Sovereign Insurance - Strategic Planning for RESULTS - SovNet

Strategic Planning for RESULTS

Best practices based on the direct observations

of thousands of RESULTS.com client firms

Presenter: Stephen Lynch

Role: Head of Strategy & Consulting at RESULTS.com

Email: [email protected]

Linkedin: linkedin.com/in/stephengeoffreylynch

Slides: results.com/slides

Software Demo: results.com/insurance

18,446,744,073,709,551,615

“We’re in the second

half of the chessboard”

“In short, software is eating the world.”

“The digital era will dwarf what occurred in the information era.

It’ll be a brutal disruption, the majority of companies today will not exist in a meaningful way

10 to 15 years from now.”

“Business is going to change more in the next 10 years than it has

in the last 50”

“It is not the strongest who survive, nor the most intelligent,

but the ones most responsive to change”

“You need to operate with one eye focused on the short-term, and one eye focused on the long-term.

Short-term planning is about improving your current business, & meeting the needs of today’s customers.”

Often, this demands bold, disruptive strategic moves”

“Long-term planning is not performance improvement. It is about forgetting the past and reshaping your

business to compete more effectively in the future.

3 to 5 Year Strategic Moves

"If you’re planning over a 3 year time horizon, you're competing against a lot of people.

But if you're willing to invest on a 7 year time horizon, you're competing against a fraction of those people, because very few companies are willing to do that.

We can't realize our potential as people or as companies unless we plan for the long term."

“You need to clearly explain the top 3 things the

company is working on.

If you can't,

then you're not leading well”

Industry Analysis

Questions / Answers:

#RealStrategy || @RESULTSdotcom

“The questions remain the same. It’s the answers that keep changing”





Rivalry between existing competitors

Who are your Key Competitors now? (the “players”) What moves are they likely to make? Any Threats? Opportunities?

( Industry life cycle: introduction > growth > maturity > decline / Industry growth rate / Industry profitability / Number of competitors / Market share / Capital requirements / Globalization / Commoditization / Cost advantages / Economies of scale / Friendly vs. Aggressive competition)

List your answers below:

New Entrants

What New Entrants could disrupt you? Any Threats? Opportunities?

( Industry barriers / Capital requirements / Learning requirements / Access to supplies / Access to distribution / Performance vs. incumbents /

Perceived differentiation in customers’ mind / Loyalty to incumbents / Switching costs / Retaliation by incumbents / “Innovator’s dilemma”)


Substitutes

What Substitute products / services could disrupt you? Any Threats? Opportunities?

( Technology changes / Industry structure changes / Availability of substitutes / Performance of substitutes / Perceived differentiation in

customers’ mind / Switching costs / Customer desire to seek out alternative solutions to satisfy their need)


Suppliers

“Who” or “What” do you need to pay to run your business?

Who are your Key Suppliers? What moves are they likely to make? Any Threats? Opportunities?

( Cost of supplies / Negotiating power of suppliers / Access to alternative sources of supply / Switching costs /

Forward integration – supplier becomes competitor)


Customers

“An excessive customer focus prevents firms from creating new markets

and finding new customers for the products of the future.

They unwittingly bypass opportunities.”

“Asking customers what they want is a systemic flaw. Customers can’t say what new product would be

desirable three years from today. New ideas are generated by imagination, risk, trial &

error by the producer.”

Strategic Focus

What do your target customers value most?

Value Discipline

(Generic Strategy)

Company examples

Low cost

Consistency Speed

No hassles

Operational Excellence

Southwest Airlines,

Walmart, Fedex

State of the art Products and Services

Product Leadership

Apple, Gillette, BMW

Customized products Personalized solutions

Customer Intimacy

Zappos, Nordstrom,

Ritz Carlton

Who are your Key Customers? What moves are they likely to make? Any Threats? Opportunities?

( Customer demographic and psychographic description / Power to dictate prices or terms / Ability to influence other customers / Customer reviews / Perception of differentiation between vendors / Loyalty / Switching costs / Backward integration – customer becomes competitor)


Political and Regulatory Factors

What political factors / laws / regulations are likely to impact you? Any Threats? Opportunities?

( Industry specific regulations / political spectrum left vs. right / political stability / laws / taxes / trade policy / wars / environmental issues /

health / safety / consumer laws / employment laws)


Economic Factors

What economic factors / changes in buying behaviors are likely to impact you? Any Threats? Opportunities?

