Monday, May 29, 2017

Balanced Scorecard Utilization

One of the key takeaways from this week’s readings is about the balanced scorecard. This topic resonated with me very strongly since it is something that I have been utilizing frequently within my organization recently.  How it is utilized within my organization is similar as well as different from how the article described the tool, but it is a great tool to help ensure new strategic initiatives are developed.
              One method on how I use the tool differently is currently I utilize as a method to reference the various aspects, but I currently don’t track key performance indicators.  The template I utilize has the ability to track key performance indicators, but it hasn’t been a priority to adopt currently.  Our focus has primarily been on tracking key projects and status.  Another area my organization is adopting the balanced scorecard is tracking key customer projects and reviewing how we are delivering services to our internal customers.  With this view we track how our individual work groups are supporting the customer and this also includes our staffing plans.  Additionally, a customer view of the balanced scorecard allows the team to track how we are performing to the customer’s budget additionally we utilize it to track our customer’s key projects and our status.  If we notice that we are starting to impact delivery we can make appropriate changes.
              Recently I utilized the balanced scorecard as a tool to review impacts of a change in strategy. The tool was extremely useful as a way to ensure all aspects of my organization’s business was reviewed for impact.  After the successful implementation of the strategy, the balanced scorecard has been adopted for other areas/projects and is now a common tool that is utilized for new projects and is continually reviewed for new impacts and improvements for my organization.
              After reading the material this week, I believe my organization needs to expand the usage of the balanced scorecard and start to track key performance indicators so we can use the balanced scorecard tool as a method to ensure we are using facts and data with our implementation of our strategy.

The Real Value of Strategic Planning

From this week’s articles, I found “The Real Value of Strategic Planning” to be a very pragmatic guide on how to approach a Strategic Planning process. Although in several aspects, some of the points mentioned in the article may sound like “common sense”, from my past experience I agree that many of the mistakes mentioned are actually very common in real life practice.

I will summarize below the key takeaways from the article:

  • Strategic Planning meetings should have a reduced number of participants, limiting participation only to decision makers.
  • Participants should be fully prepared to participate in the discussion.
  • Only strategy should be discussed in these meetings. All other issues should be treated in separate meetings.
  • The Head of Strategic Planning should lead and moderate the meeting avoiding deviation from the goals/objective of the meeting. 
  • The Ultimate Goal should be to prepare Executive Management to be ready to make, at crucial times, decisions that are aligned with the Company’s Strategy. This exercise should be seen as a training of their “minds”.
  • Strategic Planning is a process and, as such, should be under continuous evaluation/continual improvement and adapt into a changing environment. 

During the course of my career, I was once invited to participate in a Strategic Planning meeting. Based on that experience, I can totally correlate with many of the flaws that the author identified in this article, and in my opinion, the results of the meeting were disappointing.

To get into some of the details, the meeting was not lead or moderated by anyone. There was an agenda but not clear goal for the meeting was identified or communicated to the team. The team invited was very large and many participants were not prepared to contribute meaningfully. Some of the participants were more focused in trying to impress the CEO than to have a profound discussion about the Strategy of their Business Units and Company. The discussion derailed into other issues in multiple occasions. The meeting showed a deep power struggle within many of the BU Heads rather than showing collaboration and team work spirit. At the end of the meeting no clear objective was achieved, and was uncertain on how much the discussions contributed to the Strategy. My impression was that participants left the room confused rather than much better informed about the Strategy of the Company.

Guidance as the one provided in this article would had been very helpful at that time.

