© 1999 Donald A. Winkler
Breakthrough Leadership
Don WinklerFebruary, 1999
© 1999 Donald A. Winkler
2
BUSINESS• Every business can be made successful• Make no absolute assumptions about the business we’re in
LEADERSHIP• Act as if you haven’t got authority• Insist on open, honest communications
CHANGE• Think bigger and ask the better question• Don’t wait until failure occurs to bring about change
Initial Assumptions
maximize stakeholder benefit
to Phase I:
Vision Purpose Shared Vision
Breakthrough Leadership
© 1999 Donald A. Winkler
3
BREAKTHROUGH LEADERSHIP
The process has three phases. The phases have two things in common:
• First, two opposite values are simultaneously at work:— A hard-headed fact-based realism. You’ve got to know what the realities are
in terms of market trends, customer needs, resource constraints, and so on.
— Openness to fresh perspectives, free of bias, unrestrained by conventional
wisdom. You’ve got to operate in the realm of infinite possibilities.
• Second, everyone who gets involved has to have the skills to think this way, to
use the opposing values and keep the creative process working.
So, we train the team in:
— out-of the box thinking
— change management
— and communication
© 1999 Donald A. Winkler
4
Phase I:
Breakthrough Thinking
Vision Purpose Shared Vision
direction
Phase II:
Breakthrough Planning
Strategic Issues Earnings Situation Analysis
stability strategic planning
Phase III:
Breakthrough Achievement
Project Book
implementation
Breakthrough Leadership: A journey from the ordinary to the extraordinary
training
players
possibilities
realities
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
© 1999 Donald A. Winkler
5
PHASE I: BREAKTHROUGH THINKING
© 1999 Donald A. Winkler
6
Phase I:
Breakthrough Thinking
Vision Purpose Shared Vision
direction
Breakthrough Leadership: A journey from the ordinary to the extraordinary
training
players
possibilities
realities
Phase II:
Breakthrough Planning
Strategic Issues Earnings Situation Analysis
stability strategic planning
Phase III:
Breakthrough Achievement
Project Book
implementation
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
PHASE I: BREAKTHROUGH THINKING IS THEDISCOVERY PHASE, WHERE SENIOR LEADERS OF THEBUSINESS QUESTION THE EXISTING BUSINESSPROPOSITION AND LOOK AT WHAT IMPEDES US FROMACHIEVING OPTIMAL GROWTH AND PROFITABILITY —THE INTERNAL AND EXTERNAL CONSTRAINTS THATKEEP US IN OUR BOX. THESE COULD BE OUR SKILLLEVEL, TECHNOLOGY BASE, COMPETITORS, ECONOMICTRENDS, ETC.
OUT OF THIS COMES:• THE VISION — A CUSTOMER-DRIVEN PICTURE OF
WHAT THE COMPANY IS TO BECOME, AND
• A PURPOSE — A STATEMENT OF THE ACTIONS NEEDED TO ACHIEVE THE DESIRED VISION.
WE SHARE THE VISION WITH EMPLOYEES, IN ORDER TOGET THEIR BUY-IN AND FULL PARTICIPATION IN THEPROCESS.
© 1999 Donald A. Winkler
7
PHASE I: BREAKTHROUGH THINKING
• The task in Phase I is discovery: Finding out our starting point before we chart our
future.
• We look at what impedes us from achieving optimal growth and profitability.
These are external constraints, such as economic trends and competitors, and
internal constraints, such as own skills or technology.
• We feed these through the filter of realities and possibilities, and keep on prodding
each other to ask the questions, the asking of which leads to breakthroughs in our
thinking, which can lead to breakthrough results.
• And after two or three days of communicating our concerns, our fears, our ideas,
our hopes for the future, after challenging each other and working together as a
team, we produce two brief statements, on a single piece of paper, defining our
vision and purpose.
