Q8 IM04 Final

CHAPTER 4
Strategic Focus for Performance Excellence

Teaching Notes
This chapter centers on strategic management as the basis of all managerial activities relating to
total quality management. While leadership is acknowledged as the "driver" for an effective TQ
focus, this chapter focuses on the planning process, while leaving the details of leadership theory
to be addressed in Chapter 9. Strategic planning and management have become more important in
organizations that aspire to high quality levels, so leaders must understand how to "deploy" plans
and quality efforts throughout the organization.
One of the key functions of strategic focus is to provide alignment of quality goals and plans
with the overall strategy of the firm. Poor deployment of quality can generally be traced back to
poor strategy development and alignment. The internal environment of the organization must also
develop and encourage alignment, as well as the focus on doing quality at the grassroots level.
Students should be encouraged to focus on what to do, how to do it, when to do it, and how
strategic leadership must actively be involved in doing it as they look at strategic quality planning
and management. The Baldrige Criteria provide a frame of reference for assessing organizational
effectiveness and for benchmarking strategic planning. Key objectives for this chapter should
include:
To define strategy as the pattern of decisions that determines and reveals a companys
goals, policies, and plans to meet the needs of its stakeholders. Strategic planning is the
process of envisioning the organizations future and developing the necessary goals,
objectives, and action plans to achieve that future.
To develop the process and content of planning for quality in organizations. Steps in
strategy formulation begin with determining the organization's mission, vision, and guiding
principles. These lead to strategies, strategic objectives, and action plans that set the
direction for achieving the mission.
To emphasize the critical role of strategic leadership in strategic management.
To become aware that key practices for effective strategic planning include active
participation by both top management and lower-level employees, a strong customer
focus, supplier involvement, and well-established measurement and feedback systems.
To learn that deploying strategy effectively is often done through a process called hoshin
kanri, or policy deployment, that emphasizes organization-wide planning and setting of
priorities, providing resources to meet objectives, and measuring performance as a basis
for improving it and is essentially a total quality approach to executing strategy.
To understand how the seven management and planning tools can help managers to
implement policy deployment and are useful in other areas of quality planning.
To learn that the strategic planning process is fundamental to the Baldrige criteria, ISO
9000:2000, and Six Sigma. Although the relative emphasis varies, each of these
frameworks views strategic planning and deployment as a critical means of focusing the
organization, successfully implementing an effective quality management system, and
ensuring that longer-term directions are achieved.
The Instructors Resource materials found on the website, have a number of Baldrige video clips
which give an inside view of organizations that have received the Baldrige award. One of those,
featuring Baldrige award recipient, Texas Nameplate Corporation, has a number of scenes that
show how a small business can exemplify world-class strategic planning and leadership principles.
These can be used to supplement the numerous examples of many of the Baldrige winners that we
provide in the text. It can also put faces to some of the names that are mentioned, such as Dale
Crownover, CEO of Texas Nameplate.
ANSWERS TO QUALITY IN PRACTICE KEY ISSUES
Integrating Six Sigma with Strategic Planning at Cigna
1. Cigna has five strategic imperatives:
a. Establish a meaningful cost advantage relative to the competition.
b. Help improve the health and well-being of members and the people Cigna insures.
c. Bring innovative products and services to market.
d. Become the partner of choice to its customers.
e. Create a winning environment in the organization.
Six Sigma can and does help meet these strategic imperatives. Cignas Holistic Six Sigma
Model shows how Six Sigma is being used to help it address its five strategic imperatives.
Their approach appears to be consistent with the discussion of Six Sigma and competitive
strategy at the end of this chapter. Six Sigma is a way to turn performance improvement
needs into reality. To be effective, it must be integrated into strategic planning processes.
In Cigna, their Holistic Six Sigma Model corresponds to the three levels of strategy:
corporate, strategic business unit (SBU), and competitive (tactical). At the corporate
strategy level, the question of How do we, as an organization, grow? is partially
answered by using Six Sigma methodology to define which areas of improvement to
pursue. At the SBU or divisional level, the strategic question of: Where does the
organization focus its resources to enhance its value offering? is addressed by metrics for
QA, standard operating procedures, and change management. Finally, at the tactical level,
where competitive strategy focuses on value enhancement the questions of: Where are
the organizations best opportunities for widening a value advantage or closing a
disadvantage? On what basis does the organization widen or close the value gap? How
does the organization get its best return on investment for these efforts? are answered by
carrying out specific projects or events using DMAIC, DFSS, and Kaizen and other Six
Sigma tools. These tools of are particularly effective for improving business processes.
The challenge lies in directing those tools toward improvements that will have a direct
impact on value gaps. That requires aligning Six Sigma with the organizations competitive
strategy.
2.
Some Six Sigma projects that might support the objectives could include: 1) cost
reduction projects in areas such as underwriting or claims handling, in order to establish a
meaningful cost advantage relative to the competition.; 2) health improvement projects to
improve the health and well-being of members and the people Cigna insures; 3) product
development in order to bring innovative products and services to market; 4) improve P.R.
in order to become the partner of choice to its customers; 5) communication, training, and
celebration of successes within Cigna to help develop a winning environment.
Strategic Planning at Branch Smith Printing Division

1.
Branch-Smiths strategic planning process (SPP) is unique in several ways. First, it is

unusual to find such a comprehensive planning process in a small business. Second, they
have been especially careful to include monthly tracking and updates to permit them to
proactively respond to opportunities and risks. Although the company covers the key
stages of the strategic planning process presented in the chapter environmental
assessment, strategies, strategic objectives, and action plans they have tailored the
process to their organization. Note that they have three steps in their model before doing
their business analysis, which is equivalent to environmental assessment. These three
steps in Branch-Smiths process focus on the prior years performance and lessons learned,
before moving on to new and revised plans. They also take partner capabilities into
account in their business analysis. In steps 5-8 the plan is updated and action plans in the
form of cascaded deployment and budget are incorporated. Step 8 is ongoing review on a
monthly basis, mentioned above.
2.
Branch-Smiths strategic challenges revolve around the competitiveness of the industry.

The company competes on its ability to service customers needing high quality, short run,
quick turnaround orders. To cost-effectively serve their niche, they use appropriate
technology and management of customer and partner relationships. Objective 1 points at
the need for effective process improvement and healthy supplier relationships in order to
enhance financial performance. Objective 2 reinforces their customer focus and their goal
to become the partner of choice to their customers. Objective 3 points to the key role of
employees as internal partners and the goal to become the employer of choice in their
region by providing the same quality environment to coworkers as we extend to our
customers. To achieve these goals, Branch-Smith should (and generally does) provide for
deployment through specific, cascaded activities such as continuous process improvement,
customer relationship planning, employee involvement and empowerment, customer and
employee surveys, etc.
ANSWERS TO REVIEW QUESTIONS
1.
Strategy is the pattern of decisions that determines and reveals a companys goals,
policies, and plans to meet the needs of its stakeholders. Strategic planning is the
process of envisioning the organizations future and developing the necessary goals,
objectives, and action plans to achieve that future.
Thus, a strategy provides a roadmap to achieve a vision of what the organization should
and could be three, five, or more years in the future. A good strategy should build a
competitive posture that is so strong in selective ways that the organization can achieve its
goals despite unforeseeable external forces.
Making it happen is the essence of strategic planning, which generally requires strong,
participative strategic leadership. Formal strategies contain three elements:
a. Goals to be achieved.
b. Policies that guide or limit action.
c. Action sequences, or programs, that accomplish the goals.
2.
The key practices for a strategic focus on performance excellence include:

