Strategic Planning PDF

6/12/20 Strategic Planning — A strategy is is the pattern of decisions that Strategy and Performance Excellence MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 9e, © 2014 Cengage Publishing determines and reveals an organization’s goals, policies, and plans to meet the needs of its stakeholders.. —...

6/12/20 Strategic Planning — A strategy is is the pattern of decisions that Strategy and Performance Excellence MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 9e, © 2014 Cengage Publishing determines and reveals an organization’s goals, policies, and plans to meet the needs of its stakeholders.. — Strategic planning is the process of envisioning the organization’s future and developing the necessary goals, objectives, and action plans to achieve that future. 1 1 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 2 Key Practices for a Strategic Focus on Performance Excellence (1 of 3) Cargill Corn Milling 1. Where to Play—Which customers? Which segments? Which geographies? Which products? Where on the value chain? 2. How to Play—How much focus on each decision of where to play versus the other? What degree of strategic alliance at each step of the value chain? What value proposition to each customer segment? 3. What resources are needed to play—What capabilities do we need? What processes do we need? What is the ideal organizational structure? What skills do we need? 4. When to play—When is the right time to make our move? © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. — Understand the organization’s operating environment and its key relationships with customers, suppliers, partners, and stakeholders. — Understand the competitive environment, the principal factors that determine success, the organization’s core competencies, and strategic challenges—business, operational, and human resource-related— associated with organizational sustainability. — Gather and analyze relevant data and information pertaining to such factors as the organizations strengths, weaknesses, opportunities, and threats; emerging trends in technology, markets, customer preferences, competitions, and the regulatory environment; long-term organizational sustainability; and the ability to execute strategic plans. 3 3 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 4 4 Key Practices for a Strategic Focus on Performance Excellence (2 of 3) Key Practices for a Strategic Focus on Performance Excellence (2 of 3) — Develop and refine a systematic approach for conducting strategic planning and setting strategic objectives, including identifying blind spots, leveraging strengths, and addressing challenges over appropriate time horizons. — Develop and align short-term action plans with long-term strategic objectives, ensure adequate resources and the ability to sustain outcomes, assess financial and other risks associated with the plans, and communicate them throughout the organization. — Identify key measures or indicators for tracking progress on action plans, ensure that the measurement system reinforces organizational alignment, and project performance of these key measures compared with competitors or comparable organizations to identify gaps and opportunities. — Determine the organization’s core competencies, and understand how they relate to the mission, competitive environment, and strategic objectives. — View the work performed within the organization as a system, and make rational decisions about the mix of internal and external work processes that can best achieve the organization’s mission. — Derive human resource plans required to accomplish longer-term strategic objectives and shorter-term action plans that address the potential impacts on the workforce and potential changes to workforce capability and capacity needs. © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 5 2 5 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 6 6 1 6/12/20 Quality Profile: Freese and Nichols, Inc. Quality Profile: Premier, Inc. — Hedgehog Concept (the single thing that the organization — Largest health care alliance in the United States. — Premier’s “Big Hairy Audacious Goal” is for its member aims to do well): Be the very best at client service, resulting in long-term mutually beneficial relationships. — Comprehensive, year-long strategic planning process to identify key focus area indicators, critical actions, and balanced scorecard measures. — “Catch-ball” process to cascade plans to divisions, groups, and individuals to ensure that resources are committed and agreed-upon strategies are implemented. © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. hospitals to deliver the best, most cost-effective care in the nation and for the alliance to have a major influence on reshaping health care. — The company’s customers, who are also its owners, work closely with Premier and its employees to achieve their mutual goals. — Leadership role in promoting best practices in ethical conduct, transparency, and accountability within its own organization and throughout the industry. 7 7 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 8 8 Strategic Planning Process at Eastman Chemical Company Strategy Development — The goal of strategy development is envisioning the future for purposes of decision making and resource allocation. — Effective strategy development requires a systematic process that involves participation by all necessary stakeholders, ensures that relevant and important data and information are captured and analyzed, addresses both short- and longterm time horizons, addresses key strategic challenges, and leads to innovation and sustainability. © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 9 9 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 10 10 Strategic Planning Process at Park Place Lexus Mission — The mission of a firm defines its reason for existence; it answers the question “Why are we in business?” — Freese and Nichols: Innovative approaches … practical results … outstanding service. — Premier, Inc.: To improve the health of communities. — Benefits — guides the development of strategies — establishes the context within which daily operating decisions are made and sets limits on available strategic options — governs the trade-offs among the various performance measures and between short- and long-term goals — inspire employees to focus their efforts toward the overall purpose of the organization © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 11 11 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 12 12 2 6/12/20 Vision Values/Guiding Principles — Values, or guiding principles, guide the journey to a vision by defining attitudes and policies for all employees, which are reinforced through conscious and subconscious behavior at all levels of the organization. — Freese and Nichols: — The vision describes where the organization is headed and what it intends to be; it is a statement of the future that would not happen by itself. — A good vision statement should be brief, focused, clear, and inspirational to an organization’s employees. — Premier: Premier’s Owners will be the leading health care — Premier systems in their markets, and, with them, Premier will be a major influence in reshaping health care. — Freese and Nichols: Be the firm of choice for clients and employees. © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 13 13 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 14 14 Baldrige Organizational Profile Environmental Assessment — …a list of key questions that helps an organization summarize the elements of an environmental assessment. — provides a frame of reference to help an organization better understand the internal and external factors that shape its operating environment, and set the context for