cfcfe strategy reimagined slides - dr jeff callander
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Strategy ReimaginedConnecting Purpose with Strategy
(and Action!)Date: Monday 29th March 2021 11.55 – 12.30
Speaker: Dr Jeff Callander
© Dr Jeff Callander 1991-2021 1
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For a strategy to be successful, it needs clarity of Purpose
© Dr Jeff Callander 1991-2021 2
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Working with Execs to develop and use strategy as a leadership tool
Director of EMA Consultancy Group (+30 years) – Strategy Advisor
Developing tools / techniques to analyse / quantify opportunities
Over 160 projects in over 50 countries
Director/Founder of IESL (+25 years) - Oilfield engineering service company
Executive Fellow & PD of Henley Business School and UoS
Teaching, lecturing, workshops
Doctorate (DBA) at the University of Southampton – Business Goal Setting
Dr Jeff CallanderPractitioner & Academic
© Dr Jeff Callander 1991-2021 3
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© Dr Jeff Callander 1991-2021 4
Dr Jeff Callander 1991-2021
Brazil
United States
Canada
Greenland
Mexico
United Kingdom
Ireland
Spain
France
Norway
Iceland
Sweden
Finland
Cuba
Italy
Egypt
GermanyPoland
Greece
Switzerland
India
Australia
Japan
China
Russia
Venezuela
Guyana
Suriname
French Guiana
Columbia
Ecuador
Peru
Bolivia
Chile
Argentina
Paraguay
Uruguay
Falkland Islands
Haiti
DominicanRepublic
Jamaica
PanamaCostaRica
NicaraguaEl Salvador
Honduras
BelizeGuatemala
Portugal
Estonia
Austria
Turkey
Algeria
Libya
Morocco
Czech Rep.
Denmark
Lux.Belgium
Netherlands
Tunisia
Belarus
Ukraine
Romania
Moldova
Lativia
Bulgaria
Hungary
Slovakia
Serbia
Russia
Chad
WesternSahara
Mauritania Mali
BurikinaFaso
Israel
Lithuania
Albania
Bos. &Her.
NigerSudan
Croatia
Cyprus
Jordan
Syria
Senegal
The Gambia
Guinea-Bissau Guinea
SierraLeone
Liberia
CoteDivoire
Ghana
Togo
Benin
Nigeria
Cameroon
CentralAfrican Republic
Equatorial Guinea
Gabon
Rep. ofThe
CongoDemocratic
Republic
Of the Congo
Angola
Namibia
South Africa
Eritrea
Ethiopia
SomaliaUganda
Kenya
Rwanda
Burundi
Tanzania
Malawi
Mozambique
Madagascar
Zambia
Botswana
Zimbabwe
SaudiArabia
Iraq
Kuwait
Bahrain
Qutar
United ArabEmirates
Oman
Yemen
Pakistan
Afghanistan
Iran
Georgia
Armenia Azerbaijan
Turkmenistan
UzbekistanKyrgyzstan
Tajikistan
Mangolia
Nepal Bhutan
Sri Lanka
Bangladesh
Burma
Thailand
Laos
Cambodia
Vietnam
Taiwan
South Korea
North Korea
Indonesia
Malaysia
Singapore
Brunei
Philippines
PapuaNew Guinea
New Zealand
SolomonIslands
Malta
Swaziland
Lesotho
East Timor
IDV
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* Strategy: a concept or a practice?
* Reimagining strategy: strategy as a Leadership Tool
* Purpose: essential part of creating successful strategies
© Dr Jeff Callander 1991-2021 5
Key Themesema
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© Dr Jeff Callander 1991-2021 6
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* …Ensuring everyone buys-in to the Purpose and is able to contribute to the organisation’s success
* …Developing agility, resilience and a strategicmindset within the organisation
* …Identifying opportunities and managing risk
* …Ensuring successful implementation
* …Building stakeholder engagement to enable the business to survive, revive and thrive in the future
© Dr Jeff Callander 1991-2021 7
Strategy is about…ema
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Telos - Meaning & Purpose
Meaning and purpose is what contributes to “buy-in”.
Buy-in is the acceptance of and willingness to actively support and participate in something.
Yet company engagement surveys repeatedly show that employees do notbuy-in to their company’s business goals.
© Dr Jeff Callander 1991-2021 8
^384–322 BC*from the Greek τέλος for end, purpose, or goal
Greek philosopher Aristotle^ is said to have believed people andorganisations need telos*… that meaning and purpose adds value to our lives.
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* It’s about carving out a clear and tangible place in the market that translates into meaning and value for stakeholders
* It provides a description of what the organisation exists to do which both employees and customers can link to emotionally and rationally
* Along with the values, it
guides the organisation’s strategies
© Dr Jeff Callander 1991-2021 9
What is it to have Purposeas part of the strategy?
