Download - Turning Strategy In Action
Presenter: Ajay M. Pangarkar, CTDP, CPA, CMA
Based Upon the BookThe Trainer’s Balanced Scorecard: A Complete Resource for Linking Learning to Organizational Strategy
CentralKnowledge Where Learning…Means Business
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Building Business Acumen for Trainers: Skills to Empower the Learning Function (with CD) Published by Wiley Terrence Gargiulo, Ajay M. Pangarkar, Teresa Kirkwood
additional resources
The Trainer’s Balanced Scorecard: A Complete Resource for Linking Learning to Organizational Strategy Ajay M. Pangarkar, Teresa Kirkwood Published by Wiley
CentralKnowledge.com Where Learning…Means Business t: 866.4.VXPERT e: [email protected] tw: @ajaypangarkar
Identify variables supporting strategy and to deliver results
what to expect
Develop critical process to strategy formulation
Implement a strategy for performance expectations
turning strategy into
action
Learning objectives:
Develop a framework to support strategy execution
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strategy facts…
“ approximately 5% of all organizations implement their strategies successfully, and 70% of strategic initiatives fail to meet their objectives. the remaining 25% have some mild success but do not meet the full potential of the strategy devised. - Kotter International
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quick question…
what’s strategy to you? • Turn to the person next to you • Take 3 minutes and describe
what strategy means for you
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how strategy is seen…
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what strategy is not…
Strategy is more than just financial results…
…financial success is a result of a well executed, performance focused strategy - Ajay M. Pangarkar CTDP, CPA, CMA
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what strategy is not…
• provides long-term coherence and direction
• documents key choices to make
a strategic plan is not a ‘to do list’
• focuses on ‘big picture’ direction
• provides operational action items
What it is…It…
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defining strategy…
simply as going from point A to point B…
Where you are
Where you want to be
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defining strategy…
then… why do so many still get it wrong?
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defining strategy… Mission
Why we exist
Values What’s important to us
Vision What’s we want to be
Strategy Our game plan
Strategy Map Connecting the strategy Balanced Scorecard
Managing strategy performance
Targets and Initiatives What we need to do
Personal Objectives What I need to do
Satisfied Shareholders
Happy Customers
Effective Processes
Motivated Workforce
Strategic Outcomes
Ref: Kaplan & Norton
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?
core strategy concepts
Getting to… B
Where are we now
Where are we going
How will we get there ? ?
Can you answer these questions?
Take 5 minutes; turn to your neighbour and try
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?
core strategy concepts
Getting to… B
Where are we now
Where are we going
How will we get there ? ?
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core strategy concepts!
Mission and Objectives
Environmental Scan
Strategy Implementation
Strategy Formulation
Evaluation & Control
? where are we now
how will we get there ?
? where are we going ?
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strategy development!
1 define the mission 2 ? 3 identify
expectations evaluate situation
4 address options 5 implement
option(s) 6 align operations
we’re going to “storyboard” strategy
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the case: sky air
• Sky Air, a value driven airline
• Strategy shift from market growth to profitability
• Profit growth through revenue or efficiency
• Loyal clients enjoying value from SkyAir
• CEO wants efficiency over revenue growth
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where do we begin?
we need to start somewhere… what do you think?
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basic mission concepts
Current focus: • what is the mission? none?…imply one • does it clearly communicate intent? no, why?
Future direction: • does the current one fit? no, why? • what changes/modification is required?
Keep in mind mission components why; what; how; where; values
1 define the mission
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basic mission concepts
HOW an organization accomplishes what it
does to exist!
Corporate Strategy
Mission
WHAT an organization must do to become
what it aspires to be!
Vision
Business Strategy
1 define the mission
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what a mission can do…
Be the world's best quick service restaurant experience. Being best means providing outstanding quality, service, cleanliness, and value, so that we make every customer in every restaurant smile
McDonald’s mission:
1 define the mission
what are your observations about the mission?
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now it’s your turn…
In your group: § read the SkyAir case
§ together, identify Sky Air’s mission
§ what is the current focus?
we’re going to “storyboard” SkyAir
1 define the mission
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sky air’s mission
Dedication to building a recognized brand with… • the highest quality customer service and respect • delivered with a sense of warmth, friendliness,
individual pride, and company spirit • continuing building our unique position as a
leading short haul, point-to-point carrier in North America.
