STRATEGY MANAGEMENT RESEARCH STUDY STRATEGY PERFORMANCE MANAGEMENT SUMMIT 2017 Fort Lauderdale, Florida, USA
EXECUTIVE EDUCATE AND CONSENSUS AND COMMUNICATE ACCOUNTABILITY Communicate and Building the strategy map educate the workforce eliminates ambiguity and STRATEGY about the strategy. clarifies responsibility. CREATE FEEDBACK AND ALIGNMENT LEARNING MAP Each part of the Monitor and guide the organization and each strategy individual link their objectives to the strategy map.
Correlations between selected best practices The active engagement of internal stakeholder groups are key for sustainable project success Only 37 projects (out of 155) enjoyed the favorite condition to be equally supported by all 3 critical stakeholder groups: Leadership, OSM/Project team and Middle Management. However 90% of these projects achieved superior results! Disposition for and competencies in ‘Change Management’ (Org. Culture) is an important precondition for efficient project implementation Almost 90% of projects being executed in Organizations with readiness and enthusiasm for ‘Change‘ are efficient in project execution and successful in achieving the expected results! A strong and visionary leadership is the main driver for the formulation of challenging Strategies/Visions From the 14 projects which defined a strong change Strategy/Vision most (12) had been supported by an patronizing and engaged leadership
SUCCESFUL EXAMPLES
The Strategy Map and Balanced Scorecard translate the strategy statement into action Southwest Airlines: “To remain the most profitable US -based airline by offering price-sensitive travelers who value convenient flights the speed of airline travel at the price, frequency, and reliability of cars, buses and trains.” Strategy Map Balanced Scorecard Action Plan Initiative Budget Theme: Operating Efficiency Objective Measurement Target Financial • Profitability • • Profits & Market Value 30% CAGR RONA • Grow revenues • • Seat Revenue 20% CAGR Grow Fewer Revenues Planes • Fewer planes • • Plane Lease Cost 5% CAGR Customer • • • Flight is on-time FAA On-Time Arrival #1 Attract & Retain • • $XXX Rating Customer Loyalty More Customers • • Program • Customer Ranking #1 Lowest prices • • On-time Lowest • # Repeat Customers 70% Attract and retain Service Prices • • more customers # Customers Increase 12% annual • • • $XXX Fast ground • • On Ground Time 30 Minutes Ground Cycle Process Fast Ground turnaround Time Project Turnaround • • $ XXX Quality • • On-Time Departure 90% Management • $XXX • Ground crew aligned • • • % Ground Crew 100% ESOP Learning with strategy Ground Crew Stockholders and Alignment Growth • $XXX • • Ground Crew Strategic Awareness • 100% Training • Develop the • Strategic Job • • $XXX necessary skills Crew Scheduling Readiness • Yr 1 - 0% System Rollout Yr 3 - 90% • Develop the support • Info System Yr 5 - 100% Strategic Systems Strategic Job system Availability Crew Scheduling Ramp Agent • CRM System • $XXX • 100% Total Budget $XXXX Execute Communicate Measure
SUCCESFUL EXAMPLES
Correlations between selected best practices Effective strategy communication increases the chance to engage Middle Management in the implementation process The vast majority (> 80%) of projects which enjoyed intensive communication efforts had no problems with lacking capabilities or motivation of its Middle Management (the most cited implementation barrier!) Without an engaged Middle Management positive project results will be hardly achieved If Middle Management does not have the necessary discipline/motivation or capacitation less than 20% of projects in such organizations are delivering the expected results
