Chapter 5 - Leadership and strategic planning. After studying this chapter you will be able to understand: Leadership, strategic planning, the baldrige “leadership triad”, executive leadership, leadership competencies,...
Chapter 5 Leadership and Strategic Planning Leadership The ability to positively influence people and systems under one’s authority to have a meaningful impact and achieve important results Strategic Planning The process of envisioning an organization’s future and developing the necessary goals, objectives, and action plans to achieve that future The Baldrige “Leadership Triad” Strategic Planning Operations Leadership Customer and Market Focus Executive Leadership Defining and communicating business directions Ensuring that goals and expectations are met Reviewing business performance and taking appropriate action Creating an enjoyable work environment Soliciting input and feedback from customers Ensuring that employees are effective contributors Motivating, inspiring, and energizing employees Recognizing employee contributions Providing honest feedback Key Idea Six key leadership competencies can be described as navigator, communicator, mentor, learner, builder, and motivator Dale Crownover, President, Texas Nameplate Co. (a 2time Baldrige Award recipient) Leadership Competencies Navigator—creates shared meaning and provides direction toward a vision,mission, goal, or end result Communicator—effectively listens and articulates messages to provide shared meaning. Mentor—provides others with a role to guide their actions. Learner—continuously develops personal knowledge, skills, and abilities through formal study, experience, reflection, and recreation Builder—shapes processes and structures to allow for the achievement of goals and outcomes. Motivator—influences others to take action in a desirable manner. Leading Practices – Leadership (1 of 2) Create and deploy a customerfocused strategic vision and clear quality values Create a sustainable organization and environment for performance improvement, accomplishment of the mission, innovation, agility, and learning Demonstrate personal commitment to organizational values, develop future leaders, and reinforce high performance Create a focus on action and communicate with, empower, and motivate all employees Leading Practices – Leadership (2 of 2) Address organizational governance to include management and fiscal accountability, protection of stakeholder interests, and conduct evaluations to improve the leadership system Create an environment that fosters legal and ethical behavior Integrate public responsibilities, resource sustaining processes, and community support into business practices Leadership System Leadership system – how decisions are made, communicated, and carried out at all levels; mechanisms for leadership development, self examination, and improvement Effectiveness of leadership system depends in part on its organizational structure 10 Key Idea Creating the Leadership System An effective leadership system respects the capabilities and requirements of employees and other stakeholders, and sets high expectations for performance and performance improvements Strategic Planning “A strategy is a pattern or plan that integrates an organization’s major goals, policies, and action sequences into a cohesive whole.” Formal strategy includes: Goals to be achieved Policies to guide or limit action Action sequences, or programs, that accomplish the goals 12 Leading Practices Strategic Planning Systematic planning systems for strategy development and deployment Understand the competitive environment and the factors and strategic challenges that determine success, and gather and analyze a variety of external and internal data Align shortterm action plans with longterm strategic objectives, communicate them, and track progress Derive human resource plans from strategic objectives and action plans Identify key measures and indicators for tracking progress, reinforce organizational alignment, and compare performance with competitors Strategic Planning Process Reason for existence Future intent Mission Vision Attitudes and policies Guiding Principles Environmental assessment Strategies Broad statements of direction Strategic Objectives Action Plans Capabilities and risks Things to change or improve 14 Implementation Vision Where the organization is headed and what it intends to be – – – – Brief and memorable grab attention Inspiring and challenging creates excitement Descriptive of an ideal state provides guidance Appealing to all stakeholders employees can identify with Solectron: “Be the best and continuously improve” Mission Definition of products and services, markets, customer needs, and distinctive competencies Solectron: “…to provide worldwide responsiveness to our customers by offering the highest quality, lowest total cost, customized, integrated, design, supply chain, and manufacturing solutions through longterm partnerships based on integrity and ethical business practices.” Values (Guiding Principles) Define attitudes and policies for all employees, which are reinforced through conscious and subconscious behavior at all levels of the organization Pepsico: integrity, honesty, teamwork, accountability, balance Environmental Assessment SWOT Analysis Customer and market requirements, expectations, and opportunities Technological and other innovations Organizational strengths and weaknesses Financial, societal, ethical, regulatory and other potential risks Changes in global or national economy Factors unique to the organization, such as partner and supply chain needs Key Idea Strategy Development Strategies are broad statements that set the direction for the organization to take in realizing its mission and vision Strategic objectives are what an organization must change or improve to remain or become competitive Action plans are things that an organization must do to achieve its strategic objectives Strategy Deployment Developing detailed action plans, defining resource requirements and performance measures, and aligning work unit, supplier, or partner plans with overall strategic objectives Key Idea Strategy Deployment Strategic objectives and action plans often require significant changes in human resource requirements, such as redesigning the work organization or jobs to increase employee empowerment and decision making, promoting greater labor/management cooperation, modifying compensation and recognition systems, or developing new education and training initiatives Leadership and Organizational Structure Basic types of organizational structures – Line organization – Line and staff organization – Matrix organization Key Idea Organization structure As more and more companies accept the process view of organizations, they are structuring the quality organization around functional or crossfunctional teams Leadership in the Baldrige Criteria The Leadership Category examines how an organization’s senior leaders address values, directions, and performance expectations, as well as a focus on customers and other stakeholders, empowerment, innovation, and learning. Also examined is the organization’s governance and how the organization addresses its public and community responsibilities 1.1 Organizational Leadership a. Senior Leadership Direction b. Organizational Governance b. Organizational Performance Review 1.2 Social Responsibility a. Responsibilities to the Public b. Ethical Behavior c. Support of Key Communities Strategic Planning in the Baldrige Criteria The Strategic Planning Category examines how an organization develops strategic objectives and action plans. Also examined are how chosen strategic objectives and action plans are deployed and how progress is measured 2.1 Strategy Development a. Strategy Development Process b. Strategic Objectives 2.2 Strategy Deployment a. Action Plan Development and Deployment b. Performance Projection ... Creating? ?the? ?Leadership? ?System An effective? ?leadership? ?system respects the? ?capabilities? ?and? ?requirements? ?of? ? employees? ?and? ?other stakeholders,? ?and? ? sets high expectations for performance and? ?performance improvements... accomplish? ?the? ?goals 12 Leading Practices ? ?Strategic? ? Planning Systematic? ?planning? ?systems for strategy development? ?and? ?deployment Understand? ?the? ?competitive environment? ?and? ?the? ? factors? ?and? ?strategic? ?challenges that determine ... organization’s future? ?and? ? developing? ?the? ?necessary goals, objectives,? ?and? ?action plans to achieve that future The? ?Baldrige ? ?Leadership? ? Triad” Strategic Planning Operations Leadership Customer and Market