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* Mission - “Why do we exist?”* ANTIQUATED - Internalised and passive shareholder focused
* Purpose - “What are we here to do?”* Externalised and stakeholder focused value creation
* Values - “What should our behaviour be?”* This complements and is the enabler to the Purpose
* Vision - “What can we be?”* An image of what the organisation could look like in the future
* Goals - “What can we achieve?”* Provides the tangible measures of progress against the Purpose
© Dr Jeff Callander 1991-2021 10
Purpose, Values, Mission, Vision, Goals
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Strategy in Context
Strategyas aLeadership Tool
© Dr Jeff Callander 1991-2021 11
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nion Conference* Low returns from investments
* Asset underutilisation (savings “excess”)* Fragmenting contact with members* Lack of data on members and the market
* High overheads due to personalised service* Fintech and financial alternatives taking share* High variability across credit unions – tech, service * Difficulty in leveraging economies of scale through ToEs
Dysfunctional business models and organisations?© Dr Jeff Callander 1991-2021 12
Dealing with the uncertainty of Credit Union Trends
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* Vulnerabilities exposed* Unnecessary expenses identified* Shifts in communication channels and Route-to-Market* Inequality revealed - same storm but many different boats* Highly variable demand the new norm – a rebound?
* New consumer & customer segmentation needed* Experience prevails over tangible goods* The potential of can-do capability highlighted* Human centred approaches re-emerging
Don’t waste the opportunities this presents in revisiting your Purpose and reimaging your strategies
© Dr Jeff Callander 1991-2021 13
Dealing with the uncertainty of Pandemic Trends
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Dealing with the uncertainty of Market Trends
Since 2002, 52% of the Fortune 500 companies are no longer around;
most are now expected to last no more than another 15-20 years.
Disrupt 100 (2017)
“What is not so clear is how credit unions will protect and build upon their unique voluntary, not-
for-profit, member orientation.”O. McCarthy et al., The Financial Co-operative System in Ireland,
Credit Cooperative Institutions in European Countries 2016
© Dr Jeff Callander 1991-2021 14
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“As thoughts turn to recovery in the economy and in communities across Ireland – now is the time for credit
unions to focus on evolving the business model by using available lending capacity to serve members’
needs on a safe and sound basis.”
“This offers a path to sustainability, which puts members’ savings to aproductive economic use in line with the objects of credit unions, andhelps ensure an ongoing funding need for growth in members’ savings.
© Dr Jeff Callander 1991-2021 15
Financial Conditions of Credit Unions 2020ema
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A Journal of Management & Organization meta-analysis shows this ranges from 28-90%!
“Management concede that it’s often problematic to achieve the goals that are set out within their business strategies.”
Engagement surveys show less than 40% of staff feel they have clarity about the business direction and their potential contribution.
Despite saying they understand the business’ priorities, research repeatedly shows staff rarely can play these back even partially.
Why is this?
Failures of strategy and strategy implementation
© Dr Jeff Callander 1991-2021 16
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Uncertainty about Leadership
© Dr Jeff Callander 1991-2021 17
Strategy is a Leadership Tool
and Strategy equips an organisation to deal with
uncertainty
Is your credit union’s Leadership
using strategy
as a leadership tool?
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The “Story” The TitanicContext It sank …Purpose ???
Analysis Poor design
Actions Change ship structural designs
© Dr Jeff Callander 1991-2021 18
Why Purpose is what leads to ActionThe Titanic - Actual
It sank…Lives should not be lost at sea
Poor design but also poor regulations, oversight and understanding of impact
Ship structural designs were changed – but ALSO…1. Ice Patrol was established2. SOLAS set up and maritime treaty signed3. Communication was improved4. Radio communication rules agreed5. New rules for pyrotechnics6. Training of close vessel response agreed7. The required number of lifeboats increased8. Lifeboat drills were strictly implemented9. Watertight integrity advanced10. Thermal protection apparatus
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The “Story” Credit UnionsContext Sustainability challengedPurpose ???
Analysis Low returnsLoss of borrowers
Actions
Emulate banking servicesMerge for the sake of mergingChase FintechUse marketing gimmicks
© Dr Jeff Callander 1991-2021 19
Why Purpose is what leads to ActionCredit Unions - Potential
Sustainability challengedMembers’ Financial WellbeingLack of engagement and understanding of members and their financial wellbeingEngage and with membersEngage with non-membersEngage with staffEngage with communityEngage with educationEngage with businessSeek member led IT solutions
thenRe-establish the CU’s PurposeRebuild the Business Model
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© Dr Jeff Callander 1991-2021 20
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Is Strategic Leadership limiting the success of your business?
Lighthouse
© Dr Jeff Callander 1991-2021 21
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Leadership is: “…the art of getting someone else to do something
that you want done because he wants to do it.”
Dwight D. Eisenhower Annual Conference of the Society for Personnel Administration, 5/12/54
© Dr Jeff Callander 1991-2021 22
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“There is an urgency for leaders to define and convey theirorganizational Purpose and vision more clearly - and rally employeesaround it. Employees have little belief in their company's leadership.”
