Strategy Planning and Deployment Process Training Module

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The Strategy Planning and Deployment Training Module v6.0 includes:

1. MS PowerPoint Presentation including 97 slides covering our Strategy Planning and Deployment Process using Strategy Maps and Hoshin Kanri, including Introduction to Strategy Planning, Organizing the Process, Current State Analysis (CSA), Strategic Vision Elements, Strategic Breakthrough Objectives, Strategy Maps, Strategic Initiatives and Tactics, Strategy Deployment Matrix, and Strategy Implementation and Review.

2. MS Excel Templates for Annual Planning, Criticality Analysis, Force Field Analysis, Radar Gap Analysis Chart, Strategy Grid Alignment Matrix, Strategy Grid Correlation Matrix, Project Selection Matrix, Bowling Chart, and Strategy Implementation Review Table.

3. MS Word Current State Analysis (CSA) Questionnaire

4. MS Excel Hoshin Kanri Strategy Deployment X-Matrix Template

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  • Strategy Planning and Deployment Process Training Module

    1. 1. 1 Strategy Planning & Deployment Process by Operational Excellence Consulting LLC 4/9/2016 – v6.0
    2. 2. 2 4/9/2016 – v6.0 Strategic Planning and Deployment Strategic Planning is a process whereby an organization makes choices about:  Why do we exist ?  What are our major objectives and goals ?  In which markets will we compete ?  Who will be our Customers ?  How will we differentiate ourselves from our competition ?  What resources (people, processes, technology) do we need for a successful future ?
    3. 3. 3 4/9/2016 – v6.0 Strategic Planning and Deployment - Facts  Only 5% of the workforce understands their company strategy.  Only 25% of managers have incentives linked to strategy.  60% of organizations don’t link budgets to strategy.  86% of executive teams spend less than one hour per month discussing strategy. – Source: Balanced Scorecard Collaborative Strategy is an expression of what an organization intents to do to get from a current state to a future state. Strategy is often expressed in terms of a mission and vision statement, initiatives, objectives and goals. It is usually developed at the top levels of the organization, but executed by lower levels within the organization.
    4. 4. 4 4/9/2016 - v6.0 Strategic Planning and Deployment Discussion Question: 1. Most organizations tend to have good strategic plans, but they fail to successfully implement them. Identify at least two reasons why organizations fail to implement their strategic plans?
    5. 5. 5 4/9/2016 – v6.0 Strategic Planning and Deployment - The Non-Strategy Issue by John S. Hamalian Lack of a proper strategy is a serious problem that can result in ad hoc improvements that don't contribute to the organization’s overall needs.  Non-Strategy #1: ‘The Wall Placard Strategy’  Some organizations will go to great lengths to create great Vision and Mission statements, but then their planning stops there.  Non-Strategy #2: ‘The Stratospheric Strategy’  These strategies start in the clouds and they never come down, making them extremely difficult to make actionable. The result will usually be some nice slick-looking verbiage for the organization’s website and annual reports.  Non-Strategy #3: ‘The KPI Strategy’  When asked to present their strategies, some organizations excitedly pull out a beautiful PowerPoint slide that states their goals in terms of a metric. Examples are ‘double revenue in three years’ or ‘achieve 20% margin by 2013’. This is not a strategy.  Non-Strategy #4: ‘The Govern-less Strategy’  Some strategies are actually quite well constructed, but they miss one crucial element: a governance process. A strategy is worthless unless it has a clear process on who will lead the reviews, what specifically will be covered and what the frequency will be.
    6. 6. 6 4/9/2016 - v6.0 Strategic Planning and Deployment According to the Balanced Scorecard Collaborative, there are four barriers to strategic implementation: 1. Vision Barrier – No one in the organization understands the strategic objectives and goals of the organization. 2. People Barrier – Most people have objectives that are not linked to the strategy of the organization. 3. Resource Barrier – Time, energy, and money are not allocated to those things that are critical to the organization. For example, budgets are not linked to strategy, resulting in wasted resources. 4. Management Barrier – Management spends too little time on strategy and too much time on short-term tactical decision-making.
    7. 7. 7 4/9/2016 - v6.0 The 3 Value Propositions or Disciplines Market leaders choose to excel in delivering extraordinary levels of one of these three value propositions, while maintaining reasonable standards in the other disciplines. Organizations pursuing an Operational Excellence strategy, strive to deliver a combination of quality, price, and ease of purchase and service that no other organization in their market or industry can match. Operational Excellence: Companies that emphasize operational efficiency usually provide certain value attributes, such as competitive pricing, on-time delivery, or superb quality. Customer Intimacy: Other companies may create value for customers through their great relationship with the customer. Product Leadership: Finally, some companies may add value by emphasizing innovative and unique products and / or services.
    8. 8. 8 4/9/2016 - v6.0 The Four Building Blocks of Operational Excellence Achieving Operational Excellence requires the successful implementation of a integrated Business Execution System that effectively and seamlessly integrates the following four building blocks: Strategy Deployment, Performance Management, Process Excellence, and High Performance Work Teams. Strategy or Policy Deployment is the process that aligns and links business strategy and execution. Performance Management is the process that translates strategic initiatives into measurable objectives and goals. Operational Excellence can be achieved and sustained with the right attitude, the right mindset, and the right competencies. Well designed, efficient, and effective Management, Value Chain, and Support Processes are necessary to deliver world- class results. Strategy Deployment Performance Management High Performance Work Teams Process Excellence Operational Excellence Business Execution System
    9. 9. 9 4/9/2016 - v6.0 Strategic Planning & Deployment – Table of Content  Strategic Planning & Deployment Process  Organizing the Process  Current State Analysis (CSA)  Strategic Vision Elements  Strategic Breakthrough Objectives  Strategic Initiatives & Tactics  Strategy Deployment Matrix  Strategy Implementation & Review
    10. 10. 10 4/9/2016 - v6.0 Strategy Planning & Deployment – Organize the Process Phase III – Strategic Vision Elements Phase IV – Strategic Breakthrough Objectives Phase II – Current State Analysis (CSA) Phase I – Organize the Process Phase V – Strategic Initiatives & Tactics Phase VI – Strategy Implementation & Review
    11. 11. 11 4/9/2016 - v6.0 Strategic Planning & Deployment – Table of Content  Strategic Planning & Deployment Process  Organizing the Process  Current State Analysis (CSA)  Strategic Vision Elements  Strategic Breakthrough Objectives  Strategic Initiatives & Tactics  Strategy Deployment Matrix  Strategy Implementation & Review
    12. 12. 12 4/9/2016 - v6.0 Organizing the Process Preparing the Strategy Planning Process includes:  Who internally will facilitate/manage the Strategy Planning and Deployment Process?  Decide if an external resource is needed to assist with the Strategy Planning Process  Determine the scope (organization, planning period, …) of the strategic plan  Who will be involved in the Strategy Planning Process?  Determine the key planning steps, responsibilities, timelines, … of the Strategy Planning Process  Agree on terminology and definitions  What are the expected outcomes and deliverables?  Summarize current plans, vision, mission, and performance  Prepare inputs for Current State Analysis (CSA) phase  Communicate the overall approach and process to the organization  …
    13. 13. 13 4/9/2016 - v6.0 Strategic Planning & Deployment – Terminology Part I Mission: A brief description of a company's fundamental purpose. A mission statement answers the question, "Why do we exist?“. Vision: An overall statement of how the organization wants to be perceived by it’s stakeholders over the long-term (3 to 5 years). Strategic Goal: A statement of an overall achievement that is considered critical to the future success of the organization. Strategic goals express where the organization wants to be. Strategic Objective: What specifically must be done to execute the strategy; i.e. what is critical to the future success of our strategy? What the organization must do to reach its strategic goals! Another term for objectives within a strategic planning framework is to call these "enabling goals", since they will contribute to the achievement of the larger strategic goal they enable. Strategic Initiative: A major strategic thrust for the organization, such as maximizing shareholder value or improving the efficiency of operations. Strategic initiatives define the scope for building the performance management system.
