ME 217/DM 214 Strategic Planning

Prof. Jo B. Bitonio, DPA

Princessita M. Fontanilla Michael John Fontanilla

Reporters/Discussants

“If I had an hour to solve a problem and my life depended on the solution, I would

spend the first 55 minutes determining

the proper question to ask, for once I know the proper question, I

could solve the problem in less than

five minutes.”

How to identify Strategic Issues?

GETTING STARTED: IDENTIFYING ISSUES FACING THE ORGANIZATION

• HOW TO IDENTIFY STRATEGIC ISSUES

• KEY ISSUES/CHALENGES IN PANELCO III

• POSSIBLE WAYS TO RESOLVE THE STRATEGIC ISSUES

IDENTIFYING THE STRATEGIC ISSUES

FACING THE ORGANIZATION

This step defines and

describes the issues at hand

succinctly, pinpoints the

factors that make a certain

issue a fundamental challenge.

IDENTIFYING THE STRATEGIC ISSUES

FACING THE ORGANIZATION

• In Bryson’s Strategic Planning Process, this phase will allow the organization to determine a list of issues they face, divide that list into categories of strategic or operational and finally, arrange these issues in order, such as priority, logical or temporal. (Bryson, 2004)

IDENTIFYING THE STRATEGIC ISSUES

FACING THE ORGANIZATION

• Identifying the strategic issues will help the stakeholders determine what is most important to an organization and will help them formulate strategies to address these issues.

WHAT IS THE DIFFERENCE BETWEEN ISSUE AND

PROBLEM?

Some business managers mistakenly use the

term “issue” and “problem” interchangeably;

however, doing so may complicate the daily

decision making processes by lumping all issues

and problems together and possibly make a bad

situation worse. Separating issues from

problems helps to prevent smaller issues from

becoming problems. This business practice is so

important that there is an entire management

discipline predictably called, “issue management”

(IM). http://www.studymode.com/essays/Issues-Vs-Problems-648552.html

WHAT IS THE DIFFERENCE BETWEEN ISSUE AND

PROBLEM?

The Dow Jones says that “successful issue management depends

on addressing concerns before they become full blown problems.”

1. Therefore, it is deduced that issues are smaller, less threatening

and require minimal effort to find resolution – but left unchecked

could expose the organization to greater risk. There is an analogy

to help put this concept into proper perspective – “forgetting your

lunch is an issue, but losing your job is a problem.

2. Therefore, the difference between an Issue and a problem can be

explained this way, “Problems are solved. Issues need to be

resolved…. To solve is to explain and to resolve is to

separate a thing into its component parts or

elements, then determine a course of action.” (Jaques

2007. P 36, 37)

HOW TO IDENTIFY STRATEGIC ISSUES

1. Brainstorm Potential Strategic Issues

Review vision, company values, opportunities, strengths as well as threats.

Frame issues in the form of questions

2. Develop an Understanding Why an Issue is Strategic

Discuss each identified issue

Determine which issues are critical or strategic

Test for strategic quality of an issue.

TEST FOR STRATEGIC QUALITY OF AN

ISSUE

Does It:

• Pose a threat?

• Present an opportunity?

• Require significant change?

• Involve conflict/tension between choices?

• Tend to be complex?

• Generally project well into the future?

3. Determine the consequences of not addressing an issue: • Each strategic issue will generally fall

into the following categories: a) No action is currently required, but

the issue should be monitored for future action

b) Action can be determined through strategic planning process.

c) The issue appears urgent and requires an important response.

Failure to address the identified strategic issues eventually results in the realization of an external threat, lost opportunity, the lingering or worsening of an identified problem and ultimately a failure to achieve the corporate vision.

4. Consolidate overlapping or related issues: Combine related issues Determine how are they

related The fewer the issues, the

better.

5. Arrange issues into an ordered list: Three ways:

a) Logical order b) Impact order c) Temporal order

ABSTRACT:

The soul of Strategic Planning is to identify the Strategic Issues Facing the

Organization.

How?

- Brainstorming (Strengths and Weaknesses)

- Understanding its importance and relevance (Urgency)

- Know its consequences (Pros and Cons)

- Consolidate concerns (Arrange in an ordered list)

- Address the issue

THE REAL SCENARIO

KEY ISSUES/CHALLENGES

1) ISSUES FACING THE COOPERATIVE:

• Deregulation of Power Industry

• Passage of R.A. 10531, otherwise known as “An Act strengthening the NEA, further amending for the purpose of P.D. 269, as amended”

• Rampant pilferage/illegal connection

• Increasing Account Receivables

• Exposure from local politics

• Numerous reportorial requirements by the government agencies

KEY ISSUES/CHALLENGES

2) ISSUES FACING THE MANAGEMENT/HEAD OFFICE:

