Abcde Strategic Plan Model 2e1b2f

ABCDE Strategic Plan Model For Reference SMK

Directorate Technical and Vocational Education Director General of Secondary Education Ministry of Education and Culture Republic of Indonesia September, 2014

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ABCDE Model The ABCDE Model* to be a very useful model for understanding the flow of strategy from the beginning to the end of a cycle of strategic planning/execution activities: A – Assessment of current situation. This element involves scanning the external environment, competitive scanning, assessing the current situation; and clarifying perceptions of problems, needs, and opportunities. B – Baseline the gap. This element involves identifying performance gaps, and evaluating trends. C – Components of strategy. Include common concepts like core competencies, values, mission, vision, metrics, goals and objectives, portfolios, and processes. D – Delivery of component. This is the delivery of the strategic initiative, as well as other programs, projects, and operational work. Executives will formulate action plans; benefits capture plans, targets, standards, and metrics. E – Evaluation of progress. This includes review of progress, reporting, tweaking of goals, corrective actions, and learning.

Environment 1. Political Environment – Strategic initiatives are often international in scope, and they can be affected by local politics. Director of Strategic Initiatives has an important responsibility to interacting with local politicians as the company makes capital improvement investments in new rail terminals 2. Economic Environment– Here we would look at macroeconomic factors such as GDP, inflation, and industry growth rates. 3. Social Environment– There are differences in generations that have far-ranging affects upon the organization and its strategy. This contextual factor might affect HR strategic initiatives or marketing strategic initiatives. 4. Technical Environment– The technical environment gives us constraints, as well as new tools and capabilities. Many companies have launched initiatives involving social networking and mobile computing. 5. Legal Environment – The legal environment is closely associated with the political environment when we are considering the impact of new regulations or mergers and acquisitions. 6. Earth – Climate, earthquakes, are just a few of the concerns that can affect an organization’s strategy, hence its strategic initiatives.

4 important questions in the organization’s : 1. Where is the organization at? you have to know the background of the strategic initiative. 2. Where does it want to be? The vision statement is a crucial tool that needs to be understood and agreed by others. 3. How will the strategic initiative team close the performance gap? We will close the performance gap by applying resources and provide program leadership.” 4. How will the strategic initiative team measure and report its benefits? “We will identify the vital metrics of most importance to strategic stakeholders and communicate them per our program governance strategy.”

Operations people are important stakeholders for several reasons. – First, they are performers of the key activities of the current business model, and will also perform activities if the organization migrates to a new business model. – Second, they are providers and controllers of resources that are used in the strategic initiative. – Third, when operations people change their behaviors to adopt strategy, they create benefits.

A Polarity Map illustrates Organizational Tensions and Polarization. A template for a polarity map is shown in the following graphic.

The strategic-operational tension is shown on the left and right. Note the symbols in the corners. The “+” sign is a place for capturing the advantages of that pole, and the “-” sign is for the disadvantages. Thus, • The upper left is advantages of strategic focus; • the lower left is disadvantages of strategic focus. • The upper right is advantages of operational focus; • the lower right is disadvantages of operational focus.

The organizational goal is to stay in the upper half of the polarity map. Recognize that there will be tension between the two poles. Sometimes there will be more emphasis on operations and sometimes more on strategy. Be prepared to cycle back and forth. Recognize, too, that the downsides are natural and unavoidable. When the downsides of the polarity become noticeable, it is time to shift energy to the opposite pole. When you start to see the dysfunctions of the operational focus (too many projects and conflicting priorities), it is time to invest more energy in discussions about strategic alignment. The key, of course, is balance. Strategy is not the solution to the problem of operations, and operations is not the solution to the problem of strategy. , there are few problems to solve. Rather, there are tensions to manage.

What is Strategic Planning? Strategic planning is a systematic process through which an organization agrees on – and builds commitment among key stakeholders to – priorities which are essential to its mission and responsive to the operating environment

Strategic Management The process of identifying and pursuing the organization’s mission by aligning the organization’s internal capabilities with the external demands of its environment

Modern Environments are 1. 2. 3. 4.

Bigger than they used to be More diverse then they used to be Changing more quickly than they did in the past More powerful and threatening than they used to be 5. More competitive than used to be 6. More resource-limited than they used to be

Long-Range Planning

Strategic Planning

View future as predictable

View future as unpredictable

View planning as a periodic process

View planning as a continuous process.

Assume current trends will continue

Expects new trends, changes, and surprise

Assumes a most likely future and emphasizes working backward to map out a year-by-year sequence of events necessary to achieve it

Considers a range of possible futures and emphasizes the development of strategies based on a current assessment of the organization’s environment.

Asks “ What business are we in?”

Asks “What business should we be in? Are we doing the right thing?”