Understand the organizations operating environment and its key relationships with
customers, suppliers, partners, and stakeholders.
Understand the competitive environment, the principal factors that determine success,
the organizations core competencies, and strategic challenges business, operational, and
human resource-related associated with organizational sustainability.
Gather and analyze relevant data and information pertaining to such factors as the
organizations strengths, weaknesses, opportunities, and threats; emerging trends in
technology, markets, customer preferences, competitions, and the regulatory environment;
long-term organizational sustainability; and the ability to execute strategic plans.
Develop and refine a systematic approach for conducting strategic planning and setting
strategic objectives, including identifying blind spots, leveraging strengths, and addressing
challenges over appropriate time horizons.
Develop and align short-term action plans with long-term strategic objectives, ensure
adequate resources and the ability to sustain outcomes, assess financial and other risks
associated with the plans, and communicate them throughout the organization.
Derive human resource plans required to accomplish longer-term strategic objectives
and shorter-term action plans that address the potential impacts on the workforce and
potential changes to workforce capability and capacity needs.
Identify key measures or indicators for tracking progress on action plans, ensure that
the measurement system reinforces organizational alignment, and project performance of
these key measures compared with competitors or comparable organizations to identify
gaps and opportunities.
Determine the organizations core competencies, and understand how they relate to
the mission, competitive environment, and strategic objectives.
View the work performed within the organization as a system, and make rational
decisions about the mix of internal and external work processes that can best achieve the
organizations mission.
3.
Strategic leadership can be defined as a person's ability to anticipate, envision, maintain

flexibility, think strategically, and work with others to initiate changes that will create a
viable future for the organization, and its competitive advantage to the organization in this
way. Strategic leaders must be actively involved in creating and communicating a vision
of the future, sustaining an effective organization culture, making strategic decisions,
developing key competencies and responsibilities, managing multiple constituencies,
selecting and developing the next generation of leaders, and infusing ethical value systems
into an organizations culture. Effective strategic leaders also have the capability to create
and maintain absorptive capacity (the ability for an organization to learn) and adaptive
capacity (the ability of an organization to change) in order to deal with increasingly hyperturbulent environments. They must also exhibit managerial wisdom, with the ability to
perceive variation in their environment and understand the social actors and their
relationship in the system.
4.
The Baldrige Organizational Profile provides a frame of reference to help an organization

better understand the internal and external factors that shape its operating environment,
the key requirements for current and future business success and organizational
sustainability; and the needs, opportunities, and constraints placed on the organizations
performance management system.
Information is sought and classified into two principle categories, including: 1)
organization description, with sub-categories of organization environment and
organization relationships; and 2) organization situation with sub-categories of competitive
environment, strategic context, and performance improvement system.
The value to the organization is that by understanding these factors, it can better focus
strategic thinking within the organization. Thus, knowing an organizations strengths,
vulnerabilities, and opportunities for both improvement and growth helps to identify those
products, service and program offerings, processes, competencies, and performance
attributes that are unique; and that set it apart from other organizations. Those strengths
can help to sustain a competitive advantage.
5.
The steps in the strategic planning process are shown in such examples as Eastman
Chemical Company (Figure 4.1) and Park Place Lexus (Figure 4.2). Once the company's
mission, vision, and guiding principles have been determined, the organization must assess
the gap as to where it is now, and where it wants to be as described in its vision. Using
this assessment, it must then develop goals, strategies, and objectives that will enable it to
bridge this gap.
Key business factors include:
the nature of a company's products and services, its principal customers, major
markets, and key customer quality requirements
position in market and competitive environment
facilities and technologies
suppliers
other factors, such as the regulatory environment, industry changes, etc.
Strategic plans must be consistent with the important business factors of the company. For
example, plans for a company in a highly competitive, fast-changing market might include
fast cycle time and more attention to understanding emerging customer needs than plans
for a company with a low-cost focus on a mature market.
6.
The purpose, or mission, of the organization is a statement of "why the organization is in

business." In the past, the purpose of the organization was frequently stated in terms of
products or services produced or profitability to stockholders. TQ-focused firms are now
stating their purpose in terms of their customer focus and their commitment to strive for
higher levels of quality.
The vision statement is a statement of guiding values, principles, and direction of expected
growth of an organization or some segment of it, and is generally developed by key
managers and others who are responsible for planning and carrying out that vision. Vision
statements may be developed at any level within the organizational hierarchy from top to
bottom. This is a very worthwhile activity, as long as the statements are coordinated so as
to fit with those of the next higher level and the overall organization's vision.
Values, or guiding principles, guide the journey to that vision by defining attitudes and
policies for all employees, which are reinforced through conscious and subconscious
behavior at all levels of the organization. The mission, vision, and guiding principles serve
as the foundation for strategic planning. Top management and others who lead, especially
the CEO, must articulate them. They also have to be transmitted, practiced, and reinforced
through symbolic and real action before they become "real" to the employees, and the
people, groups, and organizations in the external environment that do business with the
firm.
7.
Hoshin kanri, known as policy deployment or management by planning in the U.S.A., is

the Japanese process of deploying management strategy. Various companies have various
definitions for policy deployment. In all cases, it emphasizes organization-wide planning
and setting of priorities, provides resources to meet objectives, and measures performance
as a basis for improving performance. Essentially, it is a TQ-based approach to executing a
strategy. (See Figure 5.5 in the text).
8.
Catchball is the term for the negotiating process used within an organization to determine
long- and short-term quality objectives. Leaders communicate mid-term objectives and
measures to middle managers who develop short-term objectives and recommend
necessary resources, targets, and roles/responsibilities. Catchball is not an autocratic, topdown management style. It marshals the collective expertise of the whole organization and
results in realistic and achievable objectives that do not conflict.
Policy deployment is a planning and implementation method that ties improvement
activities to long-term strategies of the organization. It is driven by data, supported by
documentation, emphasizes company-wide planning, and includes setting of priorities for
improvement. It is somewhat similar to MBO, but has a different focus. First, MBO
focuses on the performance of the individual employee, while policy deployment focuses
on the organization as a whole. Objectives in MBO are tied to performance evaluation and
rewards. Second, MBO objectives do not support the company's objectives, but are set
independently. Third, the focus of MBO is as a control mechanism between supervisors
and subordinates. Fourth, MBO objectives usually are not emphasized in daily work, but
are brought out only at performance review time.
9.
The seven management and planning tools described in this chapter include:
1. Affinity diagrams--This is a tool for organizing a large number of ideas, opinions, and
facts relating to a broad problem or subject area, i.e. a vision statement.
2. Interrelationship digraphs--Identifies and explores casual relationships among related
concepts or ideas. It shows that every idea can be logically linked with more than one idea
at a time, and allows for "lateral thinking" rather than "linear thinking."
3. Tree diagram--Maps out the paths and tasks necessary to complete a specific project or
reach a specified goal.
4. Matrix diagrams--These are "spreadsheets" that graphically display relationships

between ideas, activities, or other dimensions in such a way as to provide logical
connecting points between each item.
5. Matrix data analysis--Takes data and arranges it to display quantitative relationships
among variables to make them more easily understood and analyzed.
6. Process decision program chart--A method for mapping out every conceivable event
and contingency that can occur when moving from a problem statement to possible
solutions.
7. Arrow diagrams-- Arrow diagrams are another name for PERT/CPM project planning
diagrams. Students who have had a basic operations management course may be familiar
with the term network diagrams for project planning and scheduling.
10.
Key contextual factors that affect organizational structure include:
Company organizational and organizational guidelines

