1 discussion 13 creating vision and strategic direction

11

Discussion 13Discussion 13

Creating Vision and Strategic Creating Vision and Strategic DirectionDirection

22

“Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.”

Jack Welch

44

Strategic LeadershipStrategic Leadership

The ability to anticipate and envision the future, maintain flexibility, think strategically, and initiate changes that will create a competitive advantage for the organization in the future

55

Ex. 13.1Ex. 13.1 The Domain of Strategic The Domain of Strategic LeadershipLeadership

Architecture for alignment and implementation

Strategy

Mission

Vision

66

VisionVision

An attractive, ideal future that is credible yet not readily available

77

Ex. 13.2Ex. 13.2 Examples of Brief Vision Examples of Brief Vision Statements Statements (selected)(selected)

Motorola– Become the premier company in the world

Ritz-Carlton (Amelia Island) Engineering Dept.– Where no hotel has gone before – free of all defects

Johnson Controls Inc.– Continually exceed our customers’ increasing expectations

New York City Transit– No graffiti

Egon Zehnder– Be the worldwide leader in executive search

88

Ex. 13.3Ex. 13.3 The Nature The Nature of the Visionof the Vision

Current reality

Staying the course

Mov

ing

tow

ard

a de

sire

d

futu

re

Vision

99

What Vision DoesWhat Vision Does

• Links the present to the future

• Energizes people and gains commitment

• Gives meaning to work

• Establishes a standard of excellence and integrity

1010

Common Themes of VisionCommon Themes of Vision

• Vision has broad appeal• Vision deals with change• Vision encourages faith and hope• Vision reflects high ideals• Vision defines the destination and the journey

1111

VisionVision

• Works at multiple levels

• Must be inspirational at all levels

• Encourages independent action

• Self-reference

1212

MissionMission

The organization’s core broad purpose and reason for existence

1313

MissionMission

• Two critical parts:– Core values guide the organization– Core purpose is why the organization exists

1414

Leader’s Framework for Noble Leader’s Framework for Noble PurposePurpose

Purpose Description Basis for Action

Discovery Finding the new Pioneer

Excellence Being the best Fulfillment

Altruism Providing service Happiness

Heroism Being effective Achievement

1515

Strategic ManagementStrategic Management

Strategic Management– The set of decisions and actions used to formulate

and implement specific strategies that will achieve a competitively superior fit between the organization and its environment so as to achieve organization goals

Strategy– The general plan of action that describes resource

allocation and other activities for dealing with the environment and helping the organization attain its goals

1616

Develop Strategies Focusing OnDevelop Strategies Focusing On

• Core competence

• Developing synergy

• Creating value for customers

1717

Core CompetenceCore Competence

Something the organization does extremely well in comparison to competitors

1818

Synergy and ValueSynergy and Value

Synergy: the interaction of organizational parts to produce a joint effect that is greater than the sum of the parts

Value: the combination of benefits received and costs paid by the customer

1919

Strategy Formulation and Strategy Formulation and ImplementationImplementation

Strategy Formulation– The integrating knowledge of the environment, vision,

and mission with the core competence in such a way as to achieve synergy and create customer value

Strategy Implementation– Putting strategy into action by adjusting various parts

of the organization and directing resources to accomplish strategic goals

2020

Ex. 13.7Ex. 13.7 Making Strategic Decisions Making Strategic DecisionsEase of Implementation

Hard Easy

Strategic Impact

High

Low

High Impact, Hard to Implement.Major changes, but with potential for high payoff

High Impact, Easy to Implement.Simple changes that have high strategic impact – take action here first

Low Impact, Hard to Implement.Difficult changes with little or no potential for payoff – avoid this category

Low Impact, Easy to Implement.Incremental improvements, “small wins;” pursue for symbolic value of success

2121

Ex. 13.8Ex. 13.8 Linking Strategic Vision and Linking Strategic Vision and Strategic ActionStrategic Action

The Dreamer The Effective Leader

The Uninvolved The Doer

Action

Low HighLow

High

Vision

2222

SWOTSWOT

• Strengths

• Weaknesses

• Opportunities

• Threats

2323

Porter’s 5 Competitive SourcesPorter’s 5 Competitive Sources

• Potential new entrants

• Bargaining power of buyers

• Bargaining power of suppliers

• The threat of substitutes

• Rivalry among competitors