What is Strategic Planning? 1. Process to establish priorities on what you will accomplish in the future 2. Forces you to make choices on what you will do and what you will not do 3. Pulls the entire organization together around a single game plan for execution 4. Broad outline on where resources will get allocated

Why do Strategic Planning? 1. Be proactive about the future 2. Strategic planning improves performance 3. Counter excessive inward and short-term thinking 4. Solve major issues at a macro level 5. Communicate to everyone what is most important

A Good Strategic Plan should . . . 1. Address critical performance issues 2. Create the right balance between Capability of the organization to do vs what the organization would like to do 3. Cover a sufficient time period to close the performance gap 4. Visionary – convey a desired future end state 5. Flexible – allow and accommodate change 6. Guide decision making at lower levels – operational, tactical, individual

Strategic Planning Process 1. 2. 3. 4. 5. 6.

Articulating Mission and Vision Assessing the Environment Agree on Priorities Writing the Strategic Plan Implementing Strategic Plan Monitoring and Evaluating

Fundamental Questions to Ask 1. Where are we now? (Assessment) 2. Where do we need to be? (Gap / Future End State) 3. How will we close the gap (Strategic Plan) 4. How will we monitor our progress (BalancedScorecard)

Strategic Planning Model ABCDE Where we are

Assessment

Where we want to be

Baseline

Components

How we will do it

Down to

How are we doing

Evaluate

Specifics

• Environmental Scan

• Situation – Past, Present and Future

• Mission & Vision

• Performance Measurement

• Performance Management

• Background Information

• Significant Issues

• Values / Guiding Principles

• Targets / Standards of Performance

• Review Progress – Balanced Scorecard

• Situational Analysis

• Align / Fit with Capabilities

• Major Goals

• Initiatives and Projects

• Gaps

• Specific Objectives

• Action Plans

• Take Corrective Actions • upstream – revise plans

• SWOT – Strength’s, Weaknesses, Opportunities, Threats

Assessment Model: SWOT Internal Assessment: Organizational assets, resources, people, culture, systems, partnerships, suppliers, . . .

External Assessment: Marketplace, competitor’s, social trends, technology, regulatory environment, economic cycles .

SWOT

SWOT

Good Points

Possible Pitfalls

• Easy to Understand • Apply at any organizational level

• Needs to be Analytical and Specific • Be honest about your weaknesses

Assessment

Gap Analysis Baseline / Org Profile

Baseline

Challenges / SWOT

Gap = Basis for LongTerm Strategic Plan

Major Components of the C Strategic Plan / Down to Action

omponents

Strategic Plan

Mission Vision

What we must achieve to be successful

Objectives

Measures Targets

AI1

M1 M2 T1

T1

Evaluate Progress

What we want to be

Goals

Initiatives

Action Plans

Why we exist

O1 AI2 M3 T1

O2 AI3

Specific outcomes expressed in measurable (NOT activities) Planned Actions to Achieve Objectives Indicators and Monitors of success Desired level of performance and timelines

Down to Specifics

What are Action Plans? 1.

2. 3. 4. 5.

Down to Specifics

The Action Plan identifies the specific steps that will be taken to achieve the initiatives and strategic objectives – where the rubber meets the road Each Initiative has a ing Action Plan(s) attached to it Action Plans are geared toward operations, procedures, and processes They describe who does what, when it will be completed, and how the organization knows when steps are completed Like Initiatives, Action Plans require the monitoring of progress on Objectives, for which measures are needed Objectives Initiatives Action Plans

Evaluate

A Balanced Scorecard Sets Expectations, Removes Emotion, Establishes a Baseline to Measure Progress

Strategic Alignment

Internal Business Processes

Learning and Growth

Financial

Customer

Measurement

Cause and Effect

Managed Achievement

Alignment through Measurement

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Key Result (Performance) Areas These are priority areas within an organization’s mandate, consistent with the Mission Statement, the successful performance of which will largely determine the overall success of the organization.

Customers •IS&T contribution to initiatives of corporate strategic importance •Overall ability to deliver technical/business solutions and services •Extent to which s government initiatives

Learning and Growth

Finance •IT Cost per •IT Spending by portfolio category •Performance to spending targets •IS&T staff engagement score •IS&T capabilities vs. benchmarks •Price competitiveness of IT services vs. external benchmark

Balanced Scorecard Dimensions

Process •System downtime •Help desk first-call resolution rate •Tickets per ed per month •Number of failure incidents with business impact per quarter •Security audit results

•Willingness to engage IS&T in developing major projects •% of projects delivered to agreed scope, time and budget •Business owner satisfaction score •End- satisfaction score

Key Result Indicators Quantifiable criteria for measuring success in achieving management goals and objectives, overall and by Key Result Area : Specific Measurable Achievable Relevant, and Time Based