Developing vision, mission, shared values, motto, objectives, critical success factors, Key Performance Indicators, as well as using veritable tools for scanning the environment in order to craft effective strategy while evolving workable strategic road map
2. Learning Objectives
At the end of this course, participants should be able to
do the following:
Craft appropriate vision and mission statements, as
well as shared values and motto
Establish clearly structured objectives
Identify the right tools for conducting environmental
scanning
Identify suitable strategies for repositioning a firm
Establish a feasible strategic road map for a firm
3. “If we could first know where we are, then
wither we are tending, we could then
decide what to do and how to do it.”
- Abraham Lincoln
4. “Strategic planning is the process that comprises
the procedures of defining objectives and
creating strategies to attain those objectives.”
- Qadar Baloch & Maria Inam, Strategic Thinking: Catalyst to Competitive Advantage
5. “The strategic planning process helps an
organisation clarify, consolidate or establish
its strategic framework. Embedded in the
strategic framework are the values and vision
of the organisation.”
- Janet Shapiro, Strategic Planning Toolkit
6. Strategic Plan is the outcome of Strategic
Planning Process and serves as
Organisational Road Map for leading a
firm from current to desired future state.
7. Strategic Plan
A strategic plan maps out the short and long
range performance targets and necessary
action points of management for achievement
of outcomes.
It consists of a vision, mission strategic and
financial objectives, in addition to
comprehensive strategy for accomplishing the
objectives.
8. The Strategic Planning Process
Develop Vision,
Mission, Shared
Values, Motto,
Goals and
Objectives
Strategy
Implementation
Crafting
Strategy
Environmental
Scanning
Evaluation and
Control
9. Developing Vision and Mission
Think strategically about the organisation’s
future in 5 to 10 years.
Build a sense of purpose
Resolve the firm’s identity
Ascertain who we are, what we do, and where
we are going to.
10. “Vision is the art of seeing things invisible.”
- Jonathan Swift
11. Vision
This is the greatest aspiration of a firm, which
shows what it intends to be.
It stands for a view of supposed or assumed
destiny that signifies a Big Hairy Audacious
Goal.
12. Mission
It describes a firm in terms of its business,
showing the purpose of its existence, and
serves as a means of inspiration to the top
management and other employees.
13. Vision Statement Versus Mission
Statement
Vision towers as instrument of guidance for a
firm over long period, while mission may
change after periodic attainment. Therefore,
mission statements are timely hurdles that
need to be attained in order to advance
towards the timeless target expressed by the
vision.
14. Example of Vision/ Mission (Sony)
Vision: Become the company most known for
changing the worldwide poor quality image of
Japanese products.
Mission: To experience the joy of advancing and
applying technology for the benefit of the
public.
15. Example of Vision/ Mission
(Volvo Car Corporation)
Vision: To be the world’s most desired and
successful premium car brand.
Mission: We create the safest most exciting car
experience for modern families.
16. Example of Vision/ Mission
(Pfizer)
Vision: At Pfizer, we're inspired by a single goal: your
health. That's why we're dedicated to developing new,
safe medicines to prevent and treat the world's most
serious diseases. And why we are making them available
to the people who need them most. We believe that
from progress comes hope and the promise of a
healthier world.
Mission: We will become the world's most valued company
to patients, customers, colleagues, investors, business
partners, and the communities where we work and live.
17. Example of Vision/ Mission
(Avon Products)
Vision: To be the company that best understands and
satisfies the product, service and self-fulfillment
needs of women - globally.
Mission: We will build a unique portfolio of Beauty and
related brands, striving to surpass our competitors in
quality, innovation and value, and elevating our
image to become the Beauty company most women
turn to worldwide.
18. Benefits of Communicating Vision/Mission
Inspire, challenge and motivate workforce
Arouse strong sense of organisational
purpose, and induce employee buy-in
Fosters unity of purpose in the firm
Influences adherence to pragmatic
organisational culture
19. Shared Values
These are acceptations of a firm and its people
pertaining to the right way to act in relation to
people, situations and other things.