    14. 14. 14 4/9/2016 - v6.0 Strategic Planning & Deployment – Terminology Part II Strategic Grid - Strategy Map: A logical framework for organizing a collection of strategic objectives over four or more dimensions. Everything is linked to capture a cause and effect relationship. Strategic grids are the foundation for building the Balanced Scorecard. Dimensions or Perspectives: Four or more different views of what drives the organization. Perspectives provide a framework for measurement. The four most common perspectives are: Financials (final outcomes), Customers, “Internal” Processes, and Learning & Growth. Cause & Effect Relationship: The natural flow of business performance from a lower level to an upper level within or between dimensions. For example, training employees on customer relation’s leads to better customer service which in turn leads to improved financial results. One side is the leader or driver, producing an end result or effect on the other side. Measurement or Metrics: A way of monitoring and tracking the progress of strategic objectives. Measurements can be leading indicators of performance (leads to an end result) or lagging indicators (the end results). Target: An expected level of performance or improvement required in the future. Initiatives, Programs & Projects: Major initiatives, programs or projects that must be undertaken in order to meet one or more strategic objectives.
    15. 15. 15 Strategic Planning: Vision, Goals & Objectives Goal #1: Land on the moon and return safely to earth by the end of the decade. … Vision: Have the most advance and successful Space Program in the world. Objective #1.1 Develop safe launch and reentry vehicles Objective #1.x Maintain a ground infrastructure
    16. 16. 16 4/9/2016 - v6.0 Organizing the Process – Summary Inputs: • Vision (if available) • Mission (if available) • Last Year’s Strategic Plan (if available) • … Activities: • Define Scope • Define Planning Horizon • Define Resource Requirements • Define Terminology • … Outputs: • Strategy Process Owner • Strategy Process Facilitator • Strategic Planning Terminology • High-Level Planning Process Timelines • Strategy Development Team Members • ... Strategic Planning - Organizing the Process
    17. 17. 17 4/9/2016 - v6.0 Strategic Planning & Deployment – Table of Content  Strategic Planning & Deployment Process  Organizing the Process  Current State Analysis (CSA)  Strategic Vision Elements  Strategic Breakthrough Objectives  Strategic Initiatives & Tactics  Strategy Deployment Matrix  Strategy Implementation & Review
    18. 18. 18 4/9/2016 - v6.0 Current State Analysis (CSA) – Making Choices As part of this process step, the organization has to take a HARD look at itself.  Where are we going ?  Where can we go ?  Where are we now ?  What are our choices ? Markets Competitors Technology Trends Customers Strength & Weaknesses Distribution Channels External Factors
    19. 19. 19 4/9/2016 - v6.0 Strategy Planning & Deployment – Business Excellence Models Some organizations are using Business Excellence Models like the Malcolm Baldrige Criteria to structure their Current State Analysis and assess themselves against a well established performance excellence benchmark.
    20. 20. 20 4/9/2016 - v6.0 Strategy Planning & Deployment – Business Excellence Models Leadership: How upper management leads the organization, and how the organization leads within the community. Strategic Planning: How the organization establishes and plans to implement strategic directions. Customer and Market Focus: How the organization builds and maintains strong, lasting relationships with customers. Measurement, Analysis, and Knowledge Management: How the organization uses data to support key processes and manage performance. Human Resource Focus: How the organization empowers and involves its workforce. Process Management: How the organization designs, manages and improves key processes. Business/Organizational Performance Results: How the organization performs in terms of customer satisfaction, finances, human resources, supplier and partner performance, operations, governance and social responsibility, and how the organization compares to its competitors.
    21. 21. 21 4/9/2016 - v6.0 Strategy Planning & Deployment – Current State Analysis Leadership “The Driver” Customer “The Focus” “The System” Process Management People Operating Philosophy: Leaders build their business system so that it focuses on the customer and delivers excellent results. The business system is a set of processes that work together to produce an output that meets or exceeds the requirements of its customers.
    22. 22. 22 4/9/2016 - v6.0 Enterprise Business Process Modeling Enterprise Business Process Modeling (BPM) is the activity of representing processes, and their interrelationships, of an enterprise, so that the current ("as is") process may be analyzed and improved in future ("to be"). American Productivity & Quality Center (APQC) Process Categories 1 Develop Vision and Strategy 2 Develop and Manage Products and Services 3 Market and Sell Products and Services 4 Deliver Products and Services 5 Manage Customer Service 6 Develop and Manage Human Capital 7 Manage Information Technology 8 Manage Financial Resources 9 Acquire, Construct, and Manage Property 10 Manage Environmental Health and Safety (EHS) 11 Manage External Relationships 12 Manage Knowledge, Improvement, and Change
    23. 23. 23 4/9/2016 - v6.0 Enterprise Business Process Modeling – APQC Model American Productivity & Quality Center (APQC) Process Categories 1 Develop Vision and Strategy 2 Develop and Manage Products and Services 3 Market and Sell Products and Services 4 Deliver Products and Services 5 Manage Customer Service 6 Develop and Manage Human Capital 7 Manage Information Technology 8 Manage Financial Resources 9 Acquire, Construct, and Manage Property 10 Manage Environmental Health and Safety (EHS) 11 Manage External Relationships 12 Manage Knowledge, Improvement, and Change 1 Develop Vision and Strategy 1.1 Define the business concept and long-term vision 1.1.1 Assess the external environment 1.1.2 Survey market and determine customer needs and wants 1.1.3 Perform internal analysis 1.1.4 Establish strategic vision 1.2 Develop business strategy 1.2.1 Develop overall mission statement 1.2.2 Evaluate strategic options to achieve the objectives 1.2.3 Select long-term business strategy 1.2.4 Coordinate and align functional and process strategies 1.2.5 Create organizational design (structure, governance, reporting, etc.) 1.2.6 Develop and set organizational goals 1.2.7 Formulate business unit strategies 1.3 Manage strategic initiatives 1.3.1 Develop strategic initiatives 1.3.2 Evaluate strategic initiatives 1.3.3 Select strategic initiatives 1.3.4 Establish high-level measures
    24. 24. 24 4/9/2016 - v6.0 Strategy Planning & Deployment – Current State Analysis Inputs to a comprehensive Current State Analysis (CSA) include:  Organization’s Mission and Vision (if available)  Organization’s Values (if available)  Current Strategic Goals and Objectives (if available)  Actual Performance vs. Planned Performance  Critical Success Metric Performance  Critical Process Management and Performance  Organizational Design – Structure and Roles  Employee Satisfaction, Competences and Capabilities  Customer Needs and Satisfaction  Current Products and Services Performance  Markets and Geographic Areas served  Distribution Channels  Competitor Analysis  STEEP Factors – Social, Technological, Economic, Environmental, Political  … Leadership “The Driver” Customer “The Focus” “The System” Process Management People
    25. 25. 25 4/9/2016 - v6.0 Tool Box: Brainstorming Brainstorming is used to generate a large number of ideas in a short period of time.  Step 1: Review the topic or problem to be discussed. Make sure the entire team understands the subject of the brainstorm. Clarify if you are looking for potential root causes or possible solutions.  Step 2: Allow a couple of minutes for everyone to think about the task and write down some ideas.  Step 3: Invite the team members to call out their ideas, randomly or in turns around the table. Make sure that the team builds upon each others ideas (1 + 1 = 3), but do not allow discussions or evaluations.  Step 4: Record all ideas, e.g. on post-its, and stick them on a flip chart visible to everyone.  Step 5: Continue with Step 3 and 4 until several minutes silence produces no more.
