Transforming Vision to Value Managing the Strategy to Execution Process
Jeff Scott VP/ Business & Technology Strategy
Accelare Webinar
July 29,31, 2014
“We have great ideas, we just can’t seem to implement them.”
CEO
Smart, capable executives struggle to bring their strategies to fruition. They want to run a great organization but settle for
good… or less.
Everywhere I go, I see . . . .
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“We keep getting better at doing things that don’t matter.”
Department Manager
Managers who want to make a difference but don’t know where to apply their organization’s resources and talent. They
want to make an important contribution but settle for functional optimization.
And I see . . . .
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“I just put my head down and do what they tell me.”
Customer Service Representative
Staff who are not engaged and energized in their roles. They want to be seen as significant contributors but are frustrated
with management’s lack of clarity.
And I also see . . .
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And I believe . . .
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Strategy execution is the BIG problem
• 37% of executives say their companies are “very good or excellent” at strategy execution.
• Only 23% blame current economic conditions as a major factor in their lack of execution
• 53% of implementers cannot state their company’s strategy in its entirety 2010 HBR survey of 1,000 executives
• 60% of typical organizations do not link their strategic priorities to their budget
• 66% of HR and IT organizations develop strategic plans that are not linked to the enterprise strategy
• 95% of employees in most organizations do not understand their organization’s strategy
Robert Kaplan, Harvard Business Review
• 70% of typical organizations do not link their strategic priorities to their budget Mark Hughes, Journal of Change Management
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The organizational reality — strategy diffusion
75%
75%
75%
75%
75% 68%
61%
55%
49%
Strategic effectiveness
coefficient
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Where is your strategy process?
Order Cash
Prospect Client
Concept Product
Order office supplies
Travel expense management
Performance reviews
Strategy Execution
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Order Post-it® notes process
Fill out online request
Check inventory
Debit budget
Reject order
External Provider
Ord
er
Mgm
t.
Ge
ne
ral
Led
ger
War
eh
ou
se
Inte
roff
ice
mai
l
Pick & pack
Schedule delivery
Deliver Post-it® Notes
Update route
Send update notification
Check budget Funds
available?
Inventory available?
Debit inventory Schedule order
Item pickup
Order replenishment
No
Yes
Yes
No
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Implement strategy process Ex
ecu
tive
M
anag
em
en
t
Eve
ryo
ne
El
se
G o d o s o m e t h I n g !!!!
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The Strategy to Execution Process
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Strategy execution framework
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Clarify strategy CREATE FOCUS AND CLARITY
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Strategic intent
Direction
Aspiration
Goals
Vision
Clarify Strategy
Differentiate & illuminate VALUE MAP - STARBUCKS
Start > Strategy > Value Map > Starbucks
Clarify Strategy
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Differentiate & illuminate IT INC. - CURRENT VERSUS FUTURE STATE
Product Innovation
Identify New Opportunities
Lower Project Costs
Predictable Outcomes
Speed to Market Operational Efficiency
Start > Strategy > Value Map > IT Inc.
