Driving Business Value through Strategic Process

Report
Driving Business Value Through
Strategic Process Management
Sloan Global Holdings
Tom Coleman
Chief Information & Process Officer
[email protected]
10500 Seymour Avenue
Franklin Park, IL 60131
April 12, 2013
Step1
• Strategic
Planning
Step2
•BPM
Step3
•HCM & IT
1
•
•
•
•
•
•
•
Founded in Chicago, Illinois, USA in 1906 by William Elvis Sloan
9 Major locations IL, China (3), PA, MA, AR, Mexico, CA
4,300 distributors, 69 Rep offices, 60 countries
Privately Held, U.S. Based Commercial Plumbing Products Manufacturer
The leader in water and energy high efficiency solutions
The most comprehensive line of commercial restroom solutions
Proven reputation for innovative designs, sustainable business
practices, commitment to quality, and devotion to serving our
customers
• Global supply chain and wholesaler distribution network
• SAP Business Systems enabling breakthrough business processes
2
SLOAN Company Overview
About Sloan
Product Offering
Water & Energy Efficient
Commercial Restroom Solutions
Flushometers
Vitreous China Toilets, Urinals
and Lavatories
Sink Systems
Health & Hygiene Solutions
Water Reuse Systems
Water Monitoring & Control
Systems
High Efficiency
|
Hygienic Solutions
|
Trusted Performance
3
SLOAN Company Overview
Sensor Faucets
Sample Enterprise “Toolkit”
•
•
•
•
•
•
•
Lean – Waste elimination
TOC – Eliminate the constraint (bottleneck)
Six Sigma – Reduce variability, solve problems
BPR – Holistic redesign of end-to-end processes
ADKAR – Manage the human side of change
BSC/Hoshin – Connect strategy to action/KPIs
4DX (Four Disciplines of Execution)
–
–
–
–
Create a few must do must succeed goals (WIGs)
Act on the lead measures that impact goal achievement
Create a compelling scoreboard
Create a cadence of accountability
• Engage IT and HR “technologies”
4
Conclusion
• Companies must take an end-to-end, holistic
view of their strategy
• Corporate Strategy is a governance process
• Corporate Strategy is not the same as
Business or Marketing Strategy
• The strategy framework must tie core
ideology to the value prop, core processes,
Human Capital Management, Information
Capital Management, and Corporate Culture
• Improvement ≠ Transformation
5
What Are We Trying To Do?
What?
Cash
A/R
Inventory
Equipment
Property
Goodwill
How?
Strategy and Process
Human Capital
Information Capital
Organization Capital
Adapted from: Kaplan and Norton 2004
6
Achieving Superior Performance
Operational Effectiveness is Not Strategy
Operational
Effectiveness
• Assimilating, attaining, and
extending best practices
Run the same races “faster”
(Efficiency)
Source: Michael Porter
Value
Discipline
• Creating a unique and
sustainable competitive
position
Choose to run a different race
(Effectiveness)
7
“Strategy is not about ways to
get better…strategy
formulation is about finding
ways to get…
different”
Source: Michael Porter
8
Five Tests of a Good Strategy
• A unique value proposition compared to other
organizations
• A different, tailored value chain
• Clear tradeoffs, and choosing what not to do [as
well as what to do]
• Activities that fit together and reinforce each
other
• Continuity of strategy with continual
improvement in realizing the strategy
Adapted from: Michael Porter (2006)
9
Translating the Mission/Vision into Desired Outcomes
Mission
Why we exist
Core Values
What we believe in
Vision
What we want to be
Strategy
Our game plan
Goals
Outcomes we need to accomplish
Strategic Initiatives
What we need to do
Personal Objectives
What I need to do
Strategic Outcomes
Satisfied
Shareholders
Kaplan and Norton 2001
Delighted
Customers
Motivated
and Prepared
Workforce
Effective
Processes
10
2013 Sloan Strategic Planning Process
Core
Ideology
Discovery
Value
Plan
Strategic Goals
Realization
17.0
4.0
2.0
18.0
Market
Needs
Mission
(Purpose)
Financial
Value
Proposition
5.0
3.0
21.0
8.0
10.0
Competitive
Analysis
Vision
Strategic
Imperatives
Develop Strategic WIGs
& Key Initiatives
Communication,
Review,
Feedback
6.0
1.0
SWOT
Core
Values
What can we
discover about
the market, the
competition, and
ourselves?