Management style
Customer influences
Company size
Diversity and complexity of product line
Stability of product line
Financial stability
Availability of personnel
The implications for quality are that the quality philosophy, systems, procedures, and
people must be aligned with the organization structure and vice-versa. It has been said that
structure follows strategy, so, the quality strategy will ideally drive the development of
a structure in order to carry it out. In reality, structures that have been in place for a long
time are often difficult to change when the strategy changes, which creates significant
misalignment and organizational stress. For example, when a highly regulated industry,
such as telecommunications or electric power is deregulated, then the need for customer
focus, increased service quality, and organizational structural change becomes painfully
apparent, but difficult to accomplish.
11.
Many variations of organization structure exist, but they are commonly based on one of
the following three forms: 1) line organization, 2) line and staff organization, or 3) matrix
organization forms. The line organization is a simple form that is most successful in small
firms. It is not generally used in large organizations, where the line and staff structure is
most prevalent. Neither the pure line organization nor line and staff organization works
very well where the environment of the firm and its industry is changing very rapidly. That
is because these types of organizations tend to be rigidly structured. The matrix
organizational form is better suited to rapidly changing environments, but it is more

difficult to develop effective control of outcomes in order to meet goals using this form of
organization.
12.
TQ focused organizations are often taking a process view of organization. Therefore, they
are increasingly structuring their organization around functional or cross-functional teams.
To carry out the work, high performance teams that focus on core processes, quality
improvement or other targets are often formed. These are frequently coordinated through
cross-functional coordinating committees, management (or quality management) councils,
etc. to overcome the problems of lack of control and accountability inherent in such
matrix-form organizations.
13.
Core competencies are an organizations areas of greatest expertise that provide a

sustainable competitive advantage in the marketplace or service environment. A core
competency should meet three conditions:
a. contribute significantly to customer benefits
b. provides access to many products and markets
c. be difficult for competitors to imitate
Core competencies may involve technology expertise, unique service offerings, a
marketplace niche, or a particular business acumen (e.g., business acquisitions). Some
examples of core competencies might be quality and productivity practices (e.g., Toyota),
superior customer relationship management (e.g. Nordstroms), innovation in design and
new product development (e.g., Apple), supply chain management (e.g., Dell), or
marketing/branding expertise (e.g., Procter & Gamble). An organization needs to
understand its core competencies and how they support the organizations mission, enable
it to compete against its competitors, and help drive strategic objectives and action plans.
14.
Work systems coordinate the internal work processes and the external resources necessary
to develop, produce, and deliver products and services to customers and to succeed in
marketplace. Work systems involve the workforce, key suppliers and partners, contractors,
collaborators, and other components of the supply chain needed to produce and deliver
products, services, and business and support processes. Decisions about work systems are
strategic. These decisions involve protecting and capitalizing on core competencies and
deciding what should be procured or produced outside the organization in order to be
efficient and sustainable in the marketplace.
Outsourcing is the practice of transferring the operations of a business function to an
outside supplier and may be done through offshoring, in which the outsourced function is
relegated to foreign shores. The opposite of outsourcing is vertical integration, by which
certain business functions are acquired and consolidated within a firm. The decision to
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outsource or vertically integrate should be examined relative to all factors that can affect
organizational performance. In many cases, the decision is based solely on costs without
considering the impact on other business priorities such as quality and customer
satisfaction or risks associated with protecting intellectual property. Because outsourcing
can have significant impacts on an organizations work system effectiveness, it must be
dealt with strategically.
15.
Category 2 of the Baldrige Criteria is Strategic Planning. It focuses on drivers of customer

satisfaction, customer retention, and market share that lead to higher competitiveness,
profitability, and business success. The category is divided into two sections, labeled as
Strategy Development and Strategy Deployment. Strategy Development requires
applicants to outline how they create a view of the future that takes into account the
market factors in which they compete and the process of how they compete. Strategy
Deployment seeks information about specific action plans that a company develops, how
they are deployed, and a projection of performance. The Strategic Planning category
requirements are intended to encourage strategic thinking and action, but do not imply
that formalized plans or planning systems must be developed.
Strategic planning is not addressed as broadly in ISO 9000 as it is in the Baldrige criteria,
but the standards do require that top management ensure that quality objectives are
established at relevant functions and levels within the organization, that they be
measurable and consistent with the quality policy, that planning be carried out in order to
meet quality system requirements and the quality objectives, and that the integrity of the
quality management system is maintained when changes are planned and implemented.
Strategic leadership is one of the most fundamental values of Six Sigma. Driving
organizational change to create and sustain a Six Sigma culture simply cannot be done
without strong leadership. In other words, Six Sigma cannot be an add-on or a flavor of
the month. It must become the way business is done in organizations that adopt it.
Leaders in Twenty-first Century organizations are finding that not only must they move
from hierarchically structured organizations to learning organizations, but also they must
then take the next step of moving from learning organizations to teaching organizations.
ANSWERS TO DISCUSSION QUESTIONS

1.
The Johnson and Johnson credo serves as a reminder to every employee of their ultimate
responsibility to their direct customers (doctors and nurses, for many products) and the
ultimate consumer -- patients, mothers, and fathers, for their product quality. In its leadership
approaches, J&J would have to ensure that managers (leaders) "walk the talk" of the
importance of quality. In addition, it would have to set up a strategic planning process to
perform the 5 steps in the process developed in question 8, above, in order to be a world
class competitor in quality and product safety. Students should be encouraged to research
the actions that J&J took during the Tylenol product tampering case of the 1980s, which has
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become a classic case study on how to handle a product recall where the integrity of the
product has been compromised. This situation showed that J&J did not just pay lip service
to its credo.
2.
The mission statement of an organization should define the reason for its existence and
answers the question "Why are we in business?" The mission statement should address the
anticipated quality that the organization will strive to attain, how it plans to reach it, and how
it will behave toward its publics during the journey.
It is difficult to see how any of the mission statements, except possibly the last one, would
inspire employees or customers to loyalty or long-term commitments to the company or its
products. Most of the statements appear to be generic and might be applied to all of the
companies in an industry, or even to several industries.
3.
a) Caterpillar
b) DHL Worldwide Express
c) Volvo
d) AT&T
e) The International Red Cross (Note: Frances Hesselbein, one of the most widely hailed
leaders of the 1990s stated that she thought that this mission statement was the best she had
ever come across for its clarity, brevity, and focus.)
4.
As in 2, above, it is difficult to see how any of these vision statements would inspire
employees or customers to loyalty or long-term commitments to the company or its
products.
a. The first statement is a vague, general statement that will be of little use to the
organization. It would appeal primarily to stockholders
b. The second statement is more specific than the first, although it is also very general in tone,
and would appeal to the PR department of the company.
c. The third statement is the most specific and is a customer-focused vision of the future state
of the firm; it specifies the customers, including employees, shareowners and communities in
which the organization does business. It promises something for everyone, but makes no
mention of what the company is going to be the best at doing. It would need to be even
more specific in order to be operationalized.
5.
This list may vary widely, depending on the imaginations of the students. For example, an
affinity diagram might be used to brainstorm and classify ways to obtain ideas about planning
for, and funding the design of a new sorority or fraternity house. An interrelationship digraph
might be used to clarify issues and problems for the same project. Arrow diagrams might be
used to develop planning and sequencing for a thesis or term project.
6.
Core competencies of colleges and universities generally revolve around the traditional
areas of teaching, research, and service. In order for a specific college, such as a college of
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business or engineering, to develop a strategic niche, they must do one or several things
very well. For example if the focus is on undergraduate teaching, the core competencies
might include an outstanding co-op or internship program, faculty-student collaborative
research, development of faculty mentoring skills, and/or partnership development with
business and industry to ensure that students skill and knowledge bases meet the needs of
the target organizations and industries in which the graduates will work. If the strategy is
develop an outstanding theoretically-focused graduate program, the core competencies
would require a cadre of outstanding researchers and support staff on the cutting edge of
their field, well-equipped laboratories and computer support, and partnerships and
research projects with recognized leading firms and organizations that could assist in
advancing knowledge in the field. The leverage from a strategic perspective is generated
by a focused mission and vision, an integrated strategic management system, and a focus
on continuously improving the organization and processes that lead to success.
7.
A complete answer to this question would take up more space than is feasible for this
instructors manual. It is suggested that you use the discussion in the text under
Leadership and Strategic Planning in the Baldrige Criteria and Part 2 of the detailed
Baldrige Criteria for Performance Excellence, as found in the Bonus materials on the
Premium website, as a basis for discussion.
SUGGESTIONS FOR PROJECTS, ETC.

