STRATEGY EXECUTION FRAMEWORK FOR GOVERNMENT

Copyright 2008 by euseden

euseden 2008

STR - CMM
STRATEGY CAPABILITY MATURITY MODEL
For government and public organizations

STRATEGY
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All rights reserved by euseden


NOTES TO READER

This paper introduces a new framework for executing strategy, STR-
CMM. This is developed based on two widely adopted
methodologies - Balanced scorecard and Capability Maturity Model
(CMM). STR-CMM grew out of our consulting experience and
knowledge in implementation of these two models in many of the
leading organizations in India. The paper is divided into two parts.
Part I establishes the current context for strategy as practiced,
especially from the point of view of practitioners in government and
public organizations. It discusses what strategy means, why it is
relevant today, how it is practiced in few government organizations
and what is the new strategy agenda.

Part II explains the STR-CMM in detail. It explains essentially
architecture and various parts of this framework, how it addresses
the new role of strategy planning and conceptual foundations behind
the STR-CMM framework.

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CONTENTS
Part I
STRATEGY IN GOVERNMENTS 7
Purpose of strategy making 9
What is strategy? 10

TWO REASONS, WHY GOVERNMENTS NEED STRATEGY 12
Manage the big-picture 12
Governments can learn to govern better 13
16
A case for strategy as learning tool

NEW ROLE FOR STRATEGY IN GOVERNMENTS 18
Strategy to operationalize vision & Policies 18
Make strategy measurable 21
23
Strategy to integrate objectives
24
Strategy as management system
Strategy to align 26

Part II

STR-CMM BUILDING STRATEGY MATURITY 29
Background for STR-CMM 29
Is it a force fit? 29

STR-CMM PRIMER 31
SPA Strategy Process Area 34
Generic Goals & Generic Practices 39
Specific Goals & Specific Practices 39

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CONTENTS
Part II …continued
MASTER TEMPLATES 40
Strategy map 40
Perspectives
41
Stake holder perspective
41
Customer Perspective
42
Internal Perspective
43
Learning & Growth Perspective
44
Scorecard Measures & Targets 47
Strategic Initiatives 49

MATURITY LEVELS 50
Why start with level 2? 50

LEVEL 2 STRATEGY ACTION 52
Enterprise strategy map 52
Enterprise scorecard 52
Enterprise strategic initiatives 53
Strategy communication 54
Enterprise Strategy review 54

LEVEL 3 STRATEGY ALIGNMENT 54
Strategy alignment for all KOUs 54
KOU scorecards 55
Alignment of stake holders 55
KOU strategy reviews 56
Budgets linked to strategy 57
KOU Initiative alignment 58
Strategy competency development 58

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CONTENTS
Part II …continued

LEVEL 4 STRATEGY LEARNING 60
Strategy cascade 60
Strategy reporting system 60
Strategy review at all levels 61
IT enabled strategy management process 61
Enterprise wide Initiative management
62

LEVEL 5 STRATEGY INNOVATION 63
Align personal goals 63
Align personal incentive 63
Strategy awareness 64
Strategy process Innovation 64

EXHIBITS
Queensland government strategy framework
9
Strategy trend
12
STR-CMM
31
Maturity levels
32
Strategy Process Areas
34
SPA architecture
35
Sample page of STR-CMM implementation guide
36
Flowchart for STR-CMM implementation
37
SPA- components
38
Strategy map
40
Strategy map – RCMP, government organization
45
Sample Scorecard in government organization
48

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Part I

6


STRATEGY-CMM
FOR GOVERNMENT & PUBLIC ORGANIZATIONS

STARTEGY IN GOVERNMENT

In 2003 government of India hired international strategy consulting This paper is written by
Sheshagiri G Hegde of
firm, Boston Consulting Group to study Indian IT industry and
euseden. Sheshagiri is a
founder director of euseden.
suggest the role for the Government and CEOs of software
He can be reached on
companies. As one of its key recommendations, BCG suggested the sheshagiri@euseden.com
Government to conduct benchmarking studies to see the penetration
of e-commerce in industries like retail, financial services and banking
and promote adoption of ecommerce in these industries. Government
of India has not been able to implement this. This is despite the fact
that government said it would act on these recommendations. As
most of us know, this is not unique to Indian government alone.
World over, Governments and private companies alike are facing this

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problem of advocating a strategy and not being able to execute it. A
study by Ernst & Young found that roughly about 60% of the fortune
500 companies also failed to execute their strategies.
Many independent researches, suggest that strategy planners have
done quite well in formulating good strategy and advising on good
strategies. But when it comes to implementation, their records are
very poor. It does not matter if they were solely responsible for this.
Fact remains, at organizational level, whether it is Government or
private company, when it comes to executing the strategy it is not
encouraging. Why so many good recommendations fail to get
implemented?
Problem, as research suggests, is not in the quality of the strategy but
is in the quality of processes and tools the planners have adopted for
implementing these strategies. Hence, a lot of private organizations
and forward looking Governments, in the recent past, are shifting
their focus on implementing strategies.

Communities, public organizations, private companies and even
individuals have been learning constantly how to interact with the
world so as to make their life better. We used to ride horses now we
have cars. Millions lost their lives to plague, now it is removed from
the face of the earth. Point is, societies have been experimenting with
this super-system and is learning to use it better. While it is obvious
that we have learnt a lot on how to control certain systems, there are
others which still are beyond our current knowledge. For instance,
we still do not know how to feed every hungry mouth. We still do
not know how to educate every child on earth. We still do not know
how to build homes for all.
Big question then is, would it be worth still researching or spending
public money on how to feed every hungry mouth or topics such as
how to govern a country for prosperity? This is exactly the question
the strategy of the governments needs to address. Strategy as used in

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military is very well acknowledged and straight forward. Not many
could question whether military needed a strategy or not. Same is not
necessarily that self-evident when it comes to business organizations
and hence when it comes to the governments and its departments, as
their power seems to come from development now and not from war.
Hence, it could be worth spending some time on understanding new
contexts of strategy.

Strategy framework adopted by
Queensland Government, Australia

Innovation

Sound fiscal environment Research & development

Capital infrastructure Commercialization

Productive
Economic SMART STATE
Capacity
fundamentals STRATEGY

Industry efficiency Education & Training

Regulatory reforms Employment programs

Human Capital

Purpose of strategy making
In its most fundamental form, strategy as practiced by many
governments and many large thought-leader private companies such
as IBM, Mobil, ABB, GE, and Shell etc – is modeling for higher level
of performance. (over a long time horizon). It is about finding the
levers and trying to use them for advantage of the stake holders. As
physicist have been trying to understand how to land on the moon,
social scientists have been trying to unravel how to manage large

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corporations, how to manage municipalities, how to increase
efficiency and effectiveness of public administration and so on.
Harvard professor of Strategy, Michael E. Porter for instance, after
studying some of the world’s leading economies, suggested a frame
work for how to make better policies so that Nations can gain
competitive advantage. This is one of the land-mark studies in trying
to understand how economies gain competitive edge. Many
governments world over, benefited from it. There have been many
such efforts to understand functioning and behavior of-
governments, parts of governments, societies, economies and large
corporations.
To put it succinctly, we can fairly say, Government’s strategy is about
building hypotheses of higher performance for say next five, ten,
twenty years from now.

