STATE OF THE ART REPORT REINVENTING STRATEGIC PLANNING TO DELIVER CUSTOMER VALUE The Top 12 Common...

STATE OF THE ART REPORT

REINVENTING STRATEGIC PLANNINGTO

DELIVER CUSTOMER VALUE

The Top 12 Common Mistakes

Most Organizations Make

Using“The Systems Thinking Approach®”

OD NETWORK CERTIFICATION, JUNE 2007—PART I

2

FOUNDED 1990—OFFICES IN OVER 20 COUNTRIES

THE CENTRE’S GLOBAL MAP:“We Are The World Leader in Strategic Management

Powered by Systems Thinking”

A GLOBAL ALLIANCE OF

MASTER CONSULTANTS AND TRAINERS

3

WHO IS STEVE HAINES?

STEVE HAINESFounder & CEO:

Centre for Strategic Management® Systems Thinking Press®

Founded in 1990—38 Offices—20 Countries

STEVE is a:

“CEO—Entrepreneur—Global Strategist”and

“A Facilitator—Systems Thinker—Prolific Author”

(of 12+ books) A graduate of the US NAVAL ACADEMY’s

Legendary Leadership Class of 1968

4

BACKGROUND OF THISSTATE-OF-THE-ART BEST PRACTICES

REPORT

This Report is the result of a blend of three fundamental sources:

1. The Strategic IQ Audits that the Haines Centre does

2. Our Interpretation and Translation of Others Best Practices Research (We do not do original research ourselves-rarely paid for)

3. Our consulting practices around the world in over 20 countries

What do these #s represent as the “Natural Way the World Works”?

26 13 12 10

4 3 2

THESE ARE THE UNIVERSAL ORGANIZING FRAMEWORKS OF OUR LIVES!!!

5

SIMPLICITY YOU SEE

“EVERYTHING IS SIMPLE, YOU SEEBUT

YOU JUST HAVE TO SEE IT”

KEYS:1. Ask the #1 Systems Question: Clarity of Purpose/Goal?2. One piece of paper documents3. Rule of 3

CLARITY AND SIMPLICITY = SUCCESS

6

SIMPLICITY AND COMPLEXITY

“I wouldn’t give a fig for the Simplicity this side of Complexity (Simplistic)

ButI’d give my life for the Simplicity on the far side of

Complexity” (Elegant Simplicity)--Justice Oliver Wendell Holmes

SIMPLICITY AND GENIUS“Any idiot can simplify by ignoring the complications

ButIt takes real genius to simplify by including the

complications”--John Johnson (TEC Chair)

7

GREAT LEADERS

Great leaders know how to keep it simple . . .

"Great leaders are almost always great simplifiers,who can cut through argument, debate, and doubtto offer a solution everybody can understand." - General Colin Powell

Great leaders know how to keep it simple . . .

"Great leaders are almost always great simplifiers,who can cut through argument, debate, and doubtto offer a solution everybody can understand." - General Colin Powell

8

COMMON STRENGTHS OF MOST

ORGANIZATIONS

1. Strategic Plan and Document itself

2. The focus on Goals (Different Names)

3. The Continuity of the process-year after year

4. An Annual Review and Update of the Document

5. The focus on Mission, Vision and Core Values

6. A detailed list of Annual Actions that underlie the

Goals

7. The extensive use of Measures/Metrics-especially

financial

8. A highly committed Strategic Planning staff

YET, WHY DO ABOUT 75% OF ALL MAJOR CHANGES FAIL??

These Strengths are “Necessary but not Sufficient for Success”

9

SINGLULAR PLANNING AND CHANGE EFFORTS FAIL

A SINGLE AND ONE TIME INTERVENTION

WILL NOT CHANGE MUCH OF ANYTHING

EXCEPT FOR

ANOTHER SHORT TERM FIX

REAL CHANGE REQUIRES

MULTIPLE STRATEGIES

FOCUSED

ON CLEAR OUTCOMESOD Practitioner, May 2007

10

A NEW APPROACH PLANNING & CHANGE

IS REQUIRED IN THE 21ST CENTURY

THINK DIFFERENTLY—THINK STRATEGICALLYUse The Systems Thinking Approach®

LOOK FOR SYSTEMS SOLUTIONS TO SYSTEMS PROBLEMS (Not Analytic & Piecemeal Solutions to Systems Problems)

CLARITY AND SIMPLICITY = SUCCESS(Simplicity Wins the Game Every Time)

THIS IS WHAT THIS STATE OF THE ART REPORT IS ALL ABOUT(So Do Not Take These Best Practices Separately)

NEW APPROACH

NEEDED

THE 21ST CENTURY MACRO BEST PRACTICE:

11

LEADING STRATEGIC MANAGEMENT TO DELIVER CUSTOMER VALUE

StrategicStrategic PlanningPlanning

StrategicStrategicChangeChange

Strategic Strategic ThinkingThinking VALUE

12

COMMON SENSE

“IF NOTHING ELSE WORKS, THIS MAY BE A PERFECT

OPPORTUNITY TO USE COMMON SENSE.”

