Strategic Planning

Overview

Strategic planning is one of the most important responsibilities of the senior

management of an organization. It is the vehicle that senior management should use to

set the organizational vision, determine the strategies required to achieve that vision,

make the resource deployment decisions to achieve the selected strategies, and build

alignment to the vision and strategic direction throughout all levels of the organization.

Unfortunately, strategic planning is also one of the most misunderstood and poorly used

tools in many organizations. Strategic plans are often large documents with detailed

plans created arduously over months at great effort...only to gather dust and languish

after they have been duly acknowledged and then filed away.

Overview

There are several reasons why strategic plans are not developed properly, or not implemented properly. Among the most common are:• Senior management does not follow a defined process to

accomplish this task. As a consequence, months of effort are wasted in creating reams of paper that do not have strategic import.

• The process is delegated to a planning group, or assigned to the various functional leaders to complete for their respective areas. If completed in individual functional areas, the plan may work for individual departments, but is likely to sub-optimize the whole organization. If assigned to a planning group, the result is often not truly embraced and endorsed by senior leadership.

• Senior management does not set aside the time to develop the strategic plan as a collective team work product.

Overview

There are several reasons why strategic plans are not developed properly, or not implemented properly. Among the most common are:• The organization does not understand what a strategic plan is

actually designed to provide. Therefore, the strategic plan is a tactical business plan with multiple year extrapolations. There is very little about it that addresses actual strategic direction.

• Senior management does to follow a defined process or methodology that will result in a strategic plan in a timely and efficient yet comprehensive manner.

• The plan is developed but there is no process to communicate it throughout the organization and build organization-wide alignment to its implementation.

• The plan is developed with no implementation guidelines at all. At best, it is implemented in pieces. At worst, it is unfunded and ignored.

Aligning the Strategic Approach

Balanced Scorecard

Aligning the Strategic Approach

Stakeholder Analysis

Management Organisation

Strategic Clients

Strategic Partners

Employees

Shareholders

Guideline

Identify your stakeholders

Name Job Title Main Interest

Influence Level (HML)

• Are all of our key stakeholders clearly identified?• Who will become key stakeholders in the near

future?• Are their expectations and requirements clearly

understood?• Are they regularly consulted?• Are they kept updated, and involved in those

business decisions that will affect them?

Stakeholder Analysis

Guideline

Develop a matrix to measureStakeholderse.g. Interest , Power

Output Stakeholder plan showing how you engage with your stakeholders and what your communication strategy is

Vision Mission and Objectives

“Strategic planning is worthless—unless there is first a strategic vision.”— John Naisbitt, Author of “Megatrends”

A clear vision and mission statement, objectives, and business description are important points of departure. The vision is what guides your social enterprise and energizes your stakeholders; it is the “big picture” illustrating what you expect to achieve.

Vision and Mission

Mission Statement

To be number 1 catalyst in developing countries for improving the quantity and quality on social action by creating a social network that works seamlessly aligning it to the real needs as identified by the end of 2013

Guideline

Use Smart Language• Specific• Measurable • Achievable• Realistic• Timeous

The mission statement is the heart of your social enterprise.

It describes its central purpose and the basic principles that guide the actions of employees, partners, and management. As well, it articulates the strategy you will use to accomplish your goals and objectives. A mission statement also defines your target population and embodies the organizational values of your social enterprise.

The mission statement also provides direction to your social enterprise. If the business plan can be considered the road map of your social enterprise and the vision is the direction in which you are going, then the mission statement consists of the street signs to get there. Your business plan must be consistent with your mission statement, so use it as an anchoring guide in each step of the planning process.

Business Objectives

Business objectives are a way for an organization to define its goals and direction. A company uses a combined strategy at every level of its operation to achieve its objective. It determines how a company will allocate its resources and what strengths, weaknesses and opportunities it may have. A business objective is usually not altered once implemented, unless changes in circumstances arise; setting a clear course for the organization it key to its success

Guideline

The balanced scorecard method can help define your company objectives

The Balanced Scorecard – Key Benefits

• Better Strategic Planning• Improved Strategy Communication• Better Management Information• Improved Performance Reporting

Why should small companies use a Balanced Scorecard Approach

• A Balanced Scorecard guides managers to dedicate scarce resources such as their

“management focus” and the company’s manpower (and even money!) to achieving the

planned results, as opposed to being distracted by the many “focus thieves” that

constantly try to steal their attention.

• A Balanced Scorecard makes employees aware of how the various tasks in an organization

are connected—and exactly how their day-to-day operations fit into the big picture. This

knowledge empowers responsible employees to spend their resources in the most

beneficial ways.

• A Balanced Scorecard introduces a result-focused sense of urgency and peer pressure in

the organization, prompting the employees to pull together and concentrate on the vital

issues.

Paul BergquistCEO, Axsellit AS

What is our purpose

What is our picture of the future

What are our main focus areas

How do we know we are achieving our results

What projects will be rolled out to meet our goals and targets

Planning the Company Scorecard

Financial

Customer Relations

Learning and Growth

Internal Service Process

Vision and Strategy

The Scorecard as a Measuring System

The Financial Scorecard

Identifying the areas to define your objectives

Market share

Revenue growth

Profit ratioReturn on investment

Profitability

Categorised into

Strategy and goals

Performance Measures/Targets

Strategic Initiatives

How do we measure quality in our financial scorecard• Efficiency• Meeting our targets

Brainstorming topics

What financial steps are necessary to ensure

the execution of our strategy/goals?

Are we meeting our bottom line?

Are we meeting operational and financial

targets?