What is strategy?

Strategy has wide range of meaning even among the strategy makers
irrespective of whether the practitioner is from the government or
private company. This makes it double difficult to know whether
strategy practices can be useful beyond reasonable doubts for, we
cannot be even sure if we are understood in a manner we wanted.
For instance, when I asked one of the management team members of
a private company whether they did any strategy planning, he
explained in length about budgeting exercise they did. Strategy for
him was useful because budgeting was useful. Such wide meaning to
strategy has lead to a situation where ultimate usefulness of strategy
making appears to be more a matter of faith, value bias than scientific
and fact based. For instance, take simple strategic question. Should
government privatize education? Question is not as simple as it
appears at first glance. Answer depends on whether you are an

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executive in private company or chief of staff of a government
department. Right or wrong depends upon the rules of the context.
Should government spend public money to do strategy? Well, I
belong to the strategy camp, no matter how unsatisfactory the
mathematical proof for strategy planning is. However, it will not be
fair to presume value-add of strategy without knowing nature of
uncertainty that surrounds strategy planning practices. I wanted to
start with rather honest canvass for strategy management as capacity
that can add real value.

In India, we have Planning Commission at the center which does the
log-range plans. How effective these plans have been and to what
extent they have influenced local governments, is some thing we
need to understand beyond the fact that the government spends a lot
on planning. For instance, did planning commission suggest
Karnataka Government that it should set-up IT parks so that it can
build IT cluster that can bring state the competitive edge? Wouldn’t it
have been possible for government of Karnataka, otherwise?
Strategy needs to be able to answer these tough questions.

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TWO REASONS, WHY GOVERNMENTS NEED STRATEGY

Manage the big-picture

Conceptual essence of having a strategy that gives holistic picture at
“In any government you need
the top, comes from the gestalt of it. Whole is larger than the sum
to ensure there are ways of
setting the overall strategy,
total of its parts. At one level, whether we should have a top level ,
what you are trying to achieve,
centralized, strategy management is akin to asking this question; why and what is a priority and
what is not. A lot of things
Does the center, add value? How effective would have been the set then need to follow that,
including allocation of money,
of independent federal states of USA, without the center at the top? Is
legislation, political capital and
so on.”
US economically, socially, politically better-off without the central
governance of the sort that exists today? In world of business, most of
Dr.Milgan, Director
the leading organizations have formal strategy
Institute of community
studies UK

planning process. Many governments such as US, UK, Australia etc
have well laid out strategy planning processes. We could have
differences of opinion as to whether the Government has been
effective or not. Or whether a particular government could have
performed better. However, most of us agree to the fact that such

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central governance is definitely required despite the fact that world
as a whole still functions without such top level central governance.
Similarly, such top-down and integrated view of – opportunities,
threats, emerging scenarios, internal capabilities, changes in
demography, values and so on is definitely provides better
perspectives to manage at a large scale.

For instance, In India, we have states that have done very well when
it comes to attracting private investors. These also are states that do
well in attracting various social aids. So we have states where we
have acute poverty and illiteracy and states that have progressed
very well. This is more prominent if we look at cities like, Bangalore,
Mumbai, and Delhi. Now, if we were to ask what strategy planning
should do in such a scenario, there seems to be a good deal of
opportunities for central thinking. For instance, a good strategy
think-tank can learn from such experiences, research and understand
how and why Karnataka attracted so much IT capital as against
others and can proactively try to inject into the other states which are
not doing so well. This definitely is a huge value for strategy to add.

Governments can learn to govern better

This in my opinion is by far the single largest reason why
governments and its ministries should have a systematic, structured
and well articulated strategy plan, no matter how uncertain we are
about the outcomes. A properly constructed strategy plan facilitates
powerful learning. Generally the straight forward reason for plans is
that it helps implementation of the plan. While it is so, something
underlying is more powerful than this, i.e. how it eventually shapes
our understanding about the system as we follow the plan and hence
our ability to create future eventually.

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Strategy helps us theorize, build set of hypotheses, make
assumptions and above all “expect” certain results or outcomes. In a
simple plan we have few hypotheses, few assumptions and few
expectations. And in complex plans we have, many assumptions,
causes, and expect many outcomes. In either case, how we set out
our planned cause and effects and outcomes have significant bearing
on how we eventually learn to master the system. I will illustrate this
with examples later.

First, let’s understand this learning process in some more detail.
We as individuals and groups constantly learn about cause and effect
relationships. From as simple as how to brush, to as complex as how
to run an election campaign- discovering cause and effect, is key to
success. Unless you got very lucky, I am sure, your first experiences
behind the car steering did not go as expected. May be the car turned
too sharply as you turned the steering. May be the car engine went-
off as you tried changing gears. Moved too swiftly as you tried
releasing the clutch. However, over a period we all learn what causes
what effect while we drive a car. This is because of the feedback the
car and the driving system gives us to all our actions such as steering,
accelerating and applying the brakes. Without feedback it’s almost
impossible to learn.

Something very similar happens when we try to administer say a
nation-wide campaign for controlling spread of AIDS if we plan what
we should do, and hence what we expect- the realm of strategy. We
make assumptions about the cause and effect relationships of this
AIDS campaign system and see how to drive it towards the desired
results. In simpler words, we decide what actions we should take in

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order to achieve the results that we want. For instance, we might say
we want to first educate rural young men. This we believe will help
us eventually control the spread of AIDS as we assume that they are
the largest and the most vulnerable section. As you can see, it gets
complex here due to the fact that we cannot be precise about neither
the cause nor the effect unlike in the car driving. (That precisely is the
reason we need to specially design the feedback system while in car it
was very natural) For instance, how can we know that we can
educate rural young men? Also, what we learn here is affected by
how we define and articulate what actions to be taken and what
results we expect. For instance, if we do not assume anything about
rural young men, we will never learn about what actions to take
about this important cause though we can learn about how to control
the spread of AIDS. This can get wieldier by further articulation in
the plan such as rural young of some geography etc.

To keep it simple, we can say, what we learn significantly is
influenced by how we articulated actions and outcomes. Albeit,
outcome of actions are uncertain.

Let me explain this further with a real time case.