What is our vision
of today and of the
future? What do
we value?
Reconcilation
Budget
Process
17.0-N
Employee
Performance
Management
Process
7.0
Customer
Value
Proposition
& Discipline
What must we
achieve over the
next 5 years?
Note 1: This is an example of a strategic planning process
To achieve our
vision, what must
we deliver to our
customers and
stakeholders?
What is wildly important this
year? How shall we achieve
our financial and customer
goals?
Note 2: WIG = Wildly Important Goal
11
How does the strategic
plan reconcile with the
budget? How can we
communicate the strategic
plan? How can we align
the WIGs and initiatives
to employee action?
2013 Sloan Strategic Planning Process
Core
Ideology
Discovery
Value
Plan
4.0
2.0
18.0
Market
Needs
Mission
(Purpose)
Financial
Value
Proposition
5.0
3.0
21.0
Competitive
Analysis
Vision
Strategic
Imperatives
6.0
1.0
SWOT
Core
Values
What can we
discover about
the market, the
competition, and
ourselves?
What is our vision
of today and of the
future? What do
we value?
Strategic Goals
17.0
Reconcilation
Budget
Process
10.0
8.0
Part 1
Develop Strategic WIGs
& Key Initiatives
Note: This is an example of a strategic planning process
To achieve our
vision, what must
we deliver to our
customers and
stakeholders?
Communication,
Review,
Feedback
17.0-N
Employee
Performance
Management
Process
7.0
Customer
Value
Proposition
& Discipline
What must we
achieve over the
next 5 years?
Realization
What is wildly important this
year? How shall we achieve
our financial and customer
goals?
12
How does the strategic
plan reconcile with the
budget? How can we
communicate the strategic
plan? How can we align
the WIGs and initiatives
to employee action?
Sample Market Needs Analysis Fragment
Value Attributes Vs. Products
(Survey Sample)
Value
Attribute
Note: This analysis is done by product and also by value chain participant (customer)
Sloan sample portion of a comprehensive market needs Analysis
13
Sample Components of Competitive Analysis
What drives the
competitor?
(Four-Phase Analysis)
What the competitor is
doing and can do
Current Strategy
How the business
Is currently
competing
Future
Goals
Competitor’s Response Profile
Assumptions
Held about
itself & the
industry
Source: Michael E. Porter Competitive Strategy
Is the competitor satisfied with their
current position?
What likely moves or strategy shifts
will the competitor make?
Where is the competitor vulnerable?
What will provoke the greatest and
Most effective retaliation by the
competitor?
Capabilities
Both weakness
& strengths
14
Five-Forces Framework
(“Industry Structure”)
New
Entrants
(Threat)
Suppliers
(Bargaining Power)
Industry
Competitors
Buyers (Customers)
(Bargaining Power)
(Intensity of Rivalry)
Substitutes
(Substitution Threat)
Source: Michael E. Porter (Competitive Strategy)
15
16
17
2013 Sloan Strategic Planning Process
Core
Ideology
Discovery
Value
Plan
Strategic Goals
Realization
17.0
4.0
2.0
18.0
Market
Needs
Mission
(Purpose)
Financial
Value
Proposition
5.0
3.0
21.0
8.0
10.0
Competitive
Analysis
Vision
Strategic
Imperatives
Develop Strategic WIGs
& Key Initiatives
Communication,
Review,
Feedback
6.0
1.0
SWOT
Core
Values
What can we
discover about
the market, the
competition, and
ourselves?
What is our vision
of today and of the
future? What do
we value?
7.0
Customer
Value
Proposition
& Discipline
What must we
achieve over the
next 5 years?
Note: This is an example of a strategic planning process
To achieve our
vision, what must
we deliver to our
customers and
stakeholders?
Reconcilation
Budget
Process
Part 2
What is wildly important this
year? How shall we achieve
our financial and customer
goals?
18
17.0-N
Employee
Performance
Management
Process
How does the strategic
plan reconcile with the
budget? How can we
communicate the strategic
plan? How can we align
the WIGs and initiatives
to employee action?