When Strategy needs a Strategy - KaBoom case

The KaBoom case is an interesting one for the  below two reasons:
It shed light on to the nonprofit world which is totally unknown to me
It also reveals strategic pitfall that could be considered for the corporate world
One take away from that case is, organization should be able to swiftly shift strategy when reaching a critical juncture point. After 7 years into existence, KaBoom went quasi-instantaneously from directly building playgrounds with corporate partners to providing training/grant to help communities build those playgrounds. 
While the vision of the organization stayed the same: “to help develop a country in which all children have within their communities, access to equitable, fun, and healthy play opportunities, with the participation and support of their families and peers.” ,  lack of systems in place to manage growth had make the organization a victim of its own success. External pressure from  noticeable partners indicates difficulty in working with the organization and will command a change in strategy.
At that point,  important questions have to be asked:
a) What is an appropriate strategy? 
b) When is it appropriate to change strategy?
Keep in mind that those questions are equally relevant in the for-profit or corporate world. The approach of the Harvard Business Review in “Your Strategy needs a Strategy” offer elements of solutions to those questions by providing a roadmap for strategy formulation. The research stated a strategy formulation can “fall into of four buckets according to how predictable an industry’s environment is and how easily companies can change that environment”.  Which means that strategy depends on predictability and malleability.
From 1995 to 2002, Kaboom never changes its playground building strategy. Circa 2003, a proposed strategic shift came into life with no plan of future changes nor further upgrades. KaBoom operates as if it were in an environment where “the most attractive positions and the most rewarded capabilities today will, in all likelihood, remain the same tomorrow”.  Apparently, Kaboom employs a classical strategy which is very common in mature industry. But, consideration of the below facts reveals the opposite:
Competition in playground builds is increasing at a high rate (changing competitive dynamics become a threat).
Large corporation can be slow movers, making partnership more difficult to build but lasting longer 
Competition extends to the for profit world ( For-profit organizations also build playgrounds…)

We see that KaBoom evolves in a fairly predictable and malleable environment. As such, a more visionary strategy approach in finding new partners and funding would have been appropriate. 
Having worked for a small Financial Accounting software firm, I witnessed similar pitfall regarding strategic style choice. 
Fifteen years ago, a goal was set by the owner of company XYZ: Offer investment accounting solution that produces comprehensive, accurate and timely book of record to support key investment management processes. 
A target market was also set: large and most complex investment funds in the US, including institutional investors, plan sponsors, asset managers. 

The plans never changed. While the company knew some kind of growth at the beginning, we were operating on survival mode. We depended on a few key clients to make end meets. In a highly unpredictable industry such as software industry, our strategy did not allow us to keep up with technological innovation, global competition…Three years after my departure, the company was acquired by a competitor only because of its a high valued customer list. I am confident that a more adaptive approach could have given a different output.

Giving My Team a Driving Force (by Alex Rice)

Four months ago, I took over leadership of my program at a large local nonprofit organization after my predecessor left what he called “a sinking ship.” As the program’s new leader, I discovered that we lacked a strategy and had accordingly become overextended by saying “yes” to everything regardless of its fit. In response, I began a process of trying to determine which activities we should engage in and which activities we should not. Accordingly, I found Building Your Company’s Vision particularly valuable for helping me build a framework to assess what we should engage in.

Interestingly, our team actually tried to define our core values, core purpose, BHAG, and vivid description last year under my predecessor. However, the process was never completed, and we took some missteps along the way. For example, many of the values we considered were not truly core values. Most concerning, however, is that we never truly defined a core purpose, which is one reason that we continue to engage in activities that are not a strategic fit. Unsurprisingly, then, we discussed a BHAG that was based on unbridled expansion rather than one that actually made sense for our program. Having read this article, I would like to meet with my team in the coming months to truly define our core ideology and to envision our future so that these pieces can guide future action.

Besides guiding future action, these concepts resonated with me as a way to communicate with my team about what we do. I would like them to understand the central purpose of our work rather than to view our work as a collection of loosely-related activities. Furthermore, since we are planning to hire at least two additional people by August, these tools allow me to clearly articulate to job candidates what our program is trying to achieve. As the article indicated, it is essential to have a team that supports and will work towards your core purpose.

While I value core values, core purpose, BHAG, and vivid description as new tools to help guide my program, I am still trying to determine how to apply them in the nonprofit context. Traditionally, nonprofits are expected to articulate their mission, vision, and values. I do not know to what extent the elements identified in the article directly translate to those three pieces and what nuances may exist when defining a nonprofit organization or program. Presumably, the core purpose is roughly equivalent to the mission, the core values are the values, and the envisioned future is the vision. However, I would appreciate guidance on how to translate core ideology and envisioned future for a nonprofit audience.

