STRATEGIC VS OPERATIONAL MIND SETS

Progressive organizations characteristically maintain leadership through attention to two levels of organizational planning:

Operational Planning involves typical cycles of 12 month budget and action accountabilities and
accomplishment progress. Operational plans assure that day-to-day and month-to-month activity and accomplishment represent progress in support of strategic organizational objectives. Operational planning follows fiscal year cycles. Operational plans focus on issues of control and efficiency.

Strategic Thinking and Planning is how progressive organizations anticipate and design the future
rather than reacting as the future engulfs them. Strategic thinking involves creating a long range competitive vision for the organization over a 2-4 year horizon. Strategy is designed to achieve a "position" for the organization. A long range vision is predominantly market driven in that the strategic planning process relies heavily on "market based data" in revitalizing organizational mission, anticipating and assessing strengths, weaknesses and threats, and targeting opportunities to achieve desired position. Strategic plans focus on issues of change, adaptation and innovation. STRATEGIC PLANS HAVE COMMON CHARACTERISTICS: t t review, revitalization, or re-inventing organization a long range view of the organization's future (2-4 years)

t integration of multiple data bases (fiscal & physical resources, marketplace expectations, human resources, regulatory impact, financial marketplace) t t attention to marketing data from well defined and segmented customer groups a candid evaluation of weaknesses of, and threats to, the organization

t bold thinking in terms of "new" opportunities: markets, expansion, developing or redeveloping products / services, re-inventing corporate purpose and product / service, partnerships t documented participation by constituent groups impacted by the plan (e.g., boards, stakeholders, funders, management, employees, customers / clients, community) t contingency alternatives for potential and real organizational threats t coordination of all organizational efforts into a systematized plan: an outlined scenario of actions, resources, timelines, and responsibilities. "An organization unable to candidly challenge assumptions and slay sacred cows is destined to mediocrity." Les Wallace

THE NATURE OF STRATEGIC THOUGHT Strategic Thinking must precede planning

1. WHERE DO WE WANT TO BE? Strategy is about achieving the "position" you want: economic, marketplace, etc. Authority for identifying a position remains with boards. Management structure, culture, profitability, product / service mix, and financial structure are board decisions. What's the "vision," the "big ideas" for the organization over the next 2 to 4 years? Vision is customarily developed by executive leadership and sold to or developed with boards. Competitive objectives must be evaluated, enhanced or adjusted based upon a complete strategic planning review; management usually conducts these assessments. Strategic planning reviews become on-going processes in progressive organizations. KEY ISSUES: MISSION AND VALUES, VISION, MARKETPLACE POSITION 2. WHAT'S UNACCEPTABLE NOW? Boards of directors and management identify the amount of deviation from where the organization desires to be and targets changes necessary to achieve objectives or reach new objectives and be in the position desired. KEY ISSUES: STRATEGY INVOLVES POSITIONING; DESIGNING CHANGE TO POSITION FOR THE FUTURE 3. WHAT OPPORTUNITIES DOES THE MARKETPLACE OFFER? Missing products / services; price sensitive areas; consumer desired product / service improvements; economic upturn and downturns; new sources of revenue; new models; changing social conditions; newsworthy awareness; availability of new or additional resources (partnerships); developing market niches, weaknesses in the competition? Internal "quality management" issues such as technology, human resources, bureaucracy, organizational structure also become opportunities to be examined. "Benchmarking" models that work of leading organizations can assist creativity. Customer participation is critical to designing a market driven service / product. KEY ISSUES: THERE ARE OPPORTUNITIES FOR BUSINESS ACHIEVEMENT IN ANY ENVIRONMENT. WHAT ARE THEY? WHAT WILL THEY BE? WHAT DO KEY CUSTOMERS EXPECT? 4. WHAT STRENGTHS DO WE HAVE TO GET THERE? Based upon defined objectives validated by boards, management facilitates assessment of strengths that will allow achievement of objectives or setting of new objectives.

