NESA Business Manager’s NESA Business Manager s Instituteu

October 21-23, 2010October 21 23, 2010

Overall ScheduleOverall Schedule

Th d• Thursday– Session 1: Introduction & Case Study on

Governance Issues– Session 2: Strategic PlanningSession 2: Strategic Planning

• FridayS i 1 B h ki– Session 1: Benchmarking

– Session 2: 21st Century Schools

Overall ScheduleOverall Schedule

• Saturday– Session 1: Insurance PanelSession 1: Insurance Panel– Session 2: Alternative staffing, salaries

and moreand more

IntroductionsIntroductions

• Name• School name location enrollmentSchool name, location, enrollment• How long have you been in the job

Strategic PlanningNESANESA

October 21, 2010,

AgendaAgenda

• Explore different strategic planning systemsy

• Discuss strategic priorities for schoolsschools

• Create some Debatable Propositions for NESA schools

The Purposes of Strategic Thinking:The Big Three MotivatorsThe Big Three Motivators

1. To know, really, how well we’re doing now….now….– “The plural of anecdote is….data.” ~George

Stigler

“I G d W T t All th B i d t ” – “In God We Trust….All others: Bring data.” ~US Sec. of Ed Spellings

2. To contribute to an ongoing & flexible strategic “vision” & “road map" (rather than a fixed and rigid “plan”)– “If you want to give God a laugh, tell Him If you want to give God a laugh, tell Him

your future plans” (German Proverb)

3. To move the organization from Good to G eatGreat– “Good is the enemy of great.” (Jim Collins)

GOOD TO GREAT

Organizational Culture: Good to GreatGreat

Assess Operational Strength via Collins’ Six Criteria

1. Level 5 Leadership Investing in leaders? Investing in leaders?

2. First Who, then What Who’s on the bus? Who’s on the bus?

3. The Brutal Facts vs. Unshakeable BeliefsUnshakeable Beliefs Unsustainable financial model?

Changing school age Changing school-age demographics? Talent pool for faculty diminishing?faculty diminishing?

Organizational Culture: Good to GreatGreat

4.The Hedgehog Concept What do you do best? Rigorous

academics in a value-laden context? For the social sectors, “greatness” not

profit is the answer: how to define success is the questionsuccess is the question.

5.Culture of Discipline What to subtract when we want to What to subtract when we want to

add?6 Technology as Accelerator6.Technology as Accelerator Customized IEPs and team learning?

BALANCED SCORECARD

The Balanced Scorecard:Metrics for GreatnessMetrics for Greatness

Robert Kaplan and David Norton presented the rubric of a “balanced scorecard” to assess current program and operations (HBR1992) : 1992) :

1 Customer Satisfaction (value proposition 1.Customer Satisfaction (value proposition surveying): What’s highly valued & can be leveraged?g

2.Staff Learning/Innovation3.Business Processes/Efficiencies (cf.(

Dashboard Indicators comparisons4.Financials

STRATEGY AND DESIGN

Making the Shift in Thinking(Jeff DeCagna, Principled Innovation

jeff@principledinnovation com)jeff@principledinnovation.com)

“Strategic Planning is… an Oxymoron” ~Henry Mintzberg, The Rise The Rise and Fall of Strategic and Fall of Strategic PlanningPlanning

Strategic planning• Combines two

Strategy making• Leverages variety and

gg gg

fundamentally different ways of thinking into a single process (NB. Ike on

divergent thinking in the name of creating value

• Thrives on instability and g p (D-Day.)

• Needs stability/predictability

Thrives on instability and uncertainty

• Continuous cycle of l istability/predictability

• Driven by calendars and events

learning• Pushes for simplicity,

clarity and focus • Does not produce actual

strategy, only plans

y

Making the Shift in ThinkingJeff DeCagna, Principled Innovation

Strategic planning Strategy making• Executes plan by publishing

document & implementation schedule wedded to 3 5 year cycle

• Executes “road map” (vision of destination and proposed routes) at a summer leadership retreat (board wedded to 3 – 5 year cycle.