13

LOGISTICS

14

STRATEGIC PLANNING DEFINED

Is it:

An event?

A process?

A change in our roles?

A change in the way we run the business day-to-day?

What's your belief? Why?

ix

15

STRATEGIC MANAGEMENT DESIRED OUTCOMES-RESULTS

WHAT ARE YOUR DESIRED OUTCOMES-RESULTS? 1. Higher Profits?_______________________________

2. Greater Revenue? ____________________________

3. Lower Costs/Decrease? _______________________

4. Enhance Market Share? ________________________

5. Drive Competitive Advantage? ___________________

6. Increase Customer Service & Satisfaction? ________

7. Deliver Better Customer Value ___________________

8. Implement New Product/Service Offerings? ________

9. Growing Community/Society Reputation___________

10. Change the Employee Culture? ___________________

11. Execute a Merger or Acquisition? _________________

12. Enhancing our Commitment to the Community______

13. Develop Strategic Alliances or Partnerships? _______

14. Turn Around an Underperforming Business? _______

15. Enhance safety? _______________________________

16. Protect and Enhance the Environment? ___________

17. Decrease Waste/Simplify your Bureaucracy? _______

CASE STUDY

16

CRITICAL ISSUES LIST

What are the 3-5 most important Critical Issues facing you today as an organization regarding Strategic Planning?

1.

2.

3.

4.

5.

If Strategic Planning & Change is going smoothly, we're doing something wrong

(unless we have infinite resources).

Challenge the Obvious

CASE STUDY

17

FAILURE OF ENTERPRISE-WIDE STRATEGIC

CHANGE

MAJOR CHANGE FAILS 75% OF THE TIME:

WHY?

18

STATE OF ART BEST PRACTICES: STRATEGIC PLANNING # 1

“Begin with the end in mind”—Stephen Covey

FAILURE TO CLARIFY THE FUTURE AND YOUR

DESIRED OUTCOMES FIRST

PRACTICE#1

19

#1 KEYS TO SUCCESSFUL ORGANIZATIONAL RESULTS

#1 DAILY QUESTION:

Always ask the #1 Systems Thinking question (over and

over again):

“What are our desired results?”

“Begin with the end in mind.”

20

SYSTEMS THINKING

The Science of Living Systems

“The natural way the world works”

Backed by 50+ Years of Scientific Research

22

OUR LEVEL OF THINKING

Problems that are created by our current level of thinking can't be solved by that

same level of thinking.

—Albert Einstein

Problems that are created by our current level of thinking can't be solved by that

same level of thinking.

—Albert Einstein

So ...if we generally use analytical thinking,

we now need real “Systems Thinking ” to resolve our issues.

—Stephen G. Haines

So ...if we generally use analytical thinking,

we now need real “Systems Thinking ” to resolve our issues.

—Stephen G. Haines

23

THINK—PLAN—ACT—RESULTS

How you think

Is how you plan

Is how you act

And that

Determines the results you get in work and life

24

OUR COMPLEX WORLD TODAY!

25

COMPLEXITY – THE RUBIKS CUBE

"The Organization as a System"

From:Chaos &

Complexity

To:Elegant Simplicity

How to Start Moving:

26

GET A HIGHER AND BROADER PERSPECTIVE

Take a Helicopter View of Life!

27

A SYSTEM DEFINED

A SYSTEM :

IS A SET OF PARTS OR COMPONENTS

THAT WORK TOGETHER

FOR THE OVERALL OBJECTIVES

OF THE WHOLE

28

SYSTEMS THINKING BASICS

HOW WOULD YOU DRAW A SYSTEM—ANY SYSTEM????

29

SIMPLICITY OF SYSTEMS THINKING

Which question goes where?1. What do we do?2. What do we achieve?

Which is:The Means?The Ends?

Where should you start your thinking and planning for Change?

30

SIMPLICITY OF SYSTEMS THINKING

ENVIR

ONMEN

T

The Best, Most Holistic, Integrated, Organizing Framework There is!

31

THE SYSTEMSTHINKING APPROACH

Five Strategic Thinking Questions – In Sequence: PHASE A: Where do we want to be?

PHASE B: How will we know when we get there?

PHASE C: Where are we now?

PHASE D: How do we get there?

PHASE E: Ongoing: What will/may change in your environment in the

future?

vs. Analytic Thinking Which:1. Starts with today and the current state, issues, and problems.

2. Breaks the issues and/or problems into their smallest components.

3. Solves each component separately (i.e., maximizes the solution).

4. Has no far-reaching vision or goal (just the absence of the

problem).

32

STRATEGIC THINKING – ABCs TEMPLATE

“Clarify and Simplify Your Thinking” – About your Project___________________________________________________________________(Name of the Organization – Issue – Problem – Project – Change Effort,

etc Future Environmental Scan:What will be changing in your

future environment that will affect

us?