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A case for strategy as learning tool

Not long ago, as a consultant I worked with management team of a
retail company in India. They had many products that were sold in
small retail outlets across India and few countries outside India.
Since, too many products were only crowding and adding to the
complexity of manufacturing, scheduling, distribution etc,
management wanted to see if they could retire few products as the
overall profit margins for the company as a whole, was coming
down. To get better understanding on which products to retire, we
calculated profit for each product for different geographies. This
information was a surprise in many ways for many in the
management team. Few products which some thought highly
profitable, were not actually so. They in fact, were draining
significant resources of the company.
Though looks rather simple, now let’s ask,

•What did the company’s leaders learn in this context?
•How did the strategy plan help leaders learning this?
If we take a closer look at the case narrated above we realize that one
of the key information which acted as a trigger was dwindling
overall profit margin. Would the company management think of
product profitability analysis without knowing overall profit
margin? I doubt. Let’s ask much deeper question, what would
company management do, if it had not even set strategic goal to
related to profit margin? Would it come to know that its profit was
dwindling? Probably not, as the company would not compute overall
profit margin at all. (Such things happen on many strategic issues
faced by the organizations today. Take for instance, energy level of
companies key employees. Would company know? ) Company’s
strategy plan made leaders expect certain profit margin. Then as the
actual information was constructed this was short of the expectation.

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Hence, leaders could learn that the product’s profitability be further
analyzed.

Such a feedback is different from learning by haunch or intuition. I
am not suggesting that intuitive learning is not important. Just that
learning is very significantly enhanced through proper structuring
and planning done in a holistic way. And planning helps us to
structure information in more learnable way. As the above example
shows this is exactly where and how a good strategy plan helps
learning. Strategy plan is not only to execute but also to learn so that
eventually we will have better chance in mastering the complex
system.

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NEW ROLE FOR STRATEGY IN GOVERNMENT
Strategy to operationalize, Vision and Policies

Whether it is a Ministry of a government, a state council, or a large
private company there are systems and processes that make people
act. These are the systems which motivate people, assess people and
prompt people to act. In an organizational context, especially in
governments, people do not take actions because they heard an
inspiring political speech. Or attended a seminar on how to adopt IT
in governments. At best it can influence some level of thinking.
There are systems and processes which make them act. Unless our
policies become part of such actionable system no strategy or no
policy gets implemented. Often we hear about lofty manifestos and
promises by the political parties. Many of them even get elected
based on the promises they made. Yet, just two years down the lane
people realize that the governments fail to fulfill even the bare
minimum. People blame political will, dirty politicking, corruption
and the system. While there definitely is good share of all that, the
lion share is of the system that actionates the strategies or policies.
What are these systems and how do we change them to act?

Of all the systems and processes, budgeting is single largest
contributor of actions in government. Every government,
municipality or private company has budgets. Such accounting
system has been one of the most powerful inventions of organizing
for large scale. For years, governments across the globe have
measured their effectiveness on the basis of their budgets. In fact
actions of governments are habit around these budgets. Even in
companies competing in free market budgets are generally sacrosanct
and people keep continuing to act as per these budgets. Markets
might change, customers might change but budgets do not change.
Even today, budgets command most of

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activities. Budgets, in its most fundamental form, are generally
operation plans explained in terms of various items of expenses and
revenues measured in money. Budget is useful and old powerful
institution. It is so powerful that budgeting decides what strategy
should be than strategy deciding what budget should be.

Measuring effectiveness of actions based on expenditure, as many
governments have realized now, is a dangerous thing. For one, it has
got nothing to do with outcome as is the experience of most
governments. For instance, every government in India has spent
money on poverty alleviation but still there is large section of
population which is acutely below poverty line. Problem is, we did
measure the input not the output. In fact even today, we hear
ministers saying “we have allocated so much money for rural
development”. Why do then governments measure expenditure?
Because that is one of the most meticulously tracked systems.
One possible way for strategy to become more actionable is to find
strategy a place in the budgets. (Other is to budget the strategy) And
budgets of every one- every ministry, department, municipality, local
bodies, NGOs and even if possible volunteers. This would be like
creating total alignment. Generally, in most cases the linkage between
budget and strategy is not very smooth and effective. Most lack
proper process of building proper linkages.
That does not fully explain how we make people take actions on
strategy. To motivate people to take actions on strategy we need to
create a rather budgeting-like parallel system of measurement which
measures strategy not expenses and revenue alone. Not necessarily as
large as budgeting though. Yet, a clear number driven system of
budgeting and tracking strategy execution. There are powerful
reasons behind this.
As we saw in the earlier paragraph. Financial numbers cannot
capture and measure strategic objectives and implementation very
effectively.
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As we know financial numbers capture only monetary transactions.
They do not capture non-monetary aspects, whether they are
strategic or significant. For instance, consider a strategic objective
such as “provide basic access to essential public services such as
health, education, clean drinking water, sanitation, etc., to those who
are deprived of them”. Limitation of accounting system is, it can
provide us how much money we spent on it as against allocated
money. (This too is practically not that simple. It requires
modifications in accounting heads). But as we know, that does not
solve our problem. This as we saw only is measurement of input.
What we need possibly is some think like “percentage population
who still does not have the access to these services and how we
improve this number”. Such a thing cannot be tracked in budgets not
at least the way they are now. Yet, it is far more effective indicator
than money spent. Hence we need a new template and a process for
setting strategic objectives that can measure non-financial objectives
expressed in non-monetary numbers.
Some might think that they already have such a system of setting
targets in non-financial numbers. For instance, Planning commission
of India has set clear targets in its 11th plan. For example, look at the
following targets;
- Increase forest and tree cover by 5 percentage points.
- Attain WHO standards of air quality in all major cities by 2011-12.
- Treat all urban waste water by 2011-12 to clean river waters.
- Increase energy efficiency by 20 percentage points by 2016-17

Will it drive politicians and bureaucrats to act? Is it equal to
operationalising strategy?
Not really.

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While these are very clear than highly generic policies, these alone
will not prompt actions at all levels. We need still budget like system
for measuring and tracking such strategic objectives. It takes a
detailed process cutting-across departments and levels. For instance,
we need to now have a system where objectives such as “Increase
energy efficiency by 20%” gets cascaded to say different state
governments and State electricity boards. These in turn need to get
cascaded to next levels. This is what happens in budgeting when it
comes to money. We might even have situation where we ask
industrial houses increase their energy efficiency. And this is not all,
we need to get a system up for tracking these targets at various
levels. This for sure will prompt action at all levels. At the least, a lot
more action gets done than measuring how much money we spend
under this budget.

Make strategy measurable
One of the significant drawbacks of the strategy planning practices
adopted by the organizations of the past era was their ability to
influence execution of the strategy they made. Strategy making had
flawed strategy for strategy implementation! They formulated good
strategies. Big problem was that they could not be implemented. This
is true for most governments, their departments and civil
organizations and even the best of private organizations.
Key to this was strategies were highly generic and all encompassing
and lacked measure. This in my opinion is one of the most significant
developments of strategy planning practices of recent times. Strategy
execution such as balanced scorecard- developed by Harvard
professor and his colleague Dr Norton are remarkable contribution

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from this very important dimension. We now know that many
agencies, departments of governments in US and UK have adopted
one or the other version of such practices. When strategies are generic
and have broad range of meanings it becomes not actionable. Worse,
people do exactly opposite and interpret them to their advantage.
Governments are lot more vulnerable to such practices than private
companies. In such environments it becomes even difficult to know
whether or not a strategy is executed. We regularly come across
political parties claiming that their government made significant
progress in terms reduction of poverty or providing rural
employment or developing the backward section of the population
while opposition claims the exact opposite. Key question is just how
we know that their claims are right.

