BECOMING A STRATEGY-FOCUSED ORGANIZATION...implementing a strategy execution system, over several...
Transcript of BECOMING A STRATEGY-FOCUSED ORGANIZATION...implementing a strategy execution system, over several...
BECOMING A STRATEGY-FOCUSED
ORGANIZATION
Presented by
Paul Kenny
Chief Executive Officer
June 16, 2011
We had the distinction of being the first Asia Pacific representative
from the food & beverage industry
In 2010, MFG was inducted into Palladium Balanced Scorecard Hall of
Fame for Executing Strategy™
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Who Are We
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Owns, operates or
franchises more than
10 brands and a
profitable system of
1148 restaurants, in
15 countries across
Asia Pacific
Minor Food Group (MFG) is Thailand’s
largest QSR operator with a combined
33% share of the QSR market
In 2010, MFG’s system of company owned
and franchised restaurants served more
than 88 million customers and generated
sales of THB21.4 billion
100% owned
subsidiary of Minor
International, listed
company on The Stock
Exchange of Thailand
We were inducted for exemplifying these Strategy-Focused
Organization principles
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1. Mobilize change through
executive leadership
2. Translate strategy
to operational terms3. Align the organization
to the strategy
4. Motivate to make
strategy everyone's job 5. Govern to make strategy
a continual process
Financial measurements as key performance measures were no longer enough
The change catalyst – Thailand’s financial crisis in 1997
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Ideas on how to translate strategy into actions
Tested some ideas
Confirmed the need for change
An eye-opener – “The Balanced Scorecard”
Our top leadership team were convinced of the need for change
We then engaged several small consultancies to work on implementing a strategy execution system, over several years
Securing top leadership buy-in
It turned out to be a poor investment of time and efforts – example of a complex chart that defeats understanding!
If at first you don’t succeed…
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China
Middle East
SEA
2007
• 7 Brands
• 676 Outlets
• 8 Countries
2007
• 7 Brands
• 676 Outlets
• 8 Countries
Meanwhile, the business was becoming more complex due to rapid
expansion
In 2007, we engaged Palladium to embark on our journey to become a strategy-focused organization
Palladium started working with one of our Brands
Learning #1: Engage the right professionals to improve chances of
implementation success
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(Their logo sums it up.)
Learning #2: Total commitment from the CEO is critical for success
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The buck stops here!
We used our strategic framework (adopted from the 6-step Execution
Premium) to work with the Brand
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Develop Corporate Strategy
Align Brand Strategy
Link with Organization
Cascade to Individual Control and Learn
Execution
Functional Plan
(Operational)
1
2
3
4 5
Individual Plan
Corporate Strategy &
Plan
Brand Budget Book
(Strategy & Plan)
Company vision/mission
Strategic analysis
Strategic formulation
Performance measure and
target
Brand vision/mission
Strategic analysis
Strategic formulation
Performance measure and
target
Functional focus
Initiative definition including
work plan and milestones
Performance measure and
target
Individual action plan
including milestones
Performance measure and
target
Personal development plan
Corporate performance
review
Brand performance review
Functional performance
review
Individual performance
review
Learning #3: Be prepared for implementation challenges
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“This is a waste of time!”“This is a waste of time!”
F
inance
C
usto
mer
In
t.P
rocess
In
t.P
rocess
L &
G
Sales
100% Customer Satisfaction
Product
CleanlinessServices
Quality
QSC Checklist
QSC is one part of Operation Excellence Training
Sample QSC training
materials and in-store QSC checklist.