EE

CC DD

AASystem Throughput/Processes:How do we get there (close the gap from C A )?CC AA

___________Today’s Date

Feedback Loop/ Key Success Measurements: How will we know when we get there?

•

•

•

•

BB

Desired Outcomes- #1 System Question:Where do we want to be?

Strengths

•

•

•

•

• Threats

•

•

•

•

•

Weaknesses

•

•

•

•

• Opportunities1

• 2

•3

•4

•5

•4

•

•

•

•

•

___________Future Date•

•

•

•

•

Inputs (SWOT): CORE STRATEGIES: TOP PRIORITY ACTIONS: OUTPUTS/OUTCOMES:

Current State Assessment:Where are you now?

.

.

.

.

.

33

ORGANIZING FRAMEWORKSARE KEY

Give people the conceptual tools –

The integrated frameworks – models

to organize their evidence

– their experience – their learnings

Give people the conceptual tools –

The integrated frameworks – models

to organize their evidence

– their experience – their learnings

34

ORGANIZING FRAMEWORKS ARE KEY

Otherwise,

adults do NOT learn best

by doing things

Otherwise,

adults do NOT learn best

by doing things

35

ORGANIZING FRAMEWORKSARE KEY

The BEST conceptual, integrated ORGANIZING FRAMEWORK

that exists is

The Systems Thinking Approach®

because

“It is the natural way the world works”

– The world is composed of living/human systems

The BEST conceptual, integrated ORGANIZING FRAMEWORK

that exists is

The Systems Thinking Approach®

because

“It is the natural way the world works”

– The world is composed of living/human systems

36

SYSTEMS THINKING:50 YEARS OF SCIENTIFIC RESEARCH

FATHER OF SYSTEMS THINKING—LUDWIG von BERTALANFFY

1954-Society of General Systems Research—Three Nobel Prize Winners +LvB

Ken Boulding (Economics)—Anatol Rapoport (Math)—Ralph Gerard (Physiology)

Margaret Mead—Buckminster Fuller—James G. Miller

Abraham Maslow—Erik Erikson—Juan Piaget

Peter Drucker—Edward Deming—Russell Ackoff

Jay Forrester—Dick Beckhard—Steven Covey

Peter Senge—Margaret Wheatley—Barry Oshry—Steve Haines

37


MOS: “MORE OF THE SAME” = INSANITY

Due to lack of understanding of a

Yearly Strategic Management System and Cycle

PRACTICE#2

38

RATE OF CHANGE IN THE WORLD

“If the rate of change on the outsideexceeds

the rate of change on the inside,the end is near.”

—Jack WelchFormer Chairman and CEO

General Electric Corporation

“If the rate of change on the outsideexceeds

the rate of change on the inside,the end is near.”

—Jack WelchFormer Chairman and CEO

General Electric Corporation

39

THE ABCs OF STRATEGIC CHANGE MANAGEMENT

STRATEGIC PLANNING HAS BEEN REINVENTED:

IT IS NOW STRATEGIC CHANGE MANAGEMENT—FOUR COMPONENTS:

1. Planning

2. People

3. Leadership

4. Change

To Deliver Customer Value

SO. . . Strategic Change Management is the new way—A yearly cycle

onHow to ACHIEVE Business Excellence & Superior Results

40

THREE GOALSOF

STRATEGIC MANAGEMENT

GOAL #1: DEVELOPING STRATEGIC, BUSINESS, AND ANNUAL PLANS

(AND DOCUMENTS)

GOAL #2: ENSURING SUCCESSFUL IMPLEMENTATION

(AND ENTERPRISE-WIDE CHANGE)

GOAL #3:BUILDING & SUSTAINING HIGH PERFORMANCE

(YEAR AFTER YEAR)

THE DESIRED RESULTS: BUSINESS EXCELLENCE & SUPERIOR RESULTS

(YEAR AFTER YEAR)

41

REINVENTING STRATEGIC MANAGEMENT

• Planning • People • Leadership • Change •

1.PLAN

TO-PLAN

“BEGIN

HERE”

9. STRATEGY IMPLEMENTATION(AND ENTERPRISE-WIDE CHANGE)

CUSTOMERVALUE

10. ANNUAL STRATEGIC REVIEW(AND UPDATE)

8.PLAN-TO

IMPLEMENT

THE SYSTEMS THINKING APPROACHTM TO CREATING YOUR COMPETITIVE EDGE

C INPUTA OUTCOMES

FUTURE STATE“STRATEGIC CHANGE MANAGEMENT”

D PROCESSES

B. FEEDBACK

E

FUTURE

ENVIRONM

ENT

SCAN

2. IDEAL

FUTURE VISION

STATECURRENT

• ENV. SCAN

• VISION•MISSION•CORE VALUES•POSITIONING•RALLY CRY

• ALIGNMENT OF DELIVERY• ATTUNEMENT OF PEOPLE

3. KEY SUCCESS

MEASURES/GOALS 4. CURRENT STATE

ASSESSMENT

5. STATEGY

DEVELOPMENT

6. THREE-YEAR

BUSINESS PLANS

7. ANNUAL PLANS/

STRATEGIC BUDGETS

42

YEARLY STRATEGIC MANAGEMENT CYCLETHE SYSTEMS THINKING APPROACHTM

"Thinking Backwards to the Future"