Let’s looks at this deeper. Strategies need to be defined in more
actionable way. For that it needs to have specific measures. A number
that we can compute and measure which allows us to
compare and know. Problem with most of the strategies of the past
era was that they did not have proper way of measuring whether or
not their strategy was executed. For instance, let’s say a State wants
to pursue a strategy where its objective is to develop and promote
SME sector and encourage entrepreneurs in this sector. Now, the
strategy planners must set specific measure for measuring whether or
not such strategy is executed. For instance, it can set percentage of
contribution to the state’s GDP as a measure. It can also say how
much of fresh funding goes into this sector as another measure. This
way we can set clear targets to achieve. As you can see such a
measure helps us to know whether the state is able to implement
such a strategy. To illustrate, we can imagine that at the beginning of
the strategy the state had 20% contribution coming from this sector
and say state sets to achieve 30% contribution from this sector by the

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end of the plan period. This is very clearly measurable. Similarly, we
can set targets for investment the state needs to attract for this sector
and can clearly compute the number.

Strategy to integrate objectives
Government departments and private organizations alike tend to
follow agenda and set long-term goals which are often not a pat of
integrated whole. For instance Ministry of education may set
following goals
- Provide free education to all up to 10th grade
- Increase literacy rates in all states
- Establish vocational training institutes across the country
- Invest heavily in higher education
- Allow private players in higher education
- Attract top talent to education

Such goal setting systems are possibly the most prevalent and we see
them in all forms of organizations- Government departments, public
sector companies, private organizations and so on. While such
systems have contributed their bit, it may not be sufficient for today’s
complex and uncertain economic and social environments. Recently,
many governments, governmental agencies such as EDA (Economic
Development Authority of US under the US government), MoD UK
(Ministry of Defense UK) have set Goals in a more logical, integrated
and holistic way. They create strategy map. Strategy map as against
the set of goals as we saw in the example above- are integrated and
flow as chain of cause and effect.
Unless we make conscious effort to integrate objectives they tend to
run into conflicts. Such conflicts often fulfill one at the cost of the
other. While it is impossible to eliminate conflicts it is important we
keep it minimal. In most situations, upon some reflections it is

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possible to set policies and goals that are integrated and follow a
logical cause and effect chain and hence make not disparate stand
alone objectives but parts of an integrated whole.
Some may argue that there could be few things then we may not be
able to put in the plan. In my opinion, that is precisely what it is
supposed to do. No matter how large and competent the government
is, it is important to realize that achieving everything is not possible.
It is best to achieve few goals thoroughly than try to achieve on all
and end up doing not much.

Strategy as a management system
Many practices of strategy planning has been more like organizing an
event where strategy planners present their insights on the business
environment, emerging trends, competition, some new food for
thoughts. This is true even in some best managed private companies.
These are attended by high ranking ministers, secretaries and fellow
planners at local level. Strategy needs to go beyond such events.
Generally, set of professionals, leading academicians and some of the
best brains in the country research, scan, consult local governments
and boards, think-through and compile a quite insightful strategy
plan or long-range plans. While all this is useful, history suggests that
it is not enough and not possibly the most effective way to strategize,
if we need these strategies to be executed. It is not about how useful
insight the strategy provides. It is not even about how fine-tuned it is
about local environments. It is about how effectively it can get
translated into action at all levels of the government.
Strategy to be more effective needs to be embedded into action-
agenda of ministers and bureaucrats. This requires different
perspective, different kind of planning process, different models of
execution and different set of processes for “managing” strategy, a

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continuous process of tracking and measuring. This is not the same as
planning department conducting evaluation study of the plan-
implementation at the end of 3 years or something of that kind. For
instance, planning commission of India, might conduct an evaluation
study on how a particular scheme planned in the 5-year plan is
implemented across the country. This could be small part of it but
does not essentially cover managing of strategy. Managing strategy is
significantly more and significantly different. Some what crude
Indicator for judging whether or not we are managing strategy is
answer to the following question; Are we managing strategy as we
are managing regular operations?
Recently, central government of UK merged two different planning
departments and formed a single Strategy unit. Strategy Unit directly
reports to Prime Minister, and is doing something very different from
what the previous departments did not do. Apart form conducting
planning; co-developing papers on issues which are strategic in
nature, it also participates in the regular review of implementation of
such strategies that would have got in-built into plans of different
ministries and departments. ABB, a large private company has a
formal and elaborate process of incorporating strategic insights
developed by its strategy planning team to its budgeting. Its annual
budgeting follows the strategy plan and they have separate strategy-
budget component built into it. This budget of ABB is not the same as
old budgeting. Clearly, this is managing strategy as this makes sure
that there are processes that manage strategy on continual basis
across the organization and across all levels of the organization.
For this purpose some clarity on what is operations and what is
strategic can be useful. Strategy as practiced by the balanced
scorecard organizations and some of the leading organizations is set
of objectives that are critical for achieving our Vision and Mission.

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For instance, A particular state government might realize that it has
certain natural advantage in terms of promoting bioscience. Hence, it
might want to pursue a human development program where it
would develop bioscience competencies among the people in the
state. Obviously now, state needs to have plans and allocate
resources and organize for action. State cannot possibly set a separate
ministry and then have departments and kinsmen and troops etc (In
some cases they do). Most likely, it will need to ask the existing
ministry and departments to do that. Now, these departments have
many other things to do. They will still need to manage law and
order, education, provide electricity and build roads and so on. In
this illustration, these are regular operational activities and activities
connected with bioscience are strategic activities. Ordinarily, by the
time it reaches third to forth level of hierarchy, priority on strategic
activities get lost. Hence, we need a parallel system that continuously
prioritizes strategic actions at all levels.

Strategy to align
Barring small number of strategic objectives, most of strategies
require contribution from departments, teams and individuals at
local level. For instance, for country like India, where large chunk of
development comes from IT and IT enabled industry, it could be
important to lobby for VISA issue with US government. This could
be strategic priority for India. This might not require large
participation and could be handled by small number of senior
officials at the center. However, large majority of strategic objectives
require larger participation for effective execution. Take for instance,
issue like population control.

26


This means people at village level be educated and be provided
proper incentives and amenities to implement such a strategy. This
requires almost that whole nation gets organized around it. Similarly,
strategy like educating people for employability and giving them
skills that can find them employment also requires such a wide
participation from people across the country and at various levels to
do their bit to execute such strategy. Ordinarily most strategies fall
under such category. And require greater alignment at front level. In
such cases we need an effective strategy alignment process.

How do we cascade strategy to the frontiers? This is the most critical
question a strategy management system needs to address.

