Tomorrow always arrives. It is always different. Even the mightiest company is in trouble if it has not worked on its future. Peter Drucker

Tomorrow always arrives. It is always different. Even the mightiest company is in trouble if it has not worked on its future.

Peter Drucker

9:00-9:15 Introductions/Agenda

9:15-10:45 Strategic ManagementPhase 1: Preparation

Triage-Understanding Situation-Defining Need for ChangeGaining Management Understanding & Commitment

10:45-11:00 BREAK

10:45-12:30 Phase 1: Preparation (continued…)Planning to Plan

Phase 2: Strategic Thinking-Assess, Scan, AnalyzePhase 3: PlanningPhase 4: Execution & LearningStrategic Management Process Model

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Strategic Management System

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The course is built on the Perspective of the General Manager

“Understanding the organization as a whole and integrating and coordinating the decisions and

activities of the functional areas.”

“Managers are not confronted with problems that are independent of each other, but dynamic situations that consist of complex systems of changing problems that interact with each other. I call such situations messes

… Managers do not solve problems: they manage messes”

Russell Ackoff4

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Copyright 2013 The Coleman Group, LLC All rights reserved

A General Management Perspective

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It was six men of IndostanTo learning much inclined,Who went to see the Elephant(Though all of them were blind)That each by observationMight satisfy his mind.

The First approached the Elephant,And happening to fallAgainst his broad and sturdy side,At once began to bawl:“God Bless me! But the ElephantIs very like a WALL!”

The Second, feeling of the tusk,Cried, “Ho, what have we here,So very round and smooth and Sharp?To me ‘tis mighty clearThis wonder of an ElephantIs very like a SPEAR!”

The Third approached the animal,And happening to takeThe squirming trunk within his hands,Thus boldly up and spake:“I see,” quoth he, “the ElephantIs very like a SNAKE!”

The Fourth reached out an eager hand,And felt about the knee“What most this wondrous beast is likeIs mighty plain,” quoth he:“Tis clear enough the Elephant Is very like a TREE!”

The Fifth, who claimed to touch the ear,Said: ”E ’en the blindest manCan tell what this resembles most:Deny the fact who can,This marvel of an ElephantIs very like a FAN!”

The Sixth no sooner had begunAbout the beast to grope,Than seizing on the swinging tailThat fell within his scope,“I see,” quoth he, “the ElephantIs very like a ROPE!”

And so these men of IndostanDisputed loud and long,Each in his own opinionExceeding stiff and strong,Though each was partly in the right,And all were in the wrong!

Programs Management Governance Financial Resources Systems (Infrastructure)

Continuum of Organizational Success

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CAPACITYMeans

PERFORMANCEMeasurement

EFFECTIVENESSImpact

Programs

Ma

ng

mt.

Go

vern

an

ce

Fin

. R

eso

urc

es

Sys

tem

s

Strategic Management

Strategy is about the future and the need for change

A primary responsibility of leadership is to define the need for change

How do you do this?

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Where Are We? Where Do WeWant to Go?

How Do WeGet There?

Execution

Mission, Vision, Values,and Goals

StrategyFormulation

StrategyImplementation

Von Clausewitz: How is the Vision created?

The Starting Point The Vision orDestination

What is Strategy?Jomini’s Model Of Strategic Planning -1838

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Internal AnalysisResources and

Capabilities“Can Do”

Internal AnalysisResources and

Capabilities“Can Do”

External AnalysisIndustry Environment

What does the Market Demand?Opportunities

“Need to Do”

External AnalysisIndustry Environment

What does the Market Demand?Opportunities

“Need to Do”

Management’s& Owners’

Preferences“Want to Do”

Management’s& Owners’

Preferences“Want to Do”

Strategic Choices Must Reconcile the Differences (The Tradeoffs)

to produce a Valuable Competitive Position

Circle of Competenc

e

Circle of Confidence

Strategic ManagementStrategy as a Process

“Individual words must be organized into a logical sequence to create a meaningful sentence. Likewise, the elements of strategy (formulation, planning, execution aand learning) must be organized into a logical sequence to create an effective process for each specific situation.”

