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Transcript of NAWBO-LA PEAK LEADERSHIP ACADEMY Management Systems Consulting Corporation 10990 Wilshire Blvd....
NAWBO-LA PEAK LEADERSHIP ACADEMY
Management Systems Consulting Corporation10990 Wilshire Blvd. Suite 1420, Los Angeles, CA 90024(310) 477-0444 • www.mgtsystems.com
Session 3:Strategic Organizational Development Planning (Part 2) and Introduction to Performance Management
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 2
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
PURPOSE:
Continue developing your company’s strategic plan and begin the process of developing performance management systems to support your plan.
Strategic Organizational Development Planning
OBJECTIVES:
1. Address any questions you have about the “Environmental Scan” and “Organizational Assessment” data you have collected and analyzed to date.
2. Review/refine your company’s Business Concept and Strategic Mission.
3. Develop draft Objectives and Goals to support the achievement of your company’s plan.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 3
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Review: Strategic Planning Framework
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 4
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Session 2
Strategic Planning Process
1 ENVIRONMENTAL SCAN
Market Analysis Competitive Analysis Trend Analysis
2 ORGANIZATIONAL ASSESSMENT
Culture Management Systems Operational Systems Resources Markets and Products
3 STRATEGIC ISSUE RESOLUTION
Business Foundation Issues Strategic Organizational Development Issues
5 BUDGETING4 STRATEGIC BUSINESS PLAN
Situation Analysis Business Definition Strategic Mission Strategy Key Result Areas Objectives and Goals Action Plans
6 QUARTERLY MANAGEMENT REVIEW
Reports Meetings
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 5
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
What You’ve Completed to Date
Box 1
• “Collected” and analyzed information about your environment – using the “Planning Survey” that we gave you (in the binder) at Session 1.
Box 2
• “Collected” and analyzed information about your organization’s capabilities – using the “Planning Survey” that we you (in the binder) at Session 1.
• Received and analyzed Growing Pains and Organizational Effectiveness Survey Results.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 6
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Session 2
What You’ve Completed to Date
Boxes 3 and 4
• Prepared a draft of your company’s Business Concept and Strategic Mission – at our last session and/or as a follow-up to our last session.
• Continued to develop your plan – using the “Planning Workbook” we gave you at our last session.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 7
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Quick Review: Growing Pains and Organizational
Effectiveness Survey
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 8
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Session 2
What Are Growing Pains?
• Problems which occur as a result of inadequate organizational development in relation to business size and complexity.
• A common set of symptoms that something has gone wrong in the process of organizational development.
• A signal of the need to make the transitions from one stage of organizational development to the next.
• A set of leading indicators of future financial performance.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 9
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Growing Pains Scoring Interpretation
Score Range Color Interpretation
10-14 Green Everything is “OK”
15-19 Yellow Some things to watch
20-29 Orange Some areas need attention
30-39 Red Some very significant problems
40-50 Purple A potential turnaround situation
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 10
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Organizational Effectiveness Survey© (OES)
● The Management Systems Organizational Effectiveness Survey© is a validated instrument.
● The survey consists of 65 items that measure the extent to which an organization has developed the systems and structures needed to support its growth and/or stage of development.
● For an organization to have the highest probability of success over the long-term, it needs to effectively manage all six levels in the Pyramid of Organizational Development plus Financial Results, individually and as a system.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 11
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
To a Very Slight ExtentPurple1.0-1.9
To a Slight ExtentRed2.0-2.9
To Some ExtentOrange3.0-3.9
To a Great ExtentYellow4.0-4.4
To a Very Great ExtentGreen4.5-5.0
InterpretationColorScore Range
OES Mean Score Interpretation
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 12
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Session 2
Scoring Interpretation
• This report presents four different types of scores:
– Mean score is a standard statistical “average” score on a 5-point (Likert) scale.
– % Favorable = (# respondents with scores of ‘4’ or ‘5’)/(Total # respondents)
– % Neutral = (# respondents with scores of ‘3’)/(Total # respondents)
– % Unfavorable = (# respondents with scores of ‘1’ or ‘2’)/(Total # respondents)
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 13
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Session 2
Questions About Your Survey Results
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 14
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Session 2
Most Significant Issues for My Company
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 15
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Session 2
Share With Your Team:
• The 1-3 most significant issues you feel your company is facing at the current time– Based on your review of the information you
collected/received (including the Planning Survey, Growing Pains Questionnaire, and Organizational Effectiveness Survey results).