They represent acceptable behaviour in an
organisation, and determine standard
organisational culture, business philosophy
and leadership principles therein.
They provide driving force for evolution of
corporate character and serve as compass for
code of ethics.
20. Shared Values in Practice
Shared values should be linked to vision and
mission, thereby providing enabling platform for
accomplishment.
Shared values of a firm should be accepted,
imbibed and practiced so as not to become a
dead-print.
Albeit, the shared values of Enron were respect,
integrity, communication and excellence, it sank
due to disregard and malpractice by top
management.
21. Example of Shared Values
(Molson Coors Brewing Company)
1. Integrity and Respect
2. Quality
3. Excelling
4. Creativity
5. Passion
22. Example of Shared Values
(Fuji Xerox)
1. Customer Satisfaction
2. Environmental Consciousness
3. High Ethical Standards
4. Scientific Thinking
5. Professionalism
6. Team Spirit
7. Cultural Diversity
8. Trust and Consideration
9. Joy and Fulfillment
10. Adventurous/ Pioneer Spirit
23. Motto
This is also known as a Slogan.
It should be a brief and impressive phrase or
sentence which is used for projecting a firm’s
identity and indicating its character.
This aids effective branding, customer
experience management, differentiation of
character and evolution of shared values.
24. Example of Motto
(Boeing)
Forever New Frontiers
Example of Motto
(Google)
Google is the closest thing the web has to an
ultimate answer machine
28. Criteria For Setting Objectives
• Objectives should further the purpose and strategic aims of the organisation.
• They should also conform to the organization's values and policies.
• Objectives should be realistic in the circumstances.
• Their achievement (or otherwise) should also be measurable (in terms of
time, quantity, quality, cost or a relevant ratio).
• Objectives should preferably be set by agreement, so that those responsible
for carrying them out have some ‘ownership’ of them.
• Objectives should set clear and challenging targets for individuals.
• Objectives should be open to adaptation in the light of changing
circumstances, especially where these are unforeseen.
• Groups of objectives set for individuals, or groups, should not be in conflict
with each other, but should serve a common purpose and direction.
Source: G.A. Cole, Strategic Management
29. Setting Objectives
The rationale for setting objectives:
• Convert goals/ mission to performance targets
• Establish yardsticks to track performance
• Establish stretched targets
• Enable the firm to be resourceful, purposeful
and focused
• Avoid internal confusion
• Keep away from complacency and vagueness
30. Clearly Structured Objective
A clearly structured objective highlights critical
success factors for its achievement, key
performance indicators, and target.
CSF ObjectiveKPI Target
+ + =
31. “Critical Success Factors are the limited number
of areas in satisfactory results will ensure
successful competitive performance for the
individual, department or organisation.
Critical Success Factors are the few key areas
where things must go right for the business to
flourish and for the manager’s goals to be
attained.”
- Christine Bullen & Jack Rockart, A Primer on Critical Success
Factors
32. Critical Success Factors are few key features that
must be adequately obtained in order for
objectives to be achieved.
33. Sources of Critical Success Factors
for a Manager
• Industry
• Strategy
• Environmental Factors
• Pressing Situation
• Manager’s Job Position
34. CSF and KPI Process
• Determine vision of a firm.
• Set-up the firm’s goals and objectives.
• Identify key factors (CSF) that influence each
objective.
• Establish a measure (KPI) for each CSF.
• Determine target for each CSF.
36. How to Identify Industry Related Critical
Success Factors
• Use industry analysis to determine critical
success factors of the industry in which a firm
operates.
• Evaluate the CSF and rate them in terms of
degree of influence to the firm.
• Identify the 3 topmost CSF.
