Strategy-P1

According to Jack Welch [Winning]

“Its all in the sauce!”

By: PMS Team

 Contents
1. Introduction – Welch’s perspective on strategy,
2. 3 key proven steps in strategy development,
3. When to change strategy and how to keep it up to date,
4. Who’s involved in its development,
5. The exercise with the 5 slides
6. Summary
 Introduction

• …..“I have listened to their presentations in

disbelief” ….. As in some kind of high-brain scientific methodology
• I know that strategy is a living, breathing, totally dynamic
game.
• It’s fun—and fast. And it’s alive.

• In real life, strategy is very straightforward. You pick a

general direction and implement like hell.
 … Definition

- It is an approximate course of action that you frequently

revisit and redefine, according to shifting market
conditions.
- It is an iterative process and not nearly as theoretical or
life-and-death as some would have you believe.
- Despite size, I wanted it to operate with the speed,
informality, and open communication of a corner store.
 3 key steps proven across countries & industries

• First, come up with a big aha for your business—a smart, realistic,
relatively fast way to gain sustainable competitive advantage.
• Use the five slides
• Use a group of informed people to reflect on it –between a couple
of days and a month
• Second, put the right people in the right jobs to drive the big aha
forward - strategy and skill fit to get the bang in profit!

• Third, relentlessly seek out the best practices to achieve your big aha,
whether inside or out, adapt them, and continually improve them –
learning organization! ኩረጃ!
 … corner store

• Upper Crust Pizza- …No good service!.. But the pizza is to die for

• At Upper Crust, strategy is all about product

• Gary Drug - …. Its selection ranges from cold remedies to alarm

clocks, with tweezers and pencil sharpeners mixed in

• At Gary Drug, strategy is all about service

 When to change it

• Now, in such changing times, how and why did GE stick with one strategy over
twenty years?
• If they’re headed in the right direction and are broad enough, strategy don’t
really need to change all that often especially if they are supplemented with
fresh initiatives.
• To that end, over the years, we launched four programs to bolster our
strategy—globalization, service add-ons, Six Sigma, and e-business
• 2 powerful principles: for GE, commoditization is evil, and people are
everything!
 Who’s is involved?

• While others may disagree, I know that strategy is the job of the CEO or the
unit leader, along with his or her direct reports.
• If the culture is healthy, they can see the organization in all its various,
interdependent parts.
• They know its people, its sources of ideas and innovation, and can best
determine where the most exciting opportunities lie.
• They are the ones who will ultimately commit the resources the strategy
requires.
• They get the plaudits if the strategy succeeds and hold the bag if it fails.
• If you have a good team—candid, insightful, passionate about the business,
and willing to disagree—completing this exercise should be fun and
energizing. With intensity, it should take somewhere between a couple of days
and a month. After that, it’s time to act.
 The 5
Exercises
 1. What the Playing Field Looks Like Now

• Who are the competitors in this business, large and small, new and old?
• Who has what share, globally and in each market? Where do we fit in?
• What are the characteristics of this business? Is it commodity or high value or
somewhere in between? Is it long cycle or short? Where is it on the growth
curve? What are the drivers of profitability?
• What are the strengths and weaknesses of each competitor? How good are
their products? How much does each one spend on R & D? How big is each
sales force? How performance-driven is each culture?
• Who are this business’s main customers, and how do they buy?
 2. What the Competition Has Been Up To

• What has each competitor done in the past year to change the playing
field?
• Has anyone introduced game-changing new products, new
technologies, or a new distribution channel?
• Are there any new entrants, and what have they been up to in the past
year?

• Be granular—know what each competitor eats for breakfast

 3. What You’ve Been Up To

• What have you done in the past year to change the competitive
playing field?
• Have you bought a company, introduced a new product, stolen a
competitor’s key salesperson, or licensed a new technology from a
start-up?
• Have you lost any competitive advantages that you once had—a
great salesperson, a special product, a proprietary technology?
 Compare!

• Compare Slide #2 and #3

• The reality hits you between the eyes!
 4. What’s Around the Corner?

■ What scares you most in the year ahead—what one or two things
could a competitor do to nail you?
■ What new products or technologies could your competitors launch
that might change the game?
■ What M & A deals would knock you off your feet?
 5. What’s Your Winning Move?

• What can you do to change the playing field—is it an

acquisition, a new product, globalization?
• What can you do to make customers stick to you more than
ever before and more than to anyone else?
 Summary meanings

• What is strategy but resource allocation!

• Strategy means making clear-cut choices about how to compete
• You cannot be everything to everybody, no matter what the size of your
business or how deep its pockets.
• “Be No. 1 or No. 2 in every market, and fix, sell, or close to get there.”
• More than anything else, the No. 1 or No. 2 initiative was a communication tool
to clean up our portfolio, and it really worked.
• Our strategy was much more directional!
 Summary- Overview of Strategy Crafting,
Execution and Evaluation Process

•SWOT / Enablers &

Challenges • Customer/ •Customer
•Mission Value
•Environmental Stakehold
•Vision Proposition
Assessment er
•Core Values
•Foresight/Scenarios Needs

Discovery

•Perspectives
•Strategic Themes
& Results (Goals)

Strategic Objectives Strategy Map

KPIs Strategic Initiatives

 Strategizing the Home Front

• Mission: Creating Healthy,

financially independent family S W
Well disciplined, Aware of Unbalanced work life,
the necessary requirements Communication gap
• Vision: A family living in the for healthy living

sub-urbs having a stable

O T
source of income by 2030 Social welfare programs Rapidly growing
growing, urbanization, growing
inflation
• Core Values: Dedication to
work, Loving all, Learning with
courage
 … Strategizing the Home Front

Additional Analysis

Husband: Weak health status and requires Employer: requires timely delivery of
appropriate and timely meal assignments; reduce cost
Wife: Healthy, requires investments to provide Government: requires collection of more tax
healthy meals on time, dedication from all Community: Presence and active participation
family members to eat timely both in finance and time
Offsprings: requires investment on education,
health
Pillars @ Home Front
 Objectives & Measures

Objectives

Husband: Grow financial sources, attend all meals timely, extra activity in sport, balanced
work-life, attend social events
Wife: Wise investment of finance in health, living standard
Offsprings: Be among the top 15 student in their class, attend all meals timely, extra activities
in sport
Measures

Add two income streams, number of meals attended, Number of hours spend in sport per
week, Reduce office hours by 5%, attend one social event per month, ETB500K saving per
year for investment in housing, reduce family doctors’ visit by 10%, 2 hours study time per
day, percent of meals provided on time
What problem did you spot in the objectives & M?
Serving to Empower You!