27


Part-II

28


STR-CMM - BULDING STRATEGY MATURITY
Background for STR-CMM

STRATEGY-CMM (STR-CMM) is a model based on balanced
scorecard methodology and CMM (Capability Maturity Model
developed by Carnegie Mellon University). It draws lessons from
the two widely adopted management practices of recent times.
Balanced Scorecard is a powerful methodology developed by Dr
Robert Kaplan and Dr. David Norton. This was published in their
book The balanced scorecard. According to many published sources,
majority of the fortune 100 companies have implemented one or
the other variations of balanced scorecard. CMM, on the other
hand, is developed by SEI of Carnegie Mellon University of USA.
This model was essentially developed for helping software
companies in developing processes so that they could develop
more effective software. Since its development, thousands of
organizations across the globe have adopted CMM. CMM’s large
scale adoption is due to its practical insights on implementation of
the model.

Is it a force fit?

Well, it is not. Balanced scorecard offers rich methodology for
strategy execution. But how do you execute (implement) the
balanced scorecard itself? Especially when an organization is doing
it the first time? On this, I felt, CMM had better insight. STR-CMM,
in my opinion is a logical sequence of improvement over balanced
scorecard. STR-CMM makes the entire implementation more
manageable and easier to communicate to practitioners. Scorecard
methodology provides frame-work for strategy articulation and
measurement. Its strength is the template it provides in terms of
articulating the strategy in actionable terms.

29


However, with regards to making it a management system, it
provides not much implementation guidance. And this becomes
important in a large organization. This is exactly where we found
CMM models more insightful and hence, we felt it would be better
if we come essentially the CMM route for implementation and add
scorecard as master templates that can cut across the entire system.
In my opinion, it is pragmatic and still leaves the model highly
practicable for following reasons;

-One, we have already adopted STR-CMM approach in
implementing the balanced scorecard based strategy management
system in fairly large organizations.
-Two, SEI, itself has, since its first version, extended the CMM
model to many areas like, Product development, large software
acquisitions, people management etc.

Another important point is, we have kept the basic and high level
architecture of the CMM as it is, though in some places there could
have been better way to generalize and organize the concepts
without boxing it in CMM. For instance, balanced scorecard’s four
perspectives based strategy articulation frame work has more
weightage than it appears on the STR-CMM at first sight. This is
mainly because we did not want to modify CMM too much if it
muffled the execution dimension, the very positioning the balanced
scorecard took for strategy. This we thought outweighed the
advantage than the disadvantage of not representing the scorecard
template at the generic model level. However, in essence, this we
have taken care at the detail level where it matters the most. SPA
(Strategy Process Area) level as these are the key building blocks of
STR-CMM. In short, force-fit ? No, because, it is highly reorganized
at the granular level and still emerges the CMM way at higher
generalized level.

30


STRATEGY-CMM, PRIMER

STR-CMM has two dimensions; strategy maturity levels and
strategy master templates. Maturity levels provide a detailed,
proven frame work for process implementation around strategy
process areas (SPA). Strategy CMM helps organizations in building
their capacity to execute their strategy. Following figure gives high
level architecture of the STR-CMM. Organization achieves strategy
maturity by achieving maturity in all levels as shown in the figure,
viz, Strategy action, strategy alignment, strategy learning and
strategy innovation.

STRATEGY-CAPABILITY MATURITY MODEL

5
LEVEL INNVOVATION

4
LEARNING
LEVEL
MASTER TEMPLATES

3
ALIGNMENT
LEVEL

2
ACTION
LEVEL

Levels represent the organizational capacity to execute their
strategy. Higher the maturity levels higher the strategy capacity.
Organization’s strategy maturity is progression on maturity levels.

31


Maturity levels are group of SPAs (Strategy Process Areas), which
in turn are cluster of related strategy practices. Maturity levels, as
in other CMM, represent certain level of capability of the
organization in executing strategy. There are four maturity levels
as follows
Strategy action- Organization is capable of taking significant
amount of action on its stated strategy
Strategy alignment- Organization has capability to align its key SPA

stake holders and other organizational units to its stated strategy
Specific Goals Generic Goals Purpose statement Intro.Notes

Strategy learning- Organization has capability to know what is the Specific Practices
Specific Practices Generic Practices
Specific Practices
Generic Practices
Specific Practices

right & wrong about its strategy and which of its strategies are Generic Practices
Specific Practices

Sub Practices
Sub Practices Sub Practices
working Sub Practices
Sub Practices
Sub Practices
Sub Practices
Sub Practices

Strategy Innovation- Organization adopts innovative practices in
managing strategy

Maturity Levels

5 Organization has capability to implement
STRATEGY INNOVATION
innovative strategy management practices
LEVEL

4 Organization has capability to know right
STRATEGY LEARNING & wrong about its strategy
LEVEL

Organization has capability to align its
3 stake holders and key organization units
STRATEGY ALIGNMENT
LEVEL
to strategy

2 Organization has capability to take action
in its stated strategy
STRATEGY ACTION
LEVEL

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Master templates, the second dimension of STR-CMM, provide
architecture for articulating and translating strategy. Master
templates- strategy map, scorecard and initiatives; are based on
balanced scorecard methodology. Master templates are like special
tools that cut across many maturity levels and have important
bearing on the most of the SPAs. (Refer page for more on master
templates). To understand it better we can draw parallel to
financial statements of accounting system. Financial statements;
Balance sheet, Profit & Loss Account and Cash-flow are like master
templates of accounting system. These templates have significant
bearing on all the accounting that goes on in the system. (But, by
themselves, balance sheets etc do not provide enough insight into
how to build an accounting system in a large organization. This
might be difficult to imagine in today’s context because we cannot
imagine an organization without an accounting system)

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SPA (Strategy Process Area)

SPA (Strategy Process Area) is a cluster of related practices. For
example, Enterprise strategy map as SPA is achieved by following
many practices such as – Strategy map is created after a detailed
dialogue and discussion among the senior management team
members. There is documentation available on the enterprise
strategy map, and so on.

5
STRATEGY-CMM Innovation
LEVEL

4 Learning Strategy awareness
LEVEL
Strategy Process innovation
3 Alignment Scorecard cascade
LEVEL Personal goal alignment
Strategy Reporting system
2 Align personal incentive
Action Strategy alignment of KOUs Organization strategy review
LEVEL
Alignment of stake-holders
Strategy competency development
Enterprise strategy map
KOU strategy review Organization-wide Initiatives
Enterprise scorecard
MASTER TEMPLATES

Budgets linked to strategy
Enterprise strategy initiatives
KOU Initiative management
Enterprise strategy review

34


Each maturity level consists of 4-5 SPAs (Strategy Process Areas).
SPAs are the basic building blocks of the STR-CMM. SPAs, in turn
consist of following components
• Purpose statements
• Generic goals
• Generic practices
• Specific goals
• Specific practices
• Typical work products
• Suggested tools
• Introductory notes
• Examples and illustrations

Strategy-CMM

Level-5
Strategy Innovation

Level-4
Strategy Learning

Level-3
Strategy alignment

Level-2
Strategy action

Strategic Strategic Strategic
Process Area Process Area Process Area
(SPA-1) (SPA-2) (SPA-n)