Few employees strongly agree:* only 22%… say their leadership have a clear direction for the
organization* only 15%… say their leadership makes them enthusiastic about the
future* only 13%… say their leadership communicate effectively
© Dr Jeff Callander 1991-2021 23
Gallup Poll
State of the Workplace 2018 (USA)
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Typical Quotes from Research
* I would like my goals to make a contribution to the company’s goals just as I would like the company goals to contribute to my goals.
* Where is my part in the value chain… where is the value chain?
* Purpose and strategy should aid and direct decision making… why don’t ours?
© Dr Jeff Callander 1991-2021 24
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Misguided Purpose
© Dr Jeff Callander 1991-2021 25
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* Steers the overall strategic mindset of the company* Provides directional unity within the organisation* Creates a sense of belonging, a part of a greater whole* Enables referenced decision making and fixes boundaries
* Stimulates positive contribution, pride and presence* Serves as the standard evaluate personal performance* Becomes part of the culture, naturalised throughout* Supports organisational wellbeing
Generates VALUE© Dr Jeff Callander 1991-2021 26
What is it to have an effective Purposecommunicated within the organisation?
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Engagement
Engagement remains low -Globally 63%^Europe 58%^
UK 48%*
Employees are looking to senior leaders to point the way and make decisions for the future.
Less than 40%‡ of the workforce reports knowing their company’s goals, strategies, and tactics…
© Dr Jeff Callander 1991-2021 27
Key Trends in Employee Engagement 2018 - Best Companies Index (BCI)Leadership
Leadership^AON 2016, *Qualtrics 2017, ‡Bain 2018
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Results: Consistently Profitable
© Dr Jeff Callander 1991-2021
Gallup: State of the American Workplace Report 2013
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CustomerProductivityProfitability
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Key Concepts
StrategyDevelopment
© Dr Jeff Callander 1991-2021 29
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What is a Business Strategy?
© Dr Jeff Callander 1991-2021
It should provide enough information and guidance for decision-making.
But not so prescriptive that it stifles initiative, agility and creativity.
As a leadership tool, it should facilitateautonomous decision-making
and “line-of-sight” for key stakeholders!
30With permission from Dr Jeff Callander
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TheMarket
The Callander Externalised StrategyDevelopmentWheel
© Dr Jeff Callander 1991-2021
Business
Goals
Objectives &
Responsibilities Resources& P&Ls
Stra
tegi
c Op
tions
Impl
emen
tatio
n
& M
onito
ring
OpportunityAssessment
The WHY*
The How
31With permission from Dr Jeff Callander
*e.g. Simon Sinek’s, Start With Why
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Reimagining Strategy
APurpose DrivenBusinessModel
© Dr Jeff Callander 1991-2021 32
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The Typical Linear Financial EconomyValue Extraction Business Model
© Dr Jeff Callander 1991-2021
Environment RegulatoryGovernment
InvestmentsStaff /
Premises
Borrowers& Savers
Business
Education
Charities
Community
Banks &Other
FinancialShareholdersInterest
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The Current Members’ Perception Business Model
© Dr Jeff Callander 1991-2021
Charities
Community
RegulatoryGovernment
Staff /Premises
CreditUnion
BorrowersThe ProductInterest
BorrowingMembersThe CU
Environment
Entre-preneurship Education
LocalBusiness
SaversShareholders
Capital
SavingMembers
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The Actual “Members” Business Model
© Dr Jeff Callander 1991-2021 35
CreditUnion
Staff /Premises
RegulatoryGovernment
Education
Charities
Community
Invest-ments
3rdParty
Borrowers(Business)
Borrowers(AssetBased)
Savers(Shareholder)
Interestless Admin
Costs & Rebate
AdminCosts
Borrowers(The Product)
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© Dr Jeff Callander 1991-2021 36
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What is the Purpose of a credit union?
“As a member owned financial service provider, a credit union exists to enable members to improve their own, their fellow members’ and their community’s financial wellbeing.”
Dr Jeff Callander 2020
© Dr Jeff Callander 1991-2021 37
Purpose
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Environment
Entre-preneuship
The Circular Financial Economy – Potential Role for the CU
© Dr Jeff Callander 1991-2021 38
SaversMembers
Borrowers
LocalBusiness
Community
Charities
Education
Valu
esPurpose
Govern-ment?
Regulatory
BigBusiness
Invest-ments
3rdParty
Mem
bers
–“P
artn
ers
for l
ife”
Thro
ugh
thei
r life
sta
ges
of
Savi
ng a
nd B
orro
win
g
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Do you and your credit union’s staff use the credit union for all your borrowing needs?*
Incidental? – Topup? – Car? – Education? – Agri?Community? – Green? – Holiday? – Credit Card Debt?
Home Improvement? – Mortgage? – Business?
© Dr Jeff Callander 1991-2021 39
Quick Test of your Business Model and Purpose
*of the available services
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How does Purpose make the difference?
© Dr Jeff Callander 1991-2021
F1 Pit
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You can have the tools but you also need the capability
© Dr Jeff Callander 1991-2021
DO A STRATEGY PITSTOP
TODAY!
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YDK-W-YDK!jeff@emacg.com
© Dr Jeff Callander 1991-2021 42
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