• Fixed and inflexible goals sometimes fail to reflect changing conditions and

leadership retreat (board, admin with invited faculty and parent leaders) by developing five or so 12-month priorities, changing conditions and

priorities.e o so o p o es,

posted on the website.• Notes 24-month and 36-

month goals, but places them i l i ki l t f in a planning parking lot for successive R&D consideration.

Eight Steps of Strategy and Design

1. Setting a Framework: Strategic Plan vs. Strategic 1. Setting a Framework: Strategic Plan vs. Strategic Vision & Roadmap? Scope and scale. 12-month time-frame.

2. Planning to Plan: Populating the Team; Undertaking the Research & Reporting Out; Testing th S i ( ) A i th I t l L d hi the Scenario(s). Assessing the Internal Leadership Capacity & Inspiring the Board

3. Assessing the External Factors: Environmental Scanning. What are the “inevitable surprises” to address?address?

Eight Steps of Strategy and Design

4. Evaluating your School's Current Position: Experiment with various tools: “SWOT”; “Portfolio Experiment with various tools: SWOT ; Portfolio Analysis” (via "value proposition surveying"); “Game Theory” (a la economist Joseph Schumpeter); “Customers‘ Analysis”; Balanced Scorecard (HBR, Kaplan & Norton)

5 Identifying the Key Issues: Issue identification; 5. Identifying the Key Issues: Issue identification; sorting; evaluation; relationship to mission. What are our three most insoluble problems? Brutal facts?

6. Reviewing your Values & Mission: Mission (the present, the why we exist); and Values (the past and always the what we believe What are our unshakeable always, the what we believe. What are our unshakeable beliefs?

Eight Steps of Strategy and Design

7. Creating Your Vision for the Future: Vision (the future; the what we shall become). "Whom will we utu e; t e at e s a beco e) o eserve?" "What skills and values will they need?" "What do our customers want? Need?" "What should we be known for in the future that we're not should we be known for in the future that we re not known for now?" Scenario-writing and testing.

8. Determining Goals, Strategies, and Initiatives: From goals (the outcomes) form strategies (actionFrom goals (the outcomes) form strategies (action-oriented approaches, the how) and initiatives (tactical undertakings at the departmental levels, the what and when) Backward design the grid of the what and when). Backward design the grid of tasks, timetables, point people. Communicate the vision, “road-map,” and strategic priorities.

INEVITABLE SURPRISES

Peter Schwartz ScenariosPeter Schwartz, Scenarios

• Inevitable Surprises, (2003), a provocative look at the dynamic p yforces at play in the world today and their implications for business and their implications for business and society.

h d ’ h f• When we don’t have a sense of direction and purpose, we can easily p p , ybe swept away by events.

Preparing for the FuturePreparing for the Future

• Build and maintain your sensory and intelligence systemsg y

• Cultivate a new sense of timing. When will things change? How fast?When will things change? How fast?

• Identify in advance early warning indicators that things are coming fast

Preparing for the FuturePreparing for the Future

• Put in place mechanisms to engender creative destruction. Practice discarding things. Learn to mitigate the costs

• Try to avoid denialy• Think like a commodity company – price

peakspeaks• Be aware of the competence of your

judgmentjudgment

Preparing for the FuturePreparing for the Future

• Place a very high premium on learningg

• Place a very high premium on environmental and ecological environmental and ecological sustainability

• Place a very high premium on financial infrastructure and supportfinancial infrastructure and support

• Cultivate connections

STRATEGIC PRIORITIES FOR SCHOOLS

Eight Strategic Priorities for h lSchools

•Affordability & Accessibility: Given that financing affordable schools that are accessible and diverse is an overarching challenge and that t end indi te ontin ing p e e on i ing trends indicate continuing pressure on raising tuitions...independent schools should....