    26. 26. 26 4/9/2016 - v6.0 Tool Box: Affinity Diagram An Affinity Diagram organizes large numbers of ideas or findings into their natural relationship and taps the team’s creativity and intuition. Step 1: Record each idea/finding on a separate Post-It note and stick it to on a flip chart. Step 2: Look for ideas/findings that seem to be related and place then side by side, until all ideas/findings are grouped. Very important is that no one talk during this exercise. Step 3: Select a heading for each group and write it on a separate Post-It note. You can talk during this step. Step 4: Ensure that every idea/finding in a group aligns with the heading. Make final adjustment if necessary. Quality is becoming globalized Non-user friendly products are unacceptable Need for providing complete service Unreliability in products is not tolerated TQM-aware customers are becoming common Demand for high- quality, low- cost goods increasing Technology is no longer “awe-inspiring” Brand- awareness does not guarantee customer loyalty Market different- tiation is becoming less of an issue Individual custom- ization is becoming more of an issue Need for meeting all requirements is severe Happy to pass on good product/ service stories Instant, intuitive usability becoming requirement Local service must be available immediately Replacement parts/ product expected within 24 hours Easily contacted by telephone or fax Extended warranty expected Questions answered quickly and correctly Complete customer education/in for- mation provided Happier to pass on poor product/ service stories Low-tolerance for inadequate service; likely to return prod
    27. 27. 27 4/9/2016 - v6.0 Tool Box: SWOT Analysis A SWOT Analysis is an examination of the internal strengths (S), weaknesses (W), external opportunities (O), and threats (T) affecting an organization. Harmful (to achieve future business success) Helpful (to achieve future business success) InternalFactors (attributesoftheorganization) ExternalFactors (attributesoftheenvironment) S W O T Weakness ThreatsOpportunities Strength
    28. 28. 28 4/9/2016 - v6.0 Tool Box: SWOT Analysis S W O T Strength: • What advantages does your organization have? • What do you do better than anyone else? • What unique or lowest-cost resources can you draw upon that others can't? • What do people in your market see as your strengths? • What factors mean that you "get the sale"? • What is your organization's Unique Selling Proposition (USP)? Opportunities: • What good opportunities can you spot? • What interesting trends are you aware of? Useful opportunities can come from such things as: • Changes in technology and markets on both a broad and narrow scale. • Changes in government policy related to your field. • Changes in social patterns, population profiles, lifestyle changes, and so on. • Local events. Weaknesses: • What could you improve? • What should you avoid? • What are people in your market likely to see as weaknesses? • What factors lose you sales? • Do other people seem to perceive weaknesses that you don't see? • Are your competitors doing any better than you? Threats • What obstacles do you face? • What are your competitors doing? • Are quality standards or specifications for your job, products or services changing? • Is changing technology threatening your position? • Do you have bad debt or cash-flow problems? • Could any of your weaknesses seriously threaten your business?
    29. 29. 29 4/9/2016 - v6.0 Tool Box: Criticality Matrix A Criticality Matrix is a useful tool to assess and visualize the “Significance” and “Probability of Occurrence” for potential or perceived threats (T) identified during the development of the SWOT Analysis. Most Current State Analysis will generate 8 – 12 critical issues that will need to be considered during the strategic planning process. Probability of Occurrence High Medium Low High Medium Low CRITICALITY ANALYSIS Significance
    30. 30. 30 4/9/2016 - v6.0 Group Work: Current State Analysis The Task:  Perform a Current State Analysis for your organization and document your key findings using the “Strategy Deployment - Current State Analysis” worksheet.  Make a list of any open issues that require additional research, data and/or analysis. Assign individuals to each action item and agree on a timeline.  Develop a SWOT Matrix, including a review of your organization's Core Competencies, capturing the key findings of your Current State Analysis. Utilize Affinity Diagrams to consolidate and group your findings if needed.  Agree on the next steps to complete the Current State Analysis phase
    31. 31. 31 4/9/2016 - v6.0 Current State Analysis (CSA) – Summary Inputs: • Current Strategic Goals and Objectives (if available) • Actual vs. Planned Performance for Key Performance Indicators • Enterprise Process Architecture • Organizational Design • Customer Needs and Satisfaction • Current Products / Services Performance • Markets and Distribution Channels • Competitor Analysis • STEEP Factors • … Activities: • SWOT Analysis • … Outputs: • SWOT Analysis • TOP 10-12 Critical Issues & Challenges • … Strategic Planning – Current State Analysis
    32. 32. 32 4/9/2016 - v6.0 Strategic Planning & Deployment – Table of Content  Strategic Planning & Deployment Process  Organizing the Process  Current State Analysis (CSA)  Strategic Vision Elements  Strategic Breakthrough Objectives  Strategic Initiatives & Tactics  Strategy Deployment Matrix  Strategy Implementation & Review
    33. 33. 33 4/9/2016 - v6.0 Characteristics of a Good Vision A Vision should meet several tests:  A Vision is grounded in the reality of the organization’s Current State; meaning, it recognizes challenges that the organization now faces as having somehow been resolved in the ideal future.  A Vision creates some significant problems and challenges for the organization.  A Vision must reflect the interests of the organization’s stakeholders (owners, employees, customers, suppliers).  A Vision should be the result of the integrated thinking of the leadership team, rather then a collection of individual visions, means it is indeed a Shared Vision. Most organizations prefer a finite time-frame of a vision, usually three to five years.
    34. 34. 34 4/9/2016 - v6.0 The Visioning Process – The Vision Question The first step in the process is to develop a “Vision Question”  Strategic Vision Question: “It is 2014 and we are very pleased with out strategic success; what do we look like and how did we get there?”  Strategic Vision Question: “It is 2014 and we are the market leader in our industry; what do we look like and how did we get there?”  Tactical Vision Question: “We have designed the ideal Employee Survey Process; what does it look like and what effect is it having on the organization?”  Tactical Vision Question: “We are one of the most desired organizations to work for; how do we look like and how did we get there?”
    35. 35. 35 4/9/2016 - v6.0 Tool Box: Affinity Diagram An Affinity Diagram organizes large numbers of ideas or findings into their natural relationship and taps the team’s creativity and intuition. Step 1: Record each idea/finding on a separate Post-It note and stick it to on a flip chart. Step 2: Look for ideas/findings that seem to be related and place then side by side, until all ideas/findings are grouped. Very important is that no one talk during this exercise. Step 3: Select a heading for each group and write it on a separate Post-It note. You can talk during this step. Step 4: Ensure that every idea/finding in a group aligns with the heading. Make final adjustment if necessary. Quality is becoming globalized Non-user friendly products are unacceptable Need for providing complete service Unreliability in products is not tolerated TQM-aware customers are becoming common Demand for high- quality, low- cost goods increasing Technology is no longer “awe-inspiring” Brand- awareness does not guarantee customer loyalty Market different- tiation is becoming less of an issue Individual custom- ization is becoming more of an issue Need for meeting all requirements is severe Happy to pass on good product/ service stories Instant, intuitive usability becoming requirement Local service must be available immediately Replacement parts/ product expected within 24 hours Easily contacted by telephone or fax Extended warranty expected Questions answered quickly and correctly Complete customer education/in for- mation provided Happier to pass on poor product/ service stories Low-tolerance for inadequate service; likely to return prod Vision Elements
    36. 36. 36 4/9/2016 - v6.0 Strategic Planning – Importance of a Communication Plan “I sure wish I’d done a better job of communicating with GM people. I’d do that differently a second time around and make sure they understand and shared my vision for the company. Then they would know why I was tearing the place up, taking out whole divisions, changing our whole production structure . . . I never got this across.” Roger Smith, CEO of General Motors (1981 - 1990)
    37. 37. 37 4/9/2016 - v6.0 The Visioning Process - Catchball The Vision must be “bought into” by all members of the organization.  An effective way to do this is to share the Vision as an Affinity Diagram with all other members of the organization, and encourage additions to the preliminary version, e.g. in form of additional Post- itsTM in a different color.  Link this process step with a strategic planning road show to explain the overall planning process to your organization.