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Strategic planning consistently reviews product / service strengths to aid in identifying new opportunities or competitive advantages to be leveraged. What are the core competencies of the organization? KEY ISSUES: IDENTIFIED STRENGTHS, COMPATIBLE WITH THE CHANGING MARKETPLACE NEED TO BE LEVERAGED 5. WHAT LIMITATIONS OR THREATS WILL NEED TO BE OVERCOME? Management facilitates realistic assessment of "weaknesses" or "limitations" that restrict or may restrict the organization from achieving objectives. Assessment and review of limitations is not a "person specific" or "process specific" review but is instead a candid identification of the current capacities and efficiencies of the organization. Management must realistically identify where the organization's performance is lacking: challenging assumptions and traditions, slaying sacred cows. What factors in the business environment may pose threats or obstacles to the future success of the organization? Market competition may pose a disadvantage to the organization and therefore, be a limitation. What customer based perceptions, needs and demands should be addressed? KEY ISSUES: EVERY ORGANIZATION HAS WEAKNESSES? EVERY ENVIRONMENT POSES THREATS. OBJECTIVELY IDENTIFY THEM! 6. WHAT'S MOST IMPORTANT TO DO FIRST? Plans outline step-by-step maps for changing and accomplishing needed adjustments. Plans focus on creating base competencies and capacities to establish a success climate for achieving more complex objectives. First things first. Production cannot be expanded without adequate capital; adequate capital cannot be developed without cost effective production; product / service enhancements cannot be designed without adequate market research; efficient production design cannot be achieved without staff participation; staff participation cannot be productive without adequate knowledge of the larger game plan objectives as well as leadership competencies of management, etc. KEY ISSUES: FOCUS ON TOP PRIORITIES, STABILIZE WEAK SYSTEMS OR ONES MOST CRITICAL TO MARKETPLACE SUCCESS 7. WHAT PROBLEMS MIGHT CAUSE DELAY OR RE-DIRECTION? Management and staff must engage in contingency planning; anticipating problems and strategizing around them or planning counter measures in case of occurrence.
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Ongoing problems (for example, with adequate capital; or with the efficiency or quality of the services) will have to be addressed first in order to prevent them from being greater problems later on in the plan. KEY ISSUES: HAVE CONTINGENCY PLANS 8. HOW WILL THIS EFFECT OTHER PEOPLE / GOALS? All plans, changes and events have ripple effects. A change in one element of the process will effect other elements of the process. Have such impacts been anticipated? Have all staff heard about the objectives and been involved in designing and evaluating the changes and plan? How have constituent groups / consumers been identified, segmented, and solicited for input? KEY ISSUES: INPUT, INPUT, INPUT: STAFF AND CUSTOMERS 9. HOW WILL WE KNOW HOW WE'RE DOING? What system will you use to measure the results? How will you regularly review and evaluate how you are doing? Where does "benchmarking" models that work of other organizations play a role? How will you know when to speed up or slow down or change directions? Who will monitor what systems? Who will report and discuss performance feedback with product/ service teams? Objectives all have measurable criteria to allow evaluation of accomplishment. KEY ISSUES: IT'S NOT QUALITY SUCCESS IF IT CAN'T BE MEASURED. ASSURE BALANCED MEASURES Business Results, Customer Satisfaction, Employee Satisfaction 10. WHEN DO WE RE-LOOK AT WHAT WE WANT TO BE? Annually. Remember: Strategy is about change! On an ongoing basis as new market data, capital, service breakthroughs, new technology or opportunities come along. This process should be an ongoing process of every service area. Management must drive the "process" of strategic thinking and planning for board consideration. KEY ISSUES: STRATEGIC PLANNING IS A PROCESS NOT AN EVENT; A JOURNEY NOT A DESTINATION!

An organization unable to candidly challenge assumptions or slay sacred cows is destined to mediocrity.

STRATEGIC PLANS FOCUS ON ISSUES OF ADAPTATION AND INNOVATION

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