•Recruiting, Retaining, Rewarding Talent: Given the demographics of an aging workforce Given the demographics of an aging workforce near retirement, a generation in college now not attuned to teaching as a career, and concerns gabout recruitment, retention and competitive compensation of high quality faculty… i d d t h l h ldindependent schools should....

Eight Strategic Priorities for h lSchools

•Advocacy & Marketing: Telling the Independent School Story: Given the increase of potential competition for the next generation of t dent n in e e th t ill eq i e g e te of students, an increase that will require greater advocacy and marketing on behalf of independent schools independent schools independent schools… independent schools should....

•Communications: Given the increasingly demanding nature of parents… independent g p pschools should....

Eight Strategic Priorities for Schools

h h h l l f•Governance: Given the higher level of partnership and vision required of boards and school leadership independent schools shouldschool leadership… independent schools should....

•Accountability: Given the increased likelihood •Accountability: Given the increased likelihood of media and governmental scrutiny, intrusion, and demands for public accountability… and demands for public accountability… independent schools should....

Eight Strategic Priorities for S h lSchools

•Innovation & Change: Given the public’s id ifi i b li d i i i identification between quality and innovation, its perception of independent schools as traditional rather than innovative and the resistance to rather than innovative, and the resistance to change found within independent schools… independent schools should....p

•The High Tech and Global Future: Given the gimperative for schools to create a 21st C. curriculum so that students are prepared for a

h l l d l b l fmore technological and global future… independent schools should....

Strategic PrioritiesStrategic Priorities

• Affordability & Accessibility• Recruiting, Retaining talentg, g• Advocacy & Marketing• Communication• Communication• Governance• Accountability• Innovation & Changeg• High Tech Global Future

DEBATABLE PROPOSITIONS

PropositionsPropositions

(1) A i t t th k l d i d i t t f b th (1) Appropriate to the knowledge, experience, and interests of both speakers and audience.

(2) Debatable--that is, not obviously true or false. The statements should involve an honest difference of opinion, with arguments and evidence on both sides.

(3) Phrased in the affirmative. Positive statements prevent confusion by making the issue clear-cut.

(4) Restricted to set forth only one idea. This policy keeps the debate within narrow limits.

(5) Worded clearly. The words should be ones that can be defined exactly, so the debate does not become a mere quibble over the meaning of words. g

EXAMPLES

Proposition #1:Proposition #1:

• Innovation/21st Century School• A school that stays within the 20thA school that stays within the 20

century educational paradigm will fail to prepare students for the future to prepare students for the future and will fail to be financially

blsustainable.

Proposition #2: p

• Human Capital• The roles of faculty staff and The roles of faculty, staff, and

administrators need to be redefined: their total compensation needs to be their total compensation needs to be calibrated to a definable rubric, and h kl d d dtheir workload, productivity, and

evaluation methods need to be overhauled to be efficient and effective.effective.

Proposition #3: p

• School as a Business• Use sound business practices as the Use sound business practices as the

filter for all decision-making. Identify “good business practice” with each good business practice with each area – ROI, cash use, funding d f d ddepreciation, funding endowment, etc., and class size.,

Proposition #4: Proposition #4:

• Class Size• Increasing class size does not Increasing class size does not

necessarily reduce intimacy, nor does it diminish the educational it diminish the educational experience for the student, if it is d l ldone on an age-appropriate level with improved professional p pdevelopment.

Proposition #5:Proposition #5:

• Technology• Even though the cost of appropriate Even though the cost of appropriate

technology sometimes exceeds the value it provides our schools will not value it provides, our schools will not succeed without a continued

h linvestment in technology.

Your Work Step 1:Your Work – Step 1:

• Develop a list of strategic priorities for your schools – brainstormy

• Pick top three

Your work Step 2Your work – Step 2

• State the proposition.• What data / evidence / examples do we p

have for and against the proposition?• Identify data / evidence we do not have.Identify data / evidence we do not have.• Is there a game changer in here /

something new or different that could something new or different that could drastically impact your school? What are the next steps?the next steps?

