and funds).
Specify extent of desirable extra budgetary support.
131