    38. 38. 38 4/9/2016 - v6.0 The Visioning Process - Vision Statement The Vision as presented in an Affinity Diagram can be converted into a Vision Statement by simply incorporating the information in the group headers in to a narrative or outline “bullet” form.  Microsoft - "A personal computer in every home running Microsoft software.“  Coca-Cola - Our vision serves as the framework for our Roadmap and guides every aspect of our business by describing what we need to accomplish in order to continue achieving sustainable, quality growth.  People: Be a great place to work where people are inspired to be the best they can be.  Partners: Nurture a winning network of customers and suppliers, together we create mutual, enduring value.  Planet: Be a responsible citizen that makes a difference by helping build and support sustainable communities.  Profit: Maximize long-term return to shareowners while being mindful of our overall responsibilities.  Productivity: Be a highly effective, lean and fast-moving organization.
    39. 39. 39 4/9/2016 - v6.0 Group Work: The Visioning Process The Task:  Create a “Vision Question” for your organization.  As a team, brainstorm answers to the Vision Question and record them on Post-itsTM with a bold pen. The usual rules of brainstorming apply.  Place the Post-itsTM on a flip chart and develop an Affinity Diagram to synthesize the high level Vision Elements.  Agree on the next steps to communicate the Affinity Diagram and Vision Elements, e.g. strategic planning road show.  Agree on a timeline to create a vision statement from the Vision Elements for your organization.
    40. 40. 40 4/9/2016 - v6.0 Strategic Vision Elements – Summary Inputs: • SWOT Analysis • TOP 10-12 Critical Issues & Challenges • … Activities: • Develop Vision Question(s) • Identify Vision Elements • Communicate Vision Elements • Finalize Vision Elements • Create Vision Statement • … Outputs: • Vision Elements • Vision Statement • … Strategic Planning – Strategic Vision Elements
    41. 41. 41 4/9/2016 - v6.0 Strategic Planning & Deployment – Table of Content  Strategic Planning & Deployment Process  Organizing the Process  Current State Analysis (CSA)  Strategic Vision Elements  Strategic Breakthrough Objectives  Strategic Initiatives & Tactics  Strategy Deployment Matrix  Strategy Implementation & Review
    42. 42. 42 4/9/2016 - v6.0 Strategic Objectives – Alignment & Correlation Matrix One of the biggest mistakes organizations make is failing to focus on the high-leverage actions that really make a difference in the organization’s long-term competitiveness.
    43. 43. 43 4/9/2016 - v6.0 Tool Box: Strategic Grid Correlation Matrix The Strategic Grid Correlation Matrix is a tool an organization can use to assess and visualize the correlation between its core processes & key performance indicators and the defined vision elements. Core processes with a strong correlation to the identified vision elements need to be highlighted and if necessary improved or reengineered to ensure long-term competitiveness. DevelopVisionandStrategy MarketandSellProductsandServices DeliverProductsandServices ManageCustomerService DevelopandManageHumanCapital ManageInformationTechnology ManageFinancialResources Acquire,Construct,andManageProperty ManageEnvironmentalHealthandSafety(EHS) ManageExternalRelationships ManageKnowledge,Improvement,andChange Financials Customer InternalBusinessProcesses Learning&Growth Vision Element #1 No Correlation Vision Element #2 Vision Element #3 Weak Correlation Vision Element #4 Vision Element #5 Medium Correlation Vision Element #6 Vision Element #7 Strong Correlation Vision Element #8 Critical Processes To what extent do our Critical Processes support our Vision Elements? 20xx Vision Elements Critical Success Metrics How well do we measure the Vision Elements?
    44. 44. 44 4/9/2016 - v6.0 Tool Box: Strategic Grid Alignment Matrix The Strategic Grid Alignment Matrix is a tool an organization can use to assess and visualize that existing or planned initiatives drive defined vision elements and that selected key performance indicators are actual relevant to ensure long-term competitiveness. Project#1 Project#2 Project#3 Project#4 Project#5 Project#6 Project#7 Project#8 Project#9 Project#10 Project#11 Financials Customer InternalBusinessProcesses Learning&Growth Vision Element #1 No Correlation Vision Element #2 Vision Element #3 Weak Correlation Vision Element #4 Vision Element #5 Medium Correlation Vision Element #6 Vision Element #7 Strong Correlation Vision Element #8 Programs and Projects How well do our programs and projects support our Vision Elements? 20xx Vision Elements Critical Success Metrics How well do we measure the Vision Elements?
    45. 45. 45 Tool Box: Radar Chart A Radar Chart can be used to assess the gap separating the desired future state from the current reality with respect to each Vision Element. • Each of the “Assessors” defines the gap between the future vs. current state for each Vision Element on a scale from “0” to “10”, with “0” representing total lack of the specific Vision Element and “10” representing “perfect” current performance. • The “green” radar plots represent the individual scores from each assessor for each Vision Element. • Vision Elements with a large variation between the individual scores require further analysis, as this indicates significant differences in opinions. • The “red” radar plot represents the average score for each Vision Element. • Vision Elements with the lowest average scores are candidates for breakthrough objectives. Vision Element Gap Analysis 0 1 2 3 4 5 6 7 8 9 10 Vision Element #1 Vision Element #2 Vision Element #3 Vision Element #4 Vision Element #5 Vision Element #6 Vision Element #7 Vision Element #8 Vision Element #9 Vision Element #10 Vision Element #11 Vision Element #12 4/9/2016 - v6.0
    46. 46. 46 4/9/2016 - v6.0 Tool Box: Interrelationships Diagram The interrelationship diagram is an additional tool that can be used to identify or verify potential breakthrough objectives. Step 1: Place all Vision Elements in a circle on a flip chart. Step 2: For each idea, ask “Does this Vision Element cause or influence any other Vision Element?”. Draw arrows from each Vision Element to the ones it causes or influences. Step 3: Analyze the diagram by counting how many arrows in and out each Vision Element has. Note the number of incoming and outgoing arrows for each Vision Element “in/out”. Step 4: Note which Vision Elements have primarily outgoing arrows. These are the basic causes and thus potential candidates for breakthrough objectives. 3/3 5/0 2/1 5/1 0/5 1/3 2/2 0/5 3/1 Rejection of the Statistical Thinking Method Lack of motivation to change Lack of support for implementation Lack of consensus around the right measurement indices Data are not easily accessible Misunderstanding of Statistical Thinking Paradigm Lack of Statistical Thinking Paradigm Fear of technical tools and methods People have competing priorities
    47. 47. 47 4/9/2016 - v6.0 Group Work: Strategic Breakthrough Objectives The Task:  If applicable, create a Strategic Grid Alignment Matrix for your current Vision Elements/Strategic Objectives, Key Performance Indicators and ongoing Programs/ Projects. Identify any misalignment or gaps.  Create a Strategic Grid Correlation Matrix for your new Vision Elements, Core Processes and Balanced Scorecard Dimensions. Document any key findings or observations.  Perform an individual and team Gap Analysis using a Radar Chart. Document any key findings and discussion points, especially if the individual gap analysis results show significant variation.  Create an Interrelationship Diagram for the new Vision Elements. Identify the basic causes or vision drivers and compare the results with the results from the Gap Analysis. Document any key findings.  Define Strategic Breakthrough Objective(s)
    48. 48. 48 4/9/2016 - v6.0 Strategic Breakthrough Objectives – Summary Inputs: • SWOT Analysis • TOP 10-12 Critical Issues & Challenges • Vision Elements • Vision Statement • … Activities: • Create a Strategic Grid Alignment Matrix • Create a Strategic Grid Correlation Matrix • Perform a Gap Analysis • Modify Vision Elements (if necessary) • … Outputs: • Strategic Grid Alignment Matrix • Strategic Grid Correlation Matrix • Updated Vision Elements • Strategic Breakthrough Objectives • … Strategic Planning – Strategic Breakthrough Objectives
    49. 49. 49 4/9/2016 - v6.0 Strategic Planning & Deployment – Table of Content  Strategic Planning & Deployment Process  Organizing the Process  Current State Analysis (CSA)  Strategic Vision Elements  Strategic Breakthrough Objectives  Strategic Initiatives & Tactics  Strategy Deployment Matrix  Strategy Implementation & Review
    50. 50. 50 4/9/2016 - v6.0 Developing First-Level Strategic Initiatives The actions required to achieve a strategic objective are generally called strategies or strategic initiatives.  The first step in developing strategic initiatives is to formulate an appropriate question to brainstorm what needs to be done to achieve an identified strategic objective.  The next step is to brainstorm answers to this question. Answers can then be organized, grouped and titled utilizing the Affinity Diagram tool.  The team is then asked to examine the candidates for strategic initiatives (usually the groups identified in the Affinity Diagram), and to arrange them using a Tree Diagram.  Specially, the team is asked to form a judgment, using data if possible, on whether each of the candidates is necessary to meet the objective.