Specific Specific
Generic Generic
Goals Goals
Goals Goals

Specific Specific Specific Specific
Specific Specific Specific Specific
Practices Practices Practices Practices
Practices Practices Practices Practices

Sub Sub Sub Sub
Sub Sub Sub Sub
Sub Sub Sub Sub
Practices Practices Practices Practices Practices Practices Practices Practices Practices Practices Practices Practices

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Summary of specific goals & practices

SG 1 Identify all Key Organizational units for scorecard development Summary of
specific goals &
SP 1.1 Adequate planning is done for identifying all the KOUs
practices
Need for scorecard development is discussed with KOUs
SP 1.2

SG 2 Develop scorecards for all KOUs

SP 2.1 For all identified KOU the scorecards are developed
Completeness and adequacy of the KOU scorecard are verified
SP 2.2
There is adequate documentation available on all KOU scorecards
SP 2.3

Specific Practices by Goals

SG 1 Identify all Key Organizational units for scorecard development

Identify all key organizational units for scorecard development
SP 1.1

Specific Goals Sub Practices Examples
1. Prepare list of organizational units who have direct reporting relations

• Strategic Business units under a corporate
Specific • SBUs under a division
Practices • Corporate support functions
• Key suppliers/ vendors

Explanatory notes
Explanatory
Notes 1. One of the best ways to find out where the next immediate
scorecards need to be developed is to find the direct reportees to the
CEO, if the scorecard is developed at company level or corporate
level. If the highest level scorecard is at division level, then it could be
his direct reportees who typically head various independent business
Typical units. There are times when the first scorecard is prepared first by the
Work product support functions such as HR, IT or Finance etc. In such cases the
next cascade from the scorecard possibly is best identified by
portfolio of his direct reportees

Typical work product

List prepared for next level strategy map and scorecard development

Sample page of STR-CMM guide

36


Flowchart for implementing STR-CMM

37


Strategy Process Areas and its Components

SPA

Specific Goals Generic Goals Purpose statement Intro.Notes

Specific Practices
Specific Practices Generic Practices
Specific Practices
Generic Practices
Specific Practices
Generic Practices
Specific Practices

Sub Practices
Sub Practices Sub Practices
Sub Practices
Sub Practices
Sub Practices
Sub Practices
Sub Practices

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Generic Goals (GG) & Generic Practices (GP)
Generic Goals are essentially the goals that are part of the most of
the SPA. Most important idea behind the generic goals and
practices is that they help institutionalizing the processes and
practices. Degree of institutionalization differs in different
practices, even in same organization. Highly institutionalized
(mature) practices are likely to be practiced even under great
stress.

Specific Goals (SG) & Specific Practices (SP)

Each SPA has Specific Goals attached to it. Goals are essential
components of any SPA. They help in terms of understanding the
direction of the practices. This way we will also be able to build
standard vocabulary which powerfully helps in terms of
implementation. Specific Goals can have many specific practices.
Specific practices in turn can have few sub practices. Practices and
goals together build-up an SPA.
To implement STR-CMM, we start with learning the balanced
scorecard master templates- the strategy map, scorecard and
initiatives. Then we learn about the maturity levels and SPAs.
STR-CMM guides us through to build strategy capacity by
building the enterprise wide system of managing and executing
strategy.
The following gives simple steps in adopting STR-CMM
Understand the balanced scorecard master templates
Select level-2 and implement all the SPAs in the this maturity level
Move on to level-3 strategic alignment and implement the SPAs
Repeat this process up to level-5

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MASTER TEMPLATES

Master templates constitute the second dimension of STR-CMM.
They provide tools and templates to articulate and translate
strategy into action.

Strategy Map
Strategy map is one of the key templates for building strategy
maturity of the organization. Strategy map is simple to construct
and provide quick view of strategy. Strategy map helps us to map
strategic objectives across 4-5 perspectives stacked one above the
other.

Vision & Mission

Who are our stake holders ?
STAKE HOLDER
What are their needs ?
PERSPECTIVE
How do we satisfy their needs ?

Who are our customers ?
CUSTOMRE
What are their needs ?
PERSPECTIVE
How do we satisfy their needs ?

To satisfy our stake holders and customers,
what processes we need to excel ?
INTERNAL
What kind of IT systems should we deploy?
PERSPECTIVE

What should be our financial goals?

To excel at these processes, what
Competencies our people need to develop ?
LEARNING & GROWTH
PERSPECTIVE
What kind of culture and values do we promote?

In constructing the strategy map, we start from the top perspective
and come downwards in a logical fashion. To enable this, we need
to define the perspectives. Let’s understand this with the figure
given here.

40


As we can see, the strategy template shown here is a generic
template in a Government organization. Top most perspective is
Stake-holders perspective. It is followed by customer perspective,
internal perspective and learning and growth perspective. These
perspectives themselves are integrated by the following logic;
Our strategy needs to help us achieve our mission. This we can do
by satisfying our key stake holders. Our key stake holders can be
satisfied if we can identify our key customers and provide them
value. This in turn is possible if we have capable processes, capable
IT systems and capable financial management. Again, this in turn
is possible if we have competent set of employees who can
consistently execute these processes.

In the strategy map, we try to bring focus to our strategy and try to
build strategy in an integrated and logical way. Strategy map is a
set of objectives across the defined perspectives in a cause and
effect chain. We need to articulate our strategy in a proper cause
and effect chain so that we can achieve clear focus. This will help
us execute the strategy better. This is because, strategy, instead of
being disparate set of stand-alone objectives, now becomes an
integrated system of objectives that support one another.

Perspectives

Perspectives are broad dimensions of the strategy map. They
provide first level scoping for our strategy thinking. They are the
fundamental architecture of the strategy map and facilitate setting
and organizing the strategic objectives.
Stake holder perspective

For any Government organization it is important to understand
the needs of stake holders and its key constituents. This

41


perspective guides the planners to set strategic objectives that help
in terms of satisfying the important needs and requirements of the
stake holders. For instance, for ministry of education, State
Government itself can be a key stake holder. Central Government
can be another key stake holder. Various industry bodies also
could be other important stake holders. An important aspect of
strategy is to satisfy the stake holders. In this example for instance,
education ministry can set objectives like- provide free education
for all children up to 7th grade. This might be an important need of
the state Government.

Customer Perspective

Some practioners do not mention this as separate perspective.
They ordinarily club it with the stake holder perspective and show
it as part of the stake holder perspective. This is acceptable practice
because remember, the strategy map is only a template not a
mathematical model. In the customer perspective, we ask who are
the important segments of our services and what can we offer
them? In short, what value do we create and deliver to our
customers? In the above example of education ministry, we can ask
for instance, keeping in mind the fact that we want to provide free
education to all children up to 7th standard, what can we propose
to children further in order to achieve that? This might lead to
thinking “provide free text books”. Such an objective then, can be
part of the customer perspective. This objective “provide free text
books” is not stand alone. This is connected to the objective set
above in the stake holder perspective.
Perspectives facilitate setting strategic objectives in cause and
effect chain. And such, top-down logically linked set of objectives
will be easier to implement as against stand alone objectives.