Business View
IT View
High
Low
Emp
has
is
New IT
Clarify Strategy
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Identify capabilities CAPABILITIES LINK STRATEGY TO ACTION
Clarify Strategy > Identify Capabilities
Capabilities:
• Define what an organization must be able to do to successfully execute its business model
• Provide a common language for change
• Create a common link between executive intent and operational activities
• Provide a foundation for assessment and prioritization
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Capability map– IT Inc. CREATE A BUSINESS VIEW OF THE OPERATING MODEL
1.1 Divisional Planning
1.2 Support Business Process Reengineering
1.3 Publish IT Performance (to Customers)
1.4 Manage Customer Relationships
1.5 Maintain Current State Models
2.1 Manage EA
2.2 Manage IT Standards
2.3 Manage IT Governance
2.4 Create Annual Plans
2.5 Plan & Manage Research & Innovation
2.6 Manage Policy
3.1 Plan Portfolio
3.2 Deliver Portfolio
3.3 Manage Program & Project Standards, Methods & Governance
3.4 Manage Requirements, Project Standards, Methods & Governance
3.5 Govern Portfolio & Delivery
4.1 IT Resource Management
4.2 IT Performance Management
4.3 Execute IT Controls
4.4 IT Operational Tactical Planning
4.5 Manage IT Services/Products
5.1 Deliver Solution Estimation & Impact Analysis
5.2 Define & Manage Solution Architecture
5.3 Conduct Requirements Management
5.4 Conduct Solution Analysis
5.5 Design Solutions
5.6 Construct Solutions
5.7 Test Solutions
5.8 Design Audit, Review &Harvest
5.9 Deploy Solutions
Solutions Delivery
5 IT Administration & Management
4 Program & Project
Management IT Planning &
Controls
Business Partnership
Management
1 2 3
Start > Capabilities > Capability Models > IT Inc.
Clarify Strategy > Identify Capabilities
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PERFORMANCE is significantly below what is needed given the VALUE of the capability to the firm
PERFORMANCE is below what is needed given the VALUE of the capability to the firm
PERFORMANCE is adequate given the VALUE of the capability to the firm
Capabilities are not all equal in their VALUE to the customer and/or financial performance …
… or the same in terms of their effectiveness and efficiency PERFORMANCE within the organization.
Assess capabilities ASSESS BOTH VALUE AND PERFORMANCE
Clarify Strategy > Identify Capabilities > Assess Capabilities
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Capability assessment - IT Inc. UNDERSTAND EACH CAPABILITY’S VALUE CONTRIBUTION
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1.1 Divisional Planning
1.2 Support Business Process Reengineering
1.3 Publish IT Performance (to Customers)
1.4 Manage Customer Relationships
1.5 Maintain Current State Models
2.1 Manage EA
2.2 Manage IT Standards
2.3 Manage IT Governance
2.4 Create Annual Plans
2.5 Plan & Manage Research & Innovation
2.6 Manage Policy
3.1 Plan Portfolio
3.2 Deliver Portfolio
3.3 Manage Program & Project Standards, Methods & Governance
3.4 Manage Requirements, Project Standards, Methods & Governance
3.5 Govern Portfolio & Delivery
4.1 IT Resource Management
4.2 IT Performance Management
4.3 Execute IT Controls
4.4 IT Operational Tactical Planning
4.5 Manage IT Services/Products
5.1 Deliver Solution Estimation & Impact Analysis
5.2 Define & Manage Solution Architecture
5.3 Conduct Requirements Management
5.4 Conduct Solution Analysis
5.5 Design Solutions
5.6 Construct Solutions
5.7 Test Solutions
5.8 Design Audit, Review &Harvest
5.9 Deploy Solutions
Solutions Delivery
5 IT Administration & Management
4 Program & Project
Management IT Planning &
Controls
Business Partnership
Management
1 2 3
Business Necessity Capabilities
Essential Capabilities
Strategic Support Capabilities
Advantage Capabilities
Capability Value Index
Start > Capabilities > Capability Models > IT Inc. > Value Contribution
Clarify Strategy > Identify Capabilities > Assess Capabilities
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Capability assessment - IT Inc. AND UNDERSTAND WHICH CAPABILITIES NEED OPERATIONAL IMPROVEMENT
20
1.1 Divisional Planning
1.2 Support Business Process Reengineering
1.3 Publish IT Performance (to Customers)
1.4 Manage Customer Relationships
1.5 Maintain Current State Models
2.1 Manage EA
2.2 Manage IT Standards
2.3 Manage IT Governance
2.4 Create Annual Plans
2.5 Plan & Manage Research & Innovation
