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Strategic Planning Foundations
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Introduction
Strategic planning(Viewed)
Introduction - Strategic planning
How to ...
Set destination
Articulate a vision & a mission for where you want to be
Focus & prioritize efforts on highest value intiatives to drive your goals
Allocate resources apporiately to ensure initiatives make wanted progress
Against ...
Limited resources
Competitve environment
Mod 1. Before You Begin Planning
Understanding the principles of strategic Planning
Strategic plan defines ...
what you stand for
market you compete
how you compete
goals & initiatives to achieve the goals
Strategic plan helps to ...
allocate limit resources
Why do strategic planning?
1. provide FOCUS to effprts and limited investments
2. Enthusiasm
3. Plan for risks & Exploit opportunities
3 principles of strategic planning
1. Clear Direction & Stay in your lane
2. No distractions
3. Diverse Investments: initiatives across different time horizons, markets, products
Avoiding major strategic planning risks
Strategic planning is too expensive not to be acted on and followed
Warning signs of flawed strategic planning
1. Too many/big initialtives
2. Too small initiatives to make progress to achive the goals
3. Too big initiatives that require everything to line up perfectly (unlikely bet)
4. Depend only on known business / starve your future by ignoring small initiatives
5. Random initiative generator
Strategic planning process: Overview
Tools & Steps to follow
1. Set direction & stay in the lane
articulate: vision, mission, goals
2. Define core competencies
What are you great at?
How are you going to compete in the market?
3. Define strategic filters
Objective functions to achieve
Evaluation criteria to pursue initiatives or NOT
4. Stay focus with tools like 2 x 2 matrix to determine which opertunities to pursue / avoid
5. Ientify top initiatives and ONLY work on the top ones for which you have resources
6. Diversified portfolio of initiatives
7. Execution
Long term / Short term
Balanced across products / markets / services
Evolve profolio over time
Strategic planning process: Tactical needs
Typical cadence of planning
1. (individual) pre-work
2. (team) vision, mission, principles
3. (individual) evaluate initiative
4. (team) Prioritization
5. (individual) Deep analysis
6. (team) Final Planning & Resource allocation
Outcome: a strategic plan in documentation that contains ...
1. Core competencies
2. Prioritized list
3. Implementation & sequencing plan (which initiatives, when, what resource to allocate)
Mod 2. Defining the Strategic Environment
Assessing the market
Porter's 5 forces
1. Rivalry among Competitors
How many competitors are in the marketplace?
How do they behave?
How are they distributed by market share?
How do they go to market?
What are their core competencies?
2. Threat of new entries
How much does it take to enter the market?
3. Threat of Substitution
What other products can meet your customers' needs?
- understand what customers are buying, not necessary what you are selling
4. Buyer Power
Are you the big player or your customer?
5. Supplier Power
Providers of raw materials or inputs to your business
Q: where are the major threats? Where are the opportunities?
Conducting a SWOT analysis - assess the env you are competing in
SWOT analysis:
Strengths | Weaknesses
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Opportunities | Threats
Strength & Weakness (w/in org)
Opportunities & Threats (internal / external)
Extracting insights from a SWOT analysis
1. Eliminate items that aren't major strategic themes
2. Identify major contributors under each categories
3. Synthesize different / possible themes
Themes will ...
feed into initiatives
prioritize items
Mod 3. Setting Your Strategic Direction
Defining the direction
4 elements of setting direction
1. mission - what is your purpose? why do you exist?
2. vision - if we fulfill our purpose, what does the future look like?
3. guiding principles - how will we behave / make decision without specific directions?
4. goals - quantified measurable ideal state (hard number at specific time)
Pitfalls:
1. vision / mission statements are way too long - should be short, clear, NO buzzword
2. guiding principles need to clear enough for everyone to understand, apply to any action
3. goals should agressive (to fill the gap) but pragmatic (doable)
Direction should make it clear to everyone where we want to be in the future
Creating a mission statement
Defining the organizational vision
Refining the mission and vision
Guiding principles and goals
Mod 4. Determining How You'll Compete
Core competencies: Starbucks example(In progress)
Focusing with core competencies
Mod 5. Evaluating and Prioritizing Opportunities
Understanding strategic filters
Creating strategic filters
Applying strategic filters
Comparing and prioritizing initiatives
Conducting deep analysis of high priority ideas
Initiative prioritization: Drawing the line
Mod 6. Assessing Your Initiative Portfolio
Applying the 2x2 matrix
Creating multiple diversification views
Assessing initiatives over time
Mod 7. Organizing for Success
Planning resources
Accountability
The ongoing prioritization process
Running the strategic planning process
Conclusion
Strategic planning pitfalls
Next steps