Projects, Etc.
1.
This project is designed to familiarize students with the Baldrige Organizational Profile
questions and the process of using them to prepare an organizational profile for your
college or a local company. Use the format of the Novel Connect case study should
provide them with ideas on how those questions might be answered by the representatives
of the target organization when writing the profile.
2.
Strategic planning styles will vary widely, depending on such factors as the type of
organization, its size, and the philosophy of the top management. Students will no doubt
find that some organizations will have well-developed mission and vision statements, but
few guiding principles. Strategic planning may be a neglected task that only occurs when
someone has time to do it. In other organizations, an elaborate planning process may
exist, plans may be developed periodically, but plans are rarely reviewed or acted on. Only
the most sophisticated organizations are likely to have the type of process that Solectron
has that is fully articulated, deployed, systematically evaluated, and used to inform
decision-making on a regular and timely basis.
5.
As in discussion questions 2, 3, and 4, above, even Fortune 500 companies will often be
found not taking the time, or having the expertise, to develop mission and vision
statements that are useful, relevant, and inspire and motivate employees or customers.
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4.
More and more colleges and universities are developing well-defined mission and vision
statements and strategic planning processes to develop objectives and plans. See Northern
Kentucky Universitys website, for a comprehensive mission, vision, and strategic planning
outline at: http://www.nku.edu/about/plan.php
5.
This project will provide an opportunity for students to delve into the strategic planning
requirements of a high quality performance management system. See, for example, the
Strategy Development and Deployment (SDD) process of 2008 Baldrige Award winner
Poudre Valley Health Systems, in their award application at:
http://www.quality.nist.gov/PDF_files/2008_Poudre_Valley_Application_Summary.pdf
The approaches of other Baldrige Award winners can be researched on the Baldrige
website at: http://www.quality.nist.gov/Contacts_Profiles.htm
6.
Personal mission, vision, and statements of guiding principles can be extremely beneficial
to college students. One of the most popular guides for developing this is Stephen
Coveys, et al.s book: First Things First, New York: Simon and Schuster, 1994.
7.
As pointed out in review question 10, above: the key contextual factors that affect
organizational structure include:
Company organizational and organizational guidelines

Management style
Customer influences
Company size
Diversity and complexity of product line
Stability of product line
Financial stability
Availability of personnel
The implications for quality are that the quality philosophy, systems, procedures, and
people must be aligned with the organization structure and vice-versa. Students may find
that structures that have been in place for a long time are often difficult to change when
the strategy changes, which creates significant mis-alignment and organizational stress.
Quality approaches and results will also vary, depending on their contextual factors.
8.
Answers will vary, depending on the organizations compared. For example, Dells strategy
is to provide rapid turnaround with high volume, essentially commodity type computers
while still providing for custom configurations for each customer. Apple has the strategy
of providing products with unique design characteristics, fewer configurations, and more
customer-centric marketing through their stores and authorized dealers. Supply chain is
much more important than long-term strategic direction for Dell, than Apple.
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ANSWERS TO CASE QUESTIONS

I. A Strategic Bottleneck
The company finally realized that by developing a cooperative culture and creating common goals
it could improve both quality and morale, while contributing substantially to the bottom line. It
required a strategic approach with strong leadership support.
It began with the development of an order fulfillment process psyche that transcended
departmental thinking regarding purchasing, forming, selection and shipping. Management and
union leadership were engaged to explain and communicate this new psyche throughout the
plants. The business then developed performance measures for the forming department that
focused improvement efforts on quality yields. Self-managed work teams were formed and trained
in process improvement and measurement methodologies.
In the selection department, improvement efforts focused on increasing the sensitivity of the
devices that could detect product variability, which would help send earlier warnings to the
forming department that bottles were about to be produced out of the range of specification. The
result was a customer and business focused workforce whose measurement and compensation
systems tied everyone to the same overall performance objectives.
II. Clifton Metal Works

1.
2.
The current mission statement of Clifton Metal Works (CMW) appears to lack focus. It
doesn't tell why the company is in business, other than to "improve return on investment."
Therefore, it is not adequate to provide the strategic direction necessary for CMW to
move forward. Using this mission statement CMW could be making light bulbs or personal
computers rather than castings.
The mission statement could be improved by including a definition of products or services,
types of markets, important customer needs, or distinctive competencies. Their mission
statement might be:
CMW's mission is to produce superior customized cast metal products for markets
in the Midwestern United States using teamwork and unique advanced technology
in order to meet or exceed customer requirements, while still providing an above
average return to our shareholders.
Their vision might be:
CMW's vision is to be an outstanding company that leads the industry in quality,
technological innovations, service, and productivity. We will strive to accomplish
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our vision by embracing superior customer focus, flexibility, adaptability,

innovation, employee involvement and teamwork, with a constant awareness that
productivity, cost effectiveness, and competitive pricing are vital to business
profitability and success.
Their values seem to be:
Quality and service using a Deming philosophy
Teamwork
Financial accountability
Competitiveness
Pride in workmanship
IV. Novel Connect Core Competencies and Work Systems Design
Although not explicitly required for this exercise, the feedback report comments for this case,
based on the Baldrige criteria, are used below, since they are enlightening and serve the purpose
of responding to the issues of the Category 6 and the response of Novel Connect to the key
questions. The companys response in their application will not be duplicated here. See the Novel
Connect case materials in the Bonus materials folder on the Premium website for this chapter.
Answers to case questions

