Establish Your Strategic Decision Framework Help everyone align plans and daily work with strategy © 2010 Rally Software D...
Everyday, execs and their teams make lots of decisions <ul><li>Some will help. Some will hurt. </li></ul><ul><li>Some will...
So what’s all this talk about  “strategic alignment?”  <ul><li>Michael Porter:  Strategy = sustainable competitive advanta...
As a leader, I must define a decision framework for my teams  <ul><li>This keeps everyone aligned as we make our daily exe...
Traditional Cost-Benefit Decision Framework Referenced from Niel Nickolaisen  [email_address]   http://www.accelinnova.com...
The Problems with Cost-Benefit <ul><li>Costs are an estimate </li></ul><ul><li>Benefits are, on a good day, a bad guess </...
A Better Decision Framework <ul><li>Include Cost-Benefit, like before, but also: </li></ul><ul><li>Define the  Business Pu...
Business Value Model: A Decision Framework for Strategic Alignment Referenced from Niel Nickolaisen  [email_address]   htt...
Step 1: Business Purpose Alignment & Strategic Intent Model <ul><li>When to Use It  </li></ul><ul><li>Define business and ...
Using the Business Purpose Alignment Model for Products <ul><li>Divide features into “Differentiating” and “Parity” (along...
Next, Lower Risk of the Considerations <ul><li>Important inputs that we cannot quantify: </li></ul><ul><ul><li>Market wind...
Examples of Handling Considerations <ul><li>Market uncertainty – mitigate by delaying some decisions, filling information ...
Costs and Benefits? <ul><li>Same as before, but now not the only driver </li></ul>Referenced from Niel Nickolaisen  [email...
Summary <ul><li>Leaders must help establish a decision framework beyond cost-benefit analysis </li></ul><ul><li>The Busine...
Upcoming SlideShare
Loading in...5
×

Strategic Decision Framework

7,868

Published on

http://www.rallydev.com/learn_agile/agile_for_executives/

Published in: Technology
0 Comments
6 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total Views
7,868
On Slideshare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
0
Comments
0
Likes
6
Embeds 0
No embeds

No notes for slide
  • When aligning around purpose, evaluate business processes on two criteria. First, the extent to which the business process differentiates the organization in the marketplace. Second, the extent to which the process is mission critical to the organization. This yields four business purposes as shown above. With purpose defined, we know how to design and allocate resources to business processes (for example, we design the lower right processes to achieve and maintain parity with the marketplace). The critical step in this evaluation is to decide what generates market differentiation. This is where purpose alignment intersects with strategy.
  • Transcript of "Strategic Decision Framework"

    1. 1. Establish Your Strategic Decision Framework Help everyone align plans and daily work with strategy © 2010 Rally Software Development, Inc.
    2. 2. Everyday, execs and their teams make lots of decisions <ul><li>Some will help. Some will hurt. </li></ul><ul><li>Some will be informed. Some will not. </li></ul><ul><li>A few will be formal. Most will be ad-hoc. </li></ul>Referenced from Niel Nickolaisen [email_address] www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    3. 3. So what’s all this talk about “strategic alignment?” <ul><li>Michael Porter: Strategy = sustainable competitive advantage </li></ul>Strategy implies choices and decisions So, strategically-aligned decisions support and enhance our sustainable competitive advantage Jim Collins: Sustainable advantage = passion + best at + what drives economic engine Referenced from Niel Nickolaisen [email_address] http://www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    4. 4. As a leader, I must define a decision framework for my teams <ul><li>This keeps everyone aligned as we make our daily execution decisions </li></ul><ul><li>Makes clear how our choices & plans support our strategies </li></ul><ul><li>Decisions become visible throughout all levels of our planning </li></ul>© 2010 Rally Software Development, Inc.
    5. 5. Traditional Cost-Benefit Decision Framework Referenced from Niel Nickolaisen [email_address] http://www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    6. 6. The Problems with Cost-Benefit <ul><li>Costs are an estimate </li></ul><ul><li>Benefits are, on a good day, a bad guess </li></ul><ul><li>Where is strategy? </li></ul><ul><li>Cost-Benefit analysis is not used in the daily decisions everyone is making </li></ul>Referenced from Niel Nickolaisen [email_address] http://www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    7. 7. A Better Decision Framework <ul><li>Include Cost-Benefit, like before, but also: </li></ul><ul><li>Define the Business Purpose to align with strategy </li></ul><ul><li>List Considerations to handle what is difficult to quantify </li></ul><ul><li>Work in Iterations to deliver value early, fill in knowledge gaps and respond to feedback </li></ul>Referenced from Niel Nickolaisen [email_address] http://www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    8. 8. Business Value Model: A Decision Framework for Strategic Alignment Referenced from Niel Nickolaisen [email_address] http://www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    9. 9. Step 1: Business Purpose Alignment & Strategic Intent Model <ul><li>When to Use It </li></ul><ul><li>Define business and IT strategy </li></ul><ul><li>Align IT and the business strategically and tactically </li></ul><ul><li>Lower resistance to process improvements </li></ul><ul><li>Evaluate and implement large projects </li></ul><ul><li>Drive business value by improving resource allocation </li></ul>Referenced from Niel Nickolaisen [email_address] http://www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    10. 10. Using the Business Purpose Alignment Model for Products <ul><li>Divide features into “Differentiating” and “Parity” (along with some “Who Cares?”) </li></ul><ul><li>Simplify Parity features </li></ul><ul><li>Invest in Differentiating features </li></ul>Referenced from Niel Nickolaisen [email_address] http://www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    11. 11. Next, Lower Risk of the Considerations <ul><li>Important inputs that we cannot quantify: </li></ul><ul><ul><li>Market window </li></ul></ul><ul><ul><li>Demand uncertainty </li></ul></ul><ul><ul><li>Market uncertainty </li></ul></ul><ul><ul><li>Technical uncertainty </li></ul></ul><ul><ul><li>Internal capabilities </li></ul></ul><ul><ul><li>Complexity, et cetera. </li></ul></ul>Referenced from Niel Nickolaisen [email_address] http://www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    12. 12. Examples of Handling Considerations <ul><li>Market uncertainty – mitigate by delaying some decisions, filling information gaps, and iterate to generate feedback </li></ul><ul><li>Distributed teams – mitigate communication challenges through improved trust and frequent integration </li></ul><ul><li>Technical uncertainty – only allow on differentiating features </li></ul>© 2010 Rally Software Development, Inc.
    13. 13. Costs and Benefits? <ul><li>Same as before, but now not the only driver </li></ul>Referenced from Niel Nickolaisen [email_address] http://www.accelinnova.com/strategy.html#n2model © 2010 Rally Software Development, Inc.
    14. 14. Summary <ul><li>Leaders must help establish a decision framework beyond cost-benefit analysis </li></ul><ul><li>The Business Value model ensures decisions from executives to teams are strategically aligned </li></ul><ul><li>Explore your role in aligning the hundreds of daily decisions your teams make - Attend an Agile Executive Forum </li></ul>© 2010 Rally Software Development, Inc.

    ×