The Envisioned Future
1. Vision: What we need to become
– Vivid description of new tomorrow
– Vibrant and engaging – yet tangible
– Paints a vivid picture into people’s minds
2. Strategic Imperatives
(AKA BHAGs – Big, hairy, audacious goals)
– Ambitious plans – an “audible gulp”
– Reachable plans (unlike core purpose)
– Rev up the organization / source of motivation
– Will require 10 or more years to achieve
Inspired by Jim Collins
19
Compelling Vision Questions
“What”
 What does our organization look like in
5 years?
 How big?
 What are we famous for?
 Why does anyone care about what we
do?
 How do our people feel about being
part of our organization?
Sloan Compelling Vision Bullets
“What”
 Private Company
 Global Leader
 Manufacturing Company
 Serving the Commercial Market
 Innovation that saves $ for clients
 Innovation that benefits the
environment by saving water
 “X” revenues (to $X billion)
20
Compelling Vision
“What”
By 2017, Sloan will be a $X billion global
manufacturing leader of innovative
commercial plumbing solutions, enabling
millions of people to preserve life by
minimizing water consumption.
21
Compelling Vision
“What”
Strategic Imperatives (BHAGs)
“What”
By 2017, Sloan will
be a $X billion global
manufacturing
leader of Innovative
commercial
plumbing solutions,
enabling millions of
people to preserve
life by minimizing
water consumption.
Values
• How should we behave
while executing on our
goals.
[More here later]
22
2013 Sloan Strategic Planning Process
Core
Ideology
Discovery
Value
Plan
Strategic Goals
Realization
17.0
4.0
2.0
18.0
Market
Needs
Mission
(Purpose)
Financial
Value
Proposition
5.0
3.0
21.0
8.0
10.0
Competitive
Analysis
Vision
Strategic
Imperatives
Develop Strategic WIGs
& Key Initiatives
Communication,
Review,
Feedback
6.0
1.0
SWOT
Core
Values
What can we
discover about
the market, the
competition, and
ourselves?
What is our vision
of today and of the
future? What do
we value?
Reconcilation
Budget
Process
Part 3
17.0-N
Employee
Performance
Management
Process
7.0
Customer
Value
Proposition
& Discipline
What must we
achieve over the
next 5 years?
Note: This is an example of a strategic planning process
To achieve our
vision, what must
we deliver to our
customers and
stakeholders?
What is wildly important this
year? How shall we achieve
our financial and customer
goals?
23
How does the strategic
plan reconcile with the
budget? How can we
communicate the strategic
plan? How can we align
the WIGs and initiatives
to employee action?
Financial Value Proposition
24
Value Discipline (Strategic Position)
Best Total Cost
Achieve the low cost
position on product
and service support
Solve the customer’s
broader problem and
share in the benefit
Build a better product
for which customers
will pay a premium
Best Product Innovation
Best Total Solution
Lock-in
Adapted from: Norton and Kaplan 2003/2004
Lock customer in to high
switching costs
25
The Discipline of Best Total Cost
Culture
Disciplined teamwork
Process focused
Conformance to
“one size fits all” mindset
Organization
Centralized functions
High skills at core
Core Processes
Mgt Systems
Product delivery
Basic service cycle
Built on standards
No frills fixed assets
Command and control
Compensation fixed to
cost & quality
Transaction profitability
I.T.
Wal-Mart
Dell
Southwest Airlines
AMD
FedEx
Adapted from: Michael Treacy and Fred Wiersema
Integrated
Low-cost transaction sys
Activity-based mgt (ABM)
Fulfillment systems
26
The Discipline of Best Product Innovation
Culture
Concept, future driven
Experimentation
Out of the box mindset
Attack, go for it, win
Organization
Organic, cellular
Technical skills abound
Loose-knit structures
3M
Nike
Mercedes
BMW
Sony
Intel
Adapted from Michael Treacy and Fred Wiersema
Core Processes
Mgt Systems
Invention
Market exploitation
Commercialization
Life cycle mgt
Decisive and risk oriented
Reward individuals for
innovation capacity
Product life-cycle profits
I.T.
1-to-1 systems
1-to-many systems
Many-to many systems
Knowledge mgt
Technology enablement
27
The Discipline of Total Customer Solutions
Culture
Client and field driven
“Have it your way” mindset
Organization
Entrepreneurial client teams
High skills in the field
Core Processes
Client acquisition
Client development
Solution development
Responsive procedures
Mgt Systems
Revenue/share of wallet
Rewards based on feedback
Lifetime value of client
I.T.