Increase Customer LoyaltyIncrease Customer Frequency
Profits
Learning #4: Analyze the organization culture to find solutions
Sustain Growth of Sustain Growth of Thailand BusinessThailand BusinessSustain Growth of Sustain Growth of Thailand BusinessThailand Business
Transform Transform International International FranchisingFranchising
Transform Transform International International FranchisingFranchising
Drive Growth through Drive Growth through Strategic Acquisition Strategic Acquisition
and Alliance and Alliance
Drive Growth through Drive Growth through Strategic Acquisition Strategic Acquisition
and Alliance and Alliance
Develop and Deploy Global Functional System
Create and Execute Operational Excellence (OE)
Build Human Capital and Develop Partner Management Capabilities
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Vision To be A Global Integrated Operator of
Multiple Food Brands with the objective of
providing 100% satisfaction to all stakeholders
Vision To be A Global Integrated Operator of
Multiple Food Brands with the objective of
providing 100% satisfaction to all stakeholders
Transform China into Our Key Growth MarketTransform China into Our Key Growth Market
We changed to a top-down approach, where we defined the Group’s 5-year Strategic Direction and cascaded it the business units
Learning #5: Be flexible and adapt the approach
F
inance
C
usto
mer
In
t.P
rocess
In
t.P
rocess
L &
G
Sales
100% Customer Satisfaction
Product
CleanlinessServices
Quality
QSC Checklist
QSC is one part of Operation Excellence Training
Sample QSC training
materials and in-store QSC checklist.
Increase Customer LoyaltyIncrease Customer Frequency
Profits
Once again, Operations Excellence was the “link” that connected
successfully with our operations-oriented team
Learning #6: Change how the business is managed to change mindset
Fortnightly Brand
Meeting
Weekly Support
Function MeetingMonthly Excom*
Meeting
Quarterly Business
Review (3 days)
* (Executive Committee)
Answers to 3 questions:
• What are our Goals?
• Where do we Play?
• How do we Win?
Result- Oriented and
Strategy-Focused
Result- Oriented and
Strategy-Focused
Established an Office of Strategy Management (OSM) that reports directly to the COO, with direct access to the CEO
Resource to govern and sustain the process of strategy management in the organization
Learning #7: Govern to make strategy a continual process and instil
discipline
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CEO
COO
Office of Strategy Management (OSM)
Finally, our breakthrough results from 2007-2009 are a testament that
the system works!
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Financial Customer
Learning & Growth
Internal Process
BSC
• NPAT: 530M THB – increase of
72%
• Combined sales: 19,338M THB
– increase of 123%
• Number of outlets: 1,112 outlets
– increase of 65%
• NPAT: 530M THB – increase of
72%
• Combined sales: 19,338M THB
– increase of 123%
• Number of outlets: 1,112 outlets
– increase of 65%
• Talent retention: 95% –
increase of 21%
• Succession planning –
number of identified leaders
per position for executive
team and middle
management: 3 – increase
from 1 candidate to 3
candidates for each position
• Employee satisfaction survey
results: 90% - increase of 5%
• Talent retention: 95% –
increase of 21%
• Succession planning –
number of identified leaders
per position for executive
team and middle
management: 3 – increase
from 1 candidate to 3
candidates for each position
• Employee satisfaction survey
results: 90% - increase of 5%
• Total customers: 101,736,000 –
increase of 29%
• MC (Mystery Customer) survey
results: 97% - increase of 5%
• Brand perception index:
• The Pizza Company: 100% -
increase of 5%
• Swensen’s: 100% - increase of 6%
• Sizzler: 94% - increase of 7%
• Total customers: 101,736,000 –
increase of 29%
• MC (Mystery Customer) survey
results: 97% - increase of 5%
• Brand perception index:
• The Pizza Company: 100% -
increase of 5%
• Swensen’s: 100% - increase of 6%
• Sizzler: 94% - increase of 7%
• Franchise satisfaction score:
93% – increase of 22%
• Quality/Service/Cleanliness
score: 92% – increase of 4%
• Supply chain delivery KPI –
In Full On Time %: 97% -
increase of 4%
• Franchise satisfaction score:
93% – increase of 22%
• Quality/Service/Cleanliness
score: 92% – increase of 4%
• Supply chain delivery KPI –
In Full On Time %: 97% -
increase of 4%
And it can only be achieved with partnership and teamwork –
Palladium and MFG Teams at the 2010 Hall of Fame award ceremony
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THANK YOU