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  1. 1. STRATEGIC BUSINESS PLANNING Designing the Future of the Organization
  2. 2. Our Goals for Today ...  Explain and demonstrate the basics of Strategic Business Planning.  Get you “started” on the process.  Provide a framework to continue the process.  Lots and lots of application - workshops Set the tone:  The 5 ways to run or ruin a great business…
  3. 3. NO ! D= IO NO ! Op NO ! NO ! NO ! NO ! NO ! NO ! YES!!!
  4. 4. The 5 Key Factors -/+ 1. Lack of a clear, specific , vivid, compelling and realistic vision. What is your clear Intended Outcome? 2. Lack of urgency. You must turn the business plan…into a business reality. 3. Lack of open, honest communication. C-C-C-T 4. Allowing sub-par employees to remain. T.T.T. 5. Turning the focus inward. The customer MUST be the focus
  5. 5. Thinking Down Board
  6. 6. I hate… Somebody should… I wish… I am sick of… Why don’t they… It is stupid… COMPLAIN They ought to… ACCEPT CHANGE It will always be like this I must do something I have no control I can make a difference I can’t impact this I am willing to work and fight It is out of my hands I can impact or influence this No need to plan I demand that things change It has already happened It is worth the risk I don’t have the authority I must make a plan It is not worth the effort or risk This is my responsibility I can’t fight it any longer This can’t go on
  7. 7. What is Strategic Business Planning ?
  8. 8. Page: 2 The Elements of the Strategic Business Planning Model External Appraisal Vision Internal Appraisal Define the business Threats and Goals Strengths and Opportunities in Weaknesses of Environment Targets Organization Measurements Critical Success Distinctive Indicators - Creation of Strategy Competencies - Contingencies Value Added P/S Implementation of Strategy Monitoring / Adjustment of Business Strategy Read page 3 for the more simplistic view…
  9. 9. Page: 4 1. Long-term impact of decisions  Strategic planning deals with the future impact of current decisions. This means looking at the cause and effect consequences, over time, of an actual or intended decision.
  10. 10. Page: 4 2. Strategic Business Planning is a process  It is a process that begins with the setting of organizational aims, defines strategies and policies to achieve them, and develops detailed plans to make sure that strategies are implemented so as to achieve the results sought.
  11. 11. Page: 4 3. It is a philosophy  Strategic Planning is an attitude, a way of life. Planning necessitates dedication to acting on the basis of contemplation of the future, a determination to plan constantly and systematically as an integral part of management.
  12. 12. Page: 4 4. It gives structure A formal strategic planning system links the three major types of organizational plans:  Long-range Strategic Plans  Medium-range Programs  Short-range Budgets and Operating Plans
  13. 13. Page: 5 What Strategic Business Planning is Not !  Strategic planning does not attempt to make future decisions.  Strategic planning is not forecasting.  Strategic planning is not an attempt to blueprint the future.  Strategic planning is not necessarily the preparation of massive plans and reports.  Strategic planning is not an effort to replace good management judgement.
  14. 14. Page: 6 Why Planning Pays Off  Asks & answers questions of importance  Simulates the future  Forces the setting of objectives  Gives a framework for decisions  Develops performance measurements  Improves communications
  15. 15. Page: 7 Varied Goals for Strategic Business Planning Go to page 7 and pick your top 3 or 4 reasons why you believe planning is of value to your team
  16. 16. Page: 8 The 5 tasks of Strategic Business Planning Gap & Defining the Crafting a business / SWOT analysis - strategic developing a Vision Setting Action Plan objectives Evaluating Implementing performance and executing reviewing - strategy adjusting correcting
  17. 17. Pages: 9 & 10 BusinessThinking 1. Check your ego at the door 2. Create Curiosity 3. Move off the solution 4. Get evidence 5. Calculate the impact 6. Explore the ripple effect 7. Slow down for yellow lights
  18. 18. Page: 11 Task 1 Define the Business Develop a Vision  You must create a clear, vivid, compelling and achievable VISION of where you want to take your business over the next 3-5 years. Some key questions to think about…
  19. 19. Page: 11 1. What is the thrust or focus for future business development? 2. What is the scope of products and markets that will - and will NOT - be considered. 3. What is the future emphasis or priority and mix for the products and markets that fall within that scope? 4. What key capabilities / resources are required to make this strategic Vision happen? (money, product, people, advertising, distribution…) 5. What does this Vision imply for growth and return expectations?