IBM
Nordstrom
Home Depot
HP
Goldman-Sachs
Empire Carpet
Adapted from: Michael Treacy and Fred Wiersema
Customer databases
Link of internal/external info
Knowledge/analytics sys
Customer relationship mgt
28
Customer Value Proposition Attributes
Value Discipline* Vs. Customer Value Attributes
Product and Service Attributes
Relationship
Image
Price
Quality
Time
Selection
Functionality
Service
Relationships
Brand
Best Total
Cost
n
n
n
n
o
o
o
n
Smart
Shopper
Best Customer
Solution
o
o
o
o
o
n
n
n
Trusted
Brand
Best Product
Innovation
o
o
n
o
n
o
o
n
Best
Product
n Differentiator Strategy
o General Requirement
Adapted from Kaplan and Norton 2001
* Value discipline is a term used by Treacy and Wiersema which parallels strategic positioning
Michael Treacy and Fred Wiersema
Chart Adapted from Kaplan and Norton 2001
29
Strategic Position
Best Total
Cost
Best Product
Innovation
● Low total cost
● Speedy purchase
● Very high quality
● Best performance
products
● First to market
Golden
Rule
Best Total
Solution
System
Lock-in
● Best total solution
● Best solution
● Standards based
● Variety kills efficiency
● Cannibalize your
success with new
breakthroughs
● Solve the customer's
broader problems
● Cannibalize your
success with new
breakthroughs and
extensions
Core
Processes
● End-to-end order
fulfillement and
supply chain
● Invention
● Product development
● Market exploitation
● Customer acquisition
● Invention
and development
● Product development
● Solution development
● Market exploitation
● CRM processes
Improvement
Levers
● Fulfillemt process
redesign
● Continuous
Improvement
● Product technology
● R&D cycle time
● Product lifecycle mgt
● Problem expertise
● Product technology
● Service customization ● R&D cycle time
● Relationships
● Proprietary solutions
Major
Improvement
Challenges
● Shifting to a new
asset base
● Shift to new products
● Jumping to new
technology
● Change in the solution
paradigm
Value
Proposition
● Jumping to new
technology
● Standardization
Adapted from: Treacy and Wiersema
30
Low Cost
Niche Market
Source: Michael E. Porter
31
Mission, Vision, BHAGs,
Core Ideology
Financial Capital
key positions/skills
education/train
Knowledge mgt
teams
change management
capital asset mgmt
risk mgmt
fiduciary controls
budget controls
financial planning
Process mgmt
Systems mgmt
Knowledge mgmt
Database mgmt
Network mgmt
32
Mission, Vision, BHAGs,
Core Ideology
Financial Capital
key positions/skills
education/train
Knowledge mgt
teams
change management
capital asset mgmt
risk mgmt
fiduciary controls
budget controls
financial planning
Process mgmt
Systems mgmt
Knowledge mgmt
Database mgmt
Network mgmt
33
So…What do we have so far?
1.
2.
3.
4.
5.
6.
7.
8.
9.
Market Needs
Competitive Analysis
OTWS (aka SWOT)
Mission
Vision
Strategic Imperatives (BHAGs)
Core Values
Financial Value proposition
Customer Value Proposition
34
2013 Sloan Strategic Planning Process
Core
Ideology
Discovery
Value
Plan
Strategic Goals
Realization
17.0
4.0
2.0
18.0
Market
Needs
Mission
(Purpose)
Financial
Value
Proposition
5.0
3.0
21.0
8.0
10.0
Competitive
Analysis
Vision
Strategic
Imperatives
Develop Strategic WIGs
& Key Initiatives
Communication,
Review,
Feedback
6.0
1.0
SWOT
Core
Values
What can we
discover about
the market, the
competition, and
ourselves?
What is our vision
of today and of the
future? What do
we value?
Reconcilation
Budget
Process
17.0-N
Employee
Performance
Management
Process
7.0
Customer
Value
Proposition
& Discipline
What must we
achieve over the
next 5 years?
Note: This is an example of a strategic planning process
To achieve our
vision, what must
we deliver to our
customers and
stakeholders?