37. Deriving Objective, Target, KPI, and Critical Success Factors from A Goal
Goal
Increase in customer loyalty
Critical Success Factors
1. Increase innovative response to customer needs
2. Positioning to fulfill customer needs
3. Keeping product cost at a low level
4. Increasing value deliverables to customer
5. Boosting effective customer service and response to feedback
6. Increase brand image and awareness
7. Increase magnitude and impact of promotion
Key Performance Indicator for “Increase innovative response to customer needs”
Rate of product enhancement for catching up with changing customer needs
Target
100% integration of identified key-features requirements of customers within a period of 6 months
First Objective
Increase innovative response to customer needs by ensuring rate of product enhancement catches up with
customer needs through 100% integration of identified key-features requirements of customers within a
period of 6 months.
38. Group Task
Evaluate the other critical success factors and
identify Key Performance Indicators, Targets
and ensuing Objective.
39. Performance Indicator
It’s a tool enabling the effectiveness of an
operation or organisation to be measured,
and allows an achieved result to be gauged or
evaluated in relation to a set of objectives.
Source: OECD
40. Properties of Performance Indicators
i. Relevant to the purpose, policy and practice
ii. Clearly defined
iii. Reliable
iv. Worth measuring
v. Measurable
vi. Galvanize action
vii. Reflect results of action
viii. Precisely defined as possible
ix. Readily available within a reasonable time frame
41. Advantages of Performance Indicators
i. Means of measuring organizational
progress toward set objectives.
ii. Give room for benchmarking and
comparing various units, sections,
departments and subsidiaries.
42. Disadvantages of Performance Indicators
i. Act as bad measures if not well defined
ii. Some vital indicators cant be easily measured
iii. Issuance of complexity due to number of
indicators
43. Criteria for Selecting KPI
i. Strong linkage to objectives
ii. They should be connected to areas of the
business that can be controlled
iii. They should be quantifiable
45. Developing Targets based on KPI
A Key Performance Indicator should drive
managerial effort towards a mark of
achievement, which is a target in accordance
with set objective.
KPI…….Reduce waste
Target……50% by end of March
46. Two Types of Objectives
Financial Objectives: These are outcomes that
relate to improving a firm’s financial
performance.
Strategic Objectives: These are outcomes that
will result in greater competitiveness and
stronger long-term market position
47. Examples of Elementary Financial and
Strategic Objectives
Financial Objectives
1. Increase earnings growth from 5% to 10% per year.
2. Increase return on equity from 8% to 15% per year.
3. Increase return on asset from 4% to 11% per year.
Strategic Objectives
1. Increase firm’s market share from 13% to 25%.
2. Overtake rivals on quality or customer service effectiveness.
3. Achieve lower overall costs than rivals.
4. Become leader in introduction of new products.
5. Achieve technological superiority.
48. Examples of Combined Objectives
Quaker Oats Company
To achieve return on equity at 20% or above, “real
earnings growth averaging 5% or better over time,
be a leading marketer of strong consumer brands,
and improve the profitability of low-return
businesses or divest them.
Apple Computer
To offer the best possible personal computing
technology, and to put that technology in the hands
of as many people as possible.
49. Environmental Scanning
Environmental Scanning consist of the following:
• Internal analysis of the firm
• Analysis of the task environment (industry and
sector)
• External Analysis (STEEPLED)
50. Using Root Cause Analysis For Identification of Causalities
Declining
Sales
Marketing Production
Human Resource Materials Management
Dull Product Image
Deficiency in Promotion
Reduced Quality
Inappropriate Planning
High Staff Turnover
Lack of Vital Expertise
Poor Inventory
52. Conducting SWOT Analysis
• Indicate objectives of analysis
• Identify all the strengths and weaknesses of the firm
(weighing resources and competencies) in line with stated
objectives.
• Identify all the opportunities and threats pertaining to stated
objectives.
• Examine the interplay of strengths and weaknesses versus
opportunities and threats (SO, WO, ST & WT).
• Identify action points for achievement of stated objectives.
