QUAL8320-W22

Module 5 – Strategy Development and Deployment

What is Strategy
Strategy Development Models :

 Traditional Strategic Planning

Typically, 3 Levels:

1) Strategic: What an organization strives to become and means to achieve it.

2) Tactical: How the organization will implement the strategic plan.
3) Operational: Also known as action plan. Day to day action-oriented plans concerned
with the details of who performs what tasks and within what time frame.
 Hoshin Kanri Method:
The Japanese word Hoshin means “direction” or “compass needle.” Kanri means “control”
or “management.” This reflects the intention of the technique to let the strategic goals of
the organization guide every decision and action. The Hoshin Kanri method is utilized to get
everyone aligned and working toward the same strategic goals.

Steps:
• Creating a Vision statement
“to create the most compelling car company of the 21st century by driving the world’s
transition to electric vehicles.” Tesla Inc.’s
The reason for the vision statement is to express what the organization would like to
accomplish and/or where it would like to be in the future. A vision statement should be
brief, inspiring and challenging. It should also appeal to all stakeholders and provide
direction for the future.

• Develop Guiding Principles or Values

Guiding principles or values help establish and define the organization culture and form the
basis for decision making. Example, customer focused, innovative, ethical etc. These
principles or values are the fundamental beliefs that guide action plans.
• Defining the Mission
“serve consumers through online and physical stores and focus on selection, price, and
convenience.” Amazon Inc.
The mission defines the core purpose of the organization in terms of the accomplishments
needed that will result in a realization of the vision.

• Establishing Strategic Goals

With the Vision and Mission in mind, establish precise and concise strategic organizational
goals. Example, Increase customer satisfaction, Decrease product returns, Reduce response
time to complaints, improve product quality etc.
• Setting Multiyear Strategic Objectives
Based on the Goals established, strategic and measurable objectives are then defined.
Follow the S.M.A.R.T. W.A.Y. guidelines when selecting these objectives as shown here:
• Creating a Top-Level Means Matrix

(Months)

Mean #1 CS ACC Resource #1 Feedback #1

Mean #2 ENG Resource #2 Feedback #2

Mean #3 H&S ENG Resource #3 Feedback #3

This Mean is directly related to this Objective This Mean is partially related to this Objective

Blank = This Mean is not related to this Objective P = Primary, S = Secondary

CS = Customer Service, ACC = Accounts
ENG = Engineering, H&S = Health & Safety
• Deploying the Plan
The plans move in an iterative way i.e., repetition with changes and improvements, if
necessary. For example, up and down (vertically) and across organizational functions until
consensus is reached. A process sometimes referred to as “catch ball”.

• Preparing Action Plans

Action plans are developed for each means by the individuals or teams responsible for
executing the plans. There may be several action plans for each means. The action plans are
implemented, continuously monitored, and reviewed.

• Transitioning to the next year’s Planning

By the end of the third quarter in the planning and implementation process, Hoshin Kanri
planning begins anew for the upcoming year. Results of the first year’s implementation
become additional information, part of the environmental assessment, for the following
year. All goals, objectives, and means are carefully reviewed, and adjustments proposed as
needed. Typically, some action plans will not have worked out as planned, perhaps leaving
work to be carried over to the next year. Some objectives and some of the means
supporting those objectives may either be no longer valid, require additional resources to
complete, or be postponed to make room for a new or higher-priority activity.
Strategy Development Tool:

 SWOT (Strengths, Weaknesses, Opportunities, Treats) Analysis

A common tool in the strategic planning process involves looking at both current internal
strengths and weaknesses of the organization’s operations, as well as future opportunities
and threats in the external marketplace. A SWOT analysis is a systematic assessment of an
organization’s internal and external environment and identifies attributes that affect its
ability to achieve its vision and to improve and protect its competitive position. A SWOT
analysis looks at how the organization measures up to the current reality. Following are
some of the factors that are looked at in a SWOT analysis.

Strengths and Weaknesses (focused on internal environment) may include:

• How strong is the organization’s image and/or name/brand in the marketplace?
• How strong (stable, effective, flexible) is the organization’s leadership?
• How effective is the organizational structure?
• How stable is the current and future financial strength of the organization?
• How do features and costs of products/services compare to competitors, and what
stage are products/services in their probable life cycle?
• Is the organization well focused on a clearly defined vital few issues, or are efforts
widely dispersed?
• How innovative is the organization? What is the track record of new
products/services? Is there strong Research & Development?
• How effective are the organization’s efforts toward continual improvement?
• What is the condition (e.g., age, flexibility, capacity) of major assets (e.g., key
employees, technology, facilities etc.), and how does that impact the sustainability of
the organization?
• What additional resources does the organization have available (e.g., employees,
stakeholders, capital) to enable change?

Depending on the answers to the above questions, the action might be to build on the
strengths and address the weaknesses. In addressing the deficiencies, there are several
options:
• Remove the deficiency by changing the goal or objective to make fulfillment achievable.
• Invest more in the people, technology, physical assets, improvement efforts, and so on,
to be able to turn the deficiency into a strength.
• Outsource parts of or the entire process to another organization that can fulfill the
process requirements more effectively.
• Sell the part of the business that causes the present deficiency.
Opportunities and Threats (focused on external environment) may include:
• What viable markets are not currently being served?
• How saturated is the marketplace?
• How are demographics or values changing in the marketplace?
• Are customer/supplier partnerships or alliances effective for the organization?

• What new competitors or products may enter the marketplace?

• What new accreditation, legal, or regulatory issues/requirements might arise?
• Does the likely future economic situation pose risks or potential rewards?
SWOT Analysis Example:
Timbuk2 Plastics, recycles plastic waste into commercially viable products, using
environmentally-friendly methods.
The company wants to capitalize on one of the recycling industry’s highest-growth products
- polyethylene terephthalate (“PET”), which is found in post-consumer beverage and water
bottles - by establishing the first PET recycling plant in Western United States. The recycled
material from the PET plant will then be channeled into a brand-new Plastics Packaging
Division, where extruded sheet plastic will be produced and sold to various domestic
manufacturers.
Findings/Recommendations from SWOT Analysis:
Timbuk2 Plastics need to investigate its options for obtaining capital. Funding a new
venture can take time, and because it’s step one of the long road to revenue - they must
secure funding before they begin construction, and they must complete construction
before they can begin revenue-generating recycling operations and packaging material
production - time is of the essence.
Luckily, they have already written their business plan, which is often required by
prospective lenders and investors.
Timbuk2 Plastics may want to consider adding a Research and Development team, to
investigate new product possibilities and keep the company’s operations well prepared for
any changes in state or federal environmental regulations.
SWOT analysis should be based on objective (factual) data that review critical events from
the past, the present, and the probable future in making comparisons with the
marketplace, competitors, products and services, and company performance.
Analysis of the information will typically be reviewed for items that provide significant
advantages or risks. These should be addressed by strategy, as well as the relative ratio of
advantages to risks, which may impact the aggressiveness of the strategy plan. Items
affecting the firm’s critical success factors must also be reviewed in detail.
A SWOT analysis can be done at any time, but it is essential in developing the data needed
for strategic planning. Also, there is no reason to prevent a critical discovery from the
analysis, immediately being turned into an action plan - even before the strategic planning
process is complete.
It is vitally important that future initiatives be aligned with findings of the SWOT analysis.
Success of previous strategic initiatives should be assessed to determine whether the
desired outcomes were achieved. Success or failure may be a function of the method of
deployment (for example, process reengineering) or may indicate an issue that will only be
resolved through long-term and consistent action (for example, organization culture
change).
SWOT Analysis