Strategic Planning

Module 5 LIS 580: Spring 2006 Instructor- Michael Crandall

Roadmap
The strategic management process Mission and vision statements Analyzing strategic drivers and core competencies SWOT analysis Scenario planning

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LIS580- Spring 2006

Checklist 5.1 The Strategic Management Process

Define the business and its mission. Perform external and internal audits. Translate the mission into strategic goals. Generate and select strategies to reach strategic goals. Implement the strategy. Evaluate performance.
G.Dessler, 2003

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LIS580- Spring 2006

A Comprehensive StrategicManagement Model

Source: Adapted from Fred David, Strategic Management (Upper Saddle River, NJ: Prentice-Hall, 2001), p. 77.

FIGURE 51
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LIS580- Spring 2006

Vision and Mission

A vision statement tells people
Where we want to go What we want to become What we want to accomplish Why it is important

And a mission expresses the organizations:

Purpose - the needs we exist to address Business - what are we doing to address these Values - what principles or beliefs guide our work

April 11, 2006

LIS580- Spring 2006

Examples of Mission Statements

APEX ELEVATOR To provide a high-reliability, error-free method for moving people and products up, down, and sideways within a building. UNITED TELEPHONE CORPORATION OF DADE To provide information services in local-exchange and exchange-access markets within its franchised area, as well as cellular phone and paging services.

JOSEPHSON DRUG COMPANY, INC. To provide people with longer lives and higher-quality lives by applying research efforts to develop new or improved drugs and health-care products. GRAY COMPUTER, INC. To transform how educators work by providing innovative and easy-to-use multimedia-based computer systems.
FIGURE 52 April 11, 2006 LIS580- Spring 2006
G.Dessler, 2003

Strategies in Brief
COMPANY America Online Dell eBay General Electric STRATEGIC PRINCIPLE Consumer connectivity firstanytime, anywhere Be direct Focus on trading communities Be number one or number two in every industry in which we compete, or get out Meet customers short-haul travel needs at fares competitive with the cost of automobile travel Unmatchable value for the investor-owner Low prices, every day

Southwest Airlines

Vanguard Wal-Mart

Source: Arit Gadiesh and James Gilbert, Frontline Action, Harvard Business Review, May 2001, p. 74.

FIGURE 53
G.Dessler, 2003

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LIS580- Spring 2006

Checklist 5.2 How to Test the Quality of Your Strategy

Does your strategy fit with whats going on in the environment? Does your strategy exploit your key resources? Will competitors have difficulty keeping up with you? Are the elements of your strategy internally consistent? Do you have enough resources to pursue this strategy? Can your strategy be implemented?
G.Dessler, 2003

April 11, 2006

LIS580- Spring 2006

Relationships Among Strategies in Multiple-Business Firms

FIGURE 54
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Strategy Types
Corporate
Concentration Vertical integration Diversification Status quo Investment reduction Strategic alliances/joint ventures

Competitive
Cost leadership Differentiation Focus
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Forces Driving Industry Competition

Source: Reprinted with the permission of The Free Press, a division of Simon & Schuster from Competitive Strategy: Techniques for Analyzing Industries and Competitors by Michael E. Porter. Copyright 1980 by The Free Press.

FIGURE 55
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How the Internet Influences Industry Structure

Source: Adapted from Michael Porter, Strategy and the Internet, Harvard Business Review, March 2001, p. 67.

FIGURE 56
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Examples of a Companys Strengths, Weaknesses, Opportunities, and Threats

FIGURE 77
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Worksheet for Environmental Scanning

FIGURE 58
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Checklist 5.3 How to Benchmark

Focus on a specific problem and define it carefully Use employees who will actually implement changes to identify the bestpractices companies and to conduct onsite studies. Be willing to share information with others. Avoid sensitive issues such as pricing, and dont look for new product information. Keep information you receive confidential.
G.Dessler, 2003

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LIS580- Spring 2006

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Cineplex Odeon TOWS Matrix

Source: Fred David, Strategic Management (Upper Saddle River, NJ: Prentice-Hall, 2001), p. 207.

FIGURE 59
G.Dessler, 2003

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BCG Matrix

FIGURE 510
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Checklist 5.4 Scenario Planning Principles

Scenarios have value only to the extent that they inform decision makers and influence decision making. Scenarios add value to decision making only when managers and others use them to systematically shape questions about the present and the future, and to guide how to go about answering them. In each step of developing scenarios, the emphasis must be on identifying, challenging, and refining the substance of managers mindsets and knowledge.
G.Dessler, 2003

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Checklist 5.4 (contd) Scenario Planning Principles

Alternative projections about a given future must challenge managers current mental models by creating tension among ideas, hypotheses, perspectives, and assumptions. The dialogue and discussion spawned by the consideration of alternative futures should directly affect managers knowledge. Scenarios should include enough indicators so that managers can track how the future is actually evolving so that the learning and adaptations stimulated by the scenarios are continuous.
G.Dessler, 2003

April 11, 2006

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Southwest Airlines Activity System

Source: Reprinted by permission of Harvard Business Review. From What Is Strategy? by Michael E. Porter, NovemberDecember 1996. Copyright 1996 by the President and Fellows of Harvard College; all rights reserved.

FIGURE 511
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Strategic Fit vs. Stretch

Southwest follows Michael Porters view that functional strategies should support corporate and competitive strategies Hamel and Prahalad argue that leveraging resources is more important for long-term success Core competencies define key strengths of the organization, and provide the focus for strategic choices
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Cleveland Public Library

How did the library go about building their plan? Did they effectively engage the stakeholders in the process? What kinds of outside help did they seek in formulating their plan? How did the concrete steps they defined relate to their mission and vision statements? Were there any measurements of success built into the plan?
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Next Time
Guest lecture
Mike Eisenberg, Dean Emeritus, the Information School

Read the iSchool Strategic Plan Mike wrote in 1998, and think of it in the context of the discussions weve been having over the past several days
Come prepared with questions that use class readings and discussion to examine this plan A great chance to hear from someone whos gone through a full planning cycle

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