  20. 20. Task 1 - Define the Business Develop the Vision  Read page 12 – see list of additional key questions.  Read vision example for Adbiz  Do all or part of the ThinkSheet on page 13  Complete the workshop on page 14
  21. 21. Page: 15 The GAP / SWOT Analysis Situation The Vision 3-5 years Audit “GAP” Where you Where you are today. What you have want to go. to do to get there.
  22. 22. This is the crucial stage of asking and honestly answering dozens of very difficult questions
  23. 23. Page: 15 Gap / SWOT Work Shop Read and answer ALL the questions on pages 15-21 Some will be redundant Some you won’t know Many you will need more information in order to answer Some will not apply  Write your answers on a separate sheet Write very clearly – complete sentences This is supposed to be very hard work…
  24. 24. Now you should have a huge collection of data, facts, concerns and questions. The next step is to convert all of this random – but important - information into a list of key Factors
  25. 25. Page: 22 Factors are:  Anything that could positively or negatively affect your ability to accomplish the vision.  Written in complete sentences.  Written as a statement of fact. Examples: 1. I DK our current market share. A 2. We have 3 new products that will launch this year. B  Prioritized:  A = Immediate action required – top priority  B = Requires action at some time  C= important information – but no action required
  26. 26. Page: 22 As you review the analysis…  You may address several items with just a single well written Factor  It may take multiple factors to cover just one piece of data.  When in doubt – write another Factor Examples: 1. Our major competitors are Acme and Ajax. C 2. We currently have 15% market share. A 3. The target is to reach 20 % Market Share by 6/30/03 A 4. DK if Sun Systems is planning to enter our market. B 5. DK if we can renegotiate our supplier contracts. B 6. DK if we can automate part of our production process. A 7. Our current computer system is not sufficient for our needs. A 8. DK the technical spec’s of an acceptable computer system. B
  27. 27. Page: 23 It may help to create Factor categories to keep track of the major themes  Financial  Technical  Marketing  Sales  Personnel  Customers  Competitors Factors workshop pages: 22-25
  28. 28. Page: 26 Business Objectives Now come this most difficult step – the actual setting of business strategy – the creation of key Business Objectives
  29. 29. After looking at all of your Factors and Factor Categories… You must now create a handful of strategic thrusts that will drive your team for the next 3-5 years.  What are the main areas of focus?  Where will you deploy resources?  How will you measure success?
  30. 30. Isn’t this a little redundant – again? Yes, we are going through a time consuming but necessary screening process. Form the broadest examination of the business possible, down to the few Key Result Areas that must be accomplished to successfully achieve the Vision.
  31. 31. The setting of Business Objectives may take days or even weeks… Begin the workshop on pages: 26 & 27
  32. 32. Page: 28 The rubber meets the road… Business Objectives drive the Strategic Action Plan
  33. 33. Delegation Empowerment pecific MBO Strategic Plan easurable greed Upon ealistic Write them down ime Bound
  34. 34. Once again, this is time consuming and difficult… but vital to your success!  Actions must be clear and focused  Write them as output – not input  Assign responsibility and a due date  Cross-reference with key Factors  Hold people accountable  Track progress and failure  Adjust as needed – new info Workshop pages: 28 & 29
  35. 35. Page: 30 Contingency Planning  Factors that could have a serious impact on your business.  Probability - % or H/L  Impact - % or H/L  Trigger Point - measurable  Contingency Plan - Action
  36. 36. Page: 31 The final steps – but the critical ones…  Implementation  Monitoring, review, adjustment  New vision - new plan
  37. 37. That is: Strategic Business Planning Thank You