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Mitchell Weisberg A Global Perspective on Alignment
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  • 1. A Global Perspective on Alignment: Looking Over the Horizon Mitchell Weisberg April 1, 2014
  • 2. ©1997-2012 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 2 • Director: International Business, Balanced Scorecard Institute • Global Practice Leader of Performance Management at HP, Arthur D. Little and at Nolan, Norton/KPMG. Group Director of Strategic Planning-Motorola; Managing Director-Lumen, Inc. • Over 30 years of thought leadership and experience in performance management, balanced scorecard and strategic planning • Faculty, Northeastern University – Strategic Management in Healthcare • Member of team that developed the Balanced Scorecard with Norton and Kaplan • BS (Cornell University-Mechanical/Biomedical Engineering); MS (University of North Carolina, School of Public Health in Organizational Change and Health Behavior); Advanced Marketing Management Executive Program (Wharton School) Mitchell Weisberg
  • 3. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. Today’s Objectives • Gain a perspective on our Performance Management Journey – Current strategic alignment and organizational performance – Future enhancements to alignment which enable higher performance
  • 4. “Less than 10% of strategies effectively formulated are effectively executed” Fortune Magazine “Why do [they] fail We estimate that in 70% of cases…it isn’t bad strategy…it’s bad execution” Bossidy and Charan ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 4 What is the Biggest Problem with Strategy & Performance Management?
  • 5. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 5 Insight to Higher Performance Align with the strategy to: • Focus resources where they REALLY matter • Set priorities and reduce projects rationally according to strategic goals • Actively monitor and management results delivery • See and respond to emerging and existing challenges
  • 6. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 6 Excellent Execution Requires Alignment • Everyone uses the same language • Line-of-sight between activities and decisions to strategy and vision • Logical alignment of vision, strategy, programs, budget and people • Resources aligned with strategic objectives 
  • 7. Performance without Alignment Low Level Returns 7 Why is Alignment Important? High Value Results Performance of Aligned Organization ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission.
  • 8. Opportunity Cost Low Level Goals 8 Failure of Strategic Alignment has Hidden Costs High Value Outcomes Value of Unaligned Improvement Initiatives Value of Improvement Initiatives Aligned to Strategic Objectives ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission.
  • 9. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 9 In International Markets Alignment is Critical • Rapid responsiveness to market changes • Greater value from customers • Growth and productivity of employees
  • 10. ©1997-2014 Balanced Scorecard Institute, a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 10 Failure of International Alignment is Costly • Divergent strategies • No synergies and shared growth • Unintended competition
  • 11. ©1997-2014 Balanced Scorecard Institute, a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 11 Trends in Strategy Execution
  • 12. 12 Performance Management 1.0 – 1990’s
  • 13. 13 Stage 1.0 Ability to Report Performance Challenge of the 1990’s: “How to get better control over performance and make it more predictable…”
  • 14. 14 Benefits of Stage 1.0 Align the organization Insight into operations’ effectiveness Reporting capability Gave organizations the ability to manage the organization and be more efficient
  • 15. Performance Management 2.0 – 2000’s
  • 16. 16 Stage 2.0 Ability to Manage Challenge of the 2000’s: “How to use the methods of the 1990’s to better align the organization and drive better results…”
  • 17. 17 Benefits of Stage 2.0 • Enables well-informed, insightful FACT-BASED business decisions • Timely view of response to management actions • Increased ability to execute strategy of the organization Gave the organization the ability to align and be more effective
  • 18. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 18 Agility is Critical in Today’s International Markets • Dynamic markets and trends • Political and social forces • Differing work styles and expectations
  • 19. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 19 Customers are Dramatically Different • Global market perspective • Not about the competition • Different values and cultures
  • 20. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 20 Engaged Employees Deliver Higher Productivity • Clear understanding of strategy • Transparency across the organization • Timely decisions and focused actions
  • 21. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 21 Alignment - What Does It Take?