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Strategic ManagementProcess is Layered & Iterative

There are multiple phases involved in the development of the process, and multiple stages within each phase.

New information or learning at any phase or stage will require the organization to revisit old assumptions and adjust the plans accordingly.

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Strategic Management4 Phases

Phase 1: Preparation•Stage 1-Triage-Understanding the Situation: Defining the Need for Change•Stage 2-Gaining Management Commitment to a Strategic Management System•Stage 3-Planning to Plan

Phase 2: Strategic Thinking•Current Situation, Scanning the Future, Strategic Analysis

Phase 3: Planning•Strategic, Business, Annual & Line of Sight Plans

Phase 4: Execution & Learning 13

Triage: Quickly Assessing the Current Situation

A- Is there clarity of purpose and mission alignment w/customer segments? B- What are the revenue streams and do they cover costs

C- Where is the organization in the lifecycle?

D- What is the leadership situation (Board and Management)?

E- What is the general condition and momentum of the org.?

F- How do these conclusions shape the org’s strategic options?14








A- Is there Clarity of Purpose and Mission Alignment?(Stakeholders-Clients & Donors)

▪ Whom do you serve?▪ What are their needs?▪ How do you meet those needs?▪ What would be the affect on their lives if you didn’t exist

to do your work?

B- What are the revenue streams and do they cover costs?

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Value Proposition Customer Relation-ships

Distribution Channels

Customer

Segments

Clients

(Start Here)

Donors

Key Partners Key Activities

Key Resources

Revenue Stream

Cost Structure

Business Canvas

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Clients, Consumers: the end beneficiary of the product and/or service provided by the non-profit organization (these can be subdivided depending on the beneficiary groups).

Customers, Investors, Supporters, Donors, Volunteers: the groups or individuals the provide something(money, time, resources, potential clients) to enable the non-profit to provide their product and service to the end user-client.

Clients, Consumers: the end beneficiary of the product and/or service provided by the non-profit organization (these can be subdivided depending on the beneficiary groups).

Customers, Investors, Supporters, Donors, Volunteers: the groups or individuals the provide something(money, time, resources, potential clients) to enable the non-profit to provide their product and service to the end user-client.

Stakeholders: Who Are They?Stakeholders: Who Are They?A voluntary association of stakeholders with competing interests A voluntary association of stakeholders with competing interests

whose engagement is essential for the success of the organization.whose engagement is essential for the success of the organization.MackeyMackey

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People Support, Buy, Advocate, and Follow WHY You Do What

You Do.http://www.ted.com/talks/simon_sinek_how_

great_leaders_inspire_action.html

People Support, Buy, Advocate, and Follow WHY You Do What

You Do.http://www.ted.com/talks/simon_sinek_how_

great_leaders_inspire_action.html

Fundamentals: Purpose-WHYFundamentals: Purpose-WHY

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Sufficiency: Does the stakeholder(group) provide enough potential (size, influence growth, etc…) to meet your objectives?

• Rationale: Do you really know this stakeholder enough to engage, build a relationship, maintain loyalty, create advocacy?

Needs/Desires | Attitudes/Behaviors | Expectations

Value Perceptions | Demographics/Psychographics

Sufficiency: Does the stakeholder(group) provide enough potential (size, influence growth, etc…) to meet your objectives?

• Rationale: Do you really know this stakeholder enough to engage, build a relationship, maintain loyalty, create advocacy?

Needs/Desires | Attitudes/Behaviors | Expectations

Value Perceptions | Demographics/Psychographics

Fundamentals: WHO Fundamentals: WHO (Natural Constituency)

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Points of Parity

Points of Differentiation

Functional Benefits to Specific Stakeholder

Emotional Benefits to Specific Stakeholder

Barriers to Engaging

Points of Parity

Points of Differentiation

Functional Benefits to Specific Stakeholder

Emotional Benefits to Specific Stakeholder

Barriers to Engaging

Fundamentals: WHAT Fundamentals: WHAT (Product/Service Offering) **

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Think about Programs being supported by Management, Governance, Finance, Systems-Infrastructure

What are the Most Effective Touch Points by Stakeholder?

