Tag Archives: strategic planning

Boiling down IOT (Internet of Things) into Something Useful

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By Denise Harrison

Is your company seeing these trends?

  • Many experienced workers are retiring from the workforce, often taking tribal knowledge with them.
  • Hiring difficulty: especially among the skilled trades.

Well, your customers also face these trends – how can you help?  Can you design products/services that will help alleviate these issues for your customers?  Technology can be key to providing the solution.  Yes, you have heard the buzz words “big data” and IOT (Internet of Things) – but how can these technological advances work for you?   Is there a way that you can install sensors in your equipment to have alerts when the systems need maintenance or parts need to be replaced?  Would this ability help streamline and extend your customer’s maintenance department?  (Maintenance departments are one of the areas where there is a shortage of skilled labor.)  Could you add a service that would provide maintenance when these alerts are raised?  This could be onsite service or remote service, directing the plant personnel on what needs to be done.  Would resolving these issues for your customers give you a competitive advantage?

How do you get started?

Start by using sensors and collecting data within your own organization.  Start small (say air compressors); understand what is possible, then assess how you can use this knowledge to provide value to your customers. Starting with an in-house function allows your team to work on the kinks before you get an application into the field.  Your first thoughts on customer applications may change after you have seen the impact of technology in-house.

Buzz words and bite sized chunks

Buzz words like IOT (Internet of Things) can be meaningless unless you cut them down into bite sized chunks, small applications where you can test how they perform.  As you learn by using the technology, you will create a more efficient manufacturing facility as you link operations and then can look at “big data”.  Starting small allows the team not to be overwhelmed by the amount of data generated.  As you develop this knowledge, you will be able to apply it to your products, service and your internal processes.

Technology, one of Michael Porter’s five forces, can be harnessed to give you a significant competitive advantage.  As you develop a strategic plan, be sure to look at emerging technologies and how you can leverage them to provide a competitive advantage.

To learn about how to look at technology in your strategic planning process please contact Denise Harrison: harrison@thestratplan.com.

Strategic Planning: A Time for Reflection

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Denise Harrison

In today’s fast paced economy, we often find that executives think that they don’t have the time to reflect on their business.  While quick decision-making is important, taking the time to reflect on the possible choices and looking at long-term implications will set your business on a course to achieve long-term success. 

Reflection: What does this mean?

 There are three areas that we often find are missing when teams develop a strategic plan: 

  • Discussion of topics for research
  • Collection of research in a consistent format
  • Analysis tools that help the team think through what is the best use of the company’s resources

 Topics for Research

Many teams have a two to three-day retreat to develop a strategy; this is a good time for team building and gets ideas out on the table.  But if your strategic planning is done during this retreat, we often find that the team does not have all the information to make good decisions.  Our recommendation is a more-robust three-step process:

1.       Situation Analysis

Select the topics that require further research (markets, competition, opportunities, etc.)  Selecting these topics and then developing research allows the team to have better information for decision-making when they get to the next step.

2.       Strategy Formulation

Review the information to have a shared base of knowledge and make decision based in this information. Now you can select the strategies and the strategic initiatives that are most likely to position your company for future success. Take the time to develop action plans for your strategic initiatives so that you know what steps need to be undertaken, who is responsible and how much time and money each step will take.

3.       Implementation

Vet the action plans to ensure that accomplishing the steps will achieve the objective and assess whether the company has enough and the right talent and financial resources to accomplish the task set out in the action plans. 

 A three-step process allows your company to reflect on the correct topics to research.  Once the research is completed, the team can reflect on the information gathered to make informed decisions concerning the future direction of the company.

Consistent Format

After you select the topics for research and develop the research, it is important that the information is collected in a consistent format.  Having templates that aid in consistent information development allows for better analysis as your team develops its strategy.  For example, without a consistent format, you will get different information regarding opportunities to be researched and this will make it hard to compare options because the data is inconsistent.

Analysis

Once you have reviewed the research and the team has a shared base of knowledge, it is important to use analytical tools to assess where the best opportunities lie in your business. Tools include the Growth/Share matrix (often associated with Jack Welch) to assess which of your core business should get the most emphasis.  Analytical tools pull out the key variables and help the team better understand the information that has been gathered.

 If you would like to learn more about a structured process, with templates for research and analytical tools to help digest the information please call or email me: Denise Harrison, 910-763-5194 or harrison@thestratplan.com.