B

C A

D

StrategicManagement

System (Yearly Cycle)

Your IdealFuture

Today

Vision, MissionAnd Values

Feedback/GoalsAnd

Measures

Strategies,Business Plansand Priorities

+++++++Actions, ChangeAnd Follow-Up

EFUTURE

ENVIRONMENT

SCAN

43

Operating ManagersMeeting (Boca)600 LeadersINITIATIVE LAUNCHCase for New InitiativeOutside Company Initiative ExperienceOne Year Search TargetsRole Model PresentationsRe-Launch of Current Initiatives

GENERAL ELECTRIC’S STRATEGIC MANAGEMENT SYSTEM

First Quarter

Second Quarter

Third QuarterFourth Quarter

January March

SeptemberOctober

February

August

April

November

June

DecemberJuly

May

• Intense Energizingof Initiatives AcrossBusinesses

Corporate Executive council:CEC at Crotonville35 Business and SeniorCorporate Leaders•Early Learning?•Customer Reaction?•Initiative Resources Sufficient?•Business Management Course (BMC) Recommendations

Anonymous OnlineCEO Survey:11,000 Employees•Do you “Feel”Initiated Yet?•Do your customers feel it?•Sufficient ResourcesTo Execute?•Messages Clear And Credible?

Leadership PerformanceReviews at BusinessLocations:All Business StaffsInitiative Leadership ReviewLevel of Commitment/Quality of Talent on InitiativesDifferentiation(20% / 70% / 10%)Promote / Reward / Remove

Corporate Executive Council:(CEC at Crotonville Locations:35 Business and SeniorCorporate LeadersInitiative Best PracticesLevel of commitment/Rev. of Initiative Leadership Customer ImpactBusiness ManagementCourse (BMC)Recommendations

Corporate Executive Council:(CEC at Crotonville)35 business and SeniorCorporate LeadersAgenda for BocaIndividual BusinessInitiative HighlightsBusiness Management(BCM) CourseRecommendations

Operating PlansPresented:All Business LeadersInitiatives Stretch TargetsIndividual BusinessOperating PlansEconomic Outlook

Corporate OfficersMeeting: (Crotonville)150 OfficersNext-Year OperatingPlan FocusRole Models PresentInitiative SuccessesExecutive DevelopmentCourse (EDC)RecommendationsAll Business Dialogues:What Have weLearned?

Corporate ExecutiveCouncil: (CEC at Crotonville)35 business and SeniorCorporate LeadersBusiness ManagementCourse (BMC)RecommendationsClear Role Models Identified Outside Company BestPractices PresentedInitiative Best Practices(All Businesses)Customer Impact of Initiatives

Informal IdeaExchanges atCorporate andBusinesses

Session 1: 3-Year StrategyEconomic / CompetitiveEnvironmentGeneral Earnings OutlookInitiatives Update/StrategyCustomer ImpactInitiative ResourceRequirements

44

ANNUAL STRATEGIC REVIEW (AND UPDATE)

START

Within a Strategic Management System and Yearly Cycle

The FlywheelAnd

The Rollercoaster

Strategic Management System

And Yearly Cycle

EE

DD

CC BB

AA

YEAR 1 YEAR 2 YEAR 3 YEAR 4

BU

SIN

ES

S E

XC

ELLEN

CE &

SU

PER

IOR

RES

ULTS

(Planning – People – Leadership – Change – Customer Value)

1

2

3

4

TIMELINE ANNUAL STRATEGIC REVIEWS

45

THE SINGAPORE CITY-STATESTRATEGIC MANAGEMENT

SYSTEMURBAN REDEVELOPMENT AUTHORITY (URA)

CONCEPTPLAN

-1971/2001

MASTER PLAN

-10 to 15 years

-

Supported by numerous Citizen involvement and Feedback

DD

DD

CCBB

AA

DEVELOPMENTIMPLEMENTATION

DEVELOPMENTCONTROL-Formal

Review 5 Years

LANDSTRATEGIC

MANAGEMENTSYSTEM

48


PHASE E: FUTURE ENVIRONMENTAL SCANNING (Versus SWOT of Today)

“SKEPTIC” FRAMEWORK IS THE NEW STANDARD

PRACTICE#3

49

SWOT FRAMEWORK

I. Internal to the Organization/department (In Here)

Strengths“Build On”

Weaknesses“Eliminate/

Cope”

II. External to the Organization/department(In the environment – Out There)

Opportunities

“Exploit”

Threats“Ease/Lower”

50

IMPORTANCE OF FUTURE ENVIRONMENTAL

SCAN

“The future is shaped

by those who see the possibilities

before they become obvious”

Straits Times

“The future is shaped

by those who see the possibilities

before they become obvious”

Straits Times

51

FUTURE ENVIRONMENTAL SCANNING (SKEPTIC)

52

FUTURE ENVIRONMENTAL SCANNING TEAMS

FORM “SKEPTIC” TEAMSScanning Area

S

K

E

E

P

T

I

C

Senior ManagementTeam Leader

Team Members(Max 6)

Goal: Quarterly one-page reports to the change leadership team by each team.