(1) The information provided in 6.1a(1) and 6.1a(2) relating to how the organization determines
its core competencies outlines how Novel Connect defined its initial set of core competencies in
2000. The core competencies have been reviewed and modified as needed annually as part of the
SPP. Figure 6.1-1 indicates that the organizations core competencies are communications, agility
and rapid response, innovative niche product/feature design, and technology development and
sourcing. Their relationship to the mission, competitive environment, and action plans is also
shown in Figure 6.1-1. Some strengths and OFIs for category 6.1 follow, after discussion of
question (2).
(2) Section 6.1b(3) of Novel Connects Baldrige application describes how they design and
innovate your overall work systems and how they decide which processes within the overall work
systems will be internal to the organization (key work processes) and which will use external
resources. They use the PFPD process (Figure 6.1-4 on page 29 of the application) to ensure that
new products and services are created to better satisfy the needs of its external customers and to
ensure that its existing work processes are executed in a daily manner that meets the needs of its
employees and the organization as a whole. The company recognized early on that its ability to
provide innovative niche product and feature designs for cell phones represented a competitive
advantage. In turn, Novel Connect chose to focus on identifying, designing, and producing
proprietary products and features that allow it to satisfy unique and ever-changing market needs.
16
In assessing the companys approaches and effectiveness in addressing the questions of design and
innovation of work systems, and which are key work processes, it can be seen that they have
some obvious strengths. However, it is also possible to identify opportunities for improvement
(OFIs). See below.
6.1 Work Systems Design
STRENGTHS
Novel Connects four core competencies (Figure 6.1-1) were established during a two day
workshop in 2000, and they have been reviewed annually since 2002. Review inputs include
data from customer focus groups, surveys, sales trend analysis, and call center data. The
data are integrated and validated using a quality function deployment (QFD) matrix. The
reviews are conducted as part of the SPP cycle, and the process aligns with the voice of the
customer, which helps ensure that the core competencies evolve with changing customer
needs. Further, the QFD matrix is used as part of the analysis to determine if processes
remain internal or use external resources. The analysis determines correlations among
process performance, customer satisfaction, and a current competency.
Key work process requirements are initially defined in individual process flow diagrams by
process owners using a standard approach that includes collecting requirements from both internal
and external customers. These process requirements are maintained by the respective process
owners, who use an annual evaluation and update process to assess how well the process is
meeting the requirements. For example, through this process, improvements were made to the
Internet order fulfillment process and the returns process. Requirements for all value creation and
value stream support processes are identified in Figure 6.1-2.
Novel Connect uses the PFPD Process (Figure 6.1-4) to design new products, features, and
process options. The PFPD Process is used to transform data and requirements into sample
products and to test production runs. The resulting challenge tests are performed by a sample
group of internal or external customers.
OPPORTUNITIES FOR IMPROVEMENT
The SLT uses performance information related to meeting customer expectations, coupled with
a process synergy map (Figure 6.1-3), to design and innovate the overall work system. However,
it is not clear (1) whether the steps and methods used by the SLT are systematic or (2) whether
they are integrated with establishing the roles of the workforce, suppliers, and partners in
producing and delivering products and services. The lack of a systematic approach to designing
the overall work system may limit Novel Connects ability to realize its success factors of
responding rapidly to marketplace changes with new products and optimizing process
performance to maintain strong margins.
17
While Novel Connect uses input from customers to define and maintain process requirements, it
is not evident that input from key suppliers and partners is sought and used in this process.
Without such input, Novel Connect may have difficulty ensuring that its processes are responsive
to all stakeholders, including critical partners such as its cell carrier and retailers, and Novel
Connect may not be able to fully leverage its strategic advantage of lowered costs from offshore
suppliers.
It is not clear how the PFPD Process (Figure 6.1-4) systematically incorporates all key
requirements, agility, new technology, and organizational knowledge, as well as cycle time,
productivity, cost control, and other efficiency/effectiveness factors, into process design. Without
a systematic approach for consideration of these factors, Novel Connect may have difficulty
ensuring that its processes are optimized, which may in turn impact its ability to address the
strategic challenge of volatility in niche markets.
V. Novel Connect Strategic Planning
of responding to the issues of the Category 6 and the response of Novel Connect to the key
questions. The companys response in their application will not be duplicated here. See the Novel
Connect case materials in the Bonus materials folder on the Premium website for this chapter.
Answers to case questions
The following factors in the Organizational Profile appear to be most important in evaluating their
strategic planning and deployment approaches.
4,188 employees make up a virtual, distributed workforce: 1,200 in innovation (sales, R&D, marketing,
IT, and product engineering), 2,738 in operations, and 250 in administration and support. There is no
employee union.
Key customer requirements: allease of use, reliability; personal consumerstrendiness, convenience,
secure/encrypted data and transmission, personal/home safety and security, low cost, ruggedness; business
consumersruggedness, personal safety and security, data and voice capability, sustained signal/strength
across distances, secure/encrypted data and transmission; business/government consumerssecurity, data
and voice capability, secure/encrypted data and transmission, sustained signal/strength across distances
Facilities: Headquarters in Rochester, NY (1,622 employees, or about 39%) includes offices, the only
company-owned manufacturing plant, a research laboratory, and a distribution center. Also, throughout
the U.S., 11 podsleased office spaces that serve as hubs for home-based employees, including a call
center and a customer briefing center (2,566 employees, or about 61%).
Key suppliers/partners: two offshore manufacturing suppliers (in China and India), a cell carrier, retailers,
transportation companies, integrated component/software manufacturers, universities, IT support, a
security company, and a law firm
18
Key competitors: five of the largest cell phone manufacturers, two other niche market competitors, several
manufacturers of integrated communication devices, and several dozen competitors in the fragmented cell
phone component and ringtone markets
Principal success factors: a strong relationship with carriers, ability to respond to rapid changes in the
marketplace with new product design and/or superior hardware/software quality, and collaborations with
key suppliers/partners
Strategic advantages: product/feature design innovation, business model innovation, lowered costs from
offshore supplier/partnership relationships
Strategic challenges: availability of a highly skilled workforce, communication, logistics, rapidly changing
customer/market needs (volatility in niche markets), protection of intellectual property, volatility of the
overseas environment, market forces driving the cost of cell phones and market penetration
Based on Novel Connects response in Category 2 to the 2008 Baldrige criteria questions for this
category, their strengths and their weaknesses and opportunities for improvement are listed below.
In reference to strategy development, Novel Connects management might be advised to develop
systematic processes for determining strategic challenges, strategic advantages, or time horizons
in order to fully align action plans with improving overall organizational effectiveness and
capability. Also, they should address and include analysis of data specific to opportunities, major
shifts in technology or competition, and long-term sustainability within the SPP, to meet its
strategic challenge of volatility in niche markets. Finally, Novel Connect should be advised to use
a fact-based approach to evaluate and improve its SPP.
Related to strategy deployment, Novel Connects senior leadership teams should be advised to:
clarify the process and methods to be used by the SLT-led teams to develop action plans for
key strategic objectives. This may be significant given the volatility of the environment and the
strategic challenge of rapidly changing customer/market needs.
ensure that adequate financial and other resources are available and allocated to accomplish its
plans and to develop an approach that assesses and addresses financial and other risks
associated with Novel Connects plans, potential impacts on people, changes to workforce
capability and capacity needs, or changes to strategic challenges.
Tools and techniques that Novel Directs managers and policy analysts might find useful include
the Seven Management and Planning Tools and Six Sigma projects, to implement strategic
planning and deployment improvements.
DETAILS OF STRENGTHS AND OPPORTUNITIES FOR IMPROVEMENT
2.1 Strategy Development
STRENGTHS
19
An annual, systematic Strategic Planning Process (SPP, Figure 2.1-1) involves participation
from the SLT, representatives from higher education partners, the BOD, and members of local
workforce boards, as well as carrier representatives, key customers, manufacturing and other key
partners (including offshore suppliers), and niche market subject-matter experts.
The process begins with a review and validation of the organizations mission, vision, core values,
core competencies, Novel Path, and goals. After information is gathered from many sources (e.g.,
from markets, customers, the carrier, the industry, and manufacturing and higher education
partners), the SLT analyzes and aligns the data with the organizations mission, vision, core
competencies, and goals, and it delineates Novel Connects objectives, goals, and risks. Following
a review of internal requirements, action plans are created and assigned to members of the SLT.
Balanced scorecard metrics are established, and MAP database reports are reviewed at monthly
Triple-M meetings by the SLT.
Novel Connect has defined five key strategic objectives (profit; customer satisfaction and
market position; innovation, agility, and rapid response; value creation; and workforce
satisfaction) and established related goals, implementation profiles, and measures, as well as
relationships to strategic advantages and challenges (Figure 2.1-2). The implementation profiles
are manufacturing; new products; enhancements; value creation; customer satisfaction; changing
customer demands; rapid response to changes; technology and resources; new customer
requirements; relationships with the carrier, suppliers, and partners; new pod locations; and
maintenance of virtual workforce guidelines. Collectively, these planning elements provide a
systematic approach to help ensure that the identified needs of stakeholders are balanced.
Although Novel Connect notes that it identifies key strategic challenges as part of the SPP, a
systematic process is not described for determining strategic challenges, strategic advantages, or
time horizons. Without a systematic approach for determining these planning elements,
Novel Connects action plans may not be fully aligned with improving overall organizational
effectiveness and capability in the rapidly changing cell phone industry.
While the SPP includes a review of internal requirements to help ensure Novel Connects ability
to execute the strategic plan, it is not apparent that the SPP addresses and includes the analysis of
data specific to opportunities, major shifts in technology or competition, and long-term
sustainability. Without a plan for addressing these considerations, Novel Connect may find it
difficult to meet its strategic challenge of volatility in niche markets.
There is little evidence that Novel Connect uses a fact-based approach to evaluate and improve
its SPP. Without such a mechanism, Novel Connect may find it difficult to ensure that the process
remains current with market and business needs. This may be especially important given Novel
Connects strategic challenge of market volatility and the rate of growth in its gross revenue, as
depicted in Figure 7.3-1.
20
2.2 Strategy Deployment