    51. 51. 51 Strategic Focus Areas & Objectives Strategic Breakthrough (Hoshin) Objective Strategic Focus Area(s)  By the year 2012, our organization will have the most innovative product line of smart phones.  Product Innovation  By the year 2014, customer turnover will decline by 30% through newly created customer service representatives and pro-active customer maintenance procedures.  Customer Satisfaction  Customer Support Processes  Operating downtimes will get cut in half by cross training front line personnel and combining all four operating departments into one single service center.  Operational Efficiency  Competence Development  Organizational Design  Over the next six months, delivery times will decrease by 15% through more localized distribution centers.  Lead Time Reduction  Operational Efficiency  Distribution Management Collectively, you want to limit our strategic objectives and focus areas to no more than four to five. This helps ensure successful implementation of your organization’s strategic vision. Some common strategic focus areas are: Customer Service, Shareholder Value, Operational Efficiency, Product Innovation, and Social Responsibility.
    52. 52. 52 Strategic Focus Areas & Dimensions Basic Flow of a Strategic Focus Area across the Balanced Scorecard Dimensions Notice how each lower perspective layer supports and enables the upper perspective layer; such as “Acquire More Customers” will enable “Revenue Growth”. Keep in mind that we are trying to link everything together. This is critical to building an effective Balanced Scorecard; i.e. capturing the cause & effect relationship. Strategic Focus Area: Increase Shareholder Value Financials Revenue Growth of 20% in 2014 Customers Acquire More Customers “Internal” Processes Customer Marketing & Service Program Learning & Growth Develop Support Systems & Personnel Perspectives
    53. 53. 53 Strategic Grid & Model Basic Flow of a Strategic Focus Area within the “Financials” Dimension We will flow our strategic objectives down each balanced scorecard perspective within a grid of boxes, making sure everything is linked. This grid will serve as the foundation for constructing the Balanced Scorecard. Strategic Focus Area: Increase Shareholder Value Financials Revenue Growth of 20% by 2014 Operating Cost Improvements of 15% by 2014 New Sources of Revenue Increase Customer Profitability Lower Operating Costs High Utilization of Assets
    54. 54. 54 Strategic Grid & Model Strategic Objectives defined for all Four Balanced Scorecard Dimensions Strategic Focus Area: Increase Shareholder Value Financials Revenue Growth of 20% by 2014 Customers Acquire More Customers Become the Price Leader “Internal” Processes Improve Operational Efficiency Cost Reduction Program Knowledge Based System Reduce Non-Core Activities Learning & Growth Training – Lean Six Sigma Program Database Network on Operational Performance Re-Align Organization with Core Competencies Once you have completed the strategic grid, go back and make sure everything fits with your overall strategy. A set of strategic grids should provide the strategic model for running the business, outlining the specifics of the strategy. All stakeholders should be able to look at the grids and follow the flow of the organization’s strategy. DimensionsorPerspectives
    55. 55. 55 4/9/2016 - v6.0 Tool Box: Brainstorming Brainstorming is used to generate a large number of ideas in a short period of time. Step 1: Review the topic or problem to be discussed. Make sure the entire team understands the subject of the brainstorm. Clarify if you are looking for potential root causes or possible solutions. Step 2: Allow a couple of minutes for everyone to think about the task and write down some ideas. Step 3: Invite the team members to call out their ideas, randomly or in turns around the table. Make sure that the team builds upon each others ideas (1 + 1 = 3), but do not allow discussions or evaluations. Step 4: Record all ideas, e.g. on post-its, and stick them on a flip chart visible to everyone. Step 5: Continue with Step 3 and 4 until several minutes silence produces no more.
    56. 56. 56 4/9/2016 - v6.0 Tool Box: Affinity Diagram An Affinity Diagram organizes large numbers of ideas or findings into their natural relationship and taps the team’s creativity and intuition. Step 1: Record each idea/finding on a separate Post-It note and stick it to on a flip chart. Step 2: Look for ideas/findings that seem to be related and place then side by side, until all ideas/findings are grouped. Very important is that no one talk during this exercise. Step 3: Select a heading for each group and write it on a separate Post-It note. You can talk during this step. Step 4: Ensure that every idea/finding in a group aligns with the heading. Make final adjustment if necessary. Quality is becoming globalized Non-user friendly products are unacceptable Need for providing complete service Unreliability in products is not tolerated TQM-aware customers are becoming common Demand for high- quality, low- cost goods increasing Technology is no longer “awe-inspiring” Brand- awareness does not guarantee customer loyalty Market different- tiation is becoming less of an issue Individual custom- ization is becoming more of an issue Need for meeting all requirements is severe Happy to pass on good product/ service stories Instant, intuitive usability becoming requirement Local service must be available immediately Replacement parts/ product expected within 24 hours Easily contacted by telephone or fax Extended warranty expected Questions answered quickly and correctly Complete customer education/in for- mation provided Happier to pass on poor product/ service stories Low-tolerance for inadequate service; likely to return prod Potential Strategic Initiatives
    57. 57. 57 4/9/2016 - v6.0 Tool Box: Tree Diagram The Tree Diagram identifies initiatives and actions to solve a problem or implement a solution. Developing the Tree Diagram moves and organization’s thinking logically from broad objectives and goals to specific initiatives, projects and actions. Strategic Objective … Potential Strategic Initiatives … … … … … … IIIII II IIIIII I IIII Multi-Voting
    58. 58. 58 4/9/2016 - v6.0 Tool Box: Multi-Voting Multi-Voting narrows a large list of potential strategic initiatives to a smaller list of top priorities or to a final selection. Multi-Voting is preferred over straight voting because it allows an item that is favored by all, but not the top choice of any, to rise to the top.  Step 1: Identify a list of items through Brainstorming and organize the items into groups or categories using an Affinity Diagram. Number all groups or categories.  Step 2: Decide how many choices each team member will vote for. That number should be at least one-third the total number of items on the list.  Step 3: Each member writes down the number of his or her choices.  Step 4: Collect the papers and tally the votes.  Step 5: Reduce the list by eliminating the groups or categories with the fewest votes. In most cases there is an obvious difference between the “popular” few and the “unpopular” many.  Step 6: Repeat Step 2 to 5 with the reduced list. Continue until clear favorites emerge that can be resources and managed. Usually 2-4 initiatives for each strategic objective will be sufficient.
    59. 59. 59 4/9/2016 - v6.0 First-Level Strategic Initiatives Strategic Goal Become the Price Leader Strategic Objective Improve Operational Efficiency Metrics Total Costs per Unit Goal < $15 Metrics Productivity Goal > 15 Units per DL Manhour Strategic Initiatives Implement Cost Reduction Programs Establish Lean Six Sigma Training Program Develop & Implement company-wide Database on Operational Performance Make – Buy Analysis for Forward Logistics, Reverse Logistics and Customer Service Reduce Bill of Material Costs Create Cost Management Competence Development Plan for all Management Teams Often, there will be dependencies among the different strategic initiatives, means, some might need to be completed before others can be initiated. It is useful to lay out these dependencies on a timeline. IIIII III IIIII I III IIIII III IIIII II
    60. 60. 60 4/9/2016 - v6.0 Strategic Objective Strategic Initiatives Owners Measures Goals Measure #1: … Goal: … Measure #2: … Goal: … Measure #3: … Goal: … Deployment of First-Level Strategic Initiatives First-Level Strategic Initiatives  In many organizations the executive or management team would “hand-off” the first-level plan at this point of time and expect the organization(s) to somehow execute the strategic intent of the planning team.