© Copyright 2017 by Spex, Inc., Wilmington, NC — Reprint permission granted with full attribution.

What Went Wrong with Apple Maps?

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applemapswordle

By Denise Harrison
Apple is world renowned for its innovative product introductions – but as you look back over history, there have been plenty of flops to go along with the successes. Think about Ping and Rokr – oops, you missed these? Most people did. And, the introduction of the Apple Map application was another clunker. Using Maps, you were driven into dead ends; airport runways were specified as roads, and general requests often put you in a wrong location (yes, you ask for a hospital and get a restaurant.)

What happened? Most simply, Apple underestimated the task:
• Dedicated team was too small
• Team did not have the required competencies
• Testing was local (Maps worked well in Cupertino)

What did Apple do to recover?

Reassessed the importance of the application:
o If deemed important then move forward
o If not, use a third party provider, Apple does this for lots of applications it deems “non-mission critical”
o In this case, Apple decided that the application was critical.
Reassessed the true resourcing and capabilities requirements. The team now has thousands of members (versus a few hundred) and the team has diverse skill sets including how to use “big data” real time (traffic).
Broadened the testing – this meant a move to public testing. This decision forced Apple to move away from its traditional secrecy policy. Large numbers of users in many geographic locations were needed to get the kinks out of Apple Maps.

What does this mean for us?

When executing your strategy, you will need to select a few strategic initiatives (projects) that you need to accomplish. That number should be around 6-10, fewer if you have a large enterprise-wide project. Next you need to develop action plans for each project, with clear action steps, who is responsible and how much time and money each step will take. Assess the resources required for each action plan. Are you under-resourcing and dooming the project to failure?

Once you embark on your strategic initiatives, you may need to make course corrections – did you underestimate the scope of the project – if so, reassess and fix it.

Once a project is complete (or it bombs), do a “lessons learned”:
• What went right?
• What did not go well?
• What will we do differently in the future?
While Apple does not always hit homeruns, it does learn from its mistakes. Apple now uses public testing for many of its new releases – a real divergence to its former cloak of secrecy.

If you have additional questions about strategy development or implementation, please email Denise Harrison at harrison@thestratplan.com or call 910-763-5194.

CVS Envisions a Different Future

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May16

By Denise Harrison, President, Spex, Inc.

Over the years CVS has transitioned its business from a traditional drug store format to become more of a health care company. Why? Some trends indicated that more profitability came from its sale of prescription drugs, so a focus on health care rather than consumer products made sense. To further its movement into being a healthcare provider, it purchased MinuteClinic and opened MinuteClinics providing routine diagnosis, screening and vaccinations in many of its stores. CVS is now the biggest operator of health clinics and dispenser of prescription drugs in the US. Surprised?

What Would CVS Give Up to Continue its Focus on Providing Healthcare?

Focusing on transitioning from drug store to healthcare provider may seem like a no-brainer – but what did this move mean that CVS would have to give up? If the company was truly focused on health and wellness, how could they continue selling cigarettes? Thus, in 2015 it made the decision to stop selling tobacco products – losing $2 billion of CVS revenue.

Gutsy move – maybe. Or were they just seeing the trends and positioning themselves for the future? Some statistics on smoking adults:

  • 1965: 43%
  • 2014: 18%

As you can see the trend away from smoking is significant and if this continues down to below 10% as is expected, tobacco products would a declining revenue source. In addition, with cigarettes off the shelves, partnerships with regional hospitals were easier to form.

Key Take-Aways

  • Do you have a vision of what your company needs to look like in 10 years? An idea of what it will take to be successful?
  • Are you willing to give-up current business to focus on positioning your company for future success?

Giving up revenue and profit is a difficult decision, but companies who are willing to make these though choices may position themselves for long-term success.

If you are ready to assess what it will take to make your company successful in the future, please contact me at: 910-763-5194 or harrison@thestratplan.com and we can discuss how to develop a strategy that will position your company for future success.

 

Strategic Planning: What Did You Learn? How One Company Went Off Course

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April 16 wordle

“Follow the plan; don’t get distracted by seemingly large opportunities,” replied one CEO when asked the question: What was one key learning from following a systematic approach to strategic planning. How did he learn this? The hard way, of course.