( Economic growth / interest rates / exchange rates / inflation / availability of credit / investor interest in your industry / discretionary spending

changes in customer purchasing habits / use of debt and leverage vs. more frugal spending / new forms of payment)


Social Factors

“We live in a culture that discourages empathy.

A culture that too often tells us our principle goal in life is

to be rich, thin, young, famous, safe and entertained”

STANDARDIZED

Industrial age

work

CUSTOMIZED

Network age

work

LABOUR:

obedience

systems

processes

productivity

TALENT:

initiative

innovation

creativity

passion

Management 1.0

Management 2.0

“We are going to have to reinvent management; the way we lead, we plan, we organise, we hire, we motivate...because today, organisations are facing

a set of challenges that are truly unprecedented"

Baby Boomer

1946 -1964

Generation X

1965 - 1980

Millennial / Gen Y

1981 - 2000

Key life influences Cold War nuclear threat, NASA

moon landing, Vietnam, Civil

rights, Hippie culture

AIDS, Divorce, MTV, Cold War

ending, Personal computer,

Microsoft

Internet, Always connected,

Share everything online,

Facebook, Apple and Google

Work environment Long hours, Office only Formerly Office, Increasingly

working from home

Office, Home, Wherever,

Desires flexible work hours

Work ethic Workaholic, Quality focus,

Team player

Clear direction, Get tasks done,

Self reliant, Free agent

Entrepreneurial, Variety,

Multitasking, What’s next?

Management style Hierarchy, Chain of command Everyone should manage

themselves, Challenge people

Collaboration, Consensus

Personal Motivators Salary, Job title, Feeling valued

and respected

Money, Freedom, Break the

rules and do it your own way

Meaningful work,Maintain

personal life, Training, Mentoring

Mentoring Does not like feedback. Does

not take negative feedback very

well

Does not think feedback is

necessary. Will ask for it they

want it

Wants frequent management

feedback, Feedback on demand

at the push of a button

Internal

communication

Face to face meetings focused

on process, Memos

Face to face meetings focused

on results, Emails

Face to face participative

discussions, Emails,

Collaboration software

Client

communication

Face to face, Phone Face to face, Phone, Email Email, Social Media, Instant

messaging

Career Goals Climb the ladder at one

company, Job security

Build transferable career with

variety of skills & experiences,

Build a business.

Build several parallel careers or

businesses simultaneously

What social factors / trends / attitudes / behaviors are likely to impact you? Any Threats? Opportunities?

( Demographic trends / career attitudes / health issues / environmental concerns / communication styles / social behaviors / online behaviors /

media consumption / cultural differences / generational differences / income equality / society’s evolving attitudes, values & beliefs)


Technology Factors

What technological factors / trends / are likely to impact you? Any Threats? Opportunities?

(New technologies / Rate of technology adoption / Impact of internet and mobile / Social media / New devices & interfaces / Jobs replaced by

technology / Business models disrupted by technology)


“Many managers do not understand the importance of having a clear strategy.

Strategy is about making trade-offs.

The essence of strategy is choosing what NOT to do.”

“You need to clearly explain the top 3 things the

company is working on.

If you can't,

then you're not leading well”

What are the top 3 long-term strategic moves to position your firm for future industry success? (will be implemented within the next 3-5 years)

3-5 Year Strategic Move Person Accountable

1.

2.

3.

RESULTS.com - One Page Strategic Plan

★ Research your early adopter customers ★ Subscribe to thought leaders who comment on industry trends ★ Attend industry conferences ★ Learn from other industries - peer networks ★ Conduct thorough industry analysis at least every 12 months

○ Porter’s 5 Forces + PEST ○ Survey your staff to get their input

★ The questions remain the same. The answers keep changing ★ Strategy requires tradeoffs. What are you NOT going to do? ★ Sniff Test - Would doing the opposite also be a valid strategy? ★ Review strategy every quarter - does it still make sense?

3 to 5 yr Strategic Moves - best practices

“However beautiful the strategy, you should occasionally

look at the results”

“However beautiful the strategy, you should occasionally

look at the results”

Thank you for your time!

Strategic Planning for RESULTS

Best practices based on the direct observations

of thousands of RESULTS.com client firms

Presenter: Stephen Lynch

Role: Head of Strategy & Consulting at RESULTS.com

Email: [email protected]

Linkedin: linkedin.com/in/stephengeoffreylynch

Slides: results.com/slides

Software Demo: results.com/insurance