Guideline

You can add additional topics for your brainstorming session

The Customer Relations Scorecard

On time deliveries

Market share

Average time to process orders

Response time

Reliability

Value for money

Identifying the areas to define your objectives

Categorised into

Strategy and goals

Performance Measures/Targets

Strategic Initiatives

How do we measure quality in our customer relations scorecard? Accessibility Acceptability Continuity

Brainstorming Topics

Who are our target customers?

How do our customers see us?

How do customers rate our performance?

Guideline

You can add additional topics for your brainstorming session

The Process Management Scorecard

Procurement

Quality

Workforce

Technology

Operations

Productivity

Categorised into

Strategy and goals

Performance Measures/Targets

Strategic Initiatives

How do we measure quality in our process management scorecard• Efficiency• Reduction of rework• Increased productivity

Brainstorming Topics

What critical processes must we excel at to satisfy

our customers and stakeholders

What must be done internally to meet customer

expectations

Guideline

You can add additional topics for your brainstorming session

The Learning and Growth Scorecard

Career paths

Continuous Improvement

Technological Leadership

HR Management

Process alignment

Being competitive

Categorised into

Strategy and goals

Performance Measures/Targets

Strategic Initiatives

How do we measure quality in our learning and growth scorecard• Level of skilled employees• Increase in productivity• Allowing for employee assisting company to grow

Brainstorming Topics

How can we continue to improve?

What capabilities and tools do our employees

need to execute our strategy/goals?

Guideline

You can add additional topics for your brainstorming session

Analysis

SWOT Analysis Brainstorming Decision Tree Mapping

Guideline

• Involve as many people as possible during the analysis phase• Ensure that all ideas are documented • Have frequent breaks in the analysis process• Ensure that you identify the final document to be used for the

business plan

Analysis

The process The objective

Analysis of the Firm We will understand our core values and where we are going with the direction of the company

Marketing and Competitor Analysis We will clearly understand our competitors and ensure our marketing strategy is aligned to meet our targets and objectives

Understanding the environmental impact We will have a clear idea of the possible or probable effects of external forces and conditions on our organisations growth strategies

Defining your product Our products will meet our customer’s expectations and will be delivered in line with the agreed roadmap

• Analysis of the firm• Marketing and Competitor Analysis• Industry and Competitor Analysis• Environmental Analysis• Portfolio and Program Analysis

Selecting the strategy - Marketing

Our CustomerWe will ensure that we have a clear picture of our target customer using market research and analysis. Our MarketOur analysis will provide the correct data of our market and what the successful trends are to ensure that we have market growth Our CompetitionWe will have a clear idea of our competition and their strategies within our market range Our Distribution ChannelsWe will endeavour to distribute our product effectively to our target customers? Our Marketing MixOur marketing plan will correctly position Product, Price, Place and Promotion.Our FinancialsWe will ensure that our marketing budget is aligned to our overall financial strategy

Selecting your strategy - Product

Understanding the Product Life Cycle

Business Roadmap for calendar year

It begins with defining the company’s vision and mission

Planning the Product Roadmap

Defining the concept

Defining the business rules and product specifications

Developing and Launching the Product

Develop the Product

Project Initiation Project Planning Project Execution Project Closeout

Launch the final product

End of Product Lifecycle

Conduct Analysis and Research

Findings are documentedDocument is reviewed by nominated stakeholders

Stakeholders approve and sign off concept

Hold workshops to define the business rules and

userability of the product to be launched

Findings are documentedDocument is reviewed by nominated stakeholders

The business rules and product specifications are approved by

the Business Owners and nominated stakeholders

Document distributed to Development team

Identify concept for production

Team is appointed to proceed with

the marketing plan

TIME

SALES

Introductory stage

GrowthStage

MaturityStage

DeclineStage

Defining the Marketing Plan

Concept is aligned to the marketing strategy and financial planning for

calendar year

Findings are documentedDocument is reviewed by nominated stakeholders

The Marketing strategy and financial planning for the concept are approved

by the Business Owners and nominated stakeholders

Business rules and product specifications

commence

The objectives will outline· Who we are as a company· What do we want to achieve· How do we want to achieve this· The timeline to meet these objectives

These objectives are communicated

to the business units

TeamsManagersCustomers

Results in

Product Life Cycle

Defining the Product Process

What is our business product?

Who are our customers?

What is the demand for our product?

How will we sell and distribute our product?

What is the timeline for selling our product?

What price will we charge for our product?

Why this is importantWe will:• offer the right product or service for the market;• charge the right price for it; and• sell enough to achieve our strategic and financial goals

Guideline Ask the right questions

Aligning your project approach

Define your portfolio

Project Initiation

Project Planning

Project Execution

and Control

Project Close Out

Analysis

Design

DevelopmentTest

Deploy

Project Management

Product Development

Operations – a proposed approach

Understanding what our options are

Collate all of the info and document

Set a timeline to define your key focus areas analysis and results

Begin to document each focus area

Ensure that all documents are approved and reviewed

Present the final plan to your company

Documenting the Business Plan

• Confirm the template and table of contents• Setup a timeline to complete the document• Confirm who will compile the document• Confirm the signatories• Confirm who will view the document • Create a folder on your server to store the documents

Conclusions

• It is important to keep in mind that this presentation is a generic and high level approach to develop and document your business plan. You will go through various versions until you have reach the correct amount of detail and content that works for your company

• You can add or subtract where required from this presentation to align to your own individual approach for presenting to your audience

• The ultimate and key goal for this presentation is to have a business plan that will allow your business to grow and advance

• You should use the business process in this presentation as a roadmap to ensure that you cover all your business areas, goals and vision for your company