2.6 Manage Policy
3.1 Plan Portfolio
3.2 Deliver Portfolio
3.3 Manage Program & Project Standards, Methods & Governance
3.4 Manage Requirements, Project Standards, Methods & Governance
3.5 Govern Portfolio & Delivery
4.1 IT Resource Management
4.2 IT Performance Management
4.3 Execute IT Controls
4.4 IT Operational Tactical Planning
4.5 Manage IT Services/Products
5.1 Deliver Solution Estimation & Impact Analysis
5.2 Define & Manage Solution Architecture
5.3 Conduct Requirements Management
5.4 Conduct Solution Analysis
5.5 Design Solutions
5.6 Construct Solutions
5.7 Test Solutions
5.8 Design Audit, Review &Harvest
5.9 Deploy Solutions
Solutions Delivery
5 IT Administration & Management
4 Program & Project
Management IT Planning &
Controls
Business Partnership
Management
1 2 3
Start > Capabilities > Capability Models > IT Inc. > Performance
Meets or exceeds current needs
Needs minor improvement
Needs significant improvement
Heat Map Index
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Clarify Strategy > Identify Capabilities > Assess Capabilities
Identify the strategic “heat” PINPOINT WHICH CAPABILITIES NEED OPERATIONAL IMPROVEMENT
21
Start > Capabilities > Capability Models > IT Inc. > Performance
Clarify Strategy > Identify Capabilities > Assess Capabilities
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Strategic gap analysis
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Capability
Today
Capability
Tomorrow
7/29/14
Clarify Strategy > Identify Capabilities > Assess Capabilities > Gap Analysis
Root cause analysis IDENTIFY ISSUE
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Clarify Strategy > Identify Capabilities > Assess Capabilities > Gap Analysis
ProcessMaterials
TechnologyPeople
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why?
Why is [Pareto item] accounting for 50% of problem
Problem Statement
To copy all fishbone "objects"
Use Cntl-Shift-A
Root cause analysis IDENTIFY CAUSE
People Process Technology
Clarify Strategy > Identify Capabilities > Assess Capabilities > Gap Analysis
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Plan and fund enhancements CLOSE CAPABILITY GAPS
Clarify Strategy > Identify Capabilities > Assess Capabilities > Gap Analysis > Investment Planning
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Intended strategy
What we’d like to
happen
Emergent strategy
The many day-to-day decisions and
prioritizations that set direction
Realized strategy
What actually occurs
Unrealized strategy
Things that are left behind
Deliberate strategy
Top-down plans, statements, and initiatives
Assess progress RECOGNIZE THAT STRATEGIES ARE DYNAMIC
The role of the strategist is to get you where you want to be
Clarify Strategy > Identify Capabilities > Assess Capabilities > Gap Analysis > Investment Planning > Monitor Results
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Assess progress KEEP YOUR EYE ON WHAT MATTERS
Metrics
Change Acceleration Assessment
Overall Investment
Roadmap Health
Future State Metrics
Bottom Line Benefits (Customer
and Investor)
Enables
Delivers
Yields
Metrics
Metrics
Metrics
Metrics
Organizational measures that indicate our ability to sustain change
Process and organization KPIs that correlate to our Value Map
Customer and Financial KPIs
How are we executing our investment roadmap
Clarify Strategy > Identify Capabilities > Assess Capabilities > Gap Analysis > Investment Planning > Monitor Results
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The bottom line
VISION
GOALS
STRATEGIES
CAPABILITIES
GAPS
Focuses investments where they will have the most business impact
Creates a direct line of sight from strategic intent to day to day activities
Establishes a foundation for continuous improvement
Increases employee engagement which drives innovation and productivity
Creates an integrated and ongoing role for business architects
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Strategy to execution management
Stay in touch
Jeff Scott
Email: [email protected] Phone: +1-704-275-1725 LinkedIn: www.linkedin.com/company/accelare www.linkedin.com/in/logicalleap
Web: www.accelare.com Twitter: @accelare
Subscribe to The Business Architect @ http://thebusinessarchitect.accelare.com/
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Questions
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THANK YOU
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