This strategic planning model defines the six elements of a strategic plan and shows their relationship and inter-dependence. A valuable tool to guide the strategic planning process.
2. This tool defines the six elements of a strategic plan and shows their relationship
and inter-dependence. A valuable tool to guide the strategic planning process.
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3. Overview: The beauty of this model is that you start in the first ring and work
your way outward. Each ring provides a different perspective – or lens – with
which to define your company. When one ring is done you move on to the next.
It’s an iterative process: the work on one ring informs the work on the others.
Each successively narrows the aperture and defines the specific ways in which
the organization creates value for its owners and its customers.
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4. Purpose: A succinct statement of why the organization exists and what
it does.
Core Values: Qualities essential to the organization’s success.
Vision: A clear statement of a future or end state that the organization
wants to achieve.
Goals: The priorities for realizing the vision, purpose, and values.
Strategies: Key initiatives needed to achieve the goals.
Objectives: Measurable milestones toward achieving the goals.
Actions: Actions taken in support of objectives, with timelines and
assignments.
Performance Measures: Metrics and targets of success tied to the
strategic plan.
Strategic plan: A document that consolidates these elements into a
coherent whole.
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List of Strategic Planning Terms
5. The Six Rings Model looks the same
whether you are Intel or a small start-up.
It all starts with defining purpose and core values.
A vision then flows from these two. Together, they
form the “strategic focus” and provide a litmus
test for all other decision-making.
Will we make this product? Yes, because it’s
consistent with our strategic focus. Will we enter
this market? No, because it conflicts with our core
values. In short, when you have a well-defined
strategic focus, you can make sound, consistent
decisions at all levels. Having the strategic focus is
the first quantum leap that leaders make to build a
leadership culture.
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6. Once the strategic focus is defined, the next step is
detailing the goals, objectives, and actions.
The last three rings (goals, objectives, and
actions) show how to build the “strategic plan,”
for implementing your vision.
Objectives define the initiatives and milestones
you need to hit in order to achieve the goals.
Actions capture the specific steps, timetables
and responsibilities for achieving the objectives.
The senior leaders of the organization should
take responsibility to articulate the Goals.
Download the PDF –
The Stairway to Performance
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7. Leaders should be given responsibility to work with their departments and units to
refine the Goals and tie them to specific Objectives and a coherent set of Action
steps. This “cascade” effect enables every manager – and ultimately every
employee – to connect what they do to the strategic plan.
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8. The First Ring: Purpose
Purpose is the first ring. It communicates why
the organization exists. Purpose is
fundamental.
By clarifying purpose, you sharpen the
direction of the entire organization. The test of
a purpose is this:
Does it tell people why the organization
exists and what it fundamentally does?
Is it concise and easy to understand?
Does it communicate by implication what
you don’t do?
Download the PDF – Developing a Purpose Statement
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9. The First Ring: Purpose
A company should know why it
exists, right?
Yet purpose can be exceedingly elusive
to define. Disney and Merck have both
struggled to reconcile their shareholders’
demands for profit growth with the goal
of innovation, whether it be artistic
excellence (Disney) or basic scientific
research (Merck). Their purpose
statements have provided them with
needed clarity during these clashes. A
purpose statement doesn’t sum up
everything that the organization does.
It’s just the first ring. But it needs to be
clear. Disney’s purpose is to make
people happy. Southwest Airlines’
purpose is to provide low fares. That’s it.
Clear and simple.
Download the PDF –
Developing a Purpose Statement
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10. The Second Ring: Core Values
Core values define what is essential to the
success of the organization.
Let’s be sure everyone understands what we
mean. For example, if I say my house has a lot of
“value,” we mean it’s worth a lot of money. But
that’s not the same as a core value. If I say: “What
I value is my family,” I am stating what is of utmost
importance to me. That begins to capture the
meaning of “core values.”
When we talk about an organization’s “core
values,” we’re referring to the things essential to its
success, such as product reliability, customer
satisfaction, financial success and ethical integrity.
These are the values that the organization, if it
could speak on its own behalf, would say are
essential to its long-term success.
Download the PDF – Developing Core Values 10
11. The Third Ring: Vision
A clear vision sharpens the focus.
