ASP Atlanta Chapter Reasons Strategic Plans Fail At the ... · 1 ASP Atlanta Chapter Reasons Strategic Plans Fail – At the Intersection of Theory and Practice Randall Rollinson

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ASP Atlanta Chapter Reasons Strategic Plans Fail –

At the Intersection of Theory and Practice

Randall Rollinson President, LBL Strategies, Ltd.

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Your Presenter

Co-Founder & President/CEO, LBL Strategies, Ltd.

35 years experience as an international educator, trainer, counselor, facilitator, author, software developer, social entrepreneur and consultant

Co-Author, Strategy in the 21st Century: A Practical Strategic Management Process

Lead Instructor, Certificate in Strategic Management Program / Offered in Conjunction with ASP Chicago / DePaul University

Co-Founder, Chicago Chapter, ASP

Bachelors in Psychology and Master degrees in Counseling – Southern Illinois University / MBA in Management, DePaul University

Randall Rollinson

©LBL Strategies, Ltd. 2012

http://www.eventling.com/index.php?file=certificate&companyId=7

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STRATEGY TIMELINE

Ancient

HistoryToday

1950s-

1960s1970s 1980s 1990s 2000 2005

2300-

2500

yrs. ago

1500s 1800s1850-

19001920s 1940s

Mintzberg, Quinn, Voyer Jack Welch Rich Horwath

Sun

Tsu

Art

of W

ar

Gre

eks –

Ale

xand

er T

he G

reat

Mac

hiav

elli

The

Prin

ce

Car

l Von

Cla

usew

itz

Prin

cipl

es o

f War

Nap

oleo

n /

Wes

tPoi

nt

2nd

Indu

stri

al R

evol

utio

n

Bus

ines

s C

onte

xt E

mer

ges

e.g.

, Alfr

ed S

loan

e

Stre

ngth

s W

eakn

esse

s

Com

petit

ors

Wor

ld W

ar II

Ops

. Res

. –Li

near

Pro

gram

Gam

e Th

eory

–P

riorit

ize

Allo

cate

Pet

er D

ruck

er

MB

O

Ken

neth

And

rew

s

BC

G

Por

tfolio

Mat

rix

Mic

hael

Por

ter

5 Fo

rces

Driv

ing

Com

petit

ion

Kap

lan

& N

orto

n

Bal

ance

d S

core

card

Jim

Col

lins

Hed

geho

g

Kim

Mar

borg

ne

Blu

e O

cean

Stra

tegy

Recommend: Sun Tzu, The Art of War for Managers, Gerald Michaelson / The Daily Drucker, Peter Drucker / The Lords of Strategy, Walter Kiechel


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We Think of It in Phases

Assess &

Organize Environmental

Assessment

Strategy

Formulation

Strategic

Planning

Implement

Evaluate

Control


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It’s really a process


Perpetual Leadership

6

Management Through Applied Planning Process®


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Association for Strategic Planning Concept


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5 Primary Reasons Strategic Plans Fail

Tools and Techniques to Avoid Failure


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Reason 1

Failure to assess the current strategic position before launching a strategic planning effort


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Assess Current Strategic Position

Assess the current strategy

Plot portfolio of offerings for performance and perceived potential

Assess the strategic management capabilities of the team


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BCG Growth Matrix

H I G H L O W

Invest

Select

a few

Remainder

divested

Liquidate

G

R

O

W

T

H

R

A

T

E

L

O

W

H

I

G

H ?

$

RELATIVE POSITION (MARKET SHARE)


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Design & Organize Program

Define the scope of the program

Organize the program

– Get commitment from the top

– Identify a “strategy development champion”

– Design a process and management system that fits

– Form a planning team of key players

– Get outside help if you need it


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Gap Analysis – Start With What You Have*

Management System Component Developed

Partially Developed

(Needs Work)

To be Developed

Comments

Environmental Scan (External & Internal)

SWOT Analysis

Core Competencies / Competitive Advantage

Vision / Mission / Core Values

High Level Goals (Strategic Results)

Customer Value Proposition

High Level Strategies

Perspectives

Strategic Objectives

Strategy Map

Key Performance Indicators & Targets

Prioritized Strategic Initiatives / Projects

Communications & Change Management Plan

KPI Data Collection & Reporting (Automation)

Implementation & Cascading

Strategy Management and Budgeting Calendar

*Adapted from materials provided by the Balance Scorecard Institute


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Reason 2

Failure to “read the tea leaves” and make the necessary changes


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Key Environmental Variables

Socio-cultural Forces

Economic Forces

Technological Forces

Political/ Legal /

Regulatory Forces

Macro Environment

Stakeholders

Governments

Suppliers

Special Interest Groups

Communities

Competitors

Employees/ Labor Unions

Associations Funders

Consumers The Organization

Micro Environment

Environmental Forces


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Porter’s Five Forces

.


