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A Practical Guide to Strategy Formulation
A Comprehensive Resource for Strategic Planning Teams

by Clint Burdett CMC
A Strategic Planning Facilitator and Senior Executive Coach

Table of Contents

 
Chapters Overviews

 

The Process
  The Leader's Task - to position, adapt and align the organization
  Concepts - uncertainty, supply and demand analysis, sustainment, lifecycles, strategy maps
  Approaches - scenarios for distant future, bottom-up for mid term and team forecasting for next year+
  Teams - setting up the team
  Research Methods - theoretical models to organize thinking
  Research Sources - where to find the data
  Meeting Sequence - agenda and timelines for scenarios, bottom-up and team based forecasting
  Synthesis to Strategies - how to use the SWOT
  Action Plans - how to prepare actions plans
  A Strategy's Value - Discounted Cash Flow - how to calculate a strategy's value
  Key Documents - creating a mission, vision and the strategic plan documentation

How To's - best practice identified from over 800 participants in my seminars
  Start Planning
  Plan Better
  Implement

What to Read - top 20 books to read and top five to read first

Services and Seminars - facilitation, training, coaching

Article Archive

Process
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Introduction

The Leader's Task
  - Predict, adapt or align
  - Leaders' tasks in the Strategy Formulation Process
  - Approaches and tension the strategic planning team faces in the Strategy Formulation Process

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Concepts - the initial discussions with the boss to put together a strategic planning team
  - Uncertainty
  - Rational, Experimental or Opportunistic - how big is the team
  - Firm, Business Unit or Department perspectives
  - Demand Analysis "The External World"
  - Supply Analysis "The Internal World"
  - Business and Product Lifecycles
  - Sustaining a Strategy
  - Using Strategy Maps: The Balanced Scorecard (aligning the firm) or Market Opportunities

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Methods - select the appropriate process to organize the discussions
  - Scenarios overview
    + Why Four Scenarios
    + Design steps
  - Bottom-up and Entrepreneurs overview
    + Why It Is Hard
    + Steps and Rules for bottom-up innovation
    + Change Agents and Coalitions
  - Team-Based Forecasting, top-down, large organizations overview
    + Your Role - Your Objectives
    + Steps

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Teams - considerations on team setup and meeting rules
  - Membership, An Open Attitude, Focused on Customers, facts and Decision Criteria
  - Meeting Rules
  - Measuring Team Performance

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Research Methods - focus and level of detail for strategic planning research
  - Use the 80/20 Rule - The Odds of Success - Focus on What Has Impact
  - Make Comparisons to Identify Patterns
    + How Far to Drill Down into the Data
    + Quantitative Comparisons (absolute comparisons)
    + Relative Comparisons (comparing opinions)
  - Presenting Data to the Team
    + Presenting Performance Data
  - Basic Models (and the language they provide)
    + Macro Trends
    + Comparing Macro Trends (expert opinion)
  - Porter's Competitive Forces
    + The Effect of Imitators
  - Complementors - Brandenburger and Nalebuff look at positive forces
  - Porter's Value Chain
  - Other value chains
  - Your Promise to Your Customers
  - The Buying Decision (also called the value proposition)
  - Measure how important your value is to the customer and how well you perform
    (IP Matrix)
    + The IP Matrix over time
    + Use the IP Matrix to compare your organization to your competition
    + How to present the IP Matrix to your team
  - Assessing Your Employees
  - Your Financials (preparations)
    + Comparison method - fundamental numbers
    + Corporate numbers
    + Business Unit numbers
    + Department numbers
  - Who does the research

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Research Sources - key web references where to start research
  - Scenarios
  - Macro Trend
  - Competitive Forces
  - Complementors
  - Value Chain
  - Customers
  - Employees
  - Financials

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Meeting Sequence - process flow charts, meeting agendas, timelines
  - Considerations -- to study, to rehearse your options, to align efforts, work off-site?
  - Scenarios
  - Bottom-up or Entrepreneur Process in a Small Firm
  - Bottom-up Process in a Large Firm
  - Team-based forecast (typical corporate planning)
    + The team meeting
    + Assess the market (research)
    + Purpose, vision, options meeting
    + Assess options, assess costs
    + Decide the best options meeting and coordination
    + Finish action plans and budget inputs
    + Budget meeting
    + Team-based forecast timelines
    + Key points
  - Which approach is best?

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Synthesis to Strategies - prioritization techniques
  - Define Critical Success Factors with examples
  - The Classic SWOT Analysis- definitions, process, strategic priorities
  - Variations on the Classic SWOT
    + Side-by-side SWOTs
    + Add the competition and Critical Success factors for strengths and weaknesses
    + Decision Matrix
    + Summary - pros and cons, which method is best?

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Action Plans - templates
  - Page 1: The basics - who, what, why, goals, help need, steps, Gantt Charts
    + What ifs and flow charts -- do you add them?
    + Template
  - Page 2: Benefits and costs for the action plan
    + Compute Cash Flow from Operations for the plan
    + Subtract the indirect overhead to equal the Value Added
    + Should you project improvements in Gross Margin?
    + What if my plan does not create new sales?
    + Template
  - Page 3: Coordination
  - Key Points

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A Strategy's Value - Using Discounted Cash Flow (DCF) - fundamental approaches to calculate a strategy's value added
  - A story - A Strategy's Value the Boss's Perspective
  - Define compounding and discounting
  - Discounted Cash Flow and Net Present Value
  - The concept of the terminal value or residual value
  - The logic of valued added
  - Discount rate considerations
    + Hurdle rate
    + Weighted Average Cost of Capital
      ++ Cost of Debt
      ++ Cost of Equity (Capital Assets Pricing Model (CAPM))
      ++ WACC considerations - effect of leverage
  - Terminal Value approaches
    + Annuity Method
    + Market Value to Sales Ratio
    + Compare Annuity to Market Value to Sales
  - Strategy Steering Committee Key Questions
  - How to combine Action Plans into a value added estimate for a strategy
  - Key Points

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Key Documents - focus, style, templates and creation techniques
  - Which Audience
  - Mission, Purpose and Vision - the key statements
     + How to write the mission and vision
    + The style for a mission and vision statement
    + JFKs example of combining the mission and screening
  - Strategy, Objectives and Key Players
  - Situation Analysis
  - Programs and Coordination
  - Financials
  - Executive Summary (first in the presentation but written in this sequence)
  - Appendices
    + Summary, key players resume, financial schedules
    + Funding requirements, legal/HR assessment, whatever else
  - Key Points

Best Practice

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How To Overcome Barriers - best practice research on improving strategy formulation
  - How to get people to start planning
    + How to sell the benefits of using a strategic planning process
    + How to improve the skills we need
    + How to get the people
    + How to deduce the vision when the boss has not been clear
    + How to identify patterns of change requiring you to think strategically
  - How to plan better
    + How to get technical people to think big picture
    + How to overcome corporate silos
    + How to find time to do strategic planning
    + How to shift from a short term to a long term focus
    + How to do strategic planning faster
  - How to implement
    + How to overcome day to day pressures
    + How to make people accountable for strategic tasks
    + How to overcome the fear of change
    + How to keep the plan flexible
    + The plan dies inside the bureaucracy, what do I do?

What to Read

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Introduction (Select the individual pages for printing)
  - Best Books on the strategy formulation process and best strategies
  - Bare Bones Primer -- You are, "poof," a strategic planner

My Services

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  - Clint Burdett's Biography
  - Facilitator
  - Coaching
  - Training
  - Why Clint Works
  - Institute of Management Consultants Code of Ethics

My Seminars

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Article Archive

Link to Article Archive

 



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