APPENDIX:GOOD TO GREAT SLIDES

Good to Great Principle #1:L l Fi L d hiLevel Five Leadership

• Personal Humility + Professional WillPersonal Humility + Professional Will– sublimated egos, focused will: more

like Lincoln & Socrates than Patton or Caesar. The organization’s success is what drives the leader.

A k d ti• Asks good questions• Ambitious for the school and its people

Sh C dit T k R ibilit• Shares Credit---Takes Responsibility• Passes the Power—Diffused Decision

MakingMaking

Good to Great Principle #1:Level Five LeadershipLevel Five Leadership

• Social Sectors Variation: Social Sectors Variation: – “Social sector leaders are not less decisive

than business leaders as a general rule; they g ; yonly appear that way to those who fail to grasp the complex governance and diffuse

t t t th i l power structures common to the social structure.““True leadership exists only if people follow – True leadership exists only if people follow when they have the freedom not to.”

Good to Great Principle #2:First Who Then WhatFirst Who…Then What

• Who’s on The Bus?– Getting the right people on the bus, the g g p p ,

wrong people off the bus and the right people in the right seats on the bus. p p g

• Recruit…Train…Retain– Knowing that the only brake on moving – Knowing that the only brake on moving

forward would be the inability to attract and keep talentand keep talent

– Everyone grows.

Good to Great Principle #2:First Who Then WhatFirst Who…Then What

• Social Sectors Variation: Social Sectors Variation: – In the social sectors, getting the wrong

people off the bus more difficultpeople off the bus more difficult– Early assessment mechanisms more

i t t th hi i h i i important than hiring mechanisms, since no hiring process is flawless, and you

ll l k h ff ti really only know how effective someone is when you start working

Good to Great Principle #3:The Brutal FactsThe Brutal Facts

• Honest Assessment—Unwavering Faith• Honest Assessment—Unwavering Faith– Culture of openness that invites critiques

from all: frequent and healthy debate. from all: frequent and healthy debate. – The Stockdale Paradox—having the faith that

you will prevail but disciplining yourself to y p p g yface the brutish facts of current realities

• Debrief Success AND Failure– End each meeting with, “Where did we

succeed…and where did we fail?”• Typical school brutal facts? Unshakeable

beliefs?

Sample “Brutal Facts” for pInternational Schools

»Competition will increase dramatically for students »Competition will increase dramatically for students and teachers: better public schools, charter schools, for-profit schools, home schools, etc. Rising costs will alienate current and future »Rising costs will alienate current and future

customers, make us less affordable and attractive to most of the marketplace and diminishing our diversity. S ll h l ill f i l iSmaller schools will face survival issues.»Parents will become more consumer-oriented and difficult to manage.difficult to manage.»Governmental intrusions are likely to increase.»Resistant cultures will make it more difficult to i t d l d d l d ti thi ki innovate and lead and preclude creating thinking about 21st C. schools.

Sample “Brutal Facts” for pSchools

»After a massive investment in technology, we are still struggling to capitalize widely upon it to accelerate or customize student learning.»Prosperity and the “long boom” upon which our schools depend may be compromised by global instability, fractious social issues, a larger US deficit terrorism and wardeficit, terrorism and war.»Ethical relativism will become more pervasive and parenting less effective.W k / f i / d f f »Weakness/confusion/under-performance of

many school boards will be a huge liability.»Equity and justice efforts aside, we are still not

d t li i ld h hit q y j

ready to live in a world where whites are a minority and Christianity is not dominant.

Sample “Unshakeable Beliefs” for S h lSchools

B f f d f t »Because of our freedom from government control, independent schools can be mission-driven and child-centered. d e a d c d ce te ed»Independent schools have the resources and freedom to innovate in the development and d li f i l d t h th t delivery of curriculum and to share that innovation for the betterment of the larger education community.education community.»Independent schools can make individualized decisions in the best interests of the child and

t di ti i t can create diverse, supportive environments where children can thrive.