    61. 61. 61 4/9/2016 - v6.0 Deployment of First-Level Strategic Initiatives  In many organizations the executive or management team would “hand-off” the first-level plan at this point of time and expect the organization(s) to somehow execute the strategic intent of the planning team.  It is a known empiric fact that strategic plans without tactical detail don’t usually get implemented very well, sometimes not at all.  To deploy the first-level strategic initiatives successfully, supporting initiatives and finally actionable tactics need to be identified and defined.  To ensure proper alignment of an organization’s strategic objectives, strategic initiatives, key performance indicators, key action items and human resources, the “Catchball” Process and the “Hoshin X-Matrix” will be introduced over the following slides.
    62. 62. 62 4/9/2016 - v6.0 Strategic Objective Strategic Initiatives Owners Measures Goals Measure #1: … Goal: … Measure #2: … Goal: … Measure #3: … Goal: … Deployment of First-Level Strategic Initiatives (Catchball) First-Level Strategic Initiatives Strategic Objective Strategic Initiatives Owners Measures Goals Measure #1: … Goal: … Measure #2: … Goal: … Measure #3: … Goal: … Strategic Objective Strategic Initiatives Owners Measures Goals Measure #1: … Goal: … Measure #2: … Goal: … Measure #3: … Goal: … Strategic Objective Strategic Initiatives Owners Measures Goals Measure #1: … Goal: … Measure #2: … Goal: … Measure #3: … Goal: … Strategic Objective Strategic Initiatives Owners Measures Goals Measure #1: … Goal: … Measure #2: … Goal: … Measure #3: … Goal: … Second-Level Strategic Initiatives or Tactics Third-Level Strategic Initiatives or Tactics … …
    63. 63. 63 4/9/2016 - v6.0 Deployment of First-Level Strategic Initiatives (Catchball) The “Catchball” Process  Tactics can be accomplished through a series of meetings at successively lower levels of the organization.  A very effective way to create the tactical detail is to use the brainstorming method with Post-its that we used during prior process steps. The strategy owner and the implementation team should do the brainstorming together.  After the brainstorming, the team arranges the Post-its on a timeline corresponding to the expected completion time-frame, in their logical order of completion.  Once tactics have been defined, the plan needs to be reviewed starting at the bottom of the organization, working up until the entire plan has been reviewed and is judged to be visible and self- consistent. Interdependencies, means that the completion of one task is required before another task can be started, need to be identified and visualized.  Results of the “Catchball” Process can be documented using the “Annual Plan Template”  The “Catchball” Process is the biggest difference between Hoshin Planning and Management-by- Objectives (MBO).  The Strategic Planning Process using Hoshin Planning isn’t complete until the strategic objectives and all initiatives and tactics are agreed to and thought to be visible and self-consistent by the entire organization.
    64. 64. 64 4/9/2016 - v6.0 Risk Assessment & Contingency Planning  The development of a “Process Decision Program” can help to identify execution risks and improves the likelihood that the implementation plan will succeed. What can go wrong with "Implementation of a Lean Six Sigma Program in Manufacturing". Probability Severity P x S 1. Selecting the wrong candidates for training 7 7 49 2. Selecting the wrong projects 4 4 16 3. No or limited champion support 5 7 35 4. Takes too long to see results 6 10 60 5. Not enough time to do proper training 8 5 40 Brainstorm on Post-its What can we do about "Selecting the wrong candidates for the training"? Brainstormed Answers: Develop candidate selection criteria Formalize candidate interviewing process Identify pre-requisites and develop a test as part of the selection process …  Make sure that the identified risk mitigation activities are include into the overall implementation plan for the strategic initiative.
    65. 65. 65 4/9/2016 - v6.0 Project Selection Matrix Balanced Scorecard Project Selection Matrix KPI#1 KPI#2 KPI#3 KPI#4 KPI#5 KPI#6 KPI#7 KPI#8 Weights 20 10 15 10 5 20 10 10 100 50 30 20 100 70 30 100 Project Definition 1 Project #1 10 0 5 0 0 3 0 0 3.4 5 0 5 3.5 0 5 1.5 2 Project #2 0 3 0 5 0 0 0 0 0.8 0 5 0 1.5 3 0 2.1 3 Project #3 5 5 10 10 3 3 8 8 6.4 3 8 5 4.9 5 8 5.9 4 Project #4 0 0 10 5 0 0 5 0 2.5 0 0 10 2.0 3 3 3.0 5 Project #5 5 10 0 0 1 0 0 3 2.4 10 5 3 7.1 3 5 3.6 Ranking 0 = none Not Started 3 = low On Track 5 = medium At Risk 8= high Behind Schedule 10= very high CORRELATION MATRIX MANAGEMENTRISK TOTALRISK PROJECTSTATUS CAPITALRESOURCES DURATIONOFPROJECT TOTALEFFORT TECHNICALRISK EFFORT RISK PEOPLERESOURCES IMPACT FINANCIALS CUSTOMERS PROCESSES LEARNING& GROWTH TOTALIMPACT
    66. 66. 66 4/9/2016 - v6.0 Project Ranking Matrix 10 9 8 7 6 5 4 3 2 1 0 0 1 2 3 4 5 6 7 8 9 10 EFFORT IMPACT Size of the Ball = Size of the Risk 1 2 3 4 5
    67. 67. 67 4/9/2016 - v6.0 Group Work: Strategic Initiatives & Tactics The Task:  Formulate an appropriate question to brainstorm what needs to be done to achieve an identified strategic breakthrough objective.  Brainstorm answers to this question. Organize, group and title answers utilizing the Affinity Diagram tool.  Arrange the potential initiatives (usually the groups identified in the Affinity Diagram) using a Tree Diagram.  Narrow down the number of initiatives to the vital few using data if possible and multi-voting techniques.  Develop second- and third-level strategic initiatives and tactics.
    68. 68. 68 4/9/2016 - v6.0 Strategic Initiatives & Tactics – Summary Inputs: • SWOT Analysis • TOP 10-12 Critical Issues & Challenges • Vision Elements • Vision Statement • Strategic Breakthrough Objectives • … Activities: • Brainstorm needs to achieve an identified strategic breakthrough objective • Arrange the potential initiatives using a Tree Diagram • Narrow down the number of initiatives to the vital few • Develop second- and third- level strategic initiatives and tactics • … Outputs: • First-, second- and third- level strategic initiatives and tactics • … Strategic Planning – Strategic Initiatives & Tactics
    69. 69. 69 4/9/2016 - v6.0 Strategic Planning & Deployment – Table of Content  Strategic Planning & Deployment Process  Organizing the Process  Current State Analysis (CSA)  Strategic Vision Elements  Strategic Breakthrough Objectives  Strategic Initiatives & Tactics  Strategy Deployment Matrix  Strategy Implementation & Review
    70. 70. 70 Balanced Scorecard – Key Performance Indicators Strategic Focus Area: Increase Shareholder Value Financials Revenue Growth of 20% by 2014 Customers Acquire More Customers Become the Price Leader “Internal” Processes Improve Operational Efficiency Cost Reduction Program Knowledge Based System Reduce Non-Core Activities Learning & Growth Training – Lean Six Sigma Program Database Network on Operational Performance Re-Align Organization with Core Competencies For each objective on your strategic grids, you need at least one performance indicator. Can you have an objective without a performance indicator? Yes, it is possible, but not having a measurement makes it difficult to manage the objective. It’s best to revisit this objective and ask the question: Why is this an objective? DimensionsorPerspectives
    71. 71. 71 How do we measure Performance? Try to balance your Performance Indicators:  Do it fast.  Do it right.  Do it on time.  Keep doing it.