-- Alex Rice

Strategic Success Starts with Vision

"Building Your Company's Vision" is an article I wish I had read three months ago, prior to participating in a vision-creation exercise for my work unit. For background:

I work for the US Department of Justice, automating business processes into the enterprise's workflow tool. This unit started in 2007 with four employees and one business process, and has grown to 50 people supporting 30 business processes. For most of this period, the unit grew at a manageable pace, but the work performed remained focused on the central goal of improving efficiency through reengineering and automation of the enterprise's business processes. In 2013, the unit accepted a project with requirements requiring so many resources the unit doubled in size. As the large project concluded and people began to focus on other efforts, it became clear that the quick growth without a defined vision, strategy, and structure created a reactionary environment. Employees were merely fighting fires and resolving problems without a clear direction on how to "get out of the slump." A working group was formed, of which I was a part, to recommend changes to transform the unit into a more agile, productive shop. There were two primary recommendations out of the working group: a new organization structure that better fit the way the unit worked, and a defined vision. The hope was that with a vision, a better strategy could be developed to help define what the unit could achieve.

When it came to creating a vision, we didn't have the background knowledge on how to come up with a great vision. Primarily, we thought that a single vision statement would suffice. Upon reading this article, I now understand a good vision has multiple components, which don't have to (and probably shouldn't be able to) be reduced to a single pithy sentence or statement. Upon reflection now, I understand we were stuck defining what Collins and Poras call "descriptive statements" as our vision statement. We weren't asking the "why?" to get us to our "fundamental purpose," and we weren't defining core values or a Big, Hairy, Audacious Goal (BHAG). 

In its examination of BHAGs, the article highlights NASA as an example of an organization who set and achieved a BHAG, but never set another BHAG. I have often personally thought of NASA as an example of how our government used to do great and hard things, but doesn't anymore. I now see the underlying reason why I have that perception; government leaders haven't recently set any BHAGs that have been achieved. As the authors state, a BHAG "has a clear finish line" for the organization to run towards. In many instances, BHAGs are the achievement(s) the company is most well-known for: Boeing and the jumbo-jet, Stanford being the Harvard of the west, NASA and the moon-landing, etc.

Strategy development requires an understanding of where you want your organization to go, so that the organization can define the right way to move in that direction. Creating a vision is merely the first step, but a critical step, in defining a successful strategy.

Balancing Different Strategic Styles

One of the key takeaways I have through this week’s reading is the need to be flexible with one’s strategic approach, especially in relation to different business units with different goals/needs.  In “Your Strategy Needs a Strategy,” Martin Reeves discusses four different approaches to strategy development and the different ways they can be appropriately applied to an organization’s strategy: classical, visionary, adaptive, and shaping.  We can see these different strategic approaches in action in the “KaBOOM!” case study.  In the organization’s founding years, it deployed a shaping strategy, in building its network for partners, funding mechanisms, and community-based organizing and playground-building.  The cycle of fundraising for and then executing each of the individual project builds were the experiments for executing the strategy.  By having an approach that focused on collaboration and partnership development, KaBOOM further demonstrated the use of a shaping strategy, which resulted in a robust partner list. 

However, in the early 2000s, when faced with competitors entering the market, KaBOOM was forced to examine a different strategic thrust with the growth of new lines of business, while maintaining its community-based playground builds.  At this point, the KaBOOM Dream Builders were engaging in classic strategy development for their work—they knew their market and their competitors.  But the new training and advocacy lines of business were being forced to respond to a changing market, demonstrating a more visionary strategy in action.  In making a conscientious decision to expand its training program and focus on advocacy, KaBOOM was responding to the market, and the entry of new competitors into it, to differentiate KaBOOM as the leader around creating accessible play for children in low income communities.

