Strategic Thinking Cycle Elements of the Cycle Strategic Management Planning Implementation Strategic Thinking: Thought Processes Synthetic Divergent Creative Strategic Planning Recreating the future
Elements of the Strategic Thinking Cycle 1.Systems Perspective 2.Intent Focus 3.Intelligent Opportunism 4.Thinking in Time 5.Hypothesis Driven
SYSTEMS PERSPECTIVE Generation of a mental model of the complete system of value creation and understanding the interdependencies within the chain (Value Chain) New insights fail to get put into practice because they will conflict with deeply held internal images of how the organization works. Images that limit us to familiar ways of thinking and acting
STRATEGIC INTENT Strategic Intent implies a point of view about the long-term market/environment or competitive position that a firm or organization hopes to build over the coming decade. It conveys a sense of direction Direction, discovery and destiny-these are the attributes of strategic intent
STRATEGIC INTENT Strategic Intent provides the focus that allows individuals within an organization to marshal and leverage their energy: a) to focus attention, b) to resist distraction, and c) to concentrate for as long as it takes to achieve a goal.
INTELLIGENT OPPORTUNISM This is the third element in the Strategic Thinking Cycle. In essence this notion is the idea of openness to new experiences which allows one to take advantage of alternative strategies that may emerge in response to rapidly changing business environments,viz: Emergent Strategy vs Deliberate Strategy
THINKING IN TIME Strategy is not solely driven by the future, but by the gap between the current reality and the intent for the future. Gap analysis: By connecting the past with the present and linking this to the future, strategic thinking is always “thinking in time”
Strategic Intent The real question is not what does the future we are trying to create look like, rather it is: Having seen the future that we want to create: a) what must we keep from that past, b) lose from the past, and c) create in our present, to get there.”
5 th Element: Hypothesis Driven Hypothesis generation poses the creative question: “What if….?” Hypothesis testing follows up with the critical question: “If…… then.” It then evaluates the data relevant to the analysis.
STRATEGIC THINKING CYCLE Firms who succeed in embedding a capability for strategic thinking throughout their organization will have created a new source of competitive advantage. Strategic Thinkers see the linkages in the system from multiple perspectives and understand the relationship among the corporate, business and functional levels.
STRATEGIC THINKING CYCLE Process Considerations in The STC Processes are needed to ensure that strategies are: 1.Aligned, 2.Goal-Oriented, 3.Fact-based, 4.Based on Broad thinking, 5. Focused, 6.Agreed upon, 7.Engaging, 8.Adaptable, 9.Implementable
STRATEGIC THINKING CYCLE Aligned: A company’s/organization’s strategies must fit with its: (a) mission, (b) vision, (c) competitive situation and (d) operating strengths. Goal-oriented: Strategies are the means by which a company sets out to achieve its goals. Effective strategies, then, a) set clear expected outcomes and b) make explicit links between these outcomes and the company’s goals.
STRATEGIC THINKING CYCLE Fact-based: The best strategies are based on and supported by real data. While strategic thinking by its very nature requires assumptions about the future, these assumptions must be educated guesses, and based on facts
STRATEGIC THINKING CYCLE Based on Broad Thinking: Companies and Organizations that are strategically nimble are able to: a)consider multiple alternatives at once and b)to consider a range of scenarios in making strategic choices.
STRATEGIC THINKING CYCLE Focused: No company/organization can do everything or be all things to all people. Strategy setting involves making choices about what a company will do and—as important—what it will not do. Strategies provide clear guidance about how a company’s activities will be prioritized, and how its limited resources will be deployed.
STRATEGIC THINKING CYCLE Agreed upon: Especially in large, complex organizations (like a Ministry), successful strategies must gain the support of multiple stakeholders. This often requires a process of developing strategies that are interactive
STRATEGIC THINKING CYCLE Engaging: Strategies that will need to mobilize broad resources must be: easily articulated so that they can capture the attention of the people who will be asked to carry them out.
STRATEGIC THINKING CYCLE Implementable: Because effective strategies draw on the particular strengths and skills of an organization, they include explicit considerations of how they will be implemented. Implementable strategies provide clear guidance for decision making in order to shape behavior throughout the company.
STRATEGIC THINKING CYCLE Adaptable: Strategies need to be able to be adjusted to build on learning from experimentation, errors and new information.
STRATEGIC THINKING CYCLE SUMMARY: The following is a list of the five criteria of the strategic thinking process: 1.Organization 2.Observation 3.Views 4.Driving Forces 5.Ideal Position
STRATEGIC THINKING CYCLE 1) Organization. The organization of your (new) business involves the (a) people, (b) the organizational structure, and the (c) resources necessary to make it all work. 1.What will your organization look like? 2.What type of structure will support your vision? 3.How will you combine people, resources, and structure together to achieve your ideal outcome?
