1. Performance Management and Strategic Planning

2. Strategic Planning
Strategic planning: determining how to move organization from point A to point B
Purposes of strategic planning:
Helps organization define who they are and what their purpose is
An organization focused on cutting edge medical technology? An organization focused on innovative frozen vegan entrees?
Helps organization plan for the future-forces them to decide where they want to go
Do we want to be the regional leader in medical technology? Do we want to be present in all grocery stores on the east coast in 5 years?
Requires organizations to analyze their environment, which alerts them to potential problems and changes down the road
Is product being produced cheaper in Malaysia? Is demand for vegan entrees decreasing due to new diet fad?

3. Strategic Planning
Can produce organizational culture oriented around goals
We can do all that we can to make sure we sell more medical technology than our competitors. We can make sure that our entrees are in all grocery stores on the east coast.
Can lead to awareness of new opportunities
Did a competitor just stop producing a product that your organization can produce cheaply? Is veganism taking off in Mexico?
Demonstrates to employees what behaviors and results matter
Attention to quality matters because we need to become the regional industry leader. Sales and marketing matter because we need to get our product into more grocery stores.

4. Linking performance to Planning
Need to link strategic plan to performance management system
Otherwise, nothing changes
Individual goals not linked to organizational goals
People keep doing what they’ve been doing
Strategic plan includes:
Mission statement
Vision statement
Goals and strategies to make mission and vision happen

5. Linking performance to planning
Organization’s strategic plan
Mission
Vision
Goals
Strategies
Unit’s strategic plan
Job description
Tasks
Knowledge
Skills
Abilities
Individual and team performance
Results
Behaviors
Development plan

6. Environmental ANalysis
Environmental analysis: identifies internal and external issues to better understand organization’s strengths and weaknesses, position in industry, and position in broader economy
Analysis of external environment: identify opportunities and threats
Opportunities: things that can help the organization succeed
Examples: greater demand for organization’s products and services, technology improvements that make work more efficient, failing competitor, demand for product or service that organization could easily produce
Threats: things that can hinder organizational success
Examples: reduced demand for organization’s products and services, increased cost of materials, competitor gaining strength, legislation that will hinder production

7. Environmental Analysis
Things to consider in external environmental analysis:
Economic issues: will broad economic trends (such as recession) affect business?
Political/legal issues: Banning imports from certain country? Banning exports from certain country? Increased tax on imported materials? Environmental legislation? How will this affect business?
Social: what social trends could affect organization? Examples: aging population, increased focus on health and fitness
Technological: what technology changes are on the horizon? How will they affect business?
Competitors: what are competitors doing, and how does it affect the organization? Is there anything that can be done to reduce the impact?
Customers: what do customers want now and in the immediate future? Is there a way to anticipate these needs and wants?
Suppliers: what relationship does organization have with suppliers? Is this likely to change?

8. Environmental Analysis
Why environmental analysis is important: The case of the American auto industry:
Economic: recession from reduced demand for new cars
Political/legal: low import tariff on imported cars, NAFTA (no tariff on goods from Canada and Mexico)
Social: increasing interest in environmental sustainability
Technological: advances in mechanical technology allowed for high efficiency and hybrid cars
Competitors: foreign companies like Toyota and Honda creating fuel-efficient, reliable cars
Customers: desire for small, fuel-efficient vehicles
Suppliers: offshoring of steel production and some automotive parts

9. Environmental Analysis
Things to consider in internal environmental analysis:
Organizational structure: how is the organization structured? Hierarchical? Semi-autonomous work teams? How does this affect business?
Example: rigid hierarchical structure may limit innovation
Organizational culture: what are the underlying norms and values of the organization? How will this affect business?
Example: organization with strong focus on technological quality may have a hard time shifting to a customer service orientation
Politics: Are there any rivalries/divisions which could affect business?
Example: if the R&D and marketing departments communicate poorly with one another, may be difficult to effectively market new products

10. Environmental ANalysis
Processes: how efficient are organizational processes? Do supplies and products get where they need to go? Are there appropriate channels for vendors and customers to go through?
Example: inefficient supply chain may lead to production delays, reducing revenue
Size: based on industry, is organization size appropriate? Is growth happening at an acceptable rate?
Examples: Large organization looking to enhance adaptability and increase efficiency may need to downsize. Small organization may be growing too rapidly to operate efficiently

11. Environmental Analysis
Gap analysis: compare internal environment to external environment to identify organization’s position
Opportunity + Strength = Leverage
Opportunity in environment aligns with organizational strength
Example: need for new Smartphone operating system coupled with R&D department with strong technological skills and organizational culture that values innovation
Opportunity + Weakness = Constraint
Opportunity in environment, but organizational features won’t allow organization to take advantage
Example: need for new wireless internet provider with excellent customer support, but organizational culture views customers as a necessary evil that should only be dealt with if absolutely necessary

12. Environmental ANalysis
Threat + Strength = Vulnerability
External threat is offset by internal strengths
Example: needed production materials are increasing in cost, but organization has efficient processes and a culture that values cost-cutting
Threat + Weakness = Problem
External threat is accompanied by internal weakness
Example: Competitor is working on developing groundbreaking, innovative tablet computers, but organizational culture values prefer sticking with the tried-and-true and shuns innovation

13. Mission Statement
Mission statement: requires organization to decide who they are, what they do, and where they are going
Good mission statements answer these questions:
Why does the organization exist?
What is the scope of the organization’s activities?
Who are the customers served?
What are the products or services offered?