53

FUTURE ENVIRONMENTAL SCANNING / TRENDS

TODAY – IMPLICATIONS(Opportunities – Threats) SPONSOR

SKEPTIC – FUTURE SCANList the 5-10 environmental trends – projections

Facing you over the life of your plan

S S Socio-Demographics (People/Society):Socio-Demographics (People/Society):

K K Competition/Substitutes:Competition/Substitutes:

E E Economics:Economics:

E E Ecology:Ecology:

P P Political / Regulatory:Political / Regulatory:

T T Technical:Technical:

I I Industry / Supplier:Industry / Supplier:

C C Customers/Citizens:Customers/Citizens:

BACKWARDS THINKING

54


PHASE A: IDEAL FUTURE VISION PLATITUDES:(Form over Substance)

VISIONARY STATEMENT—VS. DETAILED BACK UP“Provider of Choice”“The best”“World-Class”“Best Value”“Value Added”

MISSION STATEMENT:Focus on Keeping it Short Vs. Meaningful:1. Who?2. What?3. Why?

PRACTICE#4

55

MISSION DEVELOPMENT TRIANGLE EXERCISE

2. Who We Serve(As our customers) - Geography - Segments - Names

3. What We Produce? (As outcome benefits) - Products - Services - Goods - Uses

1. Why We Exist? (If not already in vision statement) - Societal Need - Stockholder/Stakeholder Need

(Rallying Cry)

Positioning:

4. Our Driving Force

56

TIME FOR FORMALQUESTIONS AND ANSWERS

57

PRESENT LEARNINGS

1-2 MINUTES ONLY:

1-3 KEY LEARNINGS

HOW TO APPLY THEM IN YOUR CASE

CASE STUDY

58

TAKE A BREAK UNTIL NEXT WEEK

SESSION TWO NEXT WEEK

IN BETWEEN: IF YOU WANT MORE DETAIL AND FREE ARTICLES

ON ANY OF THIS, GO TO www.HainesCentre.com

THANK YOU

FOR YOUR PARTICIPATION

Stephen Haines

Founder and CEO

Haines Centre for Strategic Management

STATE OF THE ART REPORT

REINVENTING STRATEGIC PLANNINGTO

DELIVER CUSTOMER VALUE

The Top 12 Common Mistakes

Most Organizations Make

Using“The Systems Thinking Approach®”

OD NETWORK CERTIFICATION, JUNE 2007—PART iI

62

REVIEW OF LAST SESSION

63

A NEW APPROACH PLANNING & CHANGE

IS REQUIRED IN THE 21ST CENTURY

THINK DIFFERENTLY—THINK STRATEGICALLYUse The Systems Thinking Approach®

LOOK FOR SYSTEMS SOLUTIONS TO SYSTEMS PROBLEMS (Not Analytic & Piecemeal Solutions to Systems Problems)

CLARITY AND SIMPLICITY = SUCCESS(Simplicity Wins the Game Every Time)

THIS IS WHAT THIS STATE OF THE ART REPORT IS ALL ABOUT(So Do Not Take These Best Practices Separately)

NEW APPROACH

NEEDED

THE 21ST CENTURY MACRO BEST PRACTICE:

64


“Begin with the end in mind”—Stephen Covey

FAILURE TO CLARIFY THE FUTURE AND YOUR

DESIRED OUTCOMES FIRST

PRACTICE#1

65


MOS: “MORE OF THE SAME” = INSANITY

Due to lack of understanding of a

Yearly Strategic Management System and Cycle

PRACTICE#2

66


PHASE E: FUTURE ENVIRONMENTAL SCANNING (Versus SWOT of Today)

“SKEPTIC” FRAMEWORK IS THE NEW STANDARD

PRACTICE#3

67


PHASE A: IDEAL FUTURE VISION PLATITUDES:(Form over Substance)

VISIONARY STATEMENT FLUFF—VS. DETAILED BACK UP“Provider of Choice”“The best”“World-Class”“Best Value”“Value Added”

MISSION STATEMENT:Wrong Focus on Keeping it Short Vs. Meaningful:1. Who?2. What?3. Why?