© 1999 Donald A. Winkler
8
Phase I:Breakthrough Thinking
Vision Purpose Shared Visiondirection
to
Phase II:
Strategic Issues
Breakthrough Leadership: A journey from the ordinary to the extraordinary
•Vision•Purpose•Shared Vision
possibilities
realities
from
Initial Assumptions
EXTERNAL CONSTRAINTS INTERNALin
dustr
y
compe
titor
scu
stomer
s
deal
ers
distr
ibut
ors
bran
ches
sales
forc
esta
ff
finan
cial
techn
olog
ywor
k flo
w
work s
urfa
ceyo
urse
lf
© 1999 Donald A. Winkler
9
EXAMPLE: BOFS VISION AND PURPOSE STATEMENTS
Below are the vision and purpose statements of Banc One Financial Services, Inc.
They have been upgraded since the company started to apply the Breakthrough Process
in 1993 and will continue to evolve in the future.
© 1999 Donald A. Winkler
10
Banc One Financial Services 1996 Business Direction
We will blanket the nation with our convenient financial services networks. We will work with passion and integrity to respond immediately to customer needs. We are committed to learning and development. Working together is our hallmark. We are the supplier of choice and the employer of choice. We are frequently imitated and rarely equaled. We are the people of Banc One.
We are dedicated to becoming the number one personal financial services company in the nation. We will work together in a way that provides valuable, personalized financial solutions to our customers, respect and rewards to our employees and generous returns to our shareholders.
VISION
PURPOSE
© 1999 Donald A. Winkler
11
PHASE II: BREAKTHROUGH PLANNING — STRATEGIC ISSUES
© 1999 Donald A. Winkler
12
Phase III:
Breakthrough Achievement
Project Book
implementation
Phase I:
Breakthrough Thinking
Vision Purpose Shared Vision
direction
Phase II:
Breakthrough Planning
Strategic Issues Earnings Situation Analysis
stability strategic planning
Breakthrough Leadership: A journey from the ordinary to the extraordinary
training
players
possibilities
realities
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
PHASE II: IN THE BREAKTHROUGH PLANNING PROCESS, SENIOR LEADERS — SOMETIMES WITH THE HELP OF OUTSIDE CONSULTANTS — SUMMARIZE AND DISTILL THE CONSTRAINTS INTO FIVE STRATEGIC ISSUES. WE ALSO DETERMINE OUR BASIC BUSINESS PROPOSITION — THE VALUE WE PROVIDE TO A DEFINED CUSTOMER SET, AND THE WAY IN WHICH WE PROVIDE IT.
FROM THE STRATEGIC ISSUES, WE DEFINE THE STRATEGIC INITIATIVES THAT WILL TURN INFINITE POSSIBILITIES INTO FINITE GOALS. ACHIEVING THESE GOALS GIVES THE ORGANIZATION THE STABILITY OF CONTINUED RESOURCES.
© 1999 Donald A. Winkler
13
PHASE II: BREAKTHROUGH PLANNING — STRATEGIC ISSUES
• The output of this phase is a summary of all these constraints boiled down to five
strategic issues.
• We also emerge with a definition of our fundamental business proposition — the
value that we provide to a defined customer set, and the way we provide it.
This may be subject to change, but it is often one of our strong points, a point of
leverage that we can build on.
© 1999 Donald A. Winkler
14
Phase II:Breakthrough Planning
Strategic Issuesstability
to
Earnings Situation
Analysis
Breakthrough Leadership: A journey from the ordinary to the extraordinary
possibilities
realities
from
Vision
Purpose
Shared Vision
•Business Proposition•5 Strategic Issues•Strategic Initiatives
BUSINESS STRATEGIC ISSUESPROPOSITION #4#2#1 #3 #5
© 1999 Donald A. Winkler
15
EXAMPLE: BANC ONE FINANCIAL SERVICES
For example, the business proposition of Banc One Financial Services was well
established in 1993:
• Mail unsecured installment loan promotions to homeowners• Drive them into the branches, where we close the loans and upsell them to equity
loans.
Here is a page from the operating plan we wrote that year — a very profitable business,
but we were not positioned to grow.
© 1999 Donald A. Winkler
16
FINANCE ONE 1994-1995 OPERATING PLAN
Current PositionUntil now, the company has focused on:
• returns alone• achieved ROA = 3.7%• $24 million pre-tax income• annual receivable growth rates of 20.6%
LARGE MARKETNOT POSITIONED FOR GROWTH…
© 1999 Donald A. Winkler
17
EXAMPLE: BOFS FIVE STRATEGIC ISSUES
All the things that stopped us from growing added up to this:
• From an infrastructure standpoint, we didn’t have the people, the technology,
or the risk management capability to handle more growth
• From a marketing standpoint, we had no strategic alliances, we were
dependent on a branch system that was concentrated in three midwestern
states, and we had only two products.