1 define the mission
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anchor your strategy…
customer intimacy
product leadership
operational excellence
value disciplines focus
• customer needs • value not price
• market leader • innovator, adopters
• lean operations • efficiency, reliability
example
2 identify expectations
Can a company have more than one?
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other analysis tools?
Core Competence (P&H) • what do we do better
than others
Porter’s ‘what is strategy?’ • cost leadership,
differentiation, market focus
2 identify expectations
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now it’s your turn…
In your group: § revisit the mission
§ decide on a primary discipline
§ what is their strategy focus?
what’s SkyAir’s “anchor”?
2 identify expectations
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strategic analysis
Strategically analyze industry/competitive
conditions
Strategically analyze your company’s
situation
What strategic options does the company have?
What is the best strategy?
mission
à opportunities à threats
à strengths à weaknesses à stakeholder needs
revised mission
3 evaluate situation
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strategic analysis – external
Key Questions: • What are the industry’s dominant features?
• What’s changing the competitive/business environment?
• Which companies are in strong/weak positions?
• What strategic moves are rivals likely to make?
• What are key factors for competitive success?
• Is the industry attractive and what are the prospects for above-average profitability?
Strategically analyze industry/competitive
conditions
3 evaluate situation
external focus
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strategic analysis – internal
Key Questions: • How well is the present strategy working?
• What are the company’s strengths, weaknesses, opportunities, and threats?
• Are the company’s prices/costs competitive?
• How strong is the company’s competitive position?
• What strategic issues does the company face?
Strategically analyze your company’s
situation
3 evaluate situation
internal focus
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swot analysis
S = what do we do well W= what do we do poorly
O = what is the industry growth T= what are industry challenges
3 evaluate situation
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‘keys’ to the company key success factors • necessary to achieve the mission • vital for a successful strategy • drives the strategy forward;
makes or breaks it
key risk factors • not meeting a KSF • external threats or festering
weaknesses
3 evaluate situation
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quick question…
what are your ksf’s? • Turn to the person next to you • Take 5 minutes; come up with
3 ksf’s for your company
• Ensure they are ksf’s and not competitive advantages
3 evaluate situation
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other analysis tools?
Porters 5 Forces • Supplier, buyer, rivalry,
substitution, new entry
others you use?
PESTEL
• Political, economic, social, technology, environmental, legal
3 evaluate situation
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now it’s your turn…
In your group: § review the SWOT provided
§ identify additional SWOT points
§ identify KSFs/KRFs
§ define is the stakeholder need
evaluate SkyAir’s “situation”
3 evaluate situation
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address strategic options evaluate options to address issues: 1. operational efficiencies (flight turnaround)
2. revenue growth (premium packages)
strategy alignment ‘test’: • align with the mission? • meet with stakeholder needs? • fit with the value discipline? • capitalizes on KSFs?
4 address options
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now it’s your turn…
In your group: § select one option
§ evaluate its pros and cons
§ how well does it align?
§ hint: review the current situation
evaluate SkyAir’s strategic “options”
4 address options
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strategic fit
Best Strategy
A good fit?
Competitive advantage?
Performance objectives?
Fit the Mission?
5 implement option(s)
overall objective operational performance
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now it’s your turn…
In your group: § review the original mission
§ does it need to be modified?
§ if yes, then modify it
evaluate SkyAir’s “mission”…again
mission revised mission
5 implement option(s)
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sky air’s (revised) mission
Dedication to building a recognized brand with… • the highest quality customer service and respect • delivered with a sense of warmth, friendliness,
individual pride, and company spirit • continuing building our position as a leading
operationally efficient short haul, value driven fares, point-to-point carrier in North America.
5 implement option(s)
time to ‘operationalize’ the mission
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operational performance
“ a set of management processes help to improve management, strategy execution and decision making.
it helps execute strategy and to measure and monitor performance to make strategic decisions and learning.
it is the quality of those decisions that separate successful companies from the rest
- Advanced Performance Institute
6 align operations
performance management is…
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operational performance 6 align operations
Financial objectives “What stakeholders want?”
Customer expectations “How customers see us?”
operational financial results
market reality and expectations
support external requirements
enable operational requirements
Internal focus “What must we do well?”
Learning capacity “Improve/create value?”