PRACTICE#4

68

SESSION TWO BEGINS:STATE OF ART BEST PRACTICES:

STRATEGIC PLANNING # 5

MISSING AND MIS-UNDERSTOOD “MARKETPLACE POSITIONING”

(The PhD of Strategy)

POSITIONING TERMINOLOGY VS. A STANDARD DEFINITION

PRACTICE#5

69

CUSTOMER VALUE POSITIONING

POSITIONING IS CALLED MANY CONFUSING THINGS:

Driving Force Grand Strategy

Competitive Advantage

Competitive Edge

Strategic Intent Image

Reputation Brand Identity/Brand

STRATEGY USP

MEGA STRATEGY Value

Value Proposition Identity

Market Leader Value-Added

70

CUSTOMER VALUE POSITIONING

DEFINITION:

What is one thing that:

1. is unique, different and better about us

2. in the eyes of the customer

3. vs. the competition in the marketplace

4. that causes them to do business with us?

KISS: THIS IS NOT ROCKET SCIENCE

71

POSITIONING VS. THE COMPETITION

THE DILEMMA: WHERE ARE YOU ON EACH STAR POSITIONING FACTOR?

1. UNIQUE-DIFFERENT & BETTER THAN ALL THE COMPETITION(YOUR COMPETITIVE ADVANTAGE AND POSITIONING IN THE MARKETPLACE)

2. COMPETITIVE VS. THE COMPETITION (COMPETITIVE IN THE MARKETPLACE)

3. NONCOMPETITIVE VS. THE COMPETITON (UNCOMPETITIVE IN THE MARKETPLACE)

72

WORLD-CLASS STAR POSITIONING

YOUR COMPETITIVE BUSINESS EDGE - “VALUE PROPOSITION”

73


PHASE B: LINKING KEY SUCCESS MEASURES/GOALS: TO THE VISION, CORE VALUES & POSITIONING

(Vs. Enshrining Activities)

BALANCED SCORECARD OR QUADRUPTLE BOTTOM LINE

PRACTICE#6

74

KEY VS. COMPREHENSIVE MEASURES

THESE ARE:

KEY SUCCESS MEASURES (OUTCOMES/RESULTS) (STRATEGIC)

NOT

COMPREHENSIVE ACTIVITY METRICS (DATA)(OPERATIONAL)

MEASURE TEN OR LESS KEY SUCCESS RESULTS—

THEN, REDUCE THIS TO YOUR THREE MOST IMPORTANT RESULTS

(BHAG)

75

THE QUADRUPLE BOTTOM LINESM

BALANCE

The Systems Thinking ApproachSM to Key Success Measures (KSMs)

1. Employees

a. Operations

2. Customers

3. Stockholders (Owners)

4. Stakeholders (Community/Society)

Note:The popular “Balanced Scorecard” concept is not a systems approach, but it covers some of the same KSM areas that we do, especially 1,2, and 3.

76

Base Target

2006

KEY SUCCESS MEASURES CONTINUOUS IMPROVEMENT

MATRIX

KSM Overall Coordinator for Accountability is (Name/Title) _________________

(BACKWARDS THINKING)

KSM Areas (Headers)

Intermediate Targets

2007 2008 2009 2010

UltimateTarget

CompBenchmark

KSM Account

SpecificHeader:

Factors:

1.

2.

3.

Target

Goal2011

77


PHASE C: RITUALISTIC AND MEANINGLESS SWOT ANALYSIS(Vs. a Rigorous, in Depth, Best Practices Audit)

1. Future Environmental Scan —a Systems View— For OT(Implications of the Scan vs. the Scan itself)

PRACTICE#7

2. “Building on the Baldrige” —a Systems View— For SW

78

FUTURE ENVIRONMENTAL SCANNING / TRENDS

TODAY – IMPLICATIONS(Opportunities – Threats) SPONSOR

SKEPTIC – FUTURE SCANList the 5-10 environmental trends – projections

Facing you over the life of your plan

S S Socio-Demographics (People/Society):Socio-Demographics (People/Society):

K K Competition/Substitutes:Competition/Substitutes:

E E Economics:Economics:

E E Ecology:Ecology:

P P Political / Regulatory:Political / Regulatory:

T T Technical:Technical:

I I Industry / Supplier:Industry / Supplier:

C C Customers/Citizens:Customers/Citizens:

BACKWARDS THINKING

79

SWOT: STRATEGIC BUSINESS DESIGN

HOW TO CONDUCT THE STRENGTHS AND WEAKNESSES PART OF A SWOT?

80

SYSTEMS —THE INNER WORKINGS USING THE

BUSINESS EXCELLENCE ARCHITECTURETM

BEST PRACTICES:ENTERPRISE-WIDE ASSESSMENT

CREATINGTHE PEOPLE

EDGE

BUILDINGA CULTURE OFEXCELLENCE

REINVENTINGSTRATEGIC PLANNING

LEADINGENTERPRISE-

WIDE CHANGE

ACHIEVINGLEADERSHIPEXCELLENCE

BECOMINGCUSTOMERFOCUSED

ALIGNINGDELIVERY

CUSTOMERVALUE

B

C

D

E

A

BEST PRACTICESASSESSMENT

RESULTS

FUTUREENVIRONMENT

FEEDBACK LOOP

QUADRUPLE BOTTOM LINE

82


CONFUSION OF MEANS AND ENDS

(Regarding Goals, Objectives and Strategies)

PRACTICE#8

83

SYSTEMS THINKING ANDSTRATEGIC THINKING:

INPUTS MEANS ENDS

C D AMeans Ends

StrategiesActionsHow To

BehaviorsTasks

ActivitiesTactics

Work PlansThroughputs

Vision

Mission/Purposes

Values/Culture

What

Results

Outputs

Outcomes

Goals

Success Measures

Strategic Thinkers Focus on the relationships between means and

ends in their daily work.

