Value Chain Road Map General Approach

Linking Strategy to Action

Know your Business, Build your Strategy

Value Chain and Strategy Formulation

General Approach and Road Map For Implementation

Know Your Business, Build your Strategy

Contents

• Objectives of The Presentation
• Schematic Diagram of the Approach
• Detailed Diagram of the Approach
• Five Areas-Five Concepts-Success Criteria
• Steps Detailed (Build)
• Steps Detailed (Assess)
• Steps Detailed ( Improve)
• Example on Prioritizing
• Steps Detailed ( Review)
• Steps Detailed ( Plan)

2 2009 Mohamad Nazmi mwahadneh@hotmail.com


Objectives of this Presentation

This presentation aims to present the full road map for the approach
suggested to build the Main activities value chain and link it to the
Strategy Map of any organization.

The Presentation is directed to strategy representatives, whom can
implement the approach to validate their strategy linkage to the
overall strategic directions of Organization.



Schematic Diagram of the Approach

Build Assess Improve Review Plan



Detailed Diagram of the Approach

Identify Defects Assess Defects Status
•Understand the Org •Set initiatives to •From Lines of
Structure mitigate the Business and
•Prepare Data headaches products set the
collection Sheets •Select the Criteria •Create Action Plans mission
•Conduct Awareness of Defects for initiatives •Measure the •From the Mission
Sessions to Units’ •Create Headaches •Distribute tasks on Customers build the
Heads Sheets employees and link Satisfaction perspectives
•Distribute the forms •Distribute to PA •Identify No- •From the
•Gather the forms Headaches Sheets •Follow Up on Action Improvement perspectives build
and validate Plans till Defects and re- the strategy story
•Gather and Analyze
•Create the Value headaches Completion assess initiatives •From Strategy Story
Chain Diagrams and inputs status build Objectives

Identify Products and Set & Implement
Create The Strategy
Services Initiatives




Five Areas-Five Concepts-Success Criteria
Leadership
Leaders are Ready to Champion the Leaders will spare some good time for
Leaders are Convinced to Launch Leaders are willing to improve Leaders will delegate authorities
Change the project

People
We don’t believe in the ugly baby We will not hide information and we
We are all involved We will implement improvement The project is a Priority on our daily list
syndrome will be working as a transparent team

IT
IT solutions will be used when necessary We will use technology to facilitate the
IT solutions can not replace people We think business not machines Computers are faster but not smarter
Only project progress and to document

Project Team
We will deal with the information in a We know that People know more so we Our role is to change but not to force
We will transfer knowledge to all We will not be biased
confidential manner will listen to them the change, people shall buy in

DGEP
Excellence Model will govern all of the KPIs will be set to all project stages and We will benchmark when applicable We will keep all of the evidences in a
RADAR will be used always
stages action plans shall be met and possible file



Steps Detailed Build

Understand The Units Prepare Data Forms Get People to Know then Create the Value Chain
•Build or Obtain the Org. •Data collection forms collect Diagrams
Structure shall have the following: • Conduct awareness •Draw the Value Chain
•Gather the Main •Unit Name sessions for points of (Inputs to Activity to
activities for Every Unit •Activity contacts for how to use Product to Customer/s)
•Identify point of Contact the forms •Validate the Diagrams
•Product/s
in every unit • Distribute the forms with concerned
•Inputs
• Collect the forms •Analyze loads on units (if
•Inputs coming from
(Supplier) • Validate No. of required)
Products/No. Of Inputs/
•Products
No. Suppliers/no. Of
•Products Going to Customers
(Customers)



Steps Detailed Assess

Select the Criteria of Prepare Inputs Prepare outputs Meetings and Data
Defects headaches Sheets headaches Sheets collection
•Identify Criteria for •Prepare Inputs •Prepare outputs •Conduct awareness
Defects, such as: headaches sheet, for the headaches sheet, for the presentation or conduct
• Time Delay units to evaluate Customers to evaluate meetings to explain to
• Missing Information suppliers and the sheet the units’ products and customers and units how
will have: the sheet will have: to fill the form
• Missing point of
contact • Unit name •Customer Name • Agree on time to collect
• inconsistent quality • Product Name •Product Name forms and collect the
• Supplier • Importance (Out of 5) forms
• Inputs •headache • Categorize the
•Importance (Out of 5) •Frequency% headaches per product
• headache •Overall Satisfaction for customers and per
• Frequency% supplier for the units