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Environmental Assessment

Identification of Strategic Factors

Opportunities Threats

Market Analysis

Economic, Socio-cultural, Technological, Political/Legal Forces

Competitor Analysis Resource Analysis

Supplier Analysis Industry Analysis

Government Analysis Interest Group Analysis


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Igor Ansoff’s Grid CURRENT MARKETS NEW MARKETS

CURRENT

SERVICES /

PRODUCTS

Market

Penetration

Market

Development

Service / Product

Development Diversification

NEW

SERVICES /

PRODUCTS


20 ©LBL Strategies, Ltd. 2012

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Reason 3

Failure to successfully engage in “team based” strategic thinking


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In the end it’s about

Team Leadership

Effective Planning

Ongoing Improvement

Accurate Measurement

aka – Strategic Management

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Strategic Thinking Framework

External Environmental

Analysis

Environmental Opportunities

& Threats

Internal Analysis

Relevant Organizational Opportunities

& Threats

Strategy Formulation

A B D E

F

C

Decision Point

Core Competencies

& Competitive Advantages

Vision Mission Core Values Policies Goal (s) Strategies


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Core Competency Characteristics Prahalad and Hamel suggest three factors to help ID core competencies:

Provides access to a wide variety of markets

Difficult for competitors to imitate

Makes a significant contribution to the perceived customer benefit

Copyright 2007, LBL Strategies, Ltd.


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Strategy Canvas – Yellow Tail Wine

Expensive

wines Yellow tail Cheap wines

Price

Use of technical wine terminology

Above-the-line marketing

Aging quality

Vineyard prestige

Wine complexity

Wine range

Easy drinkability

Ease of selection

Fun and adventure

Low

High


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Environmental Assessment

Scenario 1 Scenario 2 Scenario 3

Market Analysis

Economic, Socio-cultural, Technological, Political/Legal Forces

Competitor Analysis Resource Analysis

Supplier Analysis Industry Analysis

Government Analysis Interest Group Analysis


27 ©LBL Strategies, Ltd. 2012

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The Art of the Long View, by Peter Schwartz

Copied with Permission


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Assess the Current State

Driving Forces Critical Uncertainties

1. *

*

2. *

*

3. *

*

4. *

*

5. *

*


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Copied with Permission


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Strategy Selection Process

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Consistency with leadership perceptions •Need to change •Willingness to change •Feasibility of change

Expectations of goal achievement

Linkage / synergy / impact across functions •Acceptable risk and returns •Meets customer needs •Operationally feasible •Workforce capacity exists


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Consider Planning a Two-Phase Process


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Reason 4

Failure to use a balanced set of meaningful performance measures to align performance, monitor execution and make mid-course corrections


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Meaningful Performance Measures

• Meaningful means strategic

– Focused on desired results

– Derived from the Objectives on the Strategy Map

• Meaningful means relevant to the user

– It tells the user what he or she needs to know to make better decisions

– Accepted as valid (measures what it intends)

34 ©2011 Strategy Professional Resource Center. All Rights Reserved. Do not copy without permission.

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Perspective Key Question Answered Primary Focus

Strategy Has Four Perspectives

Organizational Capacity or Learning &

Growth

Customer & Stakeholder

Financial or Stewardship

Internal Process

For businesses: how do we create value for owners? For government and nonprofits: how do we maximize mission value and effectiveness?

Through the eyes of customers and stakeholders: how well are we meeting their needs?

How can we improve internal processes to deliver products & services better, faster, and cheaper?

How can we support the internal processes through improved knowledge & skills abilities, tools & technology, leadership and other capacities?