14. Mission Statement Mission statements include: Basic product or service
Primary markets or customer groups
Unique benefits and advantages of products/services
Technology used in production or delivery
Concern for survival through growth and profitability
Managerial philosophy of organization
Public image of organization
Concept of business adopted by employees and shareholders

15. Mission Statement A less-than-useful mission statement (Auto Nation)
“To be America's best run, most profitable automotive retailer.”
Tells us nothing about:
Who the customer is
The benefits of their service
Technology used
Managerial philosophy
Public image
Concept of business

16. Mission Statement
A more useful mission statement (Coventry Health Care):
“Our mission is to provide high quality care and services to our members and to be profitable in the process. Coventry Health Care is also committed to maintaining excellence, respect, and integrity in all aspects of our operations and our professional and business conduct. We strive to reflect the highest ethical standards in our relationships with members, providers, and shareholders.”

17. Mission Statement This statement tells us: Why the organization exists
What their product (and service) is
Who the customers are
Desire for profitability
Public image sought
Self-concept of business

18. Vision Statement
Organizational vision: where does the organization want to go?
Usually written after mission statement: need to know purpose before deciding where to go
Good vision statements are:
Short
Verifiable: goals should be objective and measurable
Bound by a timeline for meeting goals
Current
Focused: include only a few aspirations
Understandable
Inspiring
A stretch

19. Vision Statement A less-than-useful vision statement (Avon):
“To be the company that best understands and satisfies the product, service and self-fulfillment needs of women—globally”
Problems:
No timeline
Not verifiable
Not very current
Not a stretch

20. Vision Statement
A more useful vision statement (Amnesty International):
“Amnesty International’s vision is of a world in which every person enjoys all of the human rights enshrined in the Universal Declaration of Human Rights and other international human rights instruments.”
Pros:
Somewhat verifiable
Current
Inspiring
A stretch
Cons:
No timeline
May be unrealistic

21. Goals
At this point, organization should know what opportunities and threats it faces
This information should have been used to craft useful mission and vision statements
Now, organization needs to develop concrete goals for what it hopes to achieve in the next several years
Goals:
Are more specific than mission or vision, so provide concrete plans for implementing mission and vision
Can motivate employees and promote organizational cohesion
Help with decision-making
Provide metric for performance judgments: what needs to be achieved vs. what has been achieved

22. Goals A few examples from Target’s corporate responsibility goals:
Ensure that our fresh and frozen seafood selection is 100 percent sustainable, traceable or in a time-bound improvement process by 2015.
Increase organic food offerings by 25 percent by 2017.
Enhance at least 50 owned-brand packaging designs to be more sustainable by 2016.

23. Strategies
Need to determine how the organization will move toward its objectives
Example strategic plan: Valdosta State University
Goal 1:  Recruit, Retain, and Graduate a Quality, Diverse Student Population and Prepare Students for Roles as Leaders in a Global Society
Objective 1.1: Actively pursue VSU’s Complete College Georgia Plan (CCG). 
Strategy 1.1.1: Develop partnerships with K-12. (USG Strategic Imperative 1a)
Strategy 1.1.2: Improve access and completion for students traditionally underserved. (USG Strategic Imperative 1a, 1b, 1d)
Strategy 1.1.3: Shorten time-to-degree. (USG Strategic Imperative 1c)
Strategy 1.1.4: Restructure instructional delivery. (USG Strategic Imperative 1c)
Strategy 1.1.5: Transform remediation. (USG Strategic Imperative 1b, 1c)

24. Strategies
Organization’s strategic plan should be related to units’ strategic plans
Example: from VSU’s division of student affairs:
“Increase activity and involvement of students, locally, regionally, nationally, and internationally, with a focus on students who could be underserved. Each unit will examine its services and identify ways to support the current audience as well as attract new students.”

25. Job descriptions
Job descriptions must fit with organizational and unit mission, vision, goals, and strategies
Example: partial job description for Publix Customer Relationship Management Program Manager, Marketing Communications:
As our CRM Program Manager, you’ll be a key driver to help us deepen our customer relationships and increase sales results by designing personalized, cross-channel, measurable CRM programs. • Responsible for leading, designing, launching and optimizing Customer Relationship Management (CRM) campaigns for corporate communications strategies intended to drive company sales and profits, as well as building brand equity • Responsible for determining the communication strategy and initiating the Communication Matrix (CM) for corporate CRM marketing campaigns to increase customer acquisition, activation, retention, loyalty, and advocacy • Collaborating with Category Marketing Manager (CMM), Channel Lead, and Creative Director on the details included in the CM to ensure campaign channel effectiveness between all communication projects and alignment with the campaign’s Strategy Brief • Responsible for providing expert CRM counsel and best practices to internal and external resources on communication opportunities that can be leveraged within current marketing campaigns to increase loyalty and maximize sales and profits by enhancing customer relationships

26. Individual and Team Performance
Performance management system should motivate employees to support organization and unit mission, vision, and goals
PM system should reward behaviors that help unit and organization meet goals
Types of performance that are measured should be relevant to organization and unit’s strategies and goals
Example: if organization and unit are focusing on enhancing customer service, employee should be evaluated (and rewarded) on customer service behavior (returning s promptly, resolving disputes, etc.)