So here is how we wrote up the five strategic issues in our strategic plan for 1993
to 1997.
© 1999 Donald A. Winkler
18
BOFS STRATEGIC ISSUES
• Infrastructure
• Asset Quality
• Marketing Alliances
• Marketing: Geographic Expansion
• Marketing: Product Expansion
© 1999 Donald A. Winkler
19
PHASE II CONTINUED: EARNINGS SITUATION ANALYSIS
As a result of the analysis we did in the discovery phase, and the brainstorming we did in
the team-building and vision-building phase, we know we have a business of strategic
importance to the Corporation.
If it wasn’t important, we wouldn’t have come this far in the process.
© 1999 Donald A. Winkler
20
Phase III:
Breakthrough Achievement
The Project Book
implementation
Phase II:
Breakthrough Planning
Strategic Issues Earnings Situation Analysis
stability strategic planning
Phase I:
Breakthrough Thinking
Vision Purpose Shared Vision
direction
Breakthrough Leadership: A journey from the ordinary to the extraordinary
training
players
possibilities
realities
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
A SECOND IMPORTANT COMPONENT OF BREAKTHROUGH PLANNING IS THE DEVELOPMENT OF THE EARNINGS SITUATION ANALYSIS. WE DO A STRAIGHT-LINE PROJECTION OF BUSINESS-AS-USUAL AND CONTRAST THAT WITH THE DESIRED GROWTH TRAJECTORY OF A CORE BUSINESS. WE AIM TO ACHIEVE COMPOUND ANNUAL EARNINGS GROWTH OF 25% TO 50%.
WE IDENTIFY SPECIFIC HIGH-IMPACT PROJECTS INVOLVED IN EACH INITIATIVE THAT MUST BE UNDERTAKEN IN ORDER TO CLOSE THE GAP. THEN WE QUANTIFY THE FINANCIAL OBJECTIVES OF EACH, AS WELL AS DETERMINE THE RISKS AND OPPORTUNITIES.
EARNINGS SITUATION ANALYSIS:GOAL = 25% OVER BASELINE- BUSINESS-AS-USUAL (BAU)+ STRATEGIC INITIATIVES= EXTRAORDINARY RESULTS
© 1999 Donald A. Winkler
21
PHASE II CONTINUED: EARNINGS SITUATION ANALYSIS
• We do a straight-line projection of business-as-usual and contrast that with the
desired 25-50% growth trajectory of a core strategic business. That results in a
very large gap.
• We then define strategic initiatives that are based on the strategic issues raised in
Phase I.
• We identify specific high-impact projects involved in each initiative that must be
undertaken in order to close the gap. Then we quantify the financial objectives of
each one.
• The impact of the initiatives is totalled up in what we call the Earnings Situation
Analysis.
© 1999 Donald A. Winkler
22
Phase II:Breakthrough Planning
Earnings Situation Analysisstrategic planning
to
Phase III:
Project Book
Breakthrough Leadership: A journey from the ordinary to the extraordinary
possibilities
realities
from
Strategic Issues
•Earnings Situation Analysis
STRATEGIC INITIATIVES#1 #2 #3 #4 #5
© 1999 Donald A. Winkler
23
EXAMPLE: BOFS EARNINGS SITUATION ANALYSIS
This is the Earnings Situation Analysis for Banc One Financial Services.
Compare the top line — the earnings from the baseline business growing at about 10% a
year — with the bottom line — adjusted pretax income as a result of the strategic
initiatives.
We nearly doubled the baseline level in 1995, and will have increased it six-fold by the
year 2000.