In-person: 1:1, Groups Print: Flyers, Newsletters, Letters Digital: E-mail, Website, Blogs, Social Media Local/State Events Through Influencers Radio, TV

Are You Creating Synergy Across All Touch Points?

What are the Most Effective Touch Points by Stakeholder?

In-person: 1:1, Groups Print: Flyers, Newsletters, Letters Digital: E-mail, Website, Blogs, Social Media Local/State Events Through Influencers Radio, TV

Are You Creating Synergy Across All Touch Points?

Fundamentals: HOW Fundamentals: HOW (Reaching Stakeholders When/Where Receptive)

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Triage: Quickly Assessing the Current SituationExercise #1

Think about the situation in your organization based on your Triage assessment.

•Do you know your WHY?

•Do you know your customers?

•How could you get to know them better?

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C- Where is the Organization in the Life Cycle?

Benefits of Understanding Lifecycle Capacity A diagnostic starting point Set realistic expectations for “typical” behavior” in a stage Recognize behaviors that are out of sync with a stage Depersonalize organizational management weaknesses Understanding stage-based development helps

supporters to become more effective advocates

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Startup

Growth

Maturity

Decline

Regeneration

Turnaround

The IdeaInflection

PointsTerminal

A sound Business concept In the

box

Fail

Vitality

How do you know when you are approaching

•maturity?•Decline?

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D- What is Leadership Situation (Board and Management)?E- What is the General Condition and Momentum of the Organization?

Positive Stable Negative

Strong Many options For how long? Have time to fix it

Average Plans are working

Little margin of error

Need corrective

action

Weak Should strengthen over time

Hanging on How much time do you

have?Applies to organization as a whole and to each Component of the Business Canvas

Co

nd

itio

n

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Triage: Quickly Assessing the Current SituationExercise #2-Discussion & Chart Handout

Think about the situation in your organization based on your Triage assessment.

•Where is your organization on the Lifecycle curve?

•What are the key issues facing your organization based on its stage of development?

•What is the general condition of your organization?

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Phase 1: Preparation•Stage 1-Triage-Understanding the Situation: Defining the Need for Change (5 Ques)•Stage 2-Gaining Management Commitment to a Strategic Management System•Stage 3-Planning to Plan

Phase 2: Strategic Thinking•Current Situation, Scanning the Future, Strategic AnalysisPhase 3: Planning•Strategic, Business, Annual & Line of Sight PlansPhase 4: Execution & Learning

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Go / No-Go Decision

1. Defer: Address current Issues Now

2. Ready: Think about the Future

Continue with Preparation Phase

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Phase 1: PreparationStage 2-Gaining Management Commitment to a Strategic

Management System

Assess Management Team’s Experience w/Strategic Management: The Strategic IQ

Exercise #3-IQ Handout

Where did you place your organization on the Strategic IQ Scale?

If inexperienced, select a consultant or course for training Research how others have approached the process Train

When understood, ask for the team to commit to the process If commitment is not given, defer the planning process until you

resolve the issue with the team If commitment is given, design the process

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Key Questions• What are realistic goals for the process?• What is the appropriate level of effort given the type, scale

and timing of the required change?• What is the logical starting point?• What are the appropriate planning horizons for the

situation?• What will be the Planning Calendar?• How will the work be organized?o Who will be the Champion?o Who will be on the Steering Task Force?o What information will be required?o What will be top down? Bottom up?o Identify the task forces, their charges, members and their work planso How will the Board be involved? 35