• Financial Performance

• Value • Effective Resource

Use

• Satisfaction • Retention

• Efficiency • Quality

• Human Capital • Tools • Innovation • Infrastructure • Culture


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Measures Can Roll Up and Drill Down

Performance Information System Overall Indicator (Measure) of Performance

Enterprise or organization-wide measures (indicators) may often be based on an aggregation of lower-level components (Business Units, Regions, Offices, etc.)


*Provided by the Balance Scorecard Institute

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Reason 5

Failure to Execute!


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Favorite Quotes (1)

“Execution is not only the biggest issue facing business today: it is something nobody has explained satisfactorily.” Page 6

Execution: The Discipline of Getting Things Done, Larry Bossidy and Ram Charan.


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Favorite Quotes (2)

“Strategies most often fail because they aren’t executed well. Things that are supposed to happen don’t happen. Either the organizations aren’t capable of making them happen, or the leaders of the business misjudge the challenges their companies face in the business environment.”

(ibid, 15)



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Favorite Quotes (3)

“An organization can execute only if the leader’s heart and soul are immersed in the company… The leader is the only person in a position to achieve that understanding. And only the leader can make execution happen, through his or her deep personal involvement in the substance and even the details of execution.” (ibid, 24)



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From the Present to the Future

Changing the Way We Change, Jeanenne LaMarsh

The Delta The Present The Future

Movable Boundaries


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Alignment Begins

•Activities & Tasks •Recognition &

Incentives •Annual Budgets • Project Measures /

Targets

• Strategic Objectives

• Strategy Deployment Map

• Strategic Initiatives / Projects

• Key Performance Indicators / Targets

• Key Result Areas • Strategies Strategic

Plan

Strategic Operating

Plan

Execution

Strategic Direction

•Vision •Mission •Values • Policies •Goals

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Performance Measurement


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Alignment

Strategy

Tier 1: Corporate Scorecard

Vision

My Personal Objectives

Tier 3: Team & Individual Scorecards

My Personal Objectives or Goals (e.g., SMART Goals), from my Development Plan

Corporate Objectives

Unit Objectives

Tier 2: Business & Support Unit Scorecards

My Department’s Strategic Objectives, tied

to Organization-wide Strategic Objectives

©2011 Strategy Professional Resource Center. All Rights Reserved. Do not copy without permission.

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Cascading Objectives Tier 1 – Strategy Map

Tier 2 – Department / Business Unit

Tier 3 – Team / Individual


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Culture Change Requirements

©C.M. Russsell Associates, 1999

Used and adapted with permission by LBL Strategies, Ltd. 2001

Managing Complex Change

Planning Scenario

Positive Corporate

Culture

Skills Exist

Appropriate Incentives

are in Place

Available Resources

Take Desired Action

Type of Change

Description Vision, mission, values, paradigms, assumptions, beliefs, attitudes, fears,

investments, etc.

Hard and soft

Recognition process, career path, job security, compensation, working

conditions

Materials, money, management team, systems, processes

Customer satisfaction, employee motivation, financial performance

Positive versus

negative

1

Yes

Yes

Yes

Yes

Yes

Positive Change Occurs

2

No

Yes

Yes

Yes

Yes

Confusion

3

Yes

No

Yes

Yes

Yes

Anxiety

4

Yes

Yes

No

Yes

Yes

Apathy

5

Yes

Yes

Yes

No

Yes

Frustration


Strategic Leadership

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End Session

LBL Strategies, Ltd. www.lblstrategies.com (Blog)

The Strategy Architects 773-774-0240

www.cpe.depaul.edu/strategic (CSM Program) www.strategyprocenter.com (ASP Certification)


http://www.lblstrategies.com/

http://www.cpe.depaul.edu/strategic

http://www.strategyprocenter.com/

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CSM Course Outline

Session 1 / “Assess and Organize” Quiz

Session 2 / “Environmental Scan”

Session 3 / “OTSW Analysis” Quiz

Session 4 / “Strategic Direction”

Session 5 / “Strategy Identification & Selection” Quiz

Session 6 / “Strategic Plan”

Session 7 / “Strategic Operating Plan” Quiz

Session 8 / “Implementation Management”

Session 9 / “Ongoing Strategic Management” Exam

Session 10 / “Pathway to ASP Certification”


Documents

ASP Atlanta Chapter Reasons Strategic Plans Fail At the ... · 1 ASP Atlanta Chapter Reasons Strategic Plans Fail – At the Intersection of Theory and Practice Randall Rollinson