SHRA

Strategic Thinking for HR Professionals

SHRA

This is a very special workshop• I have a ton to cover and I will go pretty fast.• Please take notes and ask questions.• I am happy to answer any of your questions, offer

advice and recommend books at any time.• Keep an open mind.• Work very hard…

The slides are already posted at:

www.SlideShare.net/johnspence

SHRA

SHRA

For the past 21 years…

SHRA

How does HR earn a seat the CEO’s strategy table?

SHRA

When you add so much strategic

business value that I cannot have a meeting

without you there!

SHRA

Talent

SHRA

T + C x ECF =

Success

SHRA

A little closer look…

Talent• Honest• Massively Competent• Creative• Risk-taker• Team Player• Pro-active

Culture• Sense of Urgency• Disciplined Execution• Innovative• Collaboration• Ownership Mentality• Customer Focused

SHRA

No seat at the table without strategic business value

SHRA

Achieving Business

SHRADo you have a clearly focused and well-communicated strategy for success?

Effective Strategy =

Valued Differentiation x Execution

SHRA

Key Point: Strategy is INTERNAL

as well as EXTERNAL

SHRA

Most people think of:S.W.O.T.

Competitive PositioningCustomer Intimacy / CRM

Industry trendsGlobal trends

Regulatory / Political IssuesM.E.C.E.KRA’s

Strategic ThrustsCorporate Objectives

SMART GoalsMBO

SHRA

SHRA

What strategy is not…• More, better, faster is not a strategy.• Effectiveness and efficiency are

necessary… but not sufficient.• Superb execution of fundamental

business processes… is expected.• Being extremely good at what you are

supposed to be good at… gets you no extra credit at all.

SHRA

Five Foundations of Effective Strategic Thinking

Business Acumen

Personal Experience

Pattern Recognition

Strategic Insight

Disciplined Execution 2

SHRA

The Four – I’s

• Ignorance

• Inflexibility

• Indifference

• Inconsistency2

SHRA

How to avoid the Four I’s • Aggressive external market focus.

• Aggressive customer focus.

• Keep the “Main Things” the main things.

• Bullish on knowledge sharing and learning.

• Passion and commitment at all levels.

• Foster a healthy paranoia.

• Revel in change.– be agile, adaptive, and anticipatory.

2

SHRA

Breakthrough Strategies

• GE: 1- 2 or F.S.C.• Intel: memory to processors• Microsoft: installed base• Apple: chaos to elegance• Saturn: no haggling

SHRA

Southwest

One type of planePoint-to-point

Fast turnsLow fares / no frills

Friendly staff3

SHRA

Dell

BTOJIT

Inventory turnsLogistics vs. Technology

VOC

3

SHRA

3

SHRA

Southwest – Dell – Walmart

What is the pattern?

• Extreme Efficiency

• Minimize Costs to as close to zero as possible – w/o negative impact

• All focused on delivering customer value

1- 10

SHRA

From the CEO of a little 172 billion dollar company…

Look, what is strategy but resource allocation?

When you strip away all the noise, that’s what it

comes down to. Strategy means making clear-cut

choices about how to compete. You cannot be

everything to everybody, no matter what the size

your business or how deep its pockets. You have

to figure out what to say “NO” to.Jeffrey Immelt

SHRA

Educated GuessEducated GuessDifferentiated Strategy Differentiated Strategy

FocusFocusResource AllocationResource Allocation

Bold Not RiskyBold Not RiskyWhat What NOTNOT To Do To Do

SHRA

To get the most from our session together…

It is absolutely critical that you be brutally honest with yourself today.

4

So let's get started with

a little self-test…

SHRA

Microsoft • Total World Domination• The Top 5 %• Bet the Company• Require Failure• Managers are Qualified• Perform, Perform, Perform• Shrimps vs. Weenies• Stop the Insanity• Espirit De Corps

5

From: The Twelve Simple Secrets of Microsoft Management by Thielen

SHRA

Charlie Trotter’s 5

SHRA

Lessons from seven top CEOs

• Have an outside-in perspective

• Be deeply passionate about your job

• Understand the importance of culture

• Create or adapt next generation products, processes and solutions

• Implement the best ideas regardless of origin

5

From: What the Best CEOs Know by Krames

Dell, Welch, Gerstner, Grove, Gates, Kelleher, Walton = 696 B

1-10

SHRA

SHRA

The Toyota Way• Challenging Vision

– We form a long-term vision, meeting challenges with courage and creativity to realize our dreams.