• Clamors against the implementation of the Reorganization

• Employees Union Advocacies

• Subdued Interpersonal relationship among heads and associates

• Controversies as to the duties and functions of the BOD’s and the Management

• Partial implementation of policies

• Technological Advancement is not one of the priorities

KEY ISSUES/CHALLENGES

3) ISSUES FACING THE AREA OFFICES/SUB-OFFICES: • Weak customer relations • Diverse interpretation of policies

and/or other rules and regulations of the cooperative

• Presence of language barrier

DISTINGUISH

ISSUES &

PROBLEMS

Environmental Analysis Issues Problem

1. Deregulation of Power Industry

2. Passage of R.A. 10531, otherwise known as “An Act strengthening the NEA, further amending for the purpose of P.D. 269, as amended”

3.Rampant pilferage/illegal connection

4. Increasing Account Receivables

5. Numerous reportorial requirements by the government agencies

Environmental Analysis Issues Problems

6. Clamors against the implementation of the Reorganization

7. Employees Union Advocacies

8. Subdued Interpersonal relationship among heads and associates

9. Controversies as to the duties and functions of the BOD’s and the Management

1o. Partial implementation of policies

11. Technological Advancement is not one of the priorities

Environmental Analysis Issues Problems

12. Weak customer relations

13. Diverse interpretation of policies and/or other rules and regulations of the cooperative

14. Presence of language barrier 15. System lost too high (14%)

16. Violation of the BOD Term of office

17. Too much Board meetings

Note: 15, 16, 17 lifted from CDA Findings during the inspection

DISTINGUISH BETWEEN

TASK AND SOCIETY

ENVIRONMENT

Environmental Analysis Task

Environment

Societal

Environment

1. Deregulation of Power Industry

2. Passage of R.A. 10531, otherwise known as “An Act strengthening the NEA, further amending for the purpose of P.D. 269, as amended”

3.Rampant pilferage/illegal connection

4. Increasing Account Receivables

5. Numerous reportorial requirements by the government agencies

Environmental Analysis Task

Environment

Societal

Environment

6. Clamors against the implementation of the Reorganization

7. Employees Union Advocacies

8. Subdued Interpersonal relationship among heads and associates

9. Controversies as to the duties and functions of the BOD’s and the Management

1o. Partial implementation of policies

11. Technological Advancement is not one of the priorities

Environmental Analysis Task

Environment

Societal

Environment

12. Weak customer relations

13. Diverse interpretation of policies and/or other rules and regulations of the cooperative

14. Presence of language barrier 15. System lost too high (14%)

16. Violation of the BOD Term of office

17. Too much Board meetings

Note: 15, 16, 17 lifted from CDA Findings during the inspection

PRIORITIZATION

Task Environment Ranking

1. Rampant pilferage/illegal connection

2.. Increasing Account Receivables

3. Numerous reportorial requirements by the government agencies

4. Clamors against the implementation of the Reorganization

5. Employees Union Advocacies

6. Subdued Interpersonal relationship among heads and associates

7. Controversies as to the duties and functions of the BOD’s and the Management

8. Partial implementation of policies

9. Technological Advancement is not one of the priorities

10. Weak customer relations

Task Environment Ranking

11 . Diverse interpretation of policies and/or other rules and regulations of the cooperative

12. Presence of language barrier 13. System lost too high (14%)

14. Violation of the BOD Term of office

15. Too much Board meetings

Rank the order of importance from 1-15 - most

important to less important

Society Environment Ranking

1. Deregulation of Power Industry

2. Passage of R.A. 10531, otherwise known as “An Act strengthening the NEA, further amending for the purpose of P.D. 269, as amended”

HOW TO ADDRESS STRATEGIC ISSUES?

Areas to look at: I. Achievements and Failures (Net Profit, Staff

Retention, Gained Market/Lost Clients, Low Sales, Low Efficiency)

II. Profitable Products and Services III. Financial Ratios (Key Ratios, Benchmarks, Targets) IV. External Forces (PEST) – by Elsa Richards (EL)

Profitable Products and Services Illustration

Company A

Company B

Company C

Gross Sales

125M

275M

75M

Expenses

50M

280M

10M

Gross Profit

75M

-5M

65M

External Factors: P POLITICAL E ECONOMIC S SOCIAL T TECHNOLOGICAL E ENVIRONMENT L LEGAL

WHERE DO YOU BELONG?

There are 3 kinds of people

1) those who make things happen;

2) those who watch things happen; and

3) those who wonder what happened.

Thank you so much!

Great Strategizing!

References: 1.CDA Strategic Planning Module 2.Florida MAPP Field Guide, Nov. 2008

Update 3.Strategic Planning (Research

Foundation Methodology) 4.http://pa5251.wikipaus.com/++5.+ident

ify+the+strategic+issue+facing+the+organization