Part 5
What is wildly important this
year? How shall we achieve
our financial and customer
goals?
35
How does the strategic
plan reconcile with the
budget? How can we
communicate the strategic
plan? How can we align
the WIGs and initiatives
to employee action?
Focus on the Wildly Important
In addition to the whirlwind . . .
2-3
4-10
11-20
2-3
1-2
0
“The Law of Diminishing Return”
Source: FranklinCovey 4DX
36
A WIG is a goal that
makes all the difference.
Failure to achieve this goal
renders any other
achievements secondary as
it relates to the long term
well-being of the
organization.
Source: Rick Spencer (Franklin Covey)
37
Besides the whirlwind,
what are you absolutely
going to do?
and…
What are you absolutely
going to stop doing?
38
Compelling Vision
“What”
Strategic Imperatives
“What”
• What does our
organization look
like in 5 years?
• How big?
• What are we
famous for?
• Why does anyone
care about what we
do?
• How do our people
feel about being part
of our organization?
Values
Daily Operations
“Whirlwind”
Strategy Execution
“Operating System”
• How should we behave
while executing on our
goals.
The Day Job
Wildly Important Goals
(War & Battles)
Source: FranklinCovey 4DX
39
Continuous
Improvement
Daily Operations
“Whirlwind”
Whirlwind To-Do List:
1.
This is important
2.
So it is
3.
So is this, but…
4.
So is this but…
5.
This is important
6.
So is this
7.
So is this…
8.
Not as important as…
Source: FranklinCovey 4DX
Transformational
Change
Strategy Execution
“Operating System”
Strategic War Plan
40
Transformational
Change
WAR
Grow Profits from X to Y
by 12/31/2013
BATTLE A
Lower COGS from X to Y
by 12/31/2013
OTC Proc. Team WIG
Grow throughput from X
to Y by 12/31/2013
Machining WIG
Reduce scrap from X
to Y by 12/31/2013
Mfg Eng WIG
Reduce setup from X
to Y by 12/31/2013
STP Mat. Team WIG
Reduce material costs
from X to Y by
12/31/2013
BATTLE B
Grow gross margin from X
to Y by 12/31/2013
OTC Proc. Team WIG
Increase productivity
from X to Y by
12/31/2013
OTC = Order-to-Cash Process
STP = Source-to-Pay Process
Inspired by : FranklinCovey 4DX
41
Wheels of Competitive Strategy
1980
Mfg
2007
Finance
Other
Sales
Goals
Strategy
Objectives
Engineering
Demand Generation
Process
Mktg
Service
HR
1980 Source: Michael E. Porter (Competitive Strategy)
2007 Source: T. Coleman
Customer
Support
Process
Sloan
Strategy
and
Goals
New Product
Development
Process
42
Order
To
Cash
Process
Sample Old Functions Vs Processes
Marketing
Sales
Tech Support
Mat Mgt
Mfg
QA
Research
Strategic Planning
Demand Generation
Order Acquisition
Order-to-Cash
New Product Development
Cust Support
Source-to-Pay
Information Technology (IT)
Finance
Human Resources (HR)
43
Des Eng
New Functions Vs Processes
Business Development
Product Development
Supply Chain & Ops
Strategic Planning
Demand Generation
Order Acquisition
Order-to-Cash
Product Development & Lifecycle Mgt (Domain Divided)
Cust Support
Procure-to-Pay
Information Technology & Process Mgt
Financial Capital Mgt
Human Resource Mgt (HR)
44
APQC Process Classification
Framework
Source: APQC
45
Sloan Enterprise Process Model
Master
Governance
Process
Governance
Processes
Core
Processes
Enabling
Processes
(many more)
SPP
Strategic Planning Process
EPM/OCM
Employee
Perf. Mgt. &
Org. Chg.
Mgt Process
BPM
Business
Process
Mgt Process
AOP
Annual
Oper Plan
Process
QAP
Quality
Assurance
Process
S&OP
Sales & Oper
Planning
Process
DGP
Demand
Generation
Process
OAP
Order
Acquisition
Process
OTC
Order-to-Cash
Process
CSP
Customer
Support
Process
NPD
New Product
Development
Process
MDM
Master
Data
Mgt Process
ECM
Engineering
Change
Mgt Process
PCM
Shop Process
Change
Mgt Process
STP
Source-to-Pay
Process
HCM
Human
Capital
Processes
46
Mission, Vision, BHAGs,
Core Ideology
Where do strategic goals
Flow to? PROCESSES!