Steps Detailed Improve

Analyze Headaches Root-Cause Analysis Implementation Reporting
• Use the following •Follow the product value •If the problem is caused by • APPR will be sent from
formula for the Outputs chain diagram reaching to an Input headache then Owner to the project
Headaches sheet per the activity producing the create an SLA with supplier team
product: product • if the input is caused by • project team will
•Weight= • link the Activity to a unit an internal issue (root- provide the
Avg.((Importance + or an employee caused) create an action Management by an ESR
(Frequency%*5))per • check if there is an Input plan for the initiative that
• Monthly meeting Shall
product/Headache/cust headache for the product has the following:
omer) be conducted to review
• Ask the Activity owner if •Detailed tasks the APPRs and
• List products weight in he/she believes that the • Time Plan recommendations shall
ascending order input headache (If Any) • Budget if needed be prepared by team
• Highest weight will be will cause this headache • Risks expected and discussed with
the first to start with • If not Analyze the management
then lower and lower in • Action Plan shall be
process and come with an implemented and
weight* initiative monitored by APPR.

* Example is Provided in the next slide



Example on Prioritizing
Product Customer Importance Headache Frequency% Weight

A 1 3 AH1 30% =3+0.3*5=4.5
A 1 3 AH2 60% =3+0.6*5=6
Total Weight Avg.(5+6)=5.5
B 2 4 BH1 40% =3+0.4*5=5
B 3 2 BH3 30% =2+0.3*5=3.66
Total Weight Avg.(5+3.66)=4.33

So We Will Start Working on Product A as it has more Weight (So budgets and Manpower
will be directed to it)

Notes: You Can Add Weights (%) for your customers according to their importance
You Can Add Weights (%) for Importance and Frequency according to its importance



Steps Detailed Review

Focused group Analysis Review the initiatives When to do the same again
• Re-send the headaches Sheet to •Gather all progress reports of the •It is not advised to conduct the same
your customers whom had initiatives practice more than once per year (Value
headaches in the past • According to the DGEP RADAR, chain analysis)
• Review and analyze the analyze the effectiveness of the • It is advised to measure the satisfaction
headaches again (If Any) Approach of your customers on general terms
• Meet the initiative owner and every 6 months
analyze the root-cause again •Initiatives for improvement from now
• Implement the new initiatives on shall be linked to the value chain
diagrams
• A Week that is called KAIZEN week shall
be implemented every six months to
gather initiatives from the employees



Steps Detailed Plan

•Mission represents our lines of business which can be gathered from the products and
activities list
•Example: We provide Services Directly to customers and we do not generate revenue,
and at the same time we are doing so many technical processes that depends on our
Mission Statement employees skills (Human Resources Based processes)
• So the Mission Might be: “Meeting Customers Satisfaction through “Our Lines Of
Business”, Implementing the highest standards of “requirements of services that we
provide”, while ensuring “Financial Budget terms” is available to effectively improve
our “Human Capital”

•Your Strategy perspectives shall be representing the logical sequence mentioned in
your mission statement so by the above example the following will be the logical
sequence from top to bottom for your strategy map:
Strategy Perspectives • Customers
•Internal processes
• learning and growth
• Financial



Steps Detailed Plan

•Based on the Perspectives and the Mission Statement, the example strategy story will
be:

Strategy Story • We Will Ensure that sufficient budgets are available to improve our human capital
capabilities to be able to perform “requirements of services” in order to effectively
manage and improve our processes delivering “ the Lines of Business” to better
serve our customers and meet their expectations.

•In this part you will be listing your entity objectives in all perspectives linking them to
the strategy story, lines of business, your relations with suppliers, your customers
needs, employees improvement needs, and financial terms
Strategy Objectives • Based on the above objectives you will be listing KPIs (Linked directly to your value
chain, and represents the outcomes of your processes) for each objective
• according to the KPIs linkage to activities, you can assign ownership of KPIs and
responsibilities to achieve it.



Steps Detailed Plan

Aligning your
•From your strategy map link what ever objectives you have and can serve
Strategy to Organization’s Objectives or KPIs, accordingly copy these objectives from
Organization’s Strategy Map into your strategy Map, and color these objectives with
Organization’s another color and you can even use the Organization’s Objectives as Themes in Your
Strategy Map.
Strategy

•Report the Objectives you have from Corporate SM to Performance Management
Reporting function at your organization.
•Report other Objectives to your Head of unit only


For Any Further Inquiry you can contact me at the following email:

Mohamad Nazmi Al- Wahadneh

15
Wishing You the Best
2009 Mohamad Nazmi mwahadneh@hotmail.com

Value Chain Road Map General Approach

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