STRATEGIC THINKING CYCLE 2). Observation. Strategic thinking allows you to see things from "higher up." By increasing your powers of observation, you will begin to become more aware of: what motivates people, how to solve problems more effectively, and, how to distinguish between alternatives
STRATEGIC THINKING CYCLE 3).Views. Views are simply different ways of thinking about something. In strategic thinking, there are four viewpoints to take into consideration when forming your business strategy: 1.the environmental view; 2.the marketplace view; 3.the project view; 4.the measurement view.
STRATEGIC THINKING CYCLE 4) Driving Forces. What are the driving forces that will make your ideal outcome a reality? What is your company's vision and mission? Driving forces usually lay the foundation for what you want people to focus on in your business (i.e., what you will use to motivate others to perform). Examples:
ST:Driving Forces Examples of driving forces might include: 1)individual and organizational incentives; 2)empowerment and alignment; 3)qualitative factors such as a defined vision, values, and goals; 4)productive factors like a mission or function; 5)quantitative factors such as results or experience; 6)and others such as commitment, coherent action, effectiveness, productivity, and value.
STRATEGIC THINKING CYCLE 5: Ideal Position. After working through the first four phases of the strategic thinking process, you should be able to define your ideal position. Your ideal position outline should include: 1.the conditions you have found to be necessary if your business is to be productive; 2.the niche in the marketplace that your business will fill; 3.any opportunities that may exist either currently or in the future for your business; 4.the core competencies or skills required in your business; and 5.the strategies and tactics you will use to pull it all together.
STRATEGIC MANAGEMENT Strategic management is concerned with making decisions about an organization's future direction and implementing those decisions. Strategic Management can be broken down into two phases: 1)strategic planning and 2) strategic implementation.
STRATEGIC PLANNING Strategic Planning is devising plans which insure the future well being of the organization by developing strategies which will “protect or capture” the four basic elements of its business, which are its: Products/Services, Customer Groups, Market Segments, and Geographic/Areas Markets.
STRATEGIC PLANNING Strategic planning is concerned with making decisions with regard to: 1. Defining the organization's philosophy and mission 2. Establishing long- and short-range objectives to achieve the organization's mission 3. Selecting the strategy that is to be used in achieving the organization's objectives
STRATEGIC PLANNING How is your Strategic Planning process different from others? 1.It evolves from an orderly strategic thinking process providing a solid foundation of facts 2.It is based on the driving force of your organization, often overlooked in other systems 3.It is much more effective because it is created by the management team and is consensus driven
STRATEGIC PLANNING How will Strategic Planning affect our Image, Marketing and Success? 1.It will help shape the correct image by identifying the values and beliefs of the organization 2.You will gain valuable insight into how to best market your Ministry based on solid information 3.It will insure all the departments will be “rowing the boat” in the same direction
STRATEGY IMPLEMENTATION Strategy implementation is concerned with making decisions with regard to: 1.Developing an organizational structure to achieve the strategy 2.Ensuring that the activities are effectively performed so to achieve the strategy 3. Monitoring the effectiveness of the strategy in achieving the organization's objective
ELEMENTS OF STRATEGIC PLANNING See diagram on page ---- of manual
Organizational Philosophy Organizational philosophy establishes the values, beliefs, and guidelines for the manner in which the organization is going to conduct its business. It establishes the relationship between the organization and its stakeholders: employees, customers, shareholders, suppliers, government, and the public at large.
Philosophies of excellent organizations Include the following basic beliefs: 1.Belief in being the best 2.Belief in the importance of the details of execution 3.Belief in the importance of people as individuals 4.Belief in superior quality and service 5.Belief that most members of the organization should be innovators, and its corollary, the willingness to support failure 6.Belief in the importance of informality to enhance communication. 7.Belief in and recognition of the importance of growth and success
Establishing Strategic Vision Strategic Vision encompasses an active management process which includes: 1.An Obsession for Success. 2.Focusing the Organization on winning. 3.Encouraging Innovation and Change. 4.Lengthening Executive attention Span. 5.Improving and developing outreach. 6.Motivating Employees to accomplish Goals and Objectives 7.Having a Long-Range Picture of Business Opportunities.
STRATEGIC VISIONING "If you want to move people, it has to be toward a vision that's positive for them, that taps important values that gets them something they desire, and it has to be presented in a compelling way that they feel inspired to follow. " - Martin Luther King Jr.
STRATEGIC VISIONING A vision of success, if it is to provide suitable guidance and motivation, it should include: Mission Basic philosophy and core values Goals, if they are established Basic strategies Performance criteria Important decision rules Ethical standards expected of all employees
Strategic visioning The vision should emphasize: Purpose Behavior Performance criteria, Decision rules, and Standards that are public serving rather than self-serving. The guidance offered should be specific and reasonable.