    72. 72. 72 Balanced Scorecard – Leading & Lagging Indicators  The other side of measurement is looking back, historical type measurements that show a final outcome or result. These measurements are referred to as lagging indicators and they dominate most performance measurement systems.  Examples include most financial type measurements (return on equity, sales growth, etc.) and many non-financial type measurements (production breakeven, customer retention, employee productivity index, etc.).  Lagging type measurements are common within the “Customers” and “Financials” dimensions since these are outcome related.
    73. 73. 73 Balanced Scorecard – Leading & Lagging Indicators  Some measurements will lead to change in your organization. These types of measurements are called leading indicators since they drive final outcomes within the organization.  Examples include customer contracts executed, service response time, and time spent with customers.  A common place to use leading measurements is within the “Internal Processes” and “Learning & Growth” dimensions.
    74. 74. 74 Balanced Scorecard – A Template From: January 2010 ORGANIZATION: TBD Until: December 2010 Current Month: TBD 2010 KPI KPI Name (Unit) KPI First Name Champion Last Name 10 STRETCH 9 8 7 GOAL 6 5 4 3 BASE 2 1 0 ZERO WEIGHT 0 2010 TOTAL SCORE JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER CURRENT SCORE 3 4 7 2 3 5 6 9 Stretch 2010 1000 Goal 2010 700 Base 2009 300 Actual 0 ORGANIZATION OPERATIONAL EXCELLENCE BALANCED SCORECARD FINANCIALS CUSTOMERS PROCESSES RESULTS 1 2 5 7 4 12 11 8 9 3 6 10
    75. 75. 75 4/9/2016 - v6.0 The Strategy Deployment Hoshin X-Matrix The Hoshin X-Matrix is a tool that visualizes an organization’s  strategic objectives,  strategic initiatives,  key performance indicators,  key projects & action items, and  human resources requirements in one simple matrix. The Hoshin X-Matrix enables an organization to easily review the alignment of its strategic objectives, strategic initiatives, key performance indicators, key action items and human resources. The Hoshin X-Matrix, if used properly, improves the likelihood of a successful execution of the strategic plan. 7. … x 6. Initiate RFQ Process for Cusromer Service x x x x 5. Implement reliability program for new products x x x x x x 4. Establish LSS Balck Belt project for return drivers x x x x x 3. Establish & train order-to-cash process team x x 2. Identify Lean Six Sigma consulting company x x x 1. Define Lean Six Sigma Program x x x QualityManager SystemTestManager SystemsEngineeringManager CustomerSupportManager … x $15M in annualized cost savings in 2012 x x x x x x Order-to-Cash cycle time reduction of 25% x x x DSO reduction from 90 days to 45 days x x x x Return Rate reduction from 15% to less than 8% x x x … Resource Planning Operational Excellence Consulting Strategy Deployment Matrix 2012 3.ResolveTOP3productreturndrivers 4.Improveproductverificationandvalidation 5.OutsourceCustomerServicefunction 6.… 2.ReduceDSOfrom90daystolessthan45 days 1.ReduceOperatingCostsby15% 1.ImplementaLeanSixSigmaProgram 2.Map&streamlineorder-to-cashprocess Rev: <Rev#> Revised: <Date> Author: <Name> Status: Draft - Not Released 4.… 3.ImproveNetPromotorScoreto+50% Measures & Targets Action Items StrategicInitiatives StrategicObjectives Measures & Targets Action Items StrategicInitiatives StrategicObjectives
    76. 76. 76 4/9/2016 - v6.0 7. … x 6. Initiate RFQ Process for Customer Service x x x x 5. Implement reliability program for new products x x x x x x 4. Establish LSS Black Belt project for return drivers x x x x x 3. Establish & train order-to-cash process team x x 2. Identify Lean Six Sigma consulting company x x x 1. Define Lean Six Sigma Program x x x QualityManager SystemTestManager SystemsEngineeringManager CustomerSupportManager … x $15M in annualized cost savings in 2012 x x x x x x Order-to-Cash cycle time reduction of 25% x x x DSO reduction from 90 days to 45 days x x x x Return Rate reduction from 15% to less than 8% x x x … Rev: <Rev#> Revised: <Date> Author: <Name> Status: Draft - Not Released 4.… 3.ImproveNetPromoterScoreto+50% 2.ReduceDSOfrom90daystolessthan45 days 1.ReduceOperatingCostsby15% 1.ImplementaLeanSixSigmaProgram 2.Map&streamlineorder-to-cashprocess Resource Planning Operational Excellence Consulting Strategy Deployment Matrix 2012 3.ResolveTOP3productreturndrivers 4.Improveproductverificationandvalidation 5.OutsourceCustomerServicefunction 6.… Measures & Targets Action Items StrategicInitiatives StrategicObjectives Measures & Targets Action Items StrategicInitiatives StrategicObjectives The Strategy Deployment Hoshin X-Matrix Organization’s Strategic Objectives & Goals Organization’s Key Performance Indicator (Balanced Scorecard) Organization’s Strategic Initiatives & Tactics Organization’s Tactical Projects & Action Items Organization’s Human Resource Allocation
    77. 77. 77 4/9/2016 - v6.0 7. … x 6. Initiate RFQ Process for Customer Service x x x x 5. Implement reliability program for new products x x x x x x 4. Establish LSS Black Belt project for return drivers x x x x x 3. Establish & train order-to-cash process team x x 2. Identify Lean Six Sigma consulting company x x x 1. Define Lean Six Sigma Program x x x QualityManager SystemTestManager SystemsEngineeringManager CustomerSupportManager … x $15M in annualized cost savings in 2012 x x x x x x Order-to-Cash cycle time reduction of 25% x x x DSO reduction from 90 days to 45 days x x x x Return Rate reduction from 15% to less than 8% x x x … Rev: <Rev#> Revised: <Date> Author: <Name> Status: Draft - Not Released 4.… 3.ImproveNetPromoterScoreto+50% 2.ReduceDSOfrom90daystolessthan45 days 1.ReduceOperatingCostsby15% 1.ImplementaLeanSixSigmaProgram 2.Map&streamlineorder-to-cashprocess Resource Planning Operational Excellence Consulting Strategy Deployment Matrix 2012 3.ResolveTOP3productreturndrivers 4.Improveproductverificationandvalidation 5.OutsourceCustomerServicefunction 6.… Measures & Targets Action Items StrategicInitiatives StrategicObjectives Measures & Targets Action Items StrategicInitiatives StrategicObjectives The Strategy Deployment Hoshin X-Matrix Are all Strategic Objectives measured by Key Performance Indicators? Are all Key Performance Indicators driven by Strategic Initiatives? Are the Action Items aligned with the Strategic Objectives? Are the Action Items aligned with the Strategic Initiatives? Can all Action Items be resourced with existing Human Resources?