© 1999 Donald A. Winkler
24
BOFS 1996 Strategic PlanEarnings Situation Analysis
NET INCOME BEFORE TAX Actual Actual FYF($ in Millions) 1993 1994 1995 1996 1997 1998 1999 2000Base Business 5-Year Plan: $21.1 $23.8 $29.1 $33.6 $36.9 $40.6 $44.6 $49.1 Effect of Strategic Initiatives ---- ---- 7.5 13.5 20.3 21.6 22.2 22.9 NIE Savings ---- 1.4 1.5 5.6 5 4.7 4.5 4.2Adjusted Base Business 21.1 25.2 38.1 52.7 62.2 66.9 71.3 76.21996 Strategic Plan Goals 24.7 29.5 49.5 65.1 100.2 133.1 159.9 184.1GAP -3.6 -4.3 -11.4 -12.4 -38.0 -66.2 -88.6 -107.9
INCREMENTAL EFFECT OF STRATEGIC INITIATIVES1. Analyze Market Opportunities 2.7 4.1 9.2 17.6 35.9 60.9 91.7 130.52. Expand Strategic Alliances ---- -0.4 4.5 2.5 7.1 11.5 16.0 21.43. Accomplish Significant Employee Development ---- ---- ---- -0.3 -0.3 -0.3 -0.3 -0.44. Renew the Infrastructure -1.6 -1.5 -0.9 -1.1 -1.3 -1.6 -3.0 -2.15. Marry the Customer ---- ---- ---- -0.4 -0.5 -0.5 -0.5 -0.66. Build Total Quality Excellence 2.5 2.8 0.1 -0.8 -0.7 -0.6 -0.4 -0.2TOTAL EFFECT ON GAP 3.6 5.0 12.9 17.5 40.2 69.4 103.5 148.6 GAP -3.6 -4.3 -11.4 -12.4 -38.0 -66.2 -88.6 -107.9VARIANCE FROM GAP 0.0 0.7 1.5 5.1 2.2 3.2 14.9 40.7 1996 Strategic Plan Goals 24.7 29.5 49.5 65.1 100.2 133.1 159.9 184.1ADJUSTED PRE-TAX INCOME $24.7 $30.2 $51.0 $70.2 $102.4 $136.3 $174.8 $224.8
5-YEAR PLAN
© 1999 Donald A. Winkler
25
PHASE III: BREAKTHROUGH ACHIEVEMENT — PROJECT BOOK
© 1999 Donald A. Winkler
26
Phase III:
Breakthrough Achievement
Project Book
implementation
Phase II:
Breakthrough Planning
Strategic Issues Earnings Situation Analysis
stability strategic planning
Breakthrough Leadership: A journey from the ordinary to the extraordinary
training
players
possibilities
realities
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
PHASE III: DURING THE BREAKTHROUGH ACHIEVEMENT PHASE, THE CIRCLE OF INVOLVEMENT REACHES OUT TO ALL MANAGERS AND A LARGER NUMBER OF EMPLOYEES, AS PROJECT TEAMS ARE FORMED. THESE TEAMS WORK TOGETHER TO BREAK DOWN THE PROJECTS INTO SPECIFIC TASKS WITH TIMETABLES, QUANTIFIABLE OBJECTIVES AND ACCOUNTABILITY FOR THE RESULTS. THESE BECOME OUR PROJECT PLANS.
TRYING TO TAKE ON TOO MUCH AT ONCE IS COST PROHIBITIVE AND UNFOCUSED, SO WE AIM TO MINIMIZE ACTION TO BE SUCCESSFUL. THEREFORE, WE ARE GUIDED BY CERTAIN CRITERIA IN DECIDING WHICH PROJECTS TO DO FIRST AND WHICH TO PUT ON HOLD … PROJECT PLANS MUST BE DESCRIBED IN TWO PAGES AND ANSWER QUESTIONS SUCH AS: WILL THIS PROJECT GENERATE $2 FOR EVERY $1 SPENT? CAN IT BE COMPLETED WITHIN A YEAR?
WE ALSO LOOK AT HOW RESOURCES NEED TO BE ALLOCATED IN ORDER TO PREVENT TAXING THE ORGANIZATION. IN THIS WAY OUR HUGE FINANCIAL OBJECTIVES ARE ATTAINABLE BECAUSE OF THE AGGREGATED EFFECT OF HUNDREDS OF PEOPLE ACCOMPLISHING MANAGEABLE TASKS.