• Assess & Align
53. Problems of SWOT Analysis
• The structure stresses occurrence of all opportunities
and threats must be external, meanwhile in reality
some are within a firm.
• Contradictory inputs give rise to error
• It’s too mechanistic
54. Porter’s Five Forces
This tool was developed by Michael Porter for
analysing a firm’s industry structure in
strategic processes.
Wherefore, it provides room for ascertainment
of market attractiveness by assessing total
effect of the five forces on a firm’s ability to
make profit while relating with its customers.
56. Applying The Five Forces
Bargaining Power
of Buyers
Threat of Entrants
Bargaining Power
of Suppliers
Threat of Substitutes
Extent of
Competitive Rivalry
Force Factors for Consideration
•Concentration of Customers
•Level of Fixed Cost in Industry
•Size of Customers
•Switching Cost
•Ease of Substituting Product
•Availability of Substitutes
•Switching Cost
•Ease of Forward Integration
•Network among Suppliers
•Dearth of key resources
•Economies of Scale
•Customer Loyalty
•Initial Investment Level
•Intellectual Property
•Control of Channels
•Legislation
•Switching Cost
•Quantity of Goods Purchased
•Importance of Product to Buyers
•Level of Customer Relationship
•Customer Loyalty
•Switching Cost
•Price to Performance Ratio
•Exit Barriers
•Level of Differentiation
•Growth Rate of Market
•identicalness of Strategy
57. Problems of Porter’s Five Forces
• It can’t be easily used for very complex
industries with diverse and hidden networks.
• It can’t cope with the cuff of dynamic markets.
• It can’t fit into a highly regulated industry
59. Steepled Analysis is used for identifying
attributes of keystone variables that make up
an organization's external environment, in
terms of current and future operations.
60. In application of STEEPLED Analysis, the
implication of each factor would be
ascertained, then rating system deployed to
mark impact on the firm.
Impact by type and impact over time would be
determined.
61. Crafting Strategy
This focuses on the following:
1. Achieving desired strategic and financial objectives.
2. Out-compete rivals and obtain competitive
advantage.
3. Respond to changing industry and competitive
conditions.
4. Defend against threats to firm’s well-being.
5. Grow the business.
62. “If you don’t have a competitive advantage,
don’t compete.”
- Jack Welch
63. Three Levels of Strategy
1. Corporate Level Strategy
2. Business Unit Level Strategy
3. Functional/Operational Level Strategy
64. Corporate Level Strategy
This comprises overall strategy elements for the firm.
Resolving issues pertaining to mix of businesses and
means for coordination and integration of individual
unit strategies.
It’s concerned with the following:
Managing Activities and Business Interrelationships.
Corporate Responsibilities.
Management Practices.
Competitive Contact.
65. Business Unit Level Strategy
This involves translation of the corporate level strategy into
suitable strategies for individual business divisions or
portfolios, required to develop and sustain competitive
advantage for products or services of the firm.
This is concerned with the following:
Influencing the layout of competition by means of action such
as vertical integration.
Positioning the firm’s business against competitors.
Modifying actions to cope with changes in demand, supply,
regulations and technology.
Developing useful partnerships with customers and other
business units.
66. Functional/ Operational Level Strategy
This involves development of strategies for
functional catchments such as business
development, production, finance, human
resource and materials management.
This is concerned with implementation of the
strategic plans established at corporate and
business unit levels.
67. Developing Strategic Options
A strategy portfolio consists of strategic options which enable a firm
to take advantage of distinctive leveraging points in order to
ensure appropriate alignment to objectives while reacting to
competitors or exploring opportunities.