    78. 78. 78 4/9/2016 - v6.0 Final Strategy Implementation Plan Review  After completion of the Hoshin X-Matrix and the approval of the final implementation plan by the Strategy Planning Team, the plan should be published and communicated to the organization, and the plan can be implemented according to the timing described in the individual implementation plans. “I sure wish I’d done a better job of communicating with GM people. I’d do that differently a second time around and make sure they understand and shared my vision for the company. Then they would know why I was tearing the place up, taking out whole divisions, changing our whole production structure . . . I never got this across.” Roger Smith, CEO of General Motors (1981 - 1990)
    79. 79. 79 4/9/2016 - v6.0 Group Work: Strategy Deployment Matrix The Task:  Review and finalize strategic breakthrough objectives and goals  Review and finalize strategic initiatives and tactics  Identify key performance indicators (KPIs) as they relate to the identified strategic initiatives and Tactics  Develop the organization’s Balanced Scorecard(s) for critical KPIs with baseline, targets and stretch goals  Identify key projects and activities  Define project leaders and resource requirements (human and financial resources)  Develop and communicate Hoshin Kanri X-Matrix Strategic Deployment Matrix
    80. 80. 80 4/9/2016 - v6.0 Strategic Deployment Matrix – Summary Inputs: • Vision Elements • Vision Statement • Strategic Breakthrough Objectives • First-, second- and third-level Strategic Initiatives and Tactics • … Activities: • Finalize Strategic Breakthrough Objectives • Finalize Strategic Initiatives and Tactics • Identify Key Performance Indicators • Develop Balanced Scorecard(s) • Identify Key Projects and Activities • Define Resource Requirements • Develop Strategic Deployment Matrix • … Outputs: • Hoshin Kanri X-Matrix Strategy Deployment Matrix • … Strategic Planning – Strategy Deployment Matrix
    81. 81. 81 4/9/2016 - v6.0 Strategic Planning & Deployment – Table of Content  Strategic Planning & Deployment Process  Organizing the Process  Current State Analysis (CSA)  Strategic Vision Elements  Strategic Breakthrough Objectives  Strategic Initiatives & Tactics  Strategy Deployment Matrix  Strategy Implementation & Review
    82. 82. 82 4/9/2016 - v6.0 The Strategy Deployment Review Process Review Process Overview  Reviews need to be frequent to keep the implementation process “on track”  Reviews are the “Check” of the Plan-Do-Act-Check (PDCA) cycle  They evaluate the effectiveness of the action  What did you intent to accomplish (PLAN)  What did you actually accomplish? (DO)  How did the actual accomplishment compare with what you intended? (CHECK)  The Review Process is a self-evaluation process, where the strategy owners come to the meeting to present the results of their self-evaluation of results for each strategic initiative or tactic  Attendees are usually strategy or tactics owners and their immediate teams  The agenda generally allows for a 10 to 15 minutes update on a specific strategy or tactic followed by a 5 to 10 minutes discussion
    83. 83. 83 Date: ___/___/___ Owner: _________________ Year: _________ = Made = Missed Reason for Deviation Reason for Deviation Actual Performance GoalStrategic Initaitive or Tactic 4/9/2016 - v6.0 The Review Table PLAN DO ACTCHECK Preparing the Review Table is the responsibility of the strategy or tactic owner. He or she is also responsible for preparing the analysis of the outcomes, on backup sheets.
    84. 84. 84 Date: ___/___/___ Owner: _________________ Year: _________ = Made = Missed Reason for Deviation Corrective Measures and Implications Actual Performance GoalStrategic Initaitive or Tactic 4/9/2016 - v6.0 The Review Table Statement of the Strategic Initiative or Tactic Numeric Goal for the Strategic Initiative or Tactic Numeric Goal for the Strategic Initiative or Tactic “Flag” if the Goal of the Strategic Initiative or Tactic was “Made” or “Missed” Summary of the reasons for a deviation Summary of the intended corrective actions to “get back on track”
    85. 85. 85 4/9/2016 - v6.0 A few more things about the Review Table  Keep in mind that it is just as interesting to hear about successes as it is about “misses”, and just as valuable to the organization  The “Reason for Deviation” column contains only a summary of the analysis. The detailed analysis needs to be provided by the initiative owner as a separate document  Areas of analysis should include:  Tasks scheduled but not done  Tasks completed, but wrong or unexpected results  Motivation waning, e.g. wrong objectives, not worthy of effort and resources. Flaw in selection process.  Ensure that things gone right are highlighted and standardized, e.g. “Best Practices”  For “Misses” identify immediate countermeasures, as well as corrective and preventive actions based on proper root cause analysis
    86. 86. 86 4/9/2016 - v6.0 Strategy Implementation & Review – Summary Inputs: • Vision Elements • Vision Statement • Strategic Breakthrough Objectives • First-, second- and third-level Strategic Initiatives and Tactics • Hoshin Kanri X-Matrix Strategy Deployment Matrix • … Activities: • Prepare Review Tables • Perform (monthly) Review Meetings • Identify corrective & preventive actions for initiatives & tactics “missed” • Update Strategy Deployment Matrix • Develop Action Plan • … Outputs: • Strategy Deployment Matrix • Review Tables for each initiative and tactic • Corrective & preventive actions for initiatives & tactics “missed” • Action Plan • … Strategic Planning – Strategy Implementation & Review
    87. 87. 87 4/9/2016 - v6.0 Strategic Planning & Deployment – Table of Content  Strategic Planning & Deployment Process  Organizing the Process  Current State Analysis (CSA)  Strategic Vision Elements  Strategic Breakthrough Objectives  Strategic Initiatives & Tactics  Strategy Deployment Matrix  Strategy Implementation & Review  Final Multiple Choice Questions (optional)
    88. 88. 88 4/9/2016 - v6.0 Strategy Deployment Process – Review Question #1 Strategic Planning is a process whereby management makes choices about overall direction. One such choice within strategic planning is establishing the: a. Goals of the organization b. Financing of capital assets c. Distribution of stock dividends d. Election of Officers A
    89. 89. 89 4/9/2016 - v6.0 Strategy Deployment Process – Review Question #2 Strategic Planning should be used for each of the following except for: a. Finding a vision for the organization b. Determining future strategies or objectives c. Getting the organization out of crisis d. Managing the long-term future C
    90. 90. 90 4/9/2016 - v6.0 Strategy Deployment Process – Review Question #3 Strategic Planning can result in change and people often resist change. People's resistance to change can be reduced by: a. Making the planning process extremely formal. b. Categorizing the process as re-engineering. c. Making the process very experimental. d. Getting people involved within the process. D What else can be done ?
    91. 91. 91 4/9/2016 - v6.0 Strategy Deployment Process – Review Question #4 The first real phase of strategic planning is: a. Issuing the Draft Plan b. Organizing the Process c. Approving the Plan d. Developing the Operating Plan B
    92. 92. 92 4/9/2016 - v6.0 Strategy Deployment Process – Review Question #5 In what phase of strategic planning does identification of strengths and weaknesses take place? a. Organizing b. Approval of the Plan c. Current State Analysis d. Implementation C
    93. 93. 93 4/9/2016 - v6.0 Strategy Deployment Process – Review Question #6 A good mission statement should: a. Be extremely specific for measurement b. Have references to management c. Outline the tactics of the organization d. Set direction for the organization D
    94. 94. 94 4/9/2016 - v6.0 Strategy Deployment Process – Review Question #7 Each of the following is important for developing strategic breakthrough objectives except: a. Tradeoffs between upper and lower management b. How the organization got started c. Review of available resources d. Strengths and weaknesses of the organization A
    95. 95. 95 4/9/2016 - v6.0 Strategy Deployment Process – Review Question #8 Marco Corporation has included the following statement within its strategic plan: By December 31st, the Production Department will re-align the Eastern Distribution System to better serve markets in Canada. This statement is an example of a: a. Strategic Goal b. Mission Statement c. Organizational Weakness d. Principle or Value A
    96. 96. 96 4/9/2016 - v6.0 Strategy Deployment Process – Review Question #9 To help manage unplanned events or "what if" type events, Operating Plans should include: a. Approvals by Shareholders b. References to Old Plans c. Contingency Plans d. Profiles of the Organization C
    97. 97. 97 4/9/2016 - v6.0 Strategic Planning & Deployment The End … “Perfection is not attainable, but if we chase perfection we can catch excellence.” - Vince Lombardi
    98. 98. 98 Terms & Conditions After you have downloaded the training material to your own computer, you can change any part of the course material and remove all logos and references to Operational Excellence Consulting. You can share the material with your colleagues and re-use it as you need. The main restriction is that you cannot distribute, sell, rent or license the material as though it is your own. These training course materials are for your — and your organization's — usage only. Thank you.

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