strategic planning. — addresses the basic characteristics of the organization, organizational relationships, the competitive environment, the advantages an organization has and the challenges that it faces, and its approach to performance improvement. — Key factors to assess: — The organization’s strengths, weaknesses, opportunities, and threats (SWOT) — Early indications of major shifts in technology, markets, customer preferences, competition, or the regulatory environment — Long-term organizational sustainability — The ability to execute the strategic plan © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 15 15 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 16 16 Strategic Challenges at North Mississippi Medical Center Strategic Challenges — …those pressures that exert a decisive influence on an organization’s likelihood of future success. — PEOPLE—Maintain and enhance our employees’ satisfaction, skills, and engagement. Recruit and retain skilled staff. Develop staff and physician leaders. — Examples: — operational costs — the introduction of new or substitute products or services — SERVICE—Increase our patients’ and physicians’ satisfaction. Enhance our patient–customer loyalty. — QUALITY—Provide high level, evidence-based, quality care and maintain patient safety. — FINANCIAL—Generate the financial resources necessary to support the organization in an environment of reimbursement pressures and increasing charity care. — rapid technological changes — GROWTH—Continue to expand in areas consistent with our Mission. — expanding or decreasing markets — mergers or acquisitions both by the organization and by its competitors — economic conditions — the cyclical nature of the industry — new competitors entering the market. © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 17 17 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 18 18 3 6/12/20 Strategy Deployment Developing Strategies — …involves developing specific action plans to achieve strategic objectives, ensuring that adequate financial and other resources are available to accomplish the action plans, developing contingencies should circumstances require a shift in plans and rapid execution of new plans, aligning work unit, supplier, or partner activities as necessary, and identifying performance measures for tracking progress. — Links the planners (who focus on “doing the right thing”) with the doers (whose focus is on “doing things right”). — Strategies are broad statements that set the direction for the organization to take in realizing its mission and vision. — Strategic objectives are what an organization must change or improve to remain or become competitive. — Action plans are things that an organization must do to achieve its strategic objectives. © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 19 19 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 20 20 Reasons for Poor Deployment Hoshin Kanri (Policy Deployment) — Lack of alignment across the organization. — Good deployment aligns resources and policies. — Misallocation of resources. — Good strategic planning dedicates resources to making improvements or changes in those areas that are critical to an organization’s strategic advantage. — Insufficient operational measures. — Organizations need appropriate measurement systems at the operational level to track progress and know if action plans are really accomplishing their objectives. — Literal Japanese translation of hoshin kanri is “pointing direction.” — The idea is to point, or align, the entire organization in a common direction. — In the U.S., often called policy deployment or management by planning. — Emphasizes organization-wide planning and setting of priorities, provides resources to meet objectives, and measures performance as a basis for improving performance. © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 21 21 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 22 22 Policy Deployment Process Strategic Human Resource Plans — Examples — Redesign of the work organization to increase empowerment and decision-making or team-based participation; — Initiatives for promoting greater labor/management cooperation, such as union partnerships; — Initiatives to foster knowledge sharing and organizational learning; and — Partnerships with educational institutions to help ensure the future supply of well-prepared employees. © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 23 23 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 24 24 4 6/12/20 Aligning HR Plans With Strategic Objectives The Seven Management and Planning Tools — Affinity diagrams — Interrelationship digraphs — Tree diagrams — Matrix diagrams — Matrix data analysis — Process decision program charts — Arrow diagrams © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 25 25 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 26 Affinity Diagram © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. Interrelationship Digraph 27 27 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 28 28 Tree Diagram © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 29 26 Matrix Diagram 29 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 30 30 5 6/12/20 Matrix Data Analysis © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. Process Decision Program Chart 31 31 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 32 32 Organizational Design for Performance Excellence Arrow Diagram — Factors influencing work organization — Operational and organizational guidelines — Management style — Customer influences — Size — Diversity and complexity of product line — Stability of the product line — Financial stability — Availability of personnel © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 33 33 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 34 34 Customer-Focused Team-Based Organization Chart Organizational Structures — Line organization — Traditional functional departments — Line and staff organization — Key functional departments with staff support — Matrix organization — Typically used in project-oriented organizations © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 35 35 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 36 36 6 6/12/20 Cross-Functional Team-Based Organization Chart Core Competencies and Strategic Work System Design — The term work systems refers to how the work of an organization is accomplished. — Core competencies refer to an organization’s areas of greatest expertise that provide a sustainable competitive advantage in the marketplace or service environment. Core competencies — Contribute significantly to customer benefits — Provide access to many products and markets — Are difficult for competitors to imitate © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 37 37 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 38 Strategic Work System Design Examples of Core Competencies — Strategic work system design involves determining which processes will be internal to an organization and which will use external resources. — Outsourcing refers to the practice of transferring the operations of a business function to an outside supplier. — The opposite of outsourcing is vertical integration, by which certain business functions are acquired and consolidated within a firm. — Work systems and processes must capitalize on core competencies. — Quality and productivity practices (e.g., Toyota) — Superior customer relationship management (e.g. Nordstrom) — Innovation in design and new product development (e.g., Apple) — Supply chain management (e.g., Dell) — Marketing/branding expertise (e.g., Procter & Gamble). © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 39 38 39 © 2014 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole wholeor or in part.. part. 40 40 7