Strategic Visioning a) The vision should be short, and inspiring. b) The vision should be widely circulated among organizational members and other key stake-holders c) The vision should be used to inform major and minor organizational decisions and actions. d) Preparing the vision is a waste of time if it has no behavioral effect.
STRATEGIC VISIONING EG.: The Ministry’s Vision Statement: “The Ministry of Sport and Youth Affairs is a dynamic people centered organization in the forefront of human development with particular focus on youth empowerment, total participation and excellence in sport.”
VISION & MISSION Mission outlines organization purposes, while Vision goes on to describe how the organization should look when it is working well.
MISSION The MISSION outlines organization purpose, viz. the reason why the Ministry/organization exists.
MISSION Eight (8) Questions for determining the Mission Statement 1.What activities should we be in? 2Why do we exist? 3What is unique or distinctive about this organization? 4Who are the principal recipients of our services?
MISSION 5What are the principal means of rendering our services? 6What are our principal services - present and future? 7What is different about our organization today from what it was three to five years ago? 8What is likely to be different about our organization three to five years in the future?
MISSION The Mission should be: Action oriented Time bound Clear, broad, creative and attainable Able to identify what type of business you are in or what is your business.
MISSION Defining the Organization's Mission: An organization's mission defines its current and future business activities It should include a broad description of the service, and geographical coverage of the business today and within a time frame of 3-5 yrs..
MISSION The mission statement describes how the business serves customers to underwrite its strategy; and is used as a context for the development and evaluation of intended and emergent strategies.
THE MISSION (1) it serves as a guide for day to day operations and as the foundation for decision making and (2) for employees, a strong mission statement builds commitment, loyalty and motivation.
MISSION 4) Mission provides a unifying force, a sense of direction, and a guide to decision-making for all levels of management 5) Without a concrete statement of mission it is virtually impossible to develop clear objectives and strategies.
The Mission of the Ministry “To deliver quality support services to the citizenry for the development of Youth and Sport”
VALUES 1.Values are the fundamental thoughts that shape your behavior and your operations. 2.These are key principles that govern planning and action and inspire identification with the organization 3.They are the key ideas and ideals by which the organization is governed.
EG. of VALUES OF THE MINISTRY The Ministry: 1.supports continuous learning and improvement in the organization; 2.endorses open communication, employee participation and involvement in the business of the Ministry; 3.values the diversity and promotes the well- being of its employees and stakeholders;
Values of the Ministry The Ministry: demonstrates positive work ethics, committed leadership and respect for individuals; encourages teamwork, trust and confidentiality in the conduct of its affairs; focuses on results and the delivery of quality services; recognizes excellence, creativity and performance.”
SWOT ANALYSIS The major purpose of Strategic Planning is to facilitate adaptation through anticipation. Analysis of the events and trends occurring on the Political, Economic, Social, and Technological, Legal and Regulatory and the Environment (PESTLE) fronts provide strategic decision-makers with: a wider environmental-orientated perspective and with a more futuristic view of the organization’s situation.
SWOT ANALYSIS PESTLE therefore provides an analytical framework for determining the organization’s present position in relation to the future, and is therefore a very useful method of strategic analysis.
SWOT Strategic Analysis is comprised of an analysis of the: Strengths Weaknesses Opportunities, and Threats facing the organization
INTERNAL ANALYSIS A) In the Internal Analysis the following aspects of the organization’s operations are analyzed: 1.History and Age 2.Leadership and Management Style 3.Organizational Structure and Systems 4.Organizational Culture 5.Human Resource Performance 6.Financial Performance
EXTERNAL ANALYSIS B)The External Analysis incorporates the following aspects: 1.Values of Society 2.Organized Groups 3.Competitors 4.Economic Conditions 5.Technology
ENVIRONMENTAL ANALYSIS c) Overarching considerations in the context of analyzing the operations of the organization will be: The Nature of the business/function of the organization and its changing role Expectations of Individuals Expectations of Stakeholders Expectations of Coalitions Items (a), (b), and (c) above impact on the strategic direction, strategic objectives and strategic choice(s) of the organization.
INTERNAL, EXTERNAL &ENVIRONMENTAL ANALYSES This phase of the review at item (c) would have at least determined the following: 1.What is the business of the organization? 2.What do we want to become? 3.Who are our clients? 4.What do our customers want? 5.What are our experiences?
INTERNAL, EXTERNAL &ENVIRONMENTAL ANALYSES 6What have we been mandated to do? 7What are we supposed to be doing? 8Are the things we do relevant to our purpose? 9Are we doing the same things we did five or ten years ago? 10What will we be doing in the next five years?