Phase I:
Breakthrough Thinking
Vision Purpose Shared Vision
direction
© 1999 Donald A. Winkler
27
PHASE III: BREAKTHROUGH ACHIEVEMENT — PROJECT BOOK
The daunting task of growing a line of business by 25 - 50% a year is thus restated in
achievable bites.
The aggregate effect of concentrating energy on crucial projects — and compelling
everyone to continually ask questions and make improvements — is breakthrough results
for the business.
Not all projects succeed. But the ones that do succeed invariably exceed expectations and
more than make up the difference.
The output of this phase is a Project Book.
© 1999 Donald A. Winkler
28
Phase III:Breakthrough Achievement
Project Bookimplementation
TO A STRONG,
VITAL BUSINESS
Breakthrough Leadership: A journey from the ordinary to the extraordinary
possibilities
realities
from
Earnings Situation
Analysis
•Project Book
STRATEGIC INITIATIVES#1 #2 #3 #4 #5
© 1999 Donald A. Winkler
29
EXAMPLE: BOFS PROJECT
The following pages take us from the broad strategic initiatives to a specific project. The
example below is from the BOFS operating plan.
We start with the category called “Analyze Market Opportunities”.
© 1999 Donald A. Winkler
30
Summary of Strategic Initiatives
Pre-Tax/
Profit Rev./ NIE
FTE Capital Revenue NIE (Investment) NIE 1997 1998 1999 2000 1996-2000
Analyze Market Opportunities 143 $1,450 $49,197 $26,597 $17,575 1.85:1 $35,910 $60,880 $91,739 $130,517 1.17:1
Expand Strategic Alliances 20 $519 $10,851 $5,358 $2,543 2.03:1 $7,078 $11,454 $15,984 $21,387 1.68:1
Accomplish Significant Employee Development 0 $75 $0 $322 -$322 NA -$275 -$300 -$325 -$350 NA
Renew the Infrastructure 15 $162 $0 $1,125 -$1,125 NA -$1,387 -$1,558 -$2,957 -$2,152 NA
Marry the Customer--- --- --- $415 -$415 NA -$453 -$488 -$528 -$568 NA
Build Total Quality Excellence 8 $192 $775 $876 -$844 0.88:1 -$672 -$577 -$366 -$189 NA
TOTAL 186 $2,398 $60,823 $34,693 $17,412 1.74:1 $40,201 $69,411 $103,547 $148,645 1.52:1
1996Profit (Investment)
($ in Thousands)
* Calculation of profit (investment) includes provision (not shown)
© 1999 Donald A. Winkler
31
EXAMPLE: BOFS PROJECT — BRICKLESS BRANCHING
We use the following criteria for selecting projects:• Will they return $2 for every $1 invested?• Can they be completed in one year?• How much stress will they put on the organization?• Can they be described in 2 pages?
Eight key projects are listed below. For purposes of this example, we will use “Brickless
Branch Origination and Servicing” as we expected it to generate $5 million in profit in
1996 — nearly $10 million in revenue less just under $5 million in NIE.
© 1999 Donald A. Winkler
32
Initiative: Analyze Market Opportunities
Pre-Tax/
Profit NIE
FTE Capital Revenue NIE (Investment) Rev/NIE 1997 1998 1999 2000 1996-2000
Texas Reclaim Awareness 24 $185 $4,370 $2,162 $2,208 2.02:1 $1,643 $2,453 $3,753 $5,929 1.23:1
Wholesale Enhancement 4 $93 $4,183 $1,133 $2,617 3.69:1 $3,925 $5,888 $8,832 $13,248 2.41:1
Correspondent Banking 15 $132 $9,417 $2,318 $6,299 4.06:1 $8,900 $13,098 $15,296 $15,947 1.44:1Brickless Branch-Origination & Servicing 30 $302 $9,946 $4,761 $4,958 2.09:1 $8,427 $12,295 $18,424 $31,204 1.42:1Identify Candidates & Implement Acquisitions --- --- --- --- --- NA -$452 $2,001 $7,969 $11,204 1:40:01
SecuritizationImplement Home Improvement Contract Prog. 4 $36 $118 $70 $18 1.69:1 $244 $781 $1,775 $3,421 0.95:1
Branch Expansion 61 $600 $20,003 $8,997 $7,645 2.23:1 $12,271 $23,097 $33,908 $47,386 0.85:1
Other Initiatives 5 $102 $1,140 $414 $572 2.75:1 $952 $1,267 $1,782 $2,178 2.07:1
Additional NIE Re-Deployment 0 $0 $0 $6,742 -$6,742 NA $0 $0 $0 $0 0
TOTAL 143 $1,450 $49,177 $26,597 $17,575 1.85:1 $35,910 $60,880 $91,739 $130,517 1.17:1
1996
Profit (Investment)
TO BE DETERMINED
($ in Thousands)
* Calculation of profit (investment) includes provision (not shown)
© 1999 Donald A. Winkler
33
EXAMPLE: BOFS BREAKTHROUGH PROCESS
The following exhibits are from our 1996-97 operating plan.
