Building a plan is never easy!! When did we start to think about strategy? Why should we plan? is it difficult? Some extract from lecture I give in MBA class. Enjoy, share and send me cases, examples, ideas how we can improve strategy planning.

1. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
1
Build your strategic
plan in 7 steps

2. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
© dullhunk @ Flickr
Rule # 1 - Think!
2

3. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Rule # 2 - Try!
3

4. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Rule # 3 - Each case is unique
4

5. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
5
It’s stormy outside...

6. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
6
Can I help you?

7. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
7
WHAT IS STRATEGY?

8. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
The Economist
“Nobody really
knows what
strategy is.”
source: © Marc Sniukas
8

9. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Costas Markides, Professor London Business School
“Nobody really
knows what a
strategy is or how
to develop a good
one.”
source: © Marc Sniukas
9

10. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
10
Strategy has its roots in history…
source: Business History Review 76 (Spring 2002): 37–74. © 2002 by The President and Fellows of Harvard College

11. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
11
Strategy
is a term that can be traced
back to the ancient Greeks,
for whom it meant a chief
magistrate or a military
commander in chief.
source: Business History Review 76 (Spring 2002): 37–74. © 2002 by The President and Fellows of Harvard College

12. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
All men can see the
tactics by which I
conquer, but what none
can see is the strategy out
of which great victory is
evolved
12
SunTzu,The Art of War, 400 BC

13. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
13
In USA, the building of the railroads after 1850 led to the
development of mass markets for the first time.
source: Business History Review 76 (Spring 2002): 37–74. © 2002 by The President and Fellows of Harvard College

14. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
14
By the late nineteenth century, a new type of firm began to
emerge: the vertically integrated, multidivisional (or “M-form”)
corporation which needed formal approach to corporate strategy
Right: Alfred Sloan (chief executive of General Motors from 1923 to 1946)

15. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
15
The organizational challenges involved in World War II
were a vital stimulus to strategic thinking.

16. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
16
Elite business schools were founded end of 19th century
promoting the idea that managers should be trained to think
strategically and not just to act as functional administrators

17. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
17
“Management is not just
passive, adaptive behavior;
it means taking action to
make the desired results
come to pass.”
Pr. Peter Drucker

18. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Good strategies grow out of ideas that have been kicking around
the company, and initiatives that have been taken by all sorts of
people in the company.
Prof. Henry Mintzberg
18

19. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Asking a management theorist to define
strategy is rather like asking a philosopher
to define truth.
But strategy is basically about two things:
deciding where you want your
company to go, and then how you
want to take it there.
19

20. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Four simple, timeless questions that every business
strategy must answer:
‣Where should I choose to compete?
‣Where should my core customers be?
‣How should I differentiate myself
competitively?
‣How should I discourage competitive
investment?
20

21. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
21
K.Ohmae, The Mind of the Strategist
In business as on the battlefield, the object of strategy
is to bring about the conditions most favorable to one's
own side, judging precisely the right moment to
attack or withdraw and always assessing the
limits of compromise correctly.

22. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
22
What is strategic depends
where you sit!
One person’s strategies are another’s tactics

23. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
STRATEGY SAFARI
23
A GUIDED TOUR THROUGH THE WILDS
OF STRATEGIC MANAGEMENT
Prescriptive and Descriptive Schools by Henry Mintzberg

24. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013Picasa - Yotofuji Tanaki photos
24
THINK“Look before you leap”
Design School
Strategy as a process of conception, achieving
the essential fit between
internal strengths & weaknesses and, external
opportunities & threats
Prescriptive, P. Selznick, '60s

25. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013Picasa - Hui M photos
25
Planning School
Strategy as a formal process, takes
on most of the design schools
assumptions
Process: Formal, Decomposable,
Steps, supported by checklists and
formal techniques
Prescriptive, Igor Ansoff, mid '70s
PROGRAM“A stitch in time saves nine”

26. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
26
CALCULATE“Nothing but the facts, madam”
Positioning School
Strategy as an analytical process, generic
positions selected through formalized
analyses of industry situations.
Prescriptive, Michael Porter, '80s

27. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013Picasa - Yotofuji Tanaki photos
27
CENTRALIZE“Take us to your leader”
Entrepreneurial School
Strategy as a visionary process,
based on intuition
The leader is central
Descriptive, Schumpeter,‘40s

28. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013Picasa - Yotofuji Tanaki photos
28
Cognitive School
Strategy formation as a mental process, and
analyzes how people perceive patterns and
process information
H.A Simon,‘50s
WORRY“I’ll see it when I believe it”

29. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
29
Learning School
Strategy formation as an emergent process, where the management of an
organization pays close attention to what works and doesn't work over time,
and incorporates these 'lessons learned' into their overall plan of action.
Lindblom, Hamel, Pralahad,‘70s
PLAY“If first you don’t succeed, try, try again”

30. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
30
Power School
Strategy development is seen to be a process of
negotiation between power holders within the company,
and/or between the company and external stakeholders.
Descriptive, Alison,‘80s
HOARD“Look out for number one”

31. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013Picasa - Yotofuji Tanaki photos
Cultural School
Strategy formation as a collective process
involving various groups and departments
within the company; strategy as a reflection
of the corporate culture of the
organization.
Descriptive,‘80s
31
PERPETUATE“An apple never falls far from the tree”

32. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
32
Environmental School
Strategy formation is seen to be a
reactive process: a response to the
challenges imposed by the external
environment.
Descriptive, Hannan & Freeman,
‘80s
CAPITULATE“It all depends”

33. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Configuration School
Strategy formation is seen as a process of transforming
the organization from one type of decision-making
structure into another.
Descriptive and Prescriptive, Chandler,‘70s
Picasa – Catherine S. Todd
33
LUMP“To everything there is a season...”

34. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Many definitions,
Many concepts,
Many schools!
34

35. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
35
Intended Strategy
Deliberate StrategyUnrealized Strategy
Realized Strategy
Strategy is a plan: they are made in advance of the
actions to which they apply and they are developed
consciously and purposefully
Em
ergentStrategy
Source: Mintzberg H., The strategy concept I: Five Ps for Strategy, California Management Review 1987
Strategy is a pattern: the
successful approaches merge into a
pattern of action that becomes our
strategy.

36. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Strategic Process Proposal
1. Start with an intended strategy (but keep your intuition)
2. Understand who you are? (Most probably you are not alone)
3. Understand where you are? (Your environment deserves attention)
4. Imagine where you can go? (Look for number one)
5. Define what you should do to go there? (Be a leader)
6. Set control points (Program your journey)
7. Monitor your journey & correct the trajectory if
necessary (Learn from your mistakes)
36
Our

37. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
37
WHY STRATEGY?

38. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
…. at the end it is all about ShareholderValue Creation
Remember…
38

39. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
ShareholderValue Creation is about the
fundamental equation:
PROFIT=PRICE - COST
39

40. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
40
Good analysis ties the details
of strategy to the financial
implications
Source: Barwise, P., Marsh, P., & Wensley, R. (1989). Must finance and strategy clash.
Harvard Business Review, (September-October), 85.

41. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
41
What can make
a successful
plan ?Failing

42. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Did you know that companies
loose up to
60%of their strategy during
implementation?

43. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Companies need to wake up and fix their
initiative management
Most leaders are poor strategy
communicators
Everybody agrees that skills are crucial to
performance but few are able to build an
adequate development platform
The Strategy Execution process often fails
source:The strategy execution research report

44. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
44
6 SILENT KILLERS
FOR STRATEGY EXECUTION
•Top-down or laissez-faire senior
management style (9 of 12 cases)
•Unclear strategy and conflicting
priorities (9 of 12 cases)
•An ineffective senior management team
(12 of 12 cases)
•Poor vertical communication (10 of 12
cases)
•Poor coordination across functions,
businesses or borders (9 of 12 cases)
•Inadequate down-the-line leadership
skills and development (8 of 12 cases)
Source:The six silent killers of strategy implementation and learning,
Michael Beer, Sloan Management Review Summer 2000

45. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
45
Photo: Flickr - Some rights reserved by Ametxa
Insights from the best-in-class
Strategy execution is a discipline of its own
Source: Jeroen De Flander

46. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
49 Photo: Flickr - Some rights reserved by Dino ahmad ali
Insights from the best-in-class
Strategy execution is a vast area with blurred borders
Source: Jeroen De Flander

47. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
47
Photo: Flickr - Some rights reserved by Dino ahmad ali
Insights from the best-in-class
Strategy execution is on its way to maturity
Source: Jeroen De Flander

48. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
48
51 Photo: Flickr - Some rights reserved by Dino ahmad ali
Insights from the best-in-class
Strategy execution requires a great strategy
Source: Jeroen De Flander

49. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
49
Photo: Flickr - Some rights reserved by probe.ch
Insights from the best-in-class
Strategy execution requires your attention from the start
Source: Jeroen De Flander

50. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
53 Photo: Flickr - Some rights reserved by kamera.obskura
Insights from the best-in-class
Strategy execution has a strong timing sequence
Source: Jeroen De Flander

51. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
54 Photo: Flickr - Some rights reserved by ordinaryfool
Insights from the best-in-class
Strategy execution requests an integration between organizational
and individual performance
Source: Jeroen De Flander

52. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
55
Insights from the best-in-class
Strategy execution demands clear responsibilities & requires
horizontal alignment
Source: Jeroen De Flander

53. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
56 Photo: Flickr - Some rights reserved by Dino ahmad ali
Insights from the best-in-class
Strategy execution asks for measurement
Source: Jeroen De Flander

54. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Insights from the best-in-class
Strategy execution is a resident
Source: Jeroen De Flander
Photo: Le Corbusier Seat

55. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
Insights from the best-in-class
Strategy execution needs heroes
Source: Jeroen De Flander
Photo:“The incredibles”, Pixar @ Disney

56. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
56
Enjoy your journey!!
Strategic

57. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
57
Please join our discussions
on Facebook and Google+

58. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
58
Thank you for your time

59. STRATEGY & CORPORATE GOVERNANCE - © Prof. L. Bouty 2013
59