• Note any similarities among your team.
• Develop specific action steps that might be taken to address the issues identified.
• Flip chart your issues and strategies for resolving them.
• Be prepared to share the results of your discussion when we reconvene.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 16
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Session 2
Review: Business Foundation
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 17
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Session 2
Business Definition
A broad statement of what business the firm is in that acts as a lens through which to view future strategies.
– Who are our customers?
– What are their needs?
– How do they buy?
– What is value to them?
Addresses the Questions:
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 18
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Session 2
A broad, measurable, time-dated statement of what the organization wants to or needs to become by the end of the planning period.
Strategic Mission
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 19
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Session 2
What is Strategy?
Conceptual Definition:
Strategy can be defined as the different, yet integrated, courses of action that will be taken by a firm or business unit to compete effectively in its chosen markets in order to obtain desired results.
Operational Definition:
Where you Play “The Game”
How you Play “The Game”
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 20
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
III
I
II
TIERS OF THE MARKET
-
Price
+
Quality
Service
Prestige
Quality
Service
PrestigePrice
Where You Play “The Game”:Analysis of the Strategic Board
Vertical Market Segment
Horizontal Market
Segment
III
I
II
THE STRATEGIC BOARD
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 21
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Session 2
Retail Industry by Tier
IINordstrom, Gap,
Robinsons-May, Limited
IIIK-Mart,Wal-Mart, JC Penney,
Discount Stores
QualityServicePrestige
Price+
-
QualityServicePrestigePrice
ISaks,
Neiman Marcus,Barneys
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 22
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Session 2
Automobile Industry by Tier
I
Rolls Royce,Ferrari, Mercedes
Benz
IIHonda Accord, Toyota Camry, Ford Taurus, Nissan Maxima
IIIGeo Metro, Hyundai, Ford Escort, Toyota Corolla,
QualityServicePrestige
Price+
-
QualityServicePrestigePrice
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 23
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Session 2
The Strategic Board for the Automobile Industry
• Toyota Corolla
• Honda Accord
• Toyota Camry
•Lexus•Rolls•BMW
Sedans
• Toyota Celica• Volkswagen
Jetta
•Porsche•Ferrari
Sports Cars
MinivansLight TrucksSUVs
• Toyota RAV4• Suzuki Samurai
III
• Toyota Sienna• Ford Windstar
• Toyota Tacoma• Ford Ranger
• Ford Explorer• Toyota Landcruiser• GMC Blazer• Jeep Cherokee
II
•Lexus•Range Rover•Hummer•EscaladeI
Vertical SegmentsHorizontal Segments
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 24
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Session 2
CoreStrategy
Operational Strategies
Supporting Strategies
MarketsCult
ure
Pro
ducts
and
Serv
ices
Managem
ent
Systems
OperationalSystems
Reso
urc
es
How You Play “The Game”:Three Levels Of Strategy:
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 25
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Session 2
Sample Core Strategies
• Starbuckso Redefine the nature of the coffee café and “blanket” the
U.S.
o Use our dominance in retail to become the Coca-Cola of coffee.
• Southwest Airlines
No frills, short-haul, high frequency discount airfare in relatively non-competitive markets.
• TechLinkSolutions guaranteed to go live.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 26
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Session 2
Strategic Planning – Strategic Business Plan
4 STRATEGIC BUSINESS PLAN
1 ENVIRONMENTAL SCAN
Market Analysis Competitive Analysis Trend Analysis
2 ORGANIZATIONAL ASSESSMENT
Culture Management Systems Operational Systems Resources Markets and Products
3 STRATEGIC ISSUE RESOLUTION
Business Foundation Issues Strategic Organizational Development Issues
5 BUDGETING Situation Analysis Business Definition Strategic Mission Strategy Key Result Areas Objectives and Goals Action Plans
6 QUARTERLY MANAGEMENT REVIEW
Reports Meetings
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 27
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Session 2
Elements of the Strategic Plan
Key Result Areas
Objectives
Goals
Action Plans
Business Foundation• Business Definition• Strategic Mission• Core Strategy
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 28
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Session 2
Strategic Planning Terminology
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 29
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Session 2
Key Result Areas
Areas of the business where performance has a critical impact on the achievement of the mission. Defined in one or two
words. A category, not an action.
