Many organizations do not have a formalized strategy, because their managers assume that the goals of functioning for employees are obvious. By implication, they want to maximize profits in the shortest possible time.
As practice shows, a changing environment, different understanding of success, different vision mean that organizations do not achieve their goals, and what is worse, they do not know why they did not achieve them.
It is worth establishing and planning a vision and goals for the coming years as well as a path to achieve the goal in order to operate more efficiently, and when something does not work out, know what needs to be changed.
Each organization has resources, from finances, through employees and their competences, to technologies and devices. We operate in a competitive market, where the fight for the customer is very fierce. Our organizations depend on suppliers and are subject to legal requirements and market regulations. The right strategy is the missing link that shows how to achieve the assumed goals with limited resources and market requirements.
The strategy implements the vision of the organization, indicating the directions of activities and the way of organizing resources.
We will gain certainty that all stakeholders of the strategy, including owners / supervisors, management and employees, correctly understand the goals and how to achieve them, thanks to the unambiguous definition and communication of the strategy. This does not mean, however, that the strategy is a set of unchanging elements. The strategy should be treated as a model that begins to live immediately after implementation, and thus change. The purpose of this change is to ensure adequacy in the context of the market and organizational situation and to correct errors that cannot be avoided.
The elements of the strategy form a logical model:
- Policy context – description of the baseline
- Strategic analysis – assessment of the organization
- Mission and vision – general vision of the future
- Goals – a description of the goals that allow you to achieve the vision
- Structure – target structure model
- Processes and Communication – recall processes and assign them goals
- Resources – identifying resources and defining their role
- Initiatives – a description of the path to achieve the goals of the strategy
- Risks – opportunities and threats for the implementation of the strategy
A specific description of what we want to achieve with the time horizon. The goals constitute a cascade, a certain chain of links in various areas closely related to each other. It is difficult to imagine the implementation of a new technology without knowledge transfer or without spending funds. A number of related goals should therefore be planned. Of course, you can use the proven methods of Balanced Scorecard (BSC) or management by objectives.
The only activity of the organization, i.e. the actual activities carried out in the organization, are processes and projects. Therefore, it is important to indicate how they are to translate into the implementation of the strategy. Processes, i.e. cyclical repetitive activities related to the duplication of activities and their products, are assigned to specific goals. We have described the methods of process management in the article. Likewise, projects that are more perishable are designed to serve specific purposes by engaging the resources of the organization.
A very important element, although underestimated, is properly designed communication in the organization. It is responsible for collecting information, transmitting and providing feedback and is an important motivating factor for employees who are responsible for the implementation of the strategy.
Another element of the model are initiatives, i.e. sets of activities similar to project portfolios of a similar nature, or concentrated around one area of the organization. They are a direct indication of how we want to achieve our goals. The initiatives will tell us whether we want to achieve maximum income by selling assets or by investing and expanding the market.
The strategy building model is based on understanding the organization, indicating goals, linking processes, projects and resources, proper communication and improving the management of activities. You can automate these and many other areas using the BPM tool. You can read about the tool’s functionalities in the BPM GRC article
Proper recognition of the factors that may be a stimulus to achieve goals and negative factors, both in the environment and in the organization itself, is extremely important in order to ensure the effectiveness of the strategy. You can read about risk management methods in the article … ..
Organizations often have so much to do in selected areas that they build dedicated strategies:
- Strategy for digitization and computerization
- Marketing strategy, social-media
- Development strategy
- Financial management strategy
- Human resource management strategy
- Business continuity strategy
The functional strategy covers the narrower scope of the organization’s operational activity, but often addresses the requirements in more detail. An example is the IT strategy, which additionally covers the area of functionality of ICT systems, architecture, etc. It is very important when building a functional strategy to ensure full adequacy with the main strategy. Of course, it is possible to develop a functional strategy without the main strategy, but it requires wider arrangements and analyzes.
A large company in the logistics industry required a fast and effective computerization process. The lack of a main strategy made it difficult to recognize the role of IT in the organization. Thanks to the organization of workshops for business and the determination of actual needs, it was possible to plan both the list and the model of services provided by the IT office. Thanks to the strategy automation in BPM, it was possible to introduce order based on processes and architecture (TOGAF). The organization ensured the efficiency of its systems and IT infrastructure and identified gaps that need to be filled.
The manufacturing company faced declining profitability and increasing competition. The analysis showed a great optimization potential related to sales, offers, logistics, purchases and the production itself. Lack of proper communication and working in accordance with the principle of "everyone to himself" meant that each area optimized its own operation without taking into account the interests of other areas. The lack of common goals and the incentive system magnifying the organizational dysfunction led to a situation where the margin was disappearing and the Company's competitiveness was dropping. Workshops, working together, going through the process from sales to warranty service showed obvious problems and obvious solutions. The division of areas into key and support areas as well as the division of responsibilities resulted in a further increase in the margin.
On the verge of bankruptcy, we catch everything. One of our clients found themselves in such a situation and with the last of their strength decided to carry out a joint project. We conducted a value chain analysis. We cut off everything that did not give this value. It was connected with the termination of some contracts with customers and resignation from the assortment produced for many years. We developed a new strategy that focused on survival but gave an incentive to grow and skip a certain stage. Thanks to the enormous motivation of managers and employees, the implementation of the strategy and restructuring plan, it was possible not only to keep the Company, but also to put it very quickly on the path of generating value.
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