STRENGTHS
Action plans are developed by a team that is assembled and led by a member of the SLT who
has been assigned responsibility for a strategic objective. The plans are then reviewed and
ratified by the full SLT. The responsible senior leader assigns strategies for deploying the
plans to key partners and suppliers, as well as to appropriate work groups, sites, or
individuals. The SLT conducts monthly virtual Triple-M meetings to review MAP data and
modify action plans if necessary. Adjustments in action plans and goals are communicated to
the work areas, project leaders, and other individuals by senior leaders in weekly one-on-one
meetings and/or weekly work group meetings with pod leaders.
Novel Connect has developed ten short-term action plans with deployment strategies,
measures, and goals (Figure 2.2-1a) and seven longer-term action plans, also with
deployment strategies, measures, and goals (Figure 2.2-1b). The action plans are aligned with
measures on the Novel Compass Scorecard (Figure 4.1-1) through key strategic objectives:
profit; customer satisfaction and market position; innovation, agility, and rapid response;
value creation; and workforce satisfaction.
Novel Connect has defined its performance projections and comparisons for quantitative
measures (Figure 2.2-2) that are associated with its strategic objectives and most of its
related short- and long-term action plans. Performance projections are defined by measures
through 2011, and performance comparisons are identified for the current year. Get-BetterQuick (GBQ) plans are put in place when measures do not meet benchmark or projected
performance.
It is not clear what steps or methods are used by the SLT-led teams to develop action
plans for key strategic objectives. Without a systematic process to develop action plans,
Novel Connects ability to effectively use these plans to accomplish its strategic
objectives and reach its goals may be impaired. This may be significant given the
volatility of the environment and the strategic challenge of rapidly changing
customer/market needs.
Novel Connect maintains a 70/30 resource split between short- and long-term action plans to
increase the focus on short-term goals. It is not clear, however, how this ensures that
adequate financial and other resources are available and allocated to accomplish its plans. It
also is not apparent how this approach assesses and addresses financial and other risks
associated with Novel Connects plans, potential impacts on people, changes to workforce
capability and capacity needs, or changes to strategic challenges. Without these linkages,
Novel Connect may find it difficult to ensure the desired outcomes from its Activities
21
Bonus Materials
Case: The Creative Design Group
1. See the Affinity Diagram for the Creative Design Group, below. It is constructed similar
to Figure 5.4 (looking forward to the next chapter). The diagram for CDG shows
categories that include customer service, team environment, facilities/technology, design
goals, worker amenities, project/financial controls, competitive personnel issues, and
business/financial issues.
From this analysis, Trendy began to see that human resources and
technology had some issues that needed to be addressed in her longrange plans. In addition, she suspected that the competitive
business/financial issues had impacts on, but were also impacted by, the
competitive personnel and technology issues.
AFFINITY DIAGRAM FOR CREATIVE DESIGN GROUP
Customer Service
Speed
Quality
Creativity
Value
Team Environment
Independent design
Creative direction
CSE project costing
Facilities/Technology
Modern computers
Modern software
Excellent lighting
Modern communications
Design Goals
Wow customer
Meet/exceed deadline
Superior quality
Reasonable price
Value over price
Worker Amenities
Casual dress code
Casual policies
Health insurance
Flextime
Vacation policy
Leave policy
401K retirement
Competitive wages
Project/Financial Control
CSE- project contact point
Project estimating
Project proposal
Project tracking
Client communications
Status updates and changes
Advertising and promotion
Regular financial reports
Competitive Personnel Issues

Fewer design graduates
Difficulty in recruiting talent
Difficulty in retaining
designers
Salaries being bid up
Technology trails state of the
art
2.
22
Competition
(Business/Financial Issues)
Decreasing % of bids accepted
Declining ROI
See the tree diagram, below. It can be seen how plans are cascaded going from left to
right. They become more specific, resulting in action plans to deal with competitive
business issues of advertising and estimating by taking action to improve advertising and
visibility. In order to deal with competitive personnel issues, recruiting and retention of
talented designers are addressed.
TREE DIAGRAM FOR CDG ACTION PLANNING

Make advertising
more effective
23
Place ads in
business
Redesign website
Place spot ads
on
Develop plan to
meet competition
Keep and use job

cost/time data
Improve
estimating
Use QFD
approach
Take course in
graphics
Develop action
plans
Develop co-op
position
Improve
recruiting
Pay a sign-on
bonus
Determine interest
in job sharing
Develop plan to
attract/retain
Develop stock
option plan
Improve
retention
Add child care

allowance
Increase
recognition/incenti

3.a.
24
Matrix Data Analysis

The Matrix Data Analysis chart shown below confirms that by using the weighted ratings
across all competitors, the correct selection is CCG. CCG has a total of 7.0 points (out of
a possible 10), while the next closest competitor is COG, with a total of 6.1.
Rating
for
Rating
for
Rating
for
Wtd.
Value
Wtd.
Value
Wtd.
Value
Weights
CCG
COG
COW
CCG
COG
COW
System design
reliability
0.3
2.4
1.8
1.5
Delivery
timeliness
0.2
1.4
0.8
1.8
Cost
0.2
1.0
1.4
1.2
System service
0.2
1.8
1.2
0.8
Experience
0.1
0.4
0.9
0.6
Totals
1.0
33
33
31
7.0
6.1
5.9
Supplier
Characteristics
Note: Independent ratings on a scale of 1-10 (where 10 is best) were performed by the Small
Business Council of Qualdale, where CDG is located.
Suppliers: CCG = Creative Computer Group
COG = Computer Organizational Group
COW = Computer Operations Workgroup
3.b)
Questions that CDGs management should ask Charlie include:
1. Will we be able to continue working while youre installing the new system?
2. If not, how long will we be down?
3. Can you provide us with a detailed project plan so that we will know when various
milestones have been reached?
4. What warranties will be provided for the hardware, software, and CCGs installation?
5. How much training will be required for the new system?
6. How much training will you provide versus the total training needed?
7. Will you work with us or a contractor that we select to structure the proper training?
8. If unforeseen difficulties arise, what is the procedure for initiating and approving changes?
9. How is the payment schedule structured, and is financing available?
Case The Graduation Party
1.
25
In order to develop a PERT-type network diagram activities must first be labeled, and
precedence relationships must be established.
Activity
Precedent(s)
A. Pick date
B. Estimate costs
A
C. Determine budget
B
D. Locate and book a hall
C
E. Hire a DJ
C
F. Select music
E
G. Plan menu
C
H. Plan decorations
D
I. Set up mailing list
A
J. Plan ceremony for seniors
C
K. Design and print invitations
C, D, E
L. Mail invitations
I, K
M. Determine how much will be paid from treasury vs. special assessment
C
N. Dress rehearsal (dummy) *
F, H, J, L
O. Rehearse ceremony
N
P. Setup, decorate hall
N
Q. Get food delivered
G, P
R. Have the party
Q
S. Cleanup and pay bills
R
See the interrelationship digraph below.
b) Activity C (Determine budget) is obviously a critical activity on which a number of
others depend. Designing and printing (Activity K) and the Dress rehearsal (dummy
activity N) are ones in which the long-range results terminate.
* The dummy activity (N) was actually included as a milestone to remind the project
team that they needed to check final arrangements at that point, in order to ensure that no
major problems still existed.
26
INTERRELATIONSHIP DIAGRAPH DMZ PARTY PLAN
D
A
3.
a) and b) Using data from the interrelationship digraph (see problem 1), an arrow diagram
can be established. The Arrow Diagram, shown above, shows precedent relationships for
each activity.
The technique has been extended a little further by the use of the PERT/CPM technique in
order to calculate the critical path and the estimated project completion time, which are
shown on the diagram. The arrow diagram indicates that Joe and his team have a minimum
of 21 days to complete the project, if their single time estimates for each activity are
accurate.
If a PERT-type analysis were to be used, then the probability of completion within a
specified time frame could also be established. However, this method requires that three
time estimates be made for each activity, which is a little more difficult and time
consuming.
27
A R ROW DIAGRAM FOR DMZ PARTY PLAN

t=1
M
t=2
t=3
t=1
t= 2
t=1
t=2
t=3
t=1
t=3
t=1
t=3
t=5
t=5
F
t=1
t= 0
t=1
t=2
I
The critical path is A-B-C-D-K-L-N-P-Q-R-S (bold lines on
Arrow Diagram).
Project completion time is 21 days
Case - Baldrige Assessment of Strategic Planning Part 1