• Kaizen– We improve our business operations continuously, always driving for

innovation and evolution.

• Genchi Genbutsu– We go to the source to find the facts to make correct decisions, build

consensus, and achieve our goals at our best speed.

• Respect, Challenge and Help your People and Suppliers– We respect others, make every effort to understand each other, take

responsibility and do our best to build mutual trust.

• Teamwork– We stimulate personal and professional growth, share the opportunities

of development, and maximize individual and team performance.

6

1-10

SHRA

In-depth study of 25 top companies renowned for building winning corporate cultures…

• GE• Dell• Wal-Mart• Toyota• Nordstrom• Starbucks

• Southwest Airlines• IBM• P&G• Whole Foods• Ritz Carlton• Intel

The pattern of six common traits for all of these firms…

From Results Rule by Randy Pennington

SHRA

They understand that: Results Rule!

1. Tell themselves the truth and value candor and honesty.

2. Pursue the best over the easiest in every situation.

3. Leverage the power of partnerships both internally and externally.

4. Focus the energy to make the main things the main thing.

5. Show the courage of accountability.

6. Learn, grow and improve every single day.

From Results Rule by Randy Pennington

61-10

SHRAIs Your Company Up To Speed?

Fast Company June 2003

Pages 7 - 8

SHRA

Good to Great:1,483 to 11400 – 700%15+ years

9

1-10

SHRA

83%

SHRA

The Evergreen Project

10 year study of 160 top companies

40 distinct industries

200 management practices

Winners, climbers, tumblers, losers

Winners had an average Total Return to Shareholders of 945%... The

Losers only averaged a TRS of 62%

From: What (really) Works by Joyce, Nohria, Roberson 10

SHRA

The Four Primary Practices:1. A sharply focused, clearly communicated and

well-understood strategy for growth.

2. Flawless operational execution that consistently delivers the value proposition.

3. A performance-oriented culture that does not tolerate mediocrity.

4. A fast, flexible, flat organization that reduces bureaucracy and simplifies work.

From: What (really) Works by Joyce, Nohria, Roberson

10

SHRA

The Secondary Management Practices:

• Talent = find and keep the best people.

• Key leaders show commitment and enthusiasm for the business.

• Embrace strategic innovation.

• Master the power of partnerships.

From: What (really) Works by Joyce, Nohria, Roberson

Score yourself on the 1–10 scale for all eight practices on page 10

SHRA

Key Drivers of Business Success

Financial Performance

Quality P&S&

Customer Relationship

EmployeeSatisfaction

Empowerment High Standards

Long-termOrientation

Enthusiasm, Commitment,

Respect

Training &Development

Fair Compensatio

n

CR=104.12

CR= .404

CR=.334

CR=.277

CR=.275CR=.249

CR=.280 Coaching

CR=.285

CR=.371

CR=.365

CR=.191

CR=.247

11

WorkshopPage 12

TolerateNothingLess

From: Practice What You Preach by Maister

Global study:16 countries29 companies139 offices5,589 respondents

SHRA

10 – 15 %

SHRA

What Inhibits Execution?National Survey of 4,000 Senior Executives

4. Inability to work together (21%)

3. Company culture (23%)

2. Economic climate (29%)

1. Holding onto the past / unwillingness to CHANGE (35%)

SHRAWhere are we going + how will we behave on the way?

FocusDifferentiation“No”

Stakeholders + guiding collation

Vision + ValuesStrategyPlansGoals / ObjectivesTactics / Actions

Procedures / ProtocolsRepeatable ProcessClear / consistent /

relentless

Training +time / money /

supplies / people

Measure / TrackCommunicate

Transparency Renewal

Praise + Celebration and

Eliminate Mediocrity

SHRA

Disciplined Execution Clear Vision

Detailed Strategy

Guiding Coalition

Alignment

Systems

Communication

Support

Adjust

Reward / Punish

13

1 - 10

SHRA

Individual Workshop• Go back and look at all of your audits.• Where were your low scores, where were your high

scores – what is the pattern?• Look over your notes – what were the key themes?

What are the most important ideas?• Answers all the questions on pages 14 – 16.• Put in as much detail as possible.• Be very honest with yourself.• Think in terms of Actions and Outcomes.

SHRA

THANK YOU

If you have any questions at all please do not hesitate to send a note or call. My email address is: john@johnspence.com

Also, you might find value in the ideas I share in my blog. You can sign up for it at:www.johnspence.com/blog

These slides have already been uploaded to:www.slideshare.net/johnspence