© 1999 Donald A. Winkler
34
Banc One Financial Services
Brickless Originations and Servicing
© 1999 Donald A. Winkler
35
BOFS Branch and Brickless Combination
Primary GoalThrough brickless markets, we will service customers not currently using the branch network
Secondary GoalThe brickless branch allows us to prospect in non-branch marketplaces to build critical mass for branch placement
The Objective“Offer multiple products, to multiple customer groups in multiple ways.”
© 1999 Donald A. Winkler
36
BOFS Brickless IntroductionSelecting the Best Opportunity
1996 Brickless Branch Market Opportunity
© 1999 Donald A. Winkler
37
BOFS Brickless Introductionwith Expanded Initiatives
Key Indicators($ in Thousands)
1995FYF
1996 Planw/Expanded
Initiatives 1997 1998
Volume $0 $136,624 $362,812 $536,961
# of FTE 0 30 65 91
Total Revenue $0 $9,946 $26,219 $42,212
Total NIE $0 $4,761 $8,826 $13,945
Pre-Tax Income $0 $4,958 $13,385 $25,680
Revenue/NIE Ratio 2.09:1 2.97:1 3.02:1
© 1999 Donald A. Winkler
38
EXAMPLE: BOFS BREAKTHROUGH PROCESS
• As you can see, we do a return-on-investment analysis of every project. Some are
infrastructure investments that pay off a year or two down the road. Others are
quick kills that produce results almost immediately.
• In the aggregate, we demand $2 back in year one for every dollar we invest. This
chart shows that the revenue to be generated by BOFS’ expanded initiatives in
1996 is more than two-and-a-quarter times the cost.
• If the sense of vision and purpose is the heart of our process, the project system in
the nerve center. This is our early-warning system for performance variances. If
someone falls behind schedule or misses a target, w e know about it instantly and
take action to get the plan back on track.
© 1999 Donald A. Winkler
39
BOFS Investment Return
($ in Millions)
1995 Pre-Tax Income $51.0
Incremental 1996 Expenses over 1995 ($30.1)
1996 Revenue Generated by Additional Expenses $68.5
Incremental Provision ($19.2)
1996 Pre-Tax Income with Expanded Initiatives $70.2
Revenue/Expense Ratio 2.28:1
© 1999 Donald A. Winkler
40
SUMMARY: THE BREAKTHROUGH LEADERSHIP PROCESS
So, this is our process. Highly subjective, yet highly structured. Highly realistic, yet
highly imaginative. Pretty simple, but it takes dedication, persistence and strong
leadership from the top to implement it.
Breakthrough Leadership … a journey from the ordinary to the extraordinary.
© 1999 Donald A. Winkler
41
Phase III:
Breakthrough Achievement
Project Book
implementation
Phase I:
Breakthrough Thinking
Vision Purpose Shared Vision
direction
Phase II:
Breakthrough Planning
Strategic Issues Earnings Situation Analysis
stability strategic planning
Breakthrough Leadership: A journey from the ordinary to the extraordinary
training
players
possibilities
realities
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants
• Out-of-the-box Thinking• Change Management• Communication
• Executive Committee• Key Line/Staff
Managers• Finance/Operations/
Marketing Experts• Employees• Outside Consultants