We suggest using the 6 levels of the Pyramid of Organizational Development + Financial Results:
- Markets - Operational Systems- Products - Management Systems- Resources - Culture - Financial Results
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 30
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Strategic Planning Terminology
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 31
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Key Result Areas
Areas of the business where performance has a critical impact on the achievement of the mission. Defined in one or two
words. A category, not an action.
We suggest using the 6 levels of the Pyramid of Organizational Development + Financial Results:
- Markets - Operational Systems- Products - Management Systems- Resources - Culture - Financial Results
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 32
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Session 2
Objectives
Overall definitions of what is to be achieved in each Key Result Area, typically over several years. Describes a broad outcome, not an action. Each KRA must have at least one stated objective that is derived from the mission statement. Most KRAs will have between three and six objectives.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 33
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Sample Objectives
● Develop and implement a structured corporate-wide and branch office strategy for purchasing from suppliers
● Acquire profitable new products in our current market niches that will contribute to overall growth.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 34
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Session 2
Goals
Realistic, time-dated and measurable sub-objectives, the responsibility for which is assigned to a specific individual (usually a manager or department head). Defines scope and timing of an outcome. Each objective should have one or more goals.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 35
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
SMART Goals
S Specific Outcome
M Measurable/Quantifiable
A Accountable/Achievable
R Results-Oriented and Realistic
T Time-Dated
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 36
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Session 2
Sample Goals
● Develop and begin production of two new internally generated product ideas that will result in total sales of $4 million by 12/31/0X. [Peter]
● Earn revenues of $5 million by 12/31/0X. [Paul]
● Open new accounts with average sales of $30,000 each by 12/31/0X. [Mary]
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 37
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Session 2
Sample Plan PageKEY RESULT AREA: 1.0 Markets and ProductsObjective 1.1: Grow active buyer base at a rate consistent with overall sales growth per year.
Goals Prty Who When Status
1. Increase our active buyer base by 50% from 10/1/0X to 9/30/0X through existing strategies.
A BH 10/1/0X
2. Increase active buyer base by 40% from 10/1/0X to 9/30/0X through new strategies.
B LM 10/31/0X
3. Identify and evaluate vehicles for growth beyond FY ‘0X.
A BH 9/30/0X
4. Identify new strategies to support FY ‘0X growth.
C LM 6/30/0X
Goal Prty Who When Status
YTD: +39%
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 38
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Strategic Planning Process
1 ENVIRONMENTAL SCAN
Market Analysis Competitive Analysis Trend Analysis
2 ORGANIZATIONAL ASSESSMENT
Culture Management Systems Operational Systems Resources Markets and Products
3 STRATEGIC ISSUE RESOLUTION
Business Foundation Issues Strategic Organizational Development Issues
5 BUDGETING4 STRATEGIC BUSINESS PLAN
Situation Analysis Business Definition Strategic Mission Strategy Key Result Areas Objectives and Goals Action Plans
6 QUARTERLY MANAGEMENT REVIEW
Reports Meetings
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 39
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Introduction to Performance Management Systems
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 40
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Organizational Control/Performance Management System
A set of mechanisms (both processes and techniques) designed to increase the probability that people will behave in ways that lead to the attainment of organizational objectives.
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 41
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Session 2
Six Elements in an Effective Individual Performance Management
System
• Strategy/Role Descriptions– Key Result Areas– Objectives
• Goals
• Measurement System
• Progress Review and Feedback
• Performance Appraisal
• Rewards
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 42
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Session 2
The Individual Performance Management System
PerformanceEvaluation/Appraisal
Strategy/Role
Description
• KRAs• Objectives
Results
Measurement SystemRewards
Individual Goals
Behavior
Progress Review/
Feedback
© Management Systems Consulting Corporation, 1989. Revised 2004. All rights reserved. 43
NAWBO-LA PEAK LEADERSHIP ACADEMY
Session 2
Please note that all of the materials in this slide presentation are the proprietary intellectual property of Management
Systems Consulting Corporation and may not be reproduced or otherwise distributed
without written permission.
For further information about reproduction rights for materials in this presentation, please contact:
Management Systems Consulting Corporation10990 Wilshire Blvd., Suite 1420
Los Angeles, CA 90024(310) 477-0444
www.mgtsystems.com