“Begin with the End in Mind”

Inputs

Resources:PeopleMoney

EquipmentMaterials

TechnologyInformation

B

84


IMPORTANCE AND LACK OF SHARED CORE STRATEGIES(As Department Goals for ALL Departments/Units)

Three Shared Documents—not Two

PRACTICE#9

85

SHARED VISION AND VALUES

SHARED VISION AND VALUES ARE KEY—IN ALL MGMT. BOOKS

HOWEVER, THERE IS A THIRD “SHARED” DOCUMENT

THAT IS KEY TO:

1. STRATEGIC THINKING ON A DAILY BASIS (EAB)

2. EXECUTING AND CASCADING YOUR POSITIONING (DOWN AND ACROSS THE ENTIRE ENTERPRISE)

3. THE ONLY REASON FOR THE EXISTENCE OF YOUR ENTIREORGANIZATIONAL CHART

WHAT IS IT?

86

SHARED VISION AND SHARED VALUES —YES!

1. “The Business Glue ”—of an organization is for employee teamwork. The Shared Vision is usually too high a level. It is Shared Strategies across all departments/units that is also needed.

2. “The Social Glue ”--of an organization holds its culture together.

It is the Values that guide behavior and “How we do things around here.”

“The Glue ” is THE Decision Making Criteria:a. Social =Shared Values =How to do it?

b. Business =Shared Strategies =What to do?

IT IS SHARED STRATEGIES!!

87

GAP ANALYSIS: “BRIDGING THE GAP”

BB

DDCC AA

Means Ends!

CurrentState

AssessmentToday

IdealFuture Vision

Year xxxx

Strategies and PrioritiesThe purpose of having

strategies is

To keep yourself from being seduced

By something that is “nice to do.”

1. Core Strategies – “Bridging the Gap”

2. Strategic Action Items for Next YearPlus

Key Success Measures/Goals

Means

88

CORE STRATEGIES ARE LIKE THE WEBBING IN A CHAIR

“The Glue That Holds It All Together”

CEO

A D ECB

1. CORE STRATEGIES ARE CROSS FUNCTIONAL

2. CORE STRATEGIES

3. CORE STRATEGIES

4. CORE STRATEGIES

F u n c t i o n s - S i l o s: Business Unit Drivers

ENTERPRISE-WIDE DRIVERS:

89

STATE OF ART BEST PRACTICES: STRATEGIC PLANNING #10

FAILURE TO CASCADE STRATEGIC PLANS DOWN(To Three- Year Business Plans for all Units/Departments)

1. Business Units (Line Organization)

2. MFAs (Major Functional Areas)

3. MPAs (Major Program Areas-public?)

PRACTICE#10

91

LIVING SYSTEMS WITHIN LIVING SYSTEMS ON

EARTHNested and Interdependent Systems:

Systems within Systems within Systems

Boundaries and Inter-Connectedness:

Nothing exists in isolation—

Relationships are everything!

Boundaries and Inter-Connectedness:

Nothing exists in isolation—

Relationships are everything!

92

THE CASCADE OF

PLANNING/CHANGE

“Strategic ConsistencyAnd

Operational Flexibility”

LEADING TO

ENTERPRISE-WIDE RESULTS

93

“WORK PLAN” FORMAT(FOR FUNCTIONAL/DIVISION WORK PLANS)

# : Strategy/Goals:

YearlyPriority

#

Action Items Support/Resources

Needed

Who is Responsible

Who else to

Involve

When Done

How to Measure

Status

94


FAILURE TO CASCADE PLANNING AND ACCOUNTABILITY (To ALL Employees)

Performance Management System:

And the Recognition and Rewards System

PRACTICE#11

95

SCORECARD CASCADE—LINKAGE

The Cascade-Vertical Linkages

1 of 2

96

PERFORMANCE APPRAISALS...KISS

Tied to Strategic Planning

Performance Appraisals —must be tied to support ...

#1Your organization's Core Strategies

(i.e., results)

#2Your organization's Core Values

(i.e., behaviors)

and #3Their own learning and growth

(i.e., career development)

If you are serious about your Strategic Plan Implementation

97


LACK OF OWNERSHIP (BY Senior and Middle Management)

TWO EXTREMES:1. Private Sector—Low Involvement2. Public Sector—Too much Involvement

When does Change begin?

What is the PRIMARY job of Leaders today?