Whether this was intentional, KaBOOM demonstrates how organizations can employ different strategic approaches simultaneously.  I think of application at my own organization.   We deliver multiple services with a varying number of competitors, and the needs of those services are determined by the local economic factors.  When we develop our strategy to deliver these services, we go with a classic approach, which makes sense for some of our services, but not all of them.   For example, it would make sense for our financial empowerment program to be more adaptive, so that we can meet the growing need to address the growing student loan crisis.  We need to be nimble and respond to market forces, but I think we often get hung up on specific services we offer rather than the core values and purpose of the organization.  We forget that there are different ways and opportunities to achieve that purpose.  I am in a position where I can help guide strategy, but I’m not the final decision-maker.  And without buy-in and support from all organizational decision-makers, we will not be able to achieve successful execution of different strategic approaches.

Analyzing the Importance of Uniqueness in Strategy Development

            When analyzing this week’s lecture, readings, and case studies, an important notion appears to be lacking from emphasis when discussing strategy development: an organization’s uniqueness. Given that week one’s lecture centered around the concept that strategy involves creating “a unique and valuable position, involving a different set of activities, and creating fit among those activities,” it seems remaining distinct would be a factor that is more heavily stressed when developing an organization’s strategic plan.  
I believe the importance of uniqueness is suggested well in “Your Strategy Needs a Strategy.” The authors point out that companies in different industries, such as oil and software, are making grave mistakes by attempting to utilize the same strategy plans. However, the question that comes to mind is whether this critique should apply to companies within the same industry as well. For instance, when examining the food industry, we observe the continued trend in eating natural foods that are “clean” or free of artificial ingredients.[1] Yet when we examine Panera Bread and McDonald’s, we see clearly the problems that can arise when a company, such as McDonald’s, forgoes its uniqueness in order to follow industry trends or to mimic the competition’s strategic plans.
Panera identifies their core mission to be “food as it should be,” meaning that the company’s food is “clean, raised responsibly, nutrient rich, savored and enjoyed, personalized, and transparent.”[2] According to the company’s 2000 Annual Report, “real food, not processed or commercial” has been the company’s focus even before the industry trend leaned in this direction.[3] As of 2017, the company has successfully achieved the mission it set forth in 2015 to eliminate all 96 additives from its menu.[4]
However, just because this strategic plan is working for Panera, it does not mean that it applies well to McDonald’s. According to The Wall Street Journal, McDonald’s strategic plan erred in the last five years because of the company’s focus on providing healthier, cleaner options to align with what they thought was their competition: “fast-casual” restaurants such as Panera.[5] As it turns out, McDonald’s customer base is interested in fast food, such as burgers and fries instead of wraps and salads.5
Therefore, when analyzing industry trends and competitors to create or redesign a strategic plan, I believe greater emphasis needs to be placed on an organization putting their unique aim at the forefront. Otherwise, it becomes too easy for companies to sway with the times or follow what appears to be working for others, creating problems for themselves as they drive away the customer base to whom they initially appealed.

[1] Cheang Ming, “Trends for 2017 show wellness and foods link to grow,” CNBC, Dec 2016,
[2] Panera Bread, 2017,
[3] “Panera Bread Company Annual Report 2000,” Panera Bread, 2001,
[4] Kate Taylor, “A clean-food revolution is sweeping fast food, but Panera’s CEO still has one major concern,” Business Insider, 2017,
[5] Julie Jargon, “McDonald’s decides to embrace fast-food identity,” The Wall Street Journal, Mar 2017, 
Choosing the Right Strategy is Key

In the article Your strategy Needs a Strategy, the authors discuss how matching one’s strategic style to their industry leads to success.  Many times, leaders get stuck in their ways and continue to use a strategic style that may not be the best fit for the industry they are in.  The two key factors of predictability and malleability create the four strategic styles.  These styles are classical, adaptive, shaping, and visionary.

In my military experience, I have witnessed how a change in the operating environment can limit the effectiveness of the unit if the leader does not change their strategic style.  During my previous tour I was assigned to a helicopter squadron.  While operating at homeguard (stateside), the mission was always training.  The strategy and planning of training missions was well laid out knowing a year in advance when specific detachments would be deployed.  This led itself well to the classical strategic style being successful.  The Officer in Charge (OIC) and the Operations Officer could map out the training missions and qualifications for a detachment a year in advance and roughly stick to that schedule with minor hiccups along the way.  The maintenance schedules and inspections of aircraft could easily be worked into the long range plan with all the information at hand.  The detachment that I was a part of ran smoothly at homeguard with plans laid out well in advance.