42


Internal perspective

This is one of the important dimensions added by the balanced
scorecard methodology for strategy management. Strategy so far,
was essentially externally oriented. It was more about scanning the
market, business environment, important changes in the economy,
technology and competitors etc and predicting how it all would
shape up. Balanced scorecard brought powerful internal
dimension to strategy. From the point of view of government and
public organizations, internal perspective can be summarized as
explained below.
Process

To consistently deliver value to customers it is important that
organizations have capable and highly mature processes. For
instance, if Government is intending to provide free text books to
students, to fulfill this proposition, it needs to have a well
organized procurement of such books, distribution of these books
to various schools, and make sure such books reach the students
in-time and so on. Capability in such processes becomes critical for
executing this strategy. Government’s strategy management must
make sure this process of all, is especially capable.
IT

This is another important strategic dimension today. Every
organization, large and small, public and private, is affected by IT
today. We have seen that e-governance and ecommerce are
spreading quickly. Every aspect of life is affected by IT. IT is a
powerful dimension of economy, business, society and culture
today. Key questions we need to ask in this perspective are;
- How can we use IT to achieve the objectives we have set in
process perspective and customer perspective?
- How can we use IT to deliver value to stake holders?

For instance, in the above example the Government can set

43


objectives such as- adopt cutting-edge supply chain software, Set
online portal that allows students/schools to log complaints. Key
is that IT objective here needs to be aligned with objectives we
have already set in other perspectives above. That way we increase
the strategy implementability.
Finance

For Government this may not be as critical as it is for private
organization. However, it is still important enough to be strategic.
Cost of executing the processes and activities are important
considerations for every organization. Continuing the example
above, in the finance perspective, Government can set objectives
such as- keep the average cost per book as per the approved
budget or keep total cost per servicing a student under USD 50 per
annum etc. It can also be set as productivity of people who would
be part of the process, and or speed of the process cycle. Key is, the
strategy should have financial angle to it.

Learning & Growth perspective

This again is an important dimension to strategy added by
balanced scorecard methodology. In this perspective while
mapping the strategic objectives we ask following questions;
To achieve objectives set in process perspectives what
competencies, skills and knowledge our people need to have?
To adopt IT the way envisaged in IT perspective what kind of
competencies our people need to have?
Which of the above competencies are most critical? How can we
train our people to get it?
To illustrate, continuing with our education ministry examples,
Government can ask if we need to achieve the process and IT
objectives what kind of competencies we require? In this case
Government needs to possibly train people on supply-chain
software. Also, such a large-scale adoption might require powerful
project management skills hence, people might have to be trained
44
in project management skills.


As we can see, this way by coming top-down in logical way,
perspective by perspective, Government can narrow down the
scope and can be laser focused about its strategy.
Following is example of strategy map.
Royal Canadian Mounted Police( RCMP)

Mission

STAKE HOLDER
PERSPECTIVE
Be the best
managed
organization in
Government

INTERNAL
PERSPECTIVE Exemplify
Build strategic
modern
alliances
management

Accountability
at
All levels

LEARNING
PERSPECTIVE
Provide
enabling
technology

Source-Strategy Map Robert Kaplan & David Norton

Above map shows the partial strategy map of one of the premier
government organizations of Canada. RCMP (Royal Canadian
Mounted Police) is an agency under ministry of the solicitor
general of Canada. As you can see, the strategic objectives are
mapped across three perspectives. One of the important objectives
for RCMP in stake holder perspective is to become one of the best
managed organizations for the Government of Canada. This,

45


RCMP wants to achieve by building strategic alliances. Alliances
with various communities, people, other government agencies etc.
And RCMP also believes, to be the best organization, it needs to
adopt best in class management practices (exemplify modern
management). As per RCMP management, this is one of the key
processes of its strategy. RCMP also believes, to achieve the
objective exemplify modern management it has to establish
accountability (accountability at all levels). And this in turn, is
achieved by enabling its officers with required necessary
technology. (Provide enabling technology). RCMP thinks that it is
strategic to adopt technology to improve accountability.
As I mentioned earlier, this is only a partial strategy map of RCMP.
However, the above map shows clearly how a properly
constructed strategy map can tell the strategy story.

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Scorecard- Measures and Targets

As we know strategic objectives can get very abstract and can lead
to wide interpretations. For effective implementation we need to
make it measurable to lessen conflicting interpretations. For
instance, one of the strategic objectives in stake holder perspective
for a particular state government could be “Provide employment
for rural youth”. This objective might appear to be fairly specific.
Nevertheless, there can be conflicting interpretations

To avoid this we can say this objective will be “measured by
Number of unemployed persons per village”. Such measures help
officials know how well they are able to execute their strategy. One
of the most important practices of the STR-CMM is to assign one or
two key specific measures for the strategic objectives. To do that
we simply need to ask, how can we know that the stated strategic
objective is achieved? What, if we measure, we will know whether
we have achieved the strategic objective?

Once we have defined the measures, we need to also set specific
targets in terms of the defined measures. For example, in the above
example, Government can set target of say 3 unemployed people.
This means that for every village only 3 people can remain
unemployed. As you can see, we can also compare this number
with the previous period and find out how well the strategy was
executed. Targets help us make the strategic objectives more
specific. Some of the best practice organizations, specify clearly,
how exactly such measures are computed.

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Following is an example of a properly constructed scorecard of a
government organization In our practice, we have observed that
many executives tend to set too many objectives and measures.

Energy Department, Federal procurement (USA) - Scorecard

OBJECTIVES MEASURES TARGETS

2002
Timeliness: Extent of customer
Customer Satisfaction
satisfaction with timeliness of 85%
CUSTOMER

procurement processing; planning activities; and on-
going communications.

Effective Service/Partnership Extent of customer satisfaction with the
88%
responsiveness, cooperation, and level of
communication with the procurement
office.

Extent to which internal quality control
Achieve acquisition excellence 80%
systems are effective, particularly with
respect to compliance with laws and regs, No protests
INTERNAL

vendor selection and performance, contract
admin., and subcontractor oversight

Most Effective Use of Contracting Percent of purchase and delivery
33%
Approaches to Maximize Efficiency orders issued through electronic
and Cost Effectiveness commerce
10%
Percent of RFPs over $100,000
issued electronically

Streamline processes for speed Average time from issuance of solicitation
123 days for
to date of award. contracts between $
10M to 25M
LEARNING

Provide access to strategic information The extent to which reliable procurement
Information system to
management information systems are in
be 100% timely and
place.
accurate
Superior Executive Leadership:
Employee satisfaction Employee’s perception of the organization’s
84%
professionalism, culture, values, and
empowerment

Quality Of work environment- Employee’s
degree of satisfaction with tools available
85%
to perform job, with mechanisms in place
to ensure effective communications to
accomplish job requirements, and with
current benefits and job security.