• operationalize the mission
this how you:
• measure strategy performance
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Customer Need Identified
Design Develop Make Market Customer
Need Satisfied
Service
Time to Market Supply Chain
CUSTOMER CUSTOMER INTERNAL PROCESS
LEARNING & GROWTH
Innovation Operations
FINANCIAL
performance & value chain 6 align operations
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• Sales training program • Custom. service training • HR hiring plan
• 50% incr leads • 10% incr. satisf • Maintain/incr. level by 15% / month
• Sales/month • Client satisf. • Client retention • Weekly perform reviews
• Develop/hire sales staff • Develop/hire cust. Service staff
Learning
• Incr. Resource to R&D • Benchmarking
• <$2M/quarter • >75 days from current • >10 min/client
• Invst. in R&D • Development to mkt turnaround • Cust. resp time
• Develop innov. products • Reduce client handling
Internal
• Cust. service • Innovation management • Customer loyalty program
• < 90% satisf. rate from 2005 • Survey 75% clients • % change
• Cust. satisf survey/levels • Survey current customers
• Increase client loyalty • Build client relat. And identify client needs
Customer
• Ident. markets • Stabilize prod cost • Acquire sales tools
• 35% in 2 years • 22% / year • 40% / year
• Revenue stmt. • Production level • Sales forecasts
• Revenue incr. • Increase prod. • Increase sales
Financial
Initiatives Targets Measures Objectives Strategy Map Incr. revenue
Increase production
Increase sales levels
Increase client loyalty
Develop cust. relation.
Develop new products
Align Sales team
Develop cust. service
staff
Facilitate client interaction
performance framework 6 align operations
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now it’s your turn…
In your group: § use the revised mission and swot
§ complete the BSC provided
§ map the performance links
operationalize SkyAir’s “strategy”
6 align operations
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sky air performance 6 align operations
Objectives Measures Target Initiative
Financial 1. Increase profits 2. Increase revenue 3. Fleet management
• P&L forecast to actual • Incrm. revenue report • Reduce fleet size;
reduce cost; incr. profit
• 10% net profit/yr • 15% / year • 35 planes
• Optimize flight time • Intro high margin products • Increase customer capacity of
existing fleet
Customer 1. Flight is on-time 2. Lowest prices 3. Customer
satisfaction
• FAA OnTime arrival rating
• SA to industry price report
• Customer survey
• 90% on-time arrival
• Currently #2 by Consumer Report
• 85% satisfaction
• Quality management
• Manage prices to 5% lower than competitors
• Customer loyalty program
Internal 1. Fast turn around 2. Fast passenger
processing 3. Effective resource
utilization
• On ground time • Time to disembark and
board • Resource utilization
report
• 30 minutes or less • 25 minutes or less
• 90% resource use
• Cycle time optimization for ground crew
• Cycle time optimization for gate/boarding crew
Learning 1. Ground crew alignment
2. Boarding/Gate staff alignment
• Cycle time optimization benchmark report
• Cycle time optimization benchmark report
• 30min turnaround (15% improve)
• 90% resource use • 25 min. boarding • 95% satisfaction
• Ground crew activity analysis • Optimize value add activities • Assess resource utilization • Boarding/gate staff analysis • Identify passengers concern
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quick question…
what are you taking away today? • Turn to the person next to you • Take 3 minutes to name what is your
take-away and how you will apply it
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Identify variables supporting strategy and to deliver results
turning strategy into action
Develop critical process to strategy formulation
Implement a strategy for performance expectations
learning objectives review:
Develop a framework to support strategy execution
§ Failure occurs when not operationalized
§ Creates tangible connections throughout the organization
§ Recognize strategy is not just financial
§ Aligns with the mission
§ Need to know where you want to go
§ An evolving process to achieve the mission
§ Objectively assess its current situation
§ Leverages what it does well, mitigates what it doesn’t
CentralKnowledge.com Where Learning…Means Business t: 866.4.VXPERT e: [email protected] tw: @ajaypangarkar
Identify variables supporting strategy and to deliver results
turning strategy into action
Develop critical process to strategy formulation
Implement a strategy for performance expectations
turning strategy into
action
learning objectives review:
Develop a framework to support strategy execution
§ Failure occurs when not operationalized § Creates tangible connections
throughout the organization
§ Recognize strategy is not just financial
§ Aligns with the mission
§ Need to know where you want to go
§ An evolving process to achieve the mission
§ Objectively assess its current situation
§ Leverages what it does well, mitigates what it doesn’t
CentralKnowledge.com Where Learning…Means Business t: 866.4.VXPERT e: [email protected] tw: @ajaypangarkar
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Ajay M. Pangarkar CTDP, CPA, CMA
t: 866-489-7378 x 1 e: [email protected]
@ajaypangarkar
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