LEVEL ABBREVIATED MODERATE EXTENSIVE

Time Required 3 Months 6 Months 12 Months

Personnel Involved

The CEO , Key managers and

Board

Same Same plus entire staff, board and

external stakeholders

Depth of Analysis

Minimum Some Extensive

Primary Outcomes

Consensus on Mission, Vision

(Direction), Competitive Strategy, functional strategies

and key strategic issues

Guidance to staff on developing annual

operating plans

Actions on Major Issues

Sameplus

Greater understanding of

operating environment

(SWOT’s) and related issues

Integration of strategic goals into budgeting process

Same

Same

Integration of Strategic

Management with basic management

processes

Same

What is the Appropriate Level of Effort? 36

Key Questions

•What are the appropriate planning horizons for the situation?•How much foresight is required to understand the terrain to be navigated?•What are the lead times required to bring the resources on line to support achievement of your goals?

o The Strategic Perspective – generally beyond 5 years or moreo The Resource Plan – usually 3 years with a range of 2 to 5o The Annual Operating Plan – 1 yearo Line of Sight – 90 days

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A Planning Calendar

•1st Quarter: Assessment and Learning

•2nd Quarter: Strategic Thinking: Update Strategic Plan

•3rd Quarter: Update the Resource (Business) Plan – often called the Strategic Road Map

•4th Quarter: Prepare the Annual Plan

•Quarterly: Line of Sight Action Plans

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Top Down Bottom Up

MissionVision and Goals

Policies

ObjectivesSWOT

Who Participates in the Strategic Planning? 39

Board’s Governance Role in the Process

Provide effective leadership that keeps the parts together:• In hiring the right CEO…aligned to the brand and strategy• In focusing on the right things:

o Boards spend too much time on minutia and the past.• In advising and consenting with the CEO in

o Determining the purpose – the businesses in which to beo Determining the vision o Setting goalso Understanding strategieso Making or affirming key decisions

• In oversight to ensure accountability• In assessing the current situation and the need for change

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A Consultant’s Role in the Process

• Researcher: Uncover strategic dilemmas that have been hidden from view or unable to be acknowledged

• Therapist – Help create deep understanding about behavior and chemistry of senior team

• Business Coach – Challenge paradigms of business model

• Educator – Apply learning's from other firms as appropriate

• Industry expert - Provide advice on what the strategy should be and/or how to execute it

• Process Manager – Design and manage the process 41

Exercise #4-Paired Discussion

•How is the preparation stage of the process organized in your organization in terms of time frame and people involved in it?

•How well has this worked in the past?

•What has been the Board’s role? How would you critique their involvement based on what you learned in the interviews?

•Have you used a consultant? What role did they play?

•Overall, based on what you have learned so thus far, how could the preparation stage at your organization be improved?

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The Strategic Management Process should not be a peripheral, episodic activity but should be integrated into the ongoing management and decision making processes of the organization.

Keep it simple and doable – don’t create something so complicated it falls of its on weight. Einstein: “Keep it simple, but no simpler than it is”

It usually takes 3 to 5 years to develop a good strategic management system

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Strategic Management Model

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A Strategic Management SystemRef: The Execution Premium

By Kaplan and NortonHarvard Business Press, 2008

Ready – What to Do

Aim – How to Do It

Steer – Do It

Decision

Action

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The Strategic Management System:Four Perspectives

Ref: The Execution PremiumBy Kaplan and Norton

Harvard Business Press, 2008

InformationPerformance Assessment

(Operating & Strategic)

1. New or Revised Strategy.

3. Execution ofCurrent Operations

2. Translating(Communicating)

4. Real Time Innovation and

Change

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1-Year Strategic

Framework

Strategic Plan

Level 1

Level 2

Level 3

Level 4

Daily Executio

n

3-Year Resource

Plan(Rolling)Strategic Road Map

Level 5

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1. Strategic Management should be an ongoing process, not an event

2. The process logic is generic, but its application is very situational. The model presented here is just one of many

3. Strategic Management is usually messy and iterative.

4. “Keep it simple, but no simpler than it is”-Albert Einstein

5. There must be a system to balance the tensions between strategy and operations.

Some Important Principles

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Documents

Tomorrow always arrives. It is always different. Even the mightiest company is in trouble if it has not worked on its future. Peter Drucker