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This may not be a good practice. Ordinarily, about 18-20 strategic
objectives cutting across all the perspectives should be enough to
start with. Also, we need to define in all, about 25-30 measures. It
is best we start with such numbers and gradually increase it later
as the leaders and officials become familiar with the system.

Strategic Initiatives

Initiatives are integral part of strategy execution. As we have
observed, many organizations who implement balanced scorecard
or KPI based management system, rationalize their existing
enterprise level initiatives and start many new initiatives in light of
the newly formulated strategy. This also prompts generally, chain
of initiatives being taken at lower levels of the organization. The
central organizing thread for such initiatives is, the newly
articulated strategy with clear measures and targets.
In one of the large FMCG companies that we worked with,
management set strategic objective to be the least cost producer in
India. This required that many of their 50 odd manufacturing
plants across India are upgraded, productivity be watched closely,
and certain quality management practices adhered to more
rigorously. What exactly a plant needed to do could not be
generalized though there were few things which many plants
could follow and hence could be centrally managed. Hence, plants
after taking stock of how they could contribute to the corporate
level strategic objectives assessed their situation and started their
own set of initiatives at their level. These were apart from
supporting few of the corporate wide initiatives. This way there
were hundreds of initiatives across the organization at different
levels.
Initiatives are integral part of new way of managing strategy.
Lets now look at Maturity levels and associated SPAs in some
more detail
49


MATURITY LEVELS

Maturity levels constitute the first dimension of the STR-CMM.
They provide a detailed step by step guidance for implementing
the strategy management system. Then, we might ask, what is the
system to be implemented? In part, the system is not separate from
the maturity levels. Maturity levels also constitute one dimension
of the system itself, other being the master templates. This becomes
clearer as we understand the master templates.
Maturity levels provide high level architecture of how SPAs are
grouped and hence to be managed. Maturity levels are like distinct
stages in implementation of strategy management system. Their
progression is based on logical and natural sequence we need to
follow for effective implementation.

Why start with Level 2
Strategy CMM is more about strategy execution than strategy
analysis and strategy formulation. As we saw earlier, strategy
planning could not fulfill its promise essentially because they
focused on strategy thinking and analysis. Many of them built
powerful tools and did good deal of forecasting into far future.
But, what they lacked was a process of infusing such thinking into
organization’s execution machinery and hence, translate all such
analysis into concrete set of actions.

In STR-CMM we have taken an approach, where we start from
where the traditional strategy planning left off. This part of
strategy analysis- SWOT, environment scanning, industry analysis,
dialogue etc – is taken as level one and we move on to level 2 of
the STR-CMM where we build on such analysis and translate this
into integrated set of strategic objectives across the four
perspectives as explained the master templates.

50


It could be important to note here that master templates force us to
do some degree of strategy thinking also. Templates require
planners and executives to do structured thinking on their
strategy. But the degree and intensity of such thinking is limited as
compared to the rigor used by the strategy analysis level.

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LEVEL-2 STRATEGIC ACTION

Practices in this maturity level, is a must for concrete action on
strategy. Without such practices the strategy remains just a
powerful analysis but does not get translated into actions.
Following are the SPAs in this level.

Enterprise strategy map
Main purpose of this process area is to create an integrated view of
the strategy. Generally, even in some of the best organizations,
strategy means many things to many people. This is true even with
people at the top of the management structure. What is strategic to
success of Government as perceived by the say education minister
may not be the same as that of the chief bureaucrat of the
education department. This often leads to delay in decisions and
ineffective execution. Hence, it is important to create a shared
understanding of strategy. Strategy map constructed, as explained
in the master template section earlier is a powerful practice to
create an integrated and common view of strategy. In this SPA, we
implement practices to create Enterprise level strategy map.

Enterprise scorecard
What gets measured gets done. In this process area, executives
create enterprise level scorecard- set of measures for measuring the
execution of strategic objectives. Scorecard brings a further clarity
to strategy. Scorecard generally, is set of 25-30 measures. It assigns
a mathematical number to each of the strategic objective. Measures
help us understand how we would know that strategy is being
executed. For instance, if Government sets strategic objective-
Reduce crime on women, then possible measure for this objective
can be percentage of decrease in crime against woman. Such measures
help in building focus.

52


Enterprise strategic initiatives
Based on the strategic objectives set and measures identified,
strategy planners now need to identify certain key strategic
initiatives to achieve the targets set. Initiatives generally, are
projects that can cut across the ministries and departments. For
instance, Queensland government, has set objective to “Compete
based on knowledge and Innovation”. To achieve this government
needs to identify certain key initiatives. For instance, Queensland
government can initiate a program to strengthen the research in
their technical universities.
Generally Enterprise level strategy needs to have about 25-30 such
clearly identified initiatives at enterprise level.
In this SPA, we implement practices to manage initiatives.

Strategy communication
Strategy communication, in our opinion, is one of the most
neglected SPAs. Communicating strategy goes a long way in
proper execution. IT, today, allows significant opportunity to
communicate without really spending much. Generally,
organizations are not particularly good at things which they have
not done in the past, no matter, how easy and how little it takes to
execute. Communication of strategy provides one of the high
leverage points where relative return on the effort is very huge.
Following are some of the practices in communicating strategy
-Strategy seminars
-Doing round table briefings
-Documenting strategy clearly and giving printed copies
-Publishing the same in in-house magazines
-Making a podcast/webcasting available on the intranet
-Starting an online community

53


Enterprise strategy review
Main purpose of this SPA is to have well-organized processes to do
regular and periodic review of enterprise strategy execution.
Again, this is one of the high leverage points of strategy
management. Strategy is not a one time event. Strategy to be
executed needs to be a continuous process. We need to go beyond
just the annual strategy seminar. Review, gives sense of continuity
to the activities that are undertaken to achieve strategic objectives
and targets.
In many cases that we have come across, people wait endlessly for
complete data, reports and analysis for conducting strategy review
meetings. This need not be. Thumb rule is, within 60-70 days of
preparing enterprise strategy-map and enterprise strategy
scorecard, we need to do the first round of review meeting on
strategy execution.

LEVEL 3 - STRATEGY ALIGNMENT

Strategy alignment for all KOUs
Organization needs to align all its Key Organizational Units (KOU)
to the enterprise strategy as established at the higher level. We
have set the enterprise strategy, scorecard, and targets and
communicated. Can’t we simply now leave it to the management
of the KOUs to set their objectives? As far as the past experiences
of strategy execution go, we cannot do that. We need a consciously
thought of process to do that. We need to have practices in place to
ensure that it happens.
Based on enterprise strategy, KOUs need to draw their strategy
maps scorecards. This ensures more organizational focus on
strategy. In STR-CMM enterprise level strategy is not just an
abstract, generic statement. It is followed by measures and also has
clear targets attached to it. KOUs can, like they do in the budgeting
process, take these objectives, measures and targets
54

STRATEGY EXECUTION FRAMEWORK FOR GOVERNMENT

STRATEGY EXECUTION FRAMEWORK FOR GOVERNMENT

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