It says “here’s our direction, here’s where we’re
going, here’s how we’re going to change the world.”
• Southwest Airlines’ vision is to make air travel
cheaper and more convenient than auto travel.
• Curves’ vision is to make it affordable and easy
for women to be physically fit.
• HSBC Bank ’s vision is to be the world’s local
bank.
Great leaders build trust by defining vision. People
want to know there’s a plan and direction.
Download the PDF – Developing a Vision Statement
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12. Vision Has Two Components
Sony’s vision in the 1950s was that “Fifty
years from now, our brand name will be as
well-known as any on earth.” General
Electric’s vision in the 1980s was “To
become number one or number two in
every market we serve.”
The external vision defines the outcomes that
the company wants to achieve.
Download the PDF – Developing a Vision Statement
The second is an internal vision of change.
GE said it would “revolutionize the
company to have the speed and agility of
small enterprise.” Sony said it would
“create innovative products that become
pervasive around the world.”
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13. Vision Statement Examples
• Southwest Airlines: To make air travel cheaper and more convenient than
auto travel.
• Curves: To make it affordable and easy for women to be physically fit.
• HSBC Bank: To be the world’s local bank.
• Amazon: To be earth’s most customer centric company; to build a place where
people can come to find and discover anything they might want to buy online.
• Avon Products: To be the company that best understands and satisfies the
product, service and self-fulfillment needs of women – globally.
• Kraft Foods: Helping people around the world eat and live better.
• Macy’s: Our vision is to operate Macy’s and Bloomingdale’s as dynamic
national brands while focusing on the customer offering in each store location.
• Toyota: To become the most successful and respected lift truck company in the
U.S.
• Wal-Mart: Worldwide leader in retail.
• Microsoft: A personal computer in every home running Microsoft software.
• The Walt Disney Corporation: To make people happy.
Download the PDF – Developing a Vision Statement
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14. Link Vision to Strengths and Opportunities
Vision needs to be linked to a
clear understanding of the
strengths and assets of the
organization along with the
opportunities and threats in the
marketplace. Occasionally it
requires a full-scale revamping of
the company’s business model.
Typically, it can take months to
develop a fully-understood and
fully-realized vision.
Download the PDF – Developing a Vision Statement
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15. The Fourth Ring: Goals
How do you define goals?
Your goals should reflect what the
organization needs to do to achieve its
vision. If your vision includes
expanding your product lines, then
you’d want to set a goal around that. If
your vision includes improving
customer service, then your goals
should reflect that priority. What’s
important is being clear about the goals
– they will frame the rest of your
strategic plan.
Related Blog –
How to Measure Performance
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16. The Fifth Ring: Objectives
Objectives define the initiatives and
milestones you need to hit in order to
achieve the goals.
Let’s track one example. A grocery chain listed
a set of objectives for a goal related to
improving customer service. Each of the
actions steps was assigned to a specific
individual with a specific timetable for
implementation.
Goal Objectives
Make our culture one in which our
employees take pride in delighting every
customer, every time.
• Develop “wow” program
• Implement “secret shopper” program
• Conduct annual customer satisfaction survey
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17. The Sixth Ring: Actions
The company’s executive management team tracked the status of each
action step at its Monday morning meeting.
Goal Objectives Actions
Make our culture
one in which our
employees take
pride in delighting
every customer,
every time.
Achieve 90% or
better in annual
customer
satisfaction survey.
• All managers and employees
receive “wow” training.
• Provide “wow” feedback forms for
customers.
• Build “wow” bonus compensation
program.
• Roll out “secret shopper” program.
• Implement quarterly customer
satisfaction survey.
• All managers review “wow” ratings
on a monthly basis.
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18. Strategic Planning Consulting
LRI consultants are experts in guiding executive teams through the strategic
planning process; clarifying long-range vision and goals, giving voice to vision,
shaping priorities, defining performance measures, and articulating related
strategies and actions. To schedule a free consultation, please contact us at
info@leadingresources.com.
For more information visit LeadingResources.com
Leading Resources, Inc.
1930 N Street
Sacramento, CA 95811
(916) 325-1190
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