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Strategic Planning Training CITY OF CORNWALL MAY 2013

CENTRE FOR CORPORATE LEARNING AND PERFORMANCE IMPROVEMENTStrategy Fundamentals – City of Cornwall – May 2013

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Session Agenda

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Introductions and ContextA Strategic Management Process

This session presents a high‐level process for developing and executing strategy. Complementary topics to be explored include: Resource‐based view v. positioning school; Strategy hierarchy; Elements of the strategic plan.

Set‐up for Sessions 3 – 5

Process AgendaNo. Date Item1 Friday, May 10 Survey2 Friday, May 24 (Morning) Strategy Fundamentals 3 Wednesday, May 29 (Evening) Community Consultation4 Saturday, June 1 Working Session 15 Thursday, June 6 (Afternoon) Working Session 26 Friday, June 14 Report (Draft)7 Monday, June 24 Delivery at Council8 Wednesday, July 17 Organization & Alignment

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3 Simple Questions

1. Who are we?2. Where are we going?3. How are we going to get there?

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A Strategic Management Process

Strategy Analysis

Strategy Formulation

Strategy Implementation

5

Positioning v. RBV

The Positioning School• Strategy made in context

(i.e. of environmental and organizational assessment)

• Organizations choose between a finite set of generic strategies

Resource‐Based View• Organization is a bundle of

resources and capabilities to be developed and deployed or exploited

• Four questions:1. Value2. Rare3. Inimitable4. Organization

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The Environment

Macro Environment

Industry or Sector

Organization

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Environmental Awareness

Environmental Scanning Surveillance of a firm’s

environmentEnvironmental Monitoring & Scenario Analysis

Tracking evolution of trends and considering impact of shifts

Competitive Intelligence Intelligence gathering &

interpretation of data

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Key Tools

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The Organization

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How well is our present strategy working?What are our competitively important resources and

capabilities? Are we able to take advantage of market opportunities and

overcome external threats to its external well‐being? Are our prices and costs competitive with those of key rivals,

and does it have an appealing customer value proposition? Are we competitively stronger or weaker than key rivals?What strategic issues and problems merit managerial

attention?

Key Tools

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Alignment

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“If the rate of change on the outside exceeds the rate of change on the inside, the end is near.”

Jack WelchFormer CEO, GE

Strategy & Value

Strategy …the efforts of managers to build and strengthen the company’s competitive position within its industry to create superior value Value …the firm’s ability to sell what it makes for more than the cost it incurred to make it

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Value Proposition – 3 Questions

Which customers/clients?

What relative price? Which needs?

14Source: Magretta, 2012

Generic Strategy

Low‐cost provider

Broad differentiation

Focused low‐cost provider

Focused differentiation

Best Cost Provider

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Deliberate & Emergent Strategy

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Stability &Alignment

Innovation & Adaptability

Emergent

Deliberate

…Lafley focuse[d]…around two objectives: "where to play" and "how to win."

"When we get it right," Lafley says, "we can boil it down into a one-page document that provides clarity for everyone – and more consistent execution.”

Ada

pted

from

Bus

ines

s 2.

0, 2

006

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“Where to Play and How to Win”

A Strategic Planning Framework

MissionWho are we? What do we do? Why are we here?

VisionWhat do we aspire to be?

ValuesHow will we behave?Pillars & Priorities

What do we need to achieve?Objectives & Strategies

How are we going to do it?Evaluation & Control

How are we going to track our performance?

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Coun

cil &

Sen

ior

Managem

ent Team

Administrative

Departmen

ts

Setting Strategic Direction

The Mission Statement• A statement about the organization’s raison d'être:• Who we are • What we do• Why we are here

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The Vision Statement• A statement about what the organization wants to be or,

• a picture of the organization once the strategic plan has been enacted.

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The Values Statement• A statement about how the organization will behave in pursuit of the vision and mission

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Pillars, Priorities & Objectives

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Pillar 1

Priority 1.1

Objective 1.1.1

Strategies & Action Plans

Objective 1.1.2


Priority 1.2 Objective 1.2.1


Priority 1.3

Objective 1.3.1


Objective 1.3.2


Strategy & Execution – Key Questions Do we have or can we obtain/develop staff with appropriate skills

and expertise? Are we organized/structured in a manner that supports the

strategy? Do our policies and procedures facilitate effective strategy

execution? Do we have information and operating systems that allow staff to

execute effectively? Have we allocated appropriate resources to activities critical to

strategic success? Are reward/incentive systems linked to objectives, pillars and

priorities? Do we have a culture conducive to successful strategy execution? Do we have the leadership required to drive the strategy?

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Strategy Execution – Basic Tasks

ExecutionRewards & Incentives

Corporate Culture

Leadership

Staffing & Development

Structure

Resource Allocation

Policies & Procedures

Benchmarking & CQI

IT & Operating Systems

Adapted from Thompson et al (2012)

The Triple Bottom Line

Profits

Planet

People

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The Learning & Growth PerspectiveIncludes employee training and corporate cultural attitudes related to both individual and corporate self‐improvement.

The Business Process PerspectiveRefers to internal business processes. Metrics based on this perspective allow the managers to know how well their business is running, and whether its products and services conform to customer requirements

The Customer PerspectiveRecent management philosophy has shown an increasing realization of the importance of customer focus and customer satisfaction in any business. These are leading indicators

The Financial PerspectiveTimely and accurate funding data will always be a priority; the point is that the current emphasis on financials leads to the "unbalanced" situation with regard to other perspectives.

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w.b

alan

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card

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The Balanced Scorecard

Develop the Strategy

Translate the Strategy

Plan Operations

Monitor & Learn

Test & Adapt

Adapted from

Kaplan & Norton, M

asterin

g the Managem

ent System, H

arvard Business R

eview, January 200

8

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Closing the Loop

A Strategic Planning Framework

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Priority Area 1 Priority Area 2 Priority Area 3 Priority Area 4

Mission, Vision & Values

Focus 1

.1

Focus 1

.2

Focus 1

.3

Focus 2

.1

Focus 2

.2

Focus 2

.3

Focus 3

.1

Focus 3

.2

Focus 3

.3

Focus 4

.1

Focus 4

.2

Focus 4

.3

Department A

Department B

Department C

Department D

Department E

Department F

Set by Council in collaboration with senior management team

Annual plans from departments

Annual plans to advance priorities

Annual business plan set by management team

and approved by CouncilPerformance against plan closes feedback loop to Council

Next Steps

MISSION VISION VALUES

PILLAR 1

PRIORITY 1.1

PRIORITY 1.2

PILLAR 2

PRIORITY 2.1

PRIORITY 2.2

PILLAR 3

PRIORITY 3.1

PRIORITY 3.2

PILLAR 4

PRIORITY 4.1

PRIORITY 4.2

Why are we

here?

What do we want to be?

How will we

behave?

Major themes for planning period Thematically

consistent initiatives

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