Share Foods, Inc
of responding to the issues of the Category 2 and the response of Share Foods to the key
questions. The companys response in their application will not be duplicated here. See the Share
Foods case materials in the Bonus materials folder on the Premium website for this chapter.
28
Assignment 1
The most important business or organizational factors relevant to this item in the Organizational
Profile appear to be:
Mission, Vision, Values (MVV). Mission: A community-based food bank dedicated to feeding the
hungry residents of its communities. Vision: Iowas heartland is hunger-free. Values: We work
together, we do what we say, everyone deserves respect, and we follow through.
10 full-time equivalent (FTE) employees (8 full-time and 5 part-time); 8 of 13 employees with
bachelor-level or above degrees, 5 employees with high school diplomas or associate degrees
More than 500 volunteers, including a core team of 20 volunteers, contributed 28,600 hours in 2006.
Volunteers include university nutrition and management students, government and foundation fellows,
and court-ordered community-service placements. Nearly half of volunteers are over age 55.
Competes with other social services for funds and volunteers; collaborates with these organizations in
emergency and disaster relief
Key success factors (same as strategic advantages for this organization): its ability to feed the foodinsecure through member agencies, network of food suppliers, tight management of overhead costs
(12.1% of operating expenses), and volunteer base. Other success factors: food availability and
quality; fiscal agility; funding and food resources; organizational effectiveness; optimization of human,
financial, food, and other resources; organizational learning, collaboration, and innovation; dedicated,
experienced employees and volunteers; and the satisfaction of member agencies, donors/suppliers, and
the community
Key changes: shifting groups of temporarily food-insecure persons, seasonal needs (e.g., related to
school vacation times and migrant populations), and the doubling of Hispanic and Hmong populations
in the past year. The nutritional quality of food, along with quantity, has become a key consideration in
the past decade.
Five strategic challenges: ensure food reaches those most in need when they need it most; optimize
human resources and partnerships; respond to member agency needs; obtain and maintain adequate
financial resources; recruit volunteers from a broad range of age segments
Assignment 2
Baldrige examiners are taught to develop statements of strengths and OFIs within the
framework of the Baldrige criteria and leading questions. They must also ensure that the
strengths and OFIs are congruent with the key business and organizational factors laid out in
the organizational profile, in order to ensure that quality practices fit organizational functioning
and key objectives. Thus, in the context of the case study response and the given Baldrige
criteria questions, the examiner team identified the strengths of Share Foods to fit the criteria
questions very well.
29
2007 Baldrige Strategy Development (Item 2.1) Questions

a. Strategy Development Process
Criteria questions of:
(1) How does your organization conduct its strategic planning? What are the key process steps?
Who are the key participants? How does your process identify potential blind spots? How do you
determine your strategic challenges and advantages, as identified in response to P.2 in your
Organizational Profile? What are your short- and longer-term planning time horizons? How are
these time horizons set? How does your strategic planning process address these time horizons?
appear to have been answered in the first strength. The examiner team felt that Share Foods 12step SPP and the fact that the organization identifies strategic challenges in the Current State
step represented a well-developed approach and deployment of leading-edge strategic planning
practices. Also, the fact that Share Foods includes inputs from the SWOT Analysis,
Environmental Scan, and Funding Mandate Review were very well-defined practices that clearly
answered the initial questions, above.
Other Criteria questions were:
(2) How do you ensure that strategic planning addresses the key factors listed below? How do
you collect and analyze relevant data and information pertaining to these factors as part of your
strategic planning process:
your organizations strengths, weaknesses, opportunities, and threats
early indications of major shifts in technology, markets, customer preferences, competition, or
the regulatory environment
long-term organizational sustainability
your ability to execute the strategic plan
The second strength refers to how the SPP uses SWOT Analysis, an Environmental Scan, and
performance analyses to identify potential blind spots. It appears to answer the second set of
questions from the Criteria.
Other Criteria questions were:
(1) What are your key strategic objectives and your timetable for accomplishing them? What are
your most important goals for these strategic objectives?
(2) How do your strategic objectives address your strategic challenges and strategic advantages?
How do your strategic objectives address your opportunities for innovation in products and
services, operations, and the business model? How do you ensure that your strategic objectives
balance short- and longer-term challenges and opportunities? How do you ensure that your
strategic objectives balance the needs of all key stakeholders?
These were addressed by the third strength, which refers to the fact that the organization has
identified its strategic objectives, as well as its short- and longer-term goals (for FY2007,
FY2008, FY2009, and FY2010), along with associated timetables for their accomplishment. The
30
organization aligns its strategic objectives with strategic challenges, values, key success factors,
and stakeholder requirements.
Alignment of OFIs with Criteria questions
Although there were strengths present in the approaches and deployment of the strategy
development process, there were several obvious gaps that the examiner team noted. In summary
form, the following OFIs were aligned with each set of questions, above, and identified the
gaps that were apparent.
It is unclear how the organization ensures that strategic planning addresses key factors in
some areas that have been identified as important threats. It also is unclear how strategic
planning addresses the need to obtain and maintain adequate financial resources, which
may be of particular significance.
Although the organization notes innovations in specific areas, it is not clear how its
strategic objectives address larger opportunities for innovation in products, services,
operations, and its business model.
It is unclear how the organization ensures that its strategic objectives balance short- and
longer-term challenges and opportunities.
It can be seen that the strengths and OFIs align well with the key factors identified in the
question in Assignment 1. For example, the first OFI relates to maintaining adequate financial
resources, which correlates directly with the strategic challenges of the last key issue in the list in
Assignment 1.
Most observers would agree that these are key strengths and opportunities for improvement for
this organization. One suggestions that the team did not identify relates to the fact that the SPP
is only updated biennially, raising the question of whether the SPP adequately addresses the key
issue of providing early indications of major shifts in technology, markets, customer
preferences, competition, or the regulatory environment.
Case - Baldrige Assessment of Strategic Planning Part 2
1. The most relevant business and organization factors from the Organizational Profile pertaining
to Item 2.2 are similar to Item 2.1 and appear to be:
Paid employees and volunteers acquire, warehouse, transport, and distribute food to the foodinsecure through partnerships with 58 member agencies.
10 full-time equivalent (FTE) employees (8 full-time and 5 part-time)
More than 500 volunteers, including a core team of 20 volunteers, contributed 28,600 hours in
2006. Volunteers include university nutrition and management students, government and foundation
fellows, and court-ordered community-service placements. Nearly half of volunteers are over age
31
55.
Demand for organizations services has doubled in the last three years
Competes with other social services for funds and volunteers; collaborates with these organizations
in emergency and disaster relief
Key changes: shifting groups of temporarily food-insecure persons, seasonal needs (e.g., related to
school vacation times and migrant populations), and the doubling of Hispanic and Hmong
populations in the past year. The nutritional quality of food, along with quantity, has become a key
consideration in the past decade.
2. Strengths that the organization has relative to the criteria questions (given below) are:
The SPP (Figure 2.1-1) and the PDCA Process (Figure 6.1-3) are used for the
development of action plans. Action plans are created to support the strategic objectives
during Step 9 of the SPP. Champions (chosen from senior leaders, board members,
volunteers, and LDP graduates) are assigned to each action plan to lead development and
deployment throughout the organization and to perform quarterly reviews.
SF uses its SPP (Figure 2.1-1) to ensure that adequate financial and other resources are
available and allocated to support the accomplishment of its action plans. For example,
adequate financial resources are addressed as part of Steps 8 and 10. In Step 8, the
Executive Director, with help from other senior leaders, develops annual fiscal and capital
budgets in order to support the objectives and goals established in Step 7. The
Finance/Audit Committee reviews these budgets and an outline of resources needed to
support the Strategic Plan. The Finance/Audit Committee recommends allocations of
resources based partly on action plans, and the budgets are presented for approval by the
board in Step 10.
As circumstances warrant, SF uses the Emergent Strategy Alert Process (Figure 2.2-1) to
establish and deploy modified action plans. For example, circumstances may arise as the
result of the Environmental Scan done on the years when there is no SPP or as the result
of the Community Needs Assessment. The four-step Emergent Strategy Alert Process,
which includes a rapid-cycle SWOT Analysis, guides SF to develop and deploy new or
modified strategies, goals, and actions.
SF has identified key short- and longer-term action plans that are mapped to strategic
objectives and goals (Figure 2.2-2). For example, achieving a rating of 10 on the American
Association of Food and Nutrition for a Healthier America (AAFNHA) Nutrition Scale by
FY2010 is a long-term action plan, and increasing the number of pounds of food per
person in poverty by 5% by FY2007 is a short-term action plan. Both are linked to the
32
strategic objective to increase the amount and quality of food delivered. SF also has
identified key changes planned for products and services. For example, in this fiscal year it
will increase the variety of nutritional food offered to member agencies to reflect the
Dietary Guidelines for Americans, 2005 and look for innovative ways to use Internet
communication.
3. Opportunities for improvement relative to the criteria questions include:
While champions are responsible for the deployment of action plans, a systematic
approach is not described for deploying the plans to achieve strategic objectives or
for ensuring that the key outcomes of action plans can be sustained. For example, it
is not clear how the boards oversight at quarterly meetings ensures sustainability or
what other actions are taken to integrate action plans into processes and approaches
to ensure they are maintained. Without systematic approaches to deploy action
plans and sustain their outcomes, SF may find it difficult to attain its strategic
performance goals.
It is unclear how SF assesses financial and other risks associated with its action plans (e.g.,
possible financial risks associated with its long-term action plan to achieve a rating of 10
on the AAFNHA Nutrition Scale, which might result in increased costs from purchasing
food to supplement possibly less-nutritious, donated food). The lack of an effective,
systematic approach may hamper SFs ability to evaluate the feasibility of each action plan
as it strives to consistently acquire, warehouse, transport, and distribute food to the foodinsecure through partnerships with its 58 member agencies.
It is not clear how the key human resource plans SF has noted will accomplish its strategic
objectives and action plans. More specifically, because the human resource plans are nearly
identical to short- and longer-term action plans listed for the first strategic objective in
Figure 2.2-2, it is not evident how the former will help accomplish the latter. In addition,
while the human resource/action plans include goals (e.g., increase volunteers hours by
10% each year), they do not include specific actions, including resource commitments, to
accomplish those goals and the related strategic objective. Further, it is unclear how the
human resource plans will address potential impacts on the workforce and potential
changes to workforce capability and capacity. The lack of an effective, systematic
approach and specific plans may impede SFs ability to meet its annual strategic goals as
well as its ability to continue and expand its services for the food-insecure.
While senior leaders and board committee chairs set performance projections during Step
7 of the SPP (Figure 2.2-2), it is not clear how these short- and longer-term performance
projections are determined. Additionally, it does not appear that projected performance is
compared with that of comparable organizations or past performance. Also, while goals
are presented for FY2008, FY2009, and FY2010, it is not clear whether these differ from
performance projections and if so, how. The lack of a fact-based, systematic approach may
33
limit SFs ability to assess its relative performance and prepare for projected changes, such
as the growing demand for its services, which has doubled in the last three years.
2007 Baldrige Strategy Deployment (Item 2.2) Questions
a. Action Plan Development and Deployment
(1) How do you develop and deploy action plans throughout the organization to achieve your key
strategic objectives? How do you ensure that the key outcomes of your action plans can be
sustained?
(2) How do you ensure that adequate financial and other resources are available to support the
accomplishment of your action plans? How do you allocate these resources to support the
accomplishment of the plans? How do you assess the financial and other risks associated with the
plans? How do you balance resources to ensure adequate resources to meet current obligations?
(3) How do you establish and deploy modified action plans if circumstances require a shift in plans
and rapid execution of new plans?
(4) What are your key short- and longer-term action plans? What are the key planned changes, if
any, in your products and services, your customers and markets, and how you will operate?
(5) What are your key human resource plans to accomplish your short- and longer-term strategic
objectives and action plans? How do the plans address potential impacts on people in your
workforce and any potential changes to workforce capability and capacity needs?
(6) What are your key performance measures or indicators for tracking progress on your action
plans? How do you ensure that your overall action plan measurement system reinforces
organizational alignment? How do you ensure that the measurement system covers all key
deployment areas and stakeholders?
b. Performance Projection
For the key performance measures or indicators identified in 2.2a(6), what are your performance
projections for both your short- and longer-term planning time horizons? How are these
projections determined? How does your projected performance compare with the projected
performance of your competitors or comparable organizations? How does it compare with key
benchmarks, goals, and past performance, as appropriate? How do you ensure progress so that
you will meet your projections? If there are current or projected gaps in performance against your
competitors or comparable organizations, how will you address them?
Answer
As noted in the previous case analysis, Baldrige examiners are taught to develop statements of
strengths and OFIs within the framework of the Baldrige criteria and leading questions. They
must also ensure that the strengths and OFIs are congruent with the key business and
organizational factors laid out in the organizational profile, in order to ensure that quality
practices fit organizational functioning and key objectives. Thus, in the context of the case study
response and the given Baldrige criteria questions, the examiner team identified the strengths of
Share Foods to fit the criteria questions very well.
34
It can be seen that the strengths and OFIs align well with the key factors identified in the
question in Question 1 of this case. For example, the third OFI relates to volunteer resources,
which correlates directly with the third business and organization factor from the Organizational
Profile in the list in Question 1.
Most observers would agree that these are key strengths and opportunities for improvement for
this organization.

