Some Concepts to Help the Development of a Strategic Planning April 2008 MĂĄrio LuĂs Tavares Ferreira
Strategic Planning
SWOT Internal Environment Strengths Weaknesses World class product Technical support Financial resources Internal processes Know-how Channels network External Environment Opportunities Threats Water & Energy crises Competitors market share Environment awareness Euro X Dollar Productivity improvement Technology development
TOWS matrix Strengths
Weaknesses
Opportunitie S-O strategies s
W-O strategies
Threats
W-T strategies
S-T strategies
S-O strategies pursue opportunities that are a good fit to the companies strengths. W-O strategies overcome weaknesses to pursue opportunities. S-T strategies identify ways that the firm can use its strengths to reduce its vulnerability to external threats. W-T strategies establish a defensive plan to prevent the firm's weaknesses from making it highly susceptible to external threats.
PEST analysis
A scan of the external macro-environment in which the company wants to operate (or operates) and can be expressed in terms of the following factors:
Political Economic Social Technological
Ninety ways to measure demand (6 x 5 x 3) Geographical Level
World Region Country Territory Client Total sales
Sector sales
Product Level
Company’s sales Product lines Product config Product items Short term
Medium term
Timing Level
Long term
Porter 5 Forces
Value Chain Innovation Process
Operation Process
Post Sales Process
Identification Identification of ofclient’s client’s necessities necessities Market products / Delivery identification products products / services and services creation services definition
Satisfaction Satisfactionof of Client’s Client’s necessities necessities
Services to the clients
Life cycle Sales
Sales & profit
Profit Invest & expenses
i Product ntr od development uc t
growth
io n
maturity
de cli ne
Boston matrix – Product life cycle
Directional policy matrix or GE-McKinsey matrix
The diameter of each pie is proportional to the Volume or Revenue accruing to each Segment, and the solid slice of each ‘pie’ represents the share of the market enjoyed by the Company.
S curve
Management
ď Ź
Management, control and evaluation
Keys of Success - Facts of Failure Deployment - Plan Completing Success Failure >Assign roles and responsibilities
>No accountability for deployment
>Establish priorities
>Too many goals, strategies, or objectives - no apparent priority
>Involve mid-level management as active participants
>Plan in a vacuum-functional focus
>Think it through - decide how to manage implementation
>No overall strategy to implement
>Charge mid-level management with aligning lower-level plans
>Make no attempt to link with day-to-day operations
>Make careful choices about the contents of the plan and form it will take
>Not being thorough-glossing over the details
Keys of Success - Facts of Failure
Deployment - Communicating Success
Failure
Assign roles and responsibilities
No accountability
Communicate the plan constantly and consistently
Never talk about the plan
Recognize the change process
Ignore the emotional impact of change
Help people through the change process
Focus only on task accomplishment
Keys of Success - Facts of Failure Implementing - I Success
Failure
Assign roles and responsibilities
No accountability
Involve senior leaders
Disengagement from process
Define an infrastructure
Unmanaged activity
Link goal groups
Fragmented accomplishment of objectives leads to sub-optimization
Phase integration of implementation actions with workload
Force people to choose between implementation and daily work; too many teams
Involve everyone within the organization
No alignment of strategies
Keys of Success - Facts of Failure Implementing - II Success
Failure
Allocate resources for implementation
Focus only on short term need for resources
Manage the change process
Ignore or avoid change
Evaluate results
No measurement system
Share lessons learned; acknowledge successes through open and frequent communication
Hide mistakes/lay blame; limited/no communication
Keys of Success - Facts of Failure Strategic Measurement - I Success Failure Assign roles and responsibilities
No accountability
Use measurement to understand the organization
Sub-optimization: focus only on efficiencies
Use measurement to provide a consistent viewpoint from which to gauge performance
Use measures that provide no real information on performance; use too many measures
Use measurement to provide an integrated, focused view of the future
Use measurement to focus on the bottom-line only
Keys of Success - Facts of Failure Strategic Measurement - II Success
Failure
Use measurement to communicate policy (new strategic direction)
Use measurement to control
Update the measurement system
Never review measures
Use measurement to provide quality feedback to the strategic management process
Fail to use measurement to make strategic, fact-based decisions; use only for control
Keys of Success - Facts of Failure Evaluation Success
Failure
Assign roles and responsibilities
No accountability
Recognize when to update the plan
Poor timing and not recognizing external forces
Modify strategic planning process to accommodate the more mature organization
Rigid application of strategic planning process; ignore lessons learned from previous efforts
Incorporate new leaders into the strategic planning process
Ignore impact of new leaders
Integrate measurement with strategic planning
Don't use measurement information
Use experienced strategic planning facilitators
Shortcut the process
Measurement and evaluation – BSC
Measurement and evaluation – BSC
Measurement and evaluation – BSC
Measurement and evaluation - BSC
Five disciplines – Peter Senge
Personal Mastery:
Aspiration involves formulating a coherent picture of the results people most desire to gain as individuals, alongside a realistic assessment of the current state of their lives today. Learning to cultivate the tension between vision and reality can expand people's capacity to make better choices, and to achieve more of the results that they have chosen.
Mental Models:
Reflection and inquiry skills is focused around developing awareness of the attitudes and perceptions that influence thought and interaction. By continually reflecting upon, talking about, and reconsidering these internal pictures of the world, people can gain more capability in governing their actions and decisions.
Five disciplines – Peter Senge
Shared Vision:
Establishes a focus on mutual purpose. People learn to nourish a sense of commitment in a group or organization by developing shared images of the future they seek to create, and the principles and guiding practices by which they hope to get there.
Team Learning:
Group interaction. Through techniques like dialogue and skillful discussion, teams transform their collective thinking, learning to mobilize their energies and actions to achieve common goals, and drawing forth an intelligence and ability greater than the sum of individual members' talents.
Five disciplines – Peter Senge
Systems Thinking:
People learn to better understand interdependency and change, and thereby to deal more effectively with the forces that shape the consequences of our actions. Systems thinking is based upon a growing body of theory about the behavior of feedback and complexity - the innate tendencies of a system that lead to growth or stability over time. To help people see how to change systems more effectively and how to act more in tune with the larger processes of the natural and economic world.
Project management - processes
Project management – a process
Project management – Process chain
Project management – risk analysis