Enterprises Require Vertical and Horizontal Alignment Scorecard Cascade Scorecard Cascade Headquarters Scorecard Shared Services Shared Services Business and Regional Units Departments Departments Teams & Teams & Individuals Individuals
SUCCESFUL EXAMPLES
Personal Scorecards Scorecard Targets Income $25 Year June 07 2006 YE 07 Target End People $20 OSHA Index 1.70 1.24 1.76 $15.0 MVA 33 85 68 $12.0 $15 Millions 96.1 96.3 96.5 Availability-Illness % % % $10.0 Customer $10 CAIDI 70.88 66.44 70.00 BPU/Exec $5.0 Inquiries 98 350 266 $5 Operations SAIFI .34 .69 0.70 $0 1% 2% 3% Better Than Plan Above Target At Target Below Target Payout Bargaining unit employees “own” key measures and are mindful of the “results” Note: Illustrative data only
SUCCESFUL EXAMPLES
The leadership team uses the BSC to review performance, examine strategic initiatives, make informed decisions, and assign accountability. Use of a BSC Report in 1 Strategy Review Meetings Identify Performance Issues: Focus on the performance of objectives NOT measures. I03 Identify Adverse Trends 3 2 Analyze Objective Performance: 5 What are the measures telling us? Are the measures driving change and adding focus? What are the root causes of what’s occurring? What are the expectations for the future? And, are current 4 initiatives sufficient to close the performance gap? Are initiative on track to deliver expected value? If not, why and what can be done to remedy issues? What action steps – including additional or different initiatives - are required to improve performance Objective: going forward? Discussion/Update: 6 Recommendations/Required Actions: Take Action: Person(s) Responsible: Due Date: Priority (A, B, C): 7 Discuss and agree on how to remedy issues. Assign accountability to ensure decisions are Action Item Detail: 1. 2. implemented. 3.
SUCCESFUL EXAMPLES
IF ALL GOES WELL....
IF ALL GOES WELL…?
PORTFOLIO ANALYSIS BALANCED SCORECARD VALUE INNOVATION OPERATIONAL ASSESSMENT EXECUTION BUSINESS CASE BUSINESS MODEL CANVAS SCENARIO PLANNING CULTURE ASSESSMENT PROFIT FROM THE CORE VALUE CO CREATION CHANGE MANAGEMENT DIGITAL STRATEGIES PROJECT MANAGEMENT FUTURE SEARCH INNOVATION MANAGEMENT VALUE DRIVERS COMPETITIVE INTELLIGENCE DESIGN THINKING OFFICE OF STRATEGY MANAGEMENT NETWORK INTELLIGENCE STRATEGIC REPORTING TREND WATCHING ROOT CAUSE ANALYSIS STAKEHOLDER MANAGEMENT BLUE OCEAN STRATEGIES CYNEFIN MATRIX
WE WOULD LIKE TO BE BY YOUR SIDE FOR EVERYTHING TO GO RIGHT
DNA METHODS EXPERIENCE RESULTS EXECUTION SUPPORT STRATEGY MANAGEMENT OPERATIONS FORMULATION STEPS EVOLVE VALUE
WHAT TO DO HOW TO DO IT DO IT STRATEGY SUPPORT EXECUTION FORMULATION OPERATIONS MANAGEMENT STEPS Future Scenarios New Operational Strategic Alignment Vision & Strategic Directions Strategy Performance Maturity Level Strategic Positioning DELIVRABLES Incubation and Accelerated Governance Growth, Development, Innovation Management of Innovation Projects & Operational Excellency Planning and Management Strategic Risk Strategies Project Execution of Strategic Projects Strategic Design of Initiatives on Cultural Transformation & Business Models, New Products, Change Management Services, Channels, Platforms, etc..
AND YOU? Optimization of New Business Positive Social Channel the Public Entry or Exit Contribution Development Resource Allocation Alignment of the Business Units , Align Human Supply Chain and the Support Capita with To Reach Fiscal Integration Units ( IT; FI; HR..) the Strategy Balance
MORE THAN 700 28 15 GLOBAL CENTERS YEARS OF ORGANIZATIONS OF COMPETENCIES EXPERIENCE SUPPORTED Tantum Group USA | http://www.tantum.com | a.bruno@tantum.com | 954-260-9000
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