Financial Capital
key positions/skills
education/train
Knowledge mgt
teams
change management
capital asset mgmt
risk mgmt
fiduciary controls
budget controls
financial planning
Process mgmt
Systems mgmt
Knowledge mgmt
Database mgmt
Network mgmt
47
Strategic
Theme
Customer Solutions Theme (EPO= J. Aykroyd)
Sloan Vision and Mission
Productivity Strategy
Improve Cost
Structure
Increase Asset
Utilization
Revenue Growth
Enhance Cust
Value
Expand Rev
Opportunities
Financial
Improve S&M
portion of
SG&A
Improve
DSO
Terms
Analysis
Customer
Improve
Receivables
Improve or
eliminate VAC
Service
S&M
Inventory
Improvement
Marketing
cost Improve
Product
Portfolio
Analysis &
Rationalization
To SCM
Theme
Time
Partnership
Improve
Sales Revenue
Improve NPDI
Idea Mgt
Sub Processes
Reengineer
Customer
Support
Process
(CSP)
Order
Acquision
Process Has
Clean Orders
Process
Brand
Implement Mkt
Needs &
Competitive
Analysis
Processes
-N
Mkt Needs
Custom
Solutions
To NPDI
Process
Reengineer
Order
Acquisition
Process
(OAP)
Resource
Restructure
S&M
Assign and
train SCM
and Finance
analyst
2008 Sloan Strategic Planning Cycle
Build IT's BI
Support
Implement IP
Telephony
(VoIP)
Implement
SAP CIC (IC)
Develop call
Centers
Implem CRM
Sales Lead
Mgt System
Launch BPR
Team for OAP
Marketing
Initiative
48
Explore nontraditional
ways to
increase brand
awareness &
perception
-N
Reengineer
Customer
Communication
Process
(CCP)
Assign BPR
Team for CCP
Sloan Business Process Mgt.
(Process Lifecycle Mgt.)
Engage
Improvement
Program
Yes
Perform
and Improve
the Process
Measure
Performance
and
Understand
Needs
Does
Process
Meet
Strategic
Goals?
No
Set Targets;
Understand Nature
of Perf Gap;
Develop
Intervention Plan
Strategic
Planning
Process
LEVEL 0
DIAGRAM
VERSION
Version: April 7, 2008
Decide
Approach
to
Change
Re-Design
Process
49
LEVEL 1
DIAGRAM
Sloan Business Process Redesign Process
From
BPM
Process
To
BPM
Process
Gate 6
Gate 2
Gate 1
Gate 3
Gate 4
Gate 5
1.0
2.0
3.0
4.0
5.0
Stage 1
Mobilization
Stage 2
Diagnosis
Stage 3
Design
Stage 4
Development
Stage 5
Implementation
Mobilization
Deliverables
Team Education
Scope and Boundary
Statement
Vision Statement
Mission Statement
Goal List
Problem Statement
Stakeholder List
Communication Plan
Proposed project plan
Review with EPO/CPO
Diagnosis
Deliverables
As-Is map
Benchmark Summary
Industry Trends
Gap Analysis
Barrier list
Critical Success
Factors
Improvement Priorities
Momentum for change
Updated project plan
Review with EPO/CPO
Design
Deliverables
List of Brainstorm
Results
To-Be Design
Business Case
Updated project plan
To-Be Design Preview
with EPO CPO
Development
Deliverables
Job Descriptions
Org changes
Process Prototype
Policy Statement
Procedures
Test Results
Training Scripts
Updated project plan
Development Preview
with EPO & CPO
Implementation
Deliverables
Production System
Installed
Process Education
Delivered
System Training
Performed
Initial Process
Performance
Assessment
Review with EPO/CPO
Version: April 7, 2008
50
6.0
Stage 6
Post Implement
Post-Implementation
Deliverables
Process
Measurements
Lessons Learned
Action Plans
Post Implementation
Preview with EPO &
CPO
Strategic Levers of Transformation
•
•
•
•
•
•
•
•
•
•
•
Integrated with Sloan’s Strategic Plan
Process Redesign as well as Improvement
Policies, Rules, Procedures
Computing & Technology
Organization Structure
Change Management
Roles & Job Changes
Paradigm Shifts
Communications
Knowledge
Facilities
51
Sample Methodology for Problem
Solving and Improvement
From
PLMP
Process
Define
Problem
Measure
Problem
Analyze
Problem
Improve
DMAIC
LEVEL 1
DIAGRAM
VERSION
Note: There are many types of CI methods. DMAIC
Is only one of the many methods in the toolkit that
should be used depending on the objective and tool
52
Needed for change.