PRACTICE#12

98

THREE MAIN PREMISES

MAIN PREMISE #1 “PLANNING AND CHANGE ARE THE PRIMARYJOB OF LEADERS”

MAIN PREMISE #2“PEOPLE SUPPORT WHAT THEY HELP CREATE ”

MAIN PREMISE #3 USE SYSTEMS THINKING—FOCUS ON OUTCOMES—SERVE THE CUSTOMER!

99

PLAN-TO-PLAN DAY OVERVIEW

AM: EXECUTIVE BRIEFING:1. Educating

2. Assessing

TARGET AUDIENCE:Senior ManagementSenior Staff SupportBoard of Directors?Middle Management?Anyone is fine for AM

PM: PLAN-TO-PLAN TASKS3. Organizing

4. Tailoring

TARGET AUDIENCE:Senior Management Senior Staff Support

100

STATE OF ART BEST PRACTICES: NO #: JUST SIMPLICITY

CLARITY AND SIMPLICITY = SUCCESS

FINALBONUS

101

SIMPLICITY YOU SEE

“EVERYTHING IS SIMPLE, YOU SEEBUT

YOU JUST HAVE TO SEE IT”

KEYS:1. Ask the #1 Systems Question: Clarity of Purpose/Goal?2. One piece of paper documents3. Rule of 3

102

KEEP IT SIMPLE—IN STRATEGIC MANAGEMENT

SIMPLICITY WINS THE GAME EVERY TIME:

ONE PIECE OF PAPER DOCUMENTS:

1. ABCs of Strategic Thinking Template

2. Strategic Plan Trifold

3. Annual Plan Priorities (Cheat-Sheet—To Do List)

4. Key Success Measures Matrix (Continuous Improvement—

year/year)

5. Yearly Comprehensive Map of Implementation

SUMMARY:

THE STATE OF THE ART REPORT

104

CREATING CUSTOMER VALUEA Totally Integrated Systems

Solution"A THREE-PART STRATEGIC MANAGEMENT SYSTEM”

Part I - Goal #1: 20% Effort: Cascade of Planning

Phases E-A-B-C: Develop Plans and Documents

Step #1

•Environ Scan

•Executive Briefing

•Support Cadre Training

•Enterprise Assessmt

Steps #2-5

•Strategic Planning

•Customer- Focused

•Compet.• Strategy

•Leader. Develop. System

Steps #6-7

• 3-YearBus. Plans.• AnnualPlans &Budgets

• PersonalLdr. Plans

• HR MgmtSystem

Step #8

• EWC Game Pln

• Plan-to- Implemt.

• Capacity Building

• Blow-Out Bureauc.& Simplicity

Step #9

•CLT

• PMO

•Project Mgmt Teams

• Waves of Change

•Culture Change

Step #10

•Strategic IQ Audit

•Annual Strategic Review

• Capacity Building

• Creating Customer Value

Part II – Goal #2: 40% Effort: cascade of Change

Phase D: Ensure Successful Enterprise-Wide Change

SMART START:PLAN-TO-PLAN

STRATEGICTHINKING BUSINESS &

ANNUAL PLANS SMART START: PLAN TOIMPLEMENT

ENTERPRISEWIDE CHANGE SUSTAIN

RESULTSGoal# 3: 40% Effort: Year After YearRecycle

Phase E-A-B-C-D = Business Excellence

Superior Results

105

STRATEGIC & SYSTEMS THINKING—

A NEW WAY TO THINK

“Think Differently”

START THINKING ABOUT:

1 of 2

B

A

D

E

D

B

A

1. The Environment

2. The Outcomes

3. The Future

4. The Feedback

5. The Goals

6. The Whole Organization

7. The Relationships

(and

opportunitie

s)

(and results)

(and direction)

(and learning)

(and measures)

(and helicopters @ 5,000

feet)(and patterns)

106

STOP THINKING JUST ABOUT:

1. Issues and Problems

2. Parts and Events

3. Boxes/Silos

4. Single Activities of Change

5. Defensiveness

6. Inputs and Resources

7. Separateness

How we think ... is how we plan... is how we act

And that determines the results we get in work and life

STRATEGIC & SYSTEMS THINKING—

A NEW WAY TO THINK

107

PRESENT LEARNINGS

1-2 MINUTES ONLY:

1-3 KEY LEARNINGS

HOW TO APPLY THEM IN YOUR CASE

CASE STUDY

108

THE BOTTOM LINE

What we think,

or what we know,

or what we believe

is,

in the end,

of little consequence.

The only consequence ...

is…

what we do!

What we think,

or what we know,

or what we believe

is,

in the end,

of little consequence.

The only consequence ...

is…

what we do!

THANK YOU

FOR YOUR PARTICIPATION

Stephen Haines

Founder and CEO

Haines Centre for Strategic Management

STATE OF THE ART REPORT REINVENTING STRATEGIC PLANNING TO DELIVER CUSTOMER VALUE The Top 12 Common...

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