When my detachment was deployed overseas, the operational execution of missions was not as smooth as it could have been.  The OIC had success with his classical style back at homeguard and he continued with that style on deployment.  This led to attempting to plan missions, aircraft maintenance schedules, and long range schedules without sufficient knowledge to be successful.  While on deployment, we were working with up to 6 different Navies at a time and NATO.  We could plan for a mission the night before and then the day of have it changed to something completely different.  Sometimes the mission would change several times within an hour.  The first few months of deployment were a struggle and the detachment would often rewrite plans over and over again every time something changed.  About halfway through the deployment, the OIC started to realize all this rewriting was a waste of time.  The ever changing deployment environment led itself much better to an adaptive strategy style.  Flexibility was the key to success and once the OIC realized this, the detachment operated much smoother.  Long term schedules no longer needed tons of detail, just a general outline was sufficient.  Just a change in everyone’s mindset helped to improve the situation as well.  Over time, you realize that the situation will continually change no matter what and you just have to make the best decisions from the information you have at the time.

Looking back at my past experiences, I can say that choosing the right strategy for your particular situation can have a huge impact.  Pick the wrong strategy and you’ll limit your success and most likely do needless work.  Pick the right strategy and watch how things improve.

- Tony Capotosto       

Vision Statements are Important Too

I really enjoyed reading the article, "Building Your Company's Vision".  I worked at a six-year old manufacturing plant for two years and while I think Sabra Dipping Company (my previous employer) excelled in some areas, after reading this article it became apparent they were lacking in most areas.  While I was aware what our five values were (Trust, Openness, Passion, Daring, and Caring), I never fully understood what our vision was.  I feel like by not having an actual black and white vision, it made people feel as if what they were doing everyday was not purposeful.  Obviously, our main goal was to get hummus out the door, but why?  Why was it important for us to make sure we were able to push a healthy and safe product out the door?

In April of 2015, Sabra Dipping Co. experienced one of the worst events a manufacturing company can experience:  a recall.  When this occurred, management made it clear that no one was going to lose their jobs and because the recall was voluntary and no customer experienced sickness or death, it would be easier for customers to trust us again.  The voluntary recall was the best time to come up with a vision statement, but this was a wasted opportunity.  Employees still faced the problem that they were facing before, lack of purpose in the workplace. 

When you look at companies like 3M, Hewlett-Packard, and Sony, they all have two things in common:  they have been around for many years and most everyone knows of these companies.  Like the article describes, this is because of their lasting visions.  The article also talks about how many things within companies might change, but with a strong core ideology, everything within a company can remain strong.  After experiencing life on the other side of this, I can say I fully agree.  Sabra’s management and rules were always changing.  This was eternally ongoing because of how new the company was and how inconsistent it could be.  Rather than stressing themselves out, employees would leave the company to work for a more established company.  In the first half of 2016, we lost 36 employees who had been with the company since it opened.  This was a huge blow for Sabra, but could have been rehabilitated by establishing core ideologies and eventually, a vision statement.

My favorite part of this article was reading about the Big, Hairy, Audacious Goals (BHAGs).  I worked in Human Resources during my time at Sabra.  There was nothing that went on in the plant that I was not aware of, but after reading this article, I realized I never knew what Sabra’s BHAG’s were.  The ongoing goal was to get more hummus out the door than the previous shift, but that goal does not show that management cares about the people.  Also, when this goal was met, there was no celebration for it and no praise was given to the employees.  How about a goal of reducing retention?  Or even a goal of getting to know everyone employee who works on your shift?  It is easy to say what your values are, but if the values are not practiced, then there is no point in having them.  Without values, we do not have a vision statement and then we get into the problem of employees not knowing what their purpose is.  This article taught me the importance of core values and ideologies and vision statements.  With the combination and practice of these, perhaps the cycle at Sabra Dipping Company will be broken.