E.O.W (End of the Week) Notable Tip: Decision Making

Happy Friday! I hope you are all doing well.

I’ve been currently reading, “Business Adventures” by John Brooks and am fascinated by Xerox’s culture during the late 1940s. I learned that employees put up their mortgages to ensure the success of the company. Will your employees be willing to do that for your company?!

Nevertheless, today’s E.O.W Notable Tip is about how to make quicker informed strategic decisions. Like always, remember, “Success is continuous improvement!”

 

“To reduce the decision making cycle time opt for collaborative discussions and brainstorm sessions, create a small team of key people from each department ( 4-5 max) and ask them to create industry and customer value maps with a competitive analysis comparison with recommendations per insights gathered, visually display these maps to the whole team and have them vote for the best profitable strategy that suits your company’s current capabilities.”

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The Anatomy of an Effective Strategic Plan

What is a strategic plan? In short, “a strategic plan defines the business the organization¬† intends to be in, the kind of organization it wants to be, and the kind of economic and non-economic contribution it will make to its stakeholders, employees, customers and community.”

To create an effective strategic plan an organization’s leaders must first clearly understand their business and what business they really want to be in. They must also conduct and have SWOT Analysis, customer research (including non-customers), economic, government (industry laws and regulations data), and technology (current and forecasting trends) accurate data available.

Once this information is available and carefully analyzed, leaders must discuss their intention to shift strategy with their team. All company departments should be given the opportunity to share ideas and express concerns. After the Voice of Employee has been acquired the strategic plan can begin.

An effective strategic plan is composed of the following:

  • Vision Statement
  • Mission Statement
  • Key Customer Value Factors
  • Goals
  • Objectives
  • Visual KPI Metrics
  • Contingency and Preventative Plans

To be effective, a strategic plan must be visual and are not meant to be paper documents that sit on shelves nor Word or PowerPoint documents that are only seen once. The CEO (top management) must also gain support from respected and persuasive key personnel that will drive buy-in to the new strategic plan and discourage opposition. Effective leaders align the strategic plan with daily business activities by translating what needs to be accomplished into how it will be accomplished. They give each department clear responsibilities and performance expectations instead of sending out a memo company-wide that this year they want to increase revenue by $10 million. In short, strategic goals are distributed in small batches.

Effective leaders ensure employees are given clear responsibilities and performance expectations; and are given timely rewards for achieving goals. They also ensure that the strategic plan contains clear objectives, provides and utilizes measures of performance, clear due dates and is visual.

Bringing Collaboration Into Business Strategy

 Companies that encourage collaboration of data from all departmental functions see improved forecasting and internal/external client data that can be used to achieve strategic goals. Sales, Marketing, Accounting, Production, and Procurement departments should be encourage to share data through cloud productivity solutions like Google Docs/Sheets. business-strategy-clip-art-clipart-strategy-ball-people-NVXx1H-clipart

However, this plethora of information can cause delays in decision making according to a Harvard Business Review article. Data that is analyzed in small batches and matched to critical strategy variables can be a best course of action to reducing the strategy process cycle time.

In other words, matching insights from small data batch analysis with strategic objectives and then proceeding with a strategy implementation framework. For example, say a business wants to increase revenue from 10 million to 20 million this year. When they analyze their data and use the voice of the customer, they realize that the customers that hate them want the software to load faster and integrate a picture feature for all their menu items so that their customers can see how their meal looks like before they order. The company then translates this customer requirement into product specification and increases their client base by 25%, in turn, reaching their goal and making their competitors run for their money.

The production team would also have to manage this new feature to client requirements and ensure load times stay at acceptable levels. A financial impact/financial modeling analysis is also required to provide top management a sense of what would drive the most revenue for the company.

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