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CHAPTER 4

Strategic Focus for Performance Excellence

To emphasize the critical role of strategic leadership in strategic management.

Strategic Focus for Performance Excellence

Strategic Focus for Performance Excellence

Strategic Planning at Branch Smith Printing Division

Branch-Smiths strategic planning process (SPP) is unique in several ways. First, it is

Branch-Smiths strategic challenges revolve around the competitiveness of the industry.

Strategic Focus for Performance Excellence

The key practices for a strategic focus on performance excellence include:

Strategic Focus for Performance Excellence

Strategic leadership can be defined as a person's ability to anticipate, envision, maintain

The Baldrige Organizational Profile provides a frame of reference to help an organization

Strategic Focus for Performance Excellence

The purpose, or mission, of the organization is a statement of "why the organization is in

Strategic Focus for Performance Excellence

Hoshin kanri, known as policy deployment or management by planning in the U.S.A., is

Strategic Focus for Performance Excellence

4. Matrix diagrams--These are "spreadsheets" that graphically display relationships

Key contextual factors that affect organizational structure include:

Company organizational and organizational guidelines

Strategic Focus for Performance Excellence

organizational form is better suited to rapidly changing environments, but it is more

Core competencies are an organizations areas of greatest expertise that provide a

Strategic Focus for Performance Excellence

Category 2 of the Baldrige Criteria is Strategic Planning. It focuses on drivers of customer

ANSWERS TO DISCUSSION QUESTIONS

Strategic Focus for Performance Excellence

Strategic Focus for Performance Excellence

SUGGESTIONS FOR PROJECTS, ETC.

Strategic Focus for Performance Excellence

Company organizational and organizational guidelines

Strategic Focus for Performance Excellence

ANSWERS TO CASE QUESTIONS

II. Clifton Metal Works

Strategic Focus for Performance Excellence

our vision by embracing superior customer focus, flexibility, adaptability,

Answers to case questions

Strategic Focus for Performance Excellence

Strategic Focus for Performance Excellence

Strategic Focus for Performance Excellence

Strategic Focus for Performance Excellence

Strategic Focus for Performance Excellence

2.2 Strategy Deployment

Strategic Focus for Performance Excellence

AFFINITY DIAGRAM FOR CREATIVE DESIGN GROUP

Strategic Focus for Performance Excellence

Competitive Personnel Issues

Strategic Focus for Performance Excellence

TREE DIAGRAM FOR CDG ACTION PLANNING

Keep and use job

Add child care

Strategic Focus for Performance Excellence

Matrix Data Analysis

Questions that CDGs management should ask Charlie include:

Strategic Focus for Performance Excellence

Strategic Focus for Performance Excellence

INTERRELATIONSHIP DIAGRAPH DMZ PARTY PLAN

Strategic Focus for Performance Excellence

A R ROW DIAGRAM FOR DMZ PARTY PLAN

Case - Baldrige Assessment of Strategic Planning Part 1

Strategic Focus for Performance Excellence

Strategic Focus for Performance Excellence

2007 Baldrige Strategy Development (Item 2.1) Questions