Sample “Unshakeable Beliefs” for SchoolsSchools

Independent schools can continue to survive »Independent schools can continue to survive, even in a tough economy, because of independent financial controls and our focus on independent financial controls and our focus on high quality and on accountability to the families and communities we serve.»Independent schools provide an ethos and culture that is values-oriented, one that will l d id l f ilialways attract and provide value to families.

»Independent schools have three sources of capital that ha e not e en beg n to be f ll capital that have not even begun to be fully utilized: physical capital; intellectual capital; social capitalsocial capital.

Good to Great Principle #4:Hedgehog ConceptHedgehog Concept

• Truly great companies have a simple core concept that drives everything: – What can they be the best in the world y

at? – What drives our economic engine (and What drives our economic engine (and

what could accelerate that)?What are we deeply passionate about? – What are we deeply passionate about?

(Need all three to be great.)

G2G Hedgehog Concept

WHAT YOU ARE DEEPLYWHAT YOU ARE DEEPLYPASSIONATE ABOUT?

WHAT DRIVES

Sweet Spot

WHAT YOU CANBE THE BEST IN THE WORLD AT?

WHAT DRIVES YOUR ECONOMIC ENGINE?

Good to Great Principle #4:Hedgehog ConceptHedgehog Concept

• Social Sectors Variation: hi k h h d h i h h– Must rethink the hedgehog concept without the

profit motive: i.e., challenge is to define and achieve “greatness” not “profit.” g p

– Flywheel concept in social sector case: Building momentum by building “brand” (i.e., deep will of emotional goodwill and mind-share of supporters emotional goodwill and mind share of supporters and potential supporters).

– In for-profits, money is both an input and output: in non profits it’s only an input Mission output: in non-profits, it s only an input. Mission achievement is the output, defining metrics by proxies for greatness (e.g., Cleveland symphony) symphony).

– “In the social sectors, performance is measured by the results and efficiency in delivery of the y y ysocial mission.”

Good to Great Principle #5:Culture of DisciplineCulture of Discipline

• Disciplined People Thought Action• Disciplined People, Thought, Action– Environment of freedom circumscribed by a

culture of discipline. With di i li d l d ’t d h – With disciplined people, you don’t need much hierarchy or bureaucracy (since self-disciplined people don’t need to be managed). With disciplined action o don’t need man – With disciplined action, you don’t need many controls.

– Combining a culture of discipline with a spirit of entrepreneurship creates success of entrepreneurship creates success.

– Discipline is as much about saying “No” to temptations that are not one’s core business as it is about saying “Yes ”as it is about saying Yes.

G2G Principle #5:Culture of DisciplineCulture of Discipline

• Social Sectors Variation: – “Greatness is not a function of

circumstance; greatness, it turns out, is largely a matter of conscious choice, g y ,and discipline.”

G2G Principle #6:Technology AcceleratorsTechnology Accelerators

• Never use technology to introduce a transformation but rather to accelerate it. Technology is not the core concept but can drive it.– Baumol’s Disease: Schools “less efficient

not more” because of technology.gy– With some notable exceptions, most

schools not yet using technology to schools not yet using technology to “accelerate” core business.

Built To Last & Good to GreatCompaniesCompanies

»James C Collins and Jerry I Porras Built To »James C. Collins and Jerry I. Porras, Built To Last, Harper Collins, 1004. Corporations cited who historically have outperformed all others by a

d l d 3wide margin include 3M, American Express, Boeing, Citicorp, Ford, GE, Hewlett-Packard, IBM, Johnson & Johnson, Marriott, Merck, Motorola, Johnson & Johnson, Marriott, Merck, Motorola, Nordstrom’s, Proctor & Gamble, Phillip Morris, Sony, Wal-Mart, and Walt Disney Corporation.

»Jim Collins, Good to Great, Harper Collins, 2001. Corporations cited who moved from “good” to Corporations cited who moved from good to “great” include Abbott, Circuit City, Fannie Mae, Gillette, Kimberly-Clark, Kroger, Nucor, Phillip Morris, Pitney-Bowes, Walgreen’s, and Wells Fargo.