Examples of leveraging points are as follows:
Talent
Alliances
Financial Linkage
Intellectual Property
Organizational Culture
Processes
Channels
Cost Efficiency
Technology
Economies of Scale
Assets
Innovation
68. Classes of Strategy
Attack Strategy Defense Strategy
1. Guerilla Attack
2. Bypass
3. Flanking Attack
4. Frontal Attack
5. Undifferentiated Circle
6. Differentiated Circle
1. Signaling Defense
2. Creating Entry Barriers
3. Global Service
4. Pre-emptive Strike
5. Blocking Entry
6. Counter-Attack
7. Holding the Ground
8. Withdrawal
Adapted from Jorge Vasconcellos, Strategy Moves
71. Organic and Inorganic Growth
Organic Growth
This occurs when the growth strategy is
executed internally.
Inorganic Growth
This occurs when a firm opts to implement
growth strategy externally through merger,
acquisition or alliance.
72. Motivations for Global Strategies
GLOBAL
STRATEGIES
Access Strategic
Markets
Access National
Incentives
Cross- Subsidize
Create Global
Associations
Obtain Scale
Economies
Access Low-Cost
Labour/Materials
Dodge Trade
Barriers
Source: David Aaker, Developing Business Strategies
76. Evaluating Performance
Balanced Scorecard or Performance Prism can be
used for evaluating performance.
At the corporate level, the following measures are
useful for ascertaining performance.
i. Return on equity
ii. Return on sales
iii.Return on asset
iv.Return on capital employed
v. Compound asset growth
vi.Average market to book value
77. Case Study
Crevice & Annuity is a manufacturing firm
operating in the food & Beverages subsector.
The turbulence which forced some operators
in the same subsector into moribundity
became its reason to opt for a new CEO, who
would provide appropriate leadership for
organisational excellence and overhaul the
status quo. As the new CEO, you are required
to establish a strategic road map for the firm
to escape from that quandary.
78. Dr Elijah Ezendu is Award-Winning Business Expert & Certified Management Consultant with expertise
in Interim Management, Strategy, Competitive Intelligence, Transformation, Restructuring, Turnaround
Management, Business Development, Marketing, Project & Cost Management, Leadership, HR, CSR, e-
Business & Software Architecture. He had functioned as Founder, Initiative for Sustainable Business
Equity; Chairman of Board, Charisma Broadcast Film Academy; Group Chief Operating Officer, Idova
Group; CEO, Rubiini (UAE); Special Advisor, RTEAN; Director, MMNA Investments; Chair, Int’l Board of
GCC Business Council (UAE); Senior Partner, Shevach Consulting; Chairman (Certification & Training),
Coordinator (Board of Fellows), Lead Assessor & Governing Council Member, Institute of Management
Consultants, Nigeria; Lead Resource, Centre for Competitive Intelligence Development; Lead
Consultant/ Partner, JK Michaels; Turnaround Project Director, Consolidated Business Holdings Limited;
Technical Director, Gestalt; Chief Operating Officer, Rohan Group; Executive Director (Various Roles),
Fortuna, Gambia & Malta; Chief Advisor/ Partner, D & E; Vice Chairman of Board, Refined Shipping;
Director of Programmes & Governing Council Member, Institute of Business Development, Nigeria;
Member of TDD Committee, International Association of Software Architects, USA; Member of Strategic
Planning and Implementation Committee, Chartered Institute of Personnel Management of Nigeria;
Country Manager (Nigeria) & Adjunct Faculty (MBA Programme), Regent Business School, South Africa;
Adjunct Faculty (MBA Programme), Ladoke Akintola University of Technology; Editor-in-Chief, Cost
Management Journal; Council Member, Institute of Internal Auditors of Nigeria; Member, Board of
Directors (Several Organizations). He holds Doctoral Degree in Management, Master of Business
Administration and Fellow of Professional Institutes in North America, UK & Nigeria. He is Innovator of
Corporate Investment Structure Based on Financials and Intangibles, for valuation highlighting
intangible contributions of host communities and ecological environment: A model celebrated globally
as remedy for unmitigated depreciation of ecological capital and developmental deprivation of host
communities. He had served as Examiner to Professional Institutes and Universities. He had been a
member of Guild of Soundtrack Producers of Nigeria. He's an author and extensively featured speaker.