Control
Sample Enterprise “Toolkit”
Need a recipe???
53
BPM is a management
discipline that treats Processes as
assets that directly drive
enterprise performance through
(1) operational excellence, (2)
business agility, and (3) strategic
differentiation.
54
Mission, Vision, BHAGs,
Core Ideology
Financial Capital
key positions/skills
education/train
Knowledge mgt
teams
change management
capital asset mgmt
risk mgmt
fiduciary controls
budget controls
financial planning
Process mgmt
Systems mgmt
Knowledge mgmt
Database mgmt
Network mgmt
55
“The hardest part of succeeding in
the age of Process is not technical in
nature; it revolves around people and
organizational change.”
Source: Michael Hammer
56
57
CM Tools Vs. Phases of Change
Source: Prosci
58
A word about HR…
• Benefits, onboarding, functional OD, and related HR work is
important but may do little to help the organization with
transformation
• An HR organization can gain high credibility by linking HCM to
both functions & process work
• HR is usually knowledgeable about what’s possible regarding
human capability
• Often HR and IT are the only functions that see operationally
across the entire enterprise
• The true value of HR is proportional to how they enable
human beings and process teams to support the value
proposition
59
Mission, Vision, BHAGs,
Core Ideology
Financial Capital
key positions/skills
education/train
Knowledge mgt
teams
change management
capital asset mgmt
risk mgmt
fiduciary controls
budget controls
financial planning
Process mgmt
Systems mgmt
Knowledge mgmt
Database mgmt
Network mgmt
60
Labor is the single biggest operating
expense in most businesses
IT Contribution
U.S. Bureau of Labor Statistics – 2000 to 2010
61
A word about IT…
• There is a strong correlation between companies that view IT
as a strategic enabler and those that outperform their
competition financially
• An IT organization can gain high credibility by substituting
“technology” with “Process” as THE major discussion point
• IT is usually knowledgeable about what’s possible
• Often IT is the only function that sees operationally across the
entire enterprise (add HR to the mix)
• The true value of IT is proportional to how integrated
company systems are to core processes
• Core processes must support of the value proposition and
strategic differentiation
• IT must consider becoming “BT”
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2013 Sloan Strategic Planning Process
Core
Ideology
Discovery
Value
Plan
Strategic Goals
Realization
17.0
4.0
2.0
18.0
Market
Needs
Mission
(Purpose)
Financial
Value
Proposition
5.0
3.0
21.0
8.0
10.0
Competitive
Analysis
Vision
Strategic
Imperatives
Develop Strategic WIGs
& Key Initiatives
Communication,
Review,
Feedback
6.0
1.0
SWOT
Core
Values
What can we
discover about
the market, the
competition, and
ourselves?
What is our vision
of today and of the
future? What do
we value?
Reconcilation
Budget
Process
17.0-N
Employee
Performance
Management
Process
7.0
Customer
Value
Proposition
& Discipline
What must we
achieve over the
next 5 years?
Note 1 : This is an example of a strategic planning process
To achieve our
vision, what must
we deliver to our
customers and
stakeholders?
What is wildly important this
year? How shall we achieve
our financial and customer
goals?
Note 2: WIG = Wildly Important Goal
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How does the strategic
plan reconcile with the
budget? How can we
communicate the strategic
plan? How can we align
the WIGs and initiatives
to employee action?
Conclusion
• Companies must take an end-to-end, holistic
view of their strategy
• Corporate Strategy is a governance process
• Corporate Strategy is not the same as Business
or Marketing Strategy
• The strategy framework must tie core ideology
to the value prop, core processes, Human
Capital Management, Information Capital
Management, and Corporate Culture
• Improvement ≠ Transformation
64
Any questions?

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