  • 22. 22 Performance Management 3.0 – 2014 Time
  • 23. ©1997-2014 Balanced Scorecard Institute, a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 23 You Have a Foundation, So What’s Next? • Look beyond the organization • Growth beyond consistency • Transformation, not status quo
  • 24. 24 Big Data and Predictive Analytics Enable Greater Performance Ability to Control AbilitytoKnow Unknown Known Uncontrollable Controllable Ability to Control AbilitytoKnow Unknown Known Uncontrollable Controllable
  • 25. 25 Big Data Extends Your Intelligence Beyond Your Own Organization Business Department Organization
  • 26. 26 Big Data Extends Your Intelligence Into the Market Business Department Organization Competitive Environment GLOBAL STRATEGY
  • 27. 27 Predictive Analytics Expose Emerging Patterns
  • 28. 28 Statistics Describe History • Basketball shot on the foul line with 3 seconds left in the game… what is the probability he will make the shot? • What is the likelihood he will make the shot given: time in game, home court, recent foul, team pressure, background noise, etc.  this is predictive analytics with “big data”
  • 29. 29 Predictive Analytics are Actionable
  • 30. Strategy Map with Predictive Analysis Customer Perspective Internal Process Perspective What do our customers expect fromThe Bank? What processes must we excel at in order to satisfy our customers? Our mission:Be the principal financial partner for our clients Our strategy: Financial Perspective What doesThe Bank needto do to meet budget and financial expectations? Learning & Growth Perspective What new capabilities do we need to develop to drive future performance? Increase revenue and market share Improve value proposition to customer segments Reduce costs Increase quality of loan portfolio Increase customer loyalty Improve customer experience Reduce Administrative Processes Improve risk management Improve segment management Improve risk- return decision making process Improve quality of people Improveability toadapt to external change Innovate with technology Deploy and empower people Increase profit Predictive model shows decreasing customer retention Predictive model identifies new behavior to value
  • 31. 31 Stage 3.0 Extends the Reach • Extending the horizon – Predictive analytics – Big data • Engaging the organization… and beyond – Partners – Customers – Employees
  • 32. Statistical Analysis Forecasting Predictive Modeling Optimization Statistical Analysis Forecasting Predictive Modeling Optimization 32 Move From Reactive to Proactive Decision-Making and Management Manage- ment Align- ment Ad Hoc What is the case for action? What actions are required? How does it fit strategy? What happened? Factual
  • 33. 33 Benefit of Stage 3.0 • Optimize performance for results in current and future • Proactively respond to opportunities or avoid threats – Faster response – Cost avoidance – Retention of key employees • Broader engagement Ability to optimize performance - dynamic alignment
  • 34. 34 Examples of 3.0 in Organizations  CDC can spot outbreaks with early trend data – e.g. E coli outbreak spotted after only 5 cases averting an epidemic (http://www.healthmap.org/)  A large organization has instituted a program to predict and avoid improper payments, reducing loss or need to recover  Agencies have ability to track and predict potential security threats enables preemptive response and greater safety of the US homeland
  • 35. 35 Summary Performance Management 1.0 – 1990’s - Manage Performance Management 2.0 – 2000’s – Align Performance Management 3.0 – 2014 – Deliver Time Performance
  • 36. ©1997-2014 Balanced Scorecard Institute, a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 36 ROI = High Performance • Aligned • Engaged • Results … Delivered
  • 37. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 37 Discussion & Questions Performance Management is a Journey 37
  • 38. ©1997-2014 Balanced Scorecard Institute (BSI), a Strategy Management Group company. All Rights Reserved. Do not copy without permission. 38 Thank You Contact: Mitchell Weisberg Director, International Business mweisberg@balancedscorecard.org Direct: +1 919-648-1260 Mobile: +1 781-249-3750 Skype: weisbmi 2000 Regency Pkwy. Suite 425 Cary, NC 27518 Follow Mitch @Mitch_Weisberg on Twitter 38