For years, this CEO and his team used a systematic approach to strategic planning.  That approach uses data and information to help teams focus on the areas that will optimize their future results.  In his case, we identified small-medium sized organizations as one target segment.  We also identified that the larger organizations in this industry had requirements that were beyond our core capabilities.  By focusing our efforts on the smaller organizations we would match our core capabilities with the requirements of this business segments.  This strategy proved to be successful.

 What happened subsequently?

Well, a Board member had connections to a large prestigious organization and wanted the CEO’s company to become its supplier.  The opportunity for revenue growth was significant; the Board member pushed and this CEO’s company took on the large organization as a customer

 Outcome

Resources were pulled from all areas of the company to meet this large organization’s requirements – pulled away from serving the smaller targeted organizations.  The large organization may have increased top line growth, but it had a significantly negative impact on the bottom line and hurt relationships with the customers that we had determined were the best fit with our core capabilities.

Lessons Learned

It is important to stick with your strategy unless something has changed in the business environment and/or your core capabilities.

 Can You Make Exceptions?

Of course, but ensure that your exception make sense.  For instance, in this example the following question should have been asked:

  •  Do the requirements of this large prestigious organization map to what the requirements of large organization or small-medium sized organizations?

If the answer is the requirements look like the large segment, then we should say no. If the answer is the requirements look like the ones we usually find in our small-medium sized organizations and map with our core capabilities, then this exception is acceptable.

Sticking to your strategy may require discipline in the face of a large revenue opportunity. Use your strategy to determine its fit with your organization’s capabilities.  Once you have a strategy, use it to assess a specific situation to see if an exception is warranted.

For information on strategy development please contact Denise Harrison at: 910-763-5194 or harrison@thestratplan.com.

©2015 Spex, Inc., Wilmington, NC 28401

Reprint permission granted, with attribution.

Overcoming Strategic Gaps–an Optics Design Case

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Optics Photo 2015By Denise Harrison, President, Strategic Planning & Execution, Spex, Inc.

 Would integrated circuits be constrained by what could physically fit on a chip? Heat and size issues were becoming constraints to what was possible with traditional technology. Synopsys, a world leader in software and IP for semiconductor design and verification manufacturing, saw that its customers’ applications required more and more functionality in ever-decreasing size and understood that traditional technology would no longer fit the bill. They observed that recent breakthroughs in the optics world would enable more functionality on chips, using light and lasers rather than traditional wiring.

But how could Synopsys develop a core competency in this area? The team at Synopsys knew there was significant “know-how” being developed in this area that would be important to providing the solutions for which their customers were looking. In order to find the leading scientists in optics they searched patents and found that one name appeared again and again, Optical Research Associates. The folks at Optical Research not only understood the technology, but were continuing to develop breakthroughs in this area of optics design and engineering. Synopsys saw that a partnership with Optical Research Associates would be beneficial to their future success and embarked on a successful acquisition campaign. Now Optical Research (renamed Synopsys Optical Solutions) is a business unit within Synopsys and this important technology is enabling Synopsys to meet its customers’ goal of developing continually smaller chips while increasing the functionality.

Lessons Learned:

1. Have a clear vision of where you want to go and what your company needs to look like in order to be successful in the future.
2. Develop the list of characteristics that will be needed to achieve that future vision.
3. Understand which of these characteristics you have and which you need to develop. Don’t pretend you are better than you are with regard to the characteristics required for success.
4. Decide whether to make or buy the skills required. Developing the skills will take time, but acquisitions often do not deliver as expected.
5. Develop a plan to acquire/develop the skills.
6. Monitor to make sure you stay on track.

Understanding where you want to go and what gaps you have to fill to get there are important parts of strategic planning. Without a clear vision of the future, companies often flounder and try to go after too many choices. With a clear vision of the future, your team will understand the 2-3 important gaps that you need to work on in order reach the desired end-state. Trying to be everything to everybody will not allow you to truly be successful in the few areas that will make a difference.

If you would like to discuss ways to enhance your strategic planning efforts please call: Denise Harrison, 910-763-5194; harrison@thestratplan

©Spex, Inc. Wilimington, NC, 2015

The Importance of Scenarios when Dealing with Uncertainty

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Denise Harrison                                                                                                                       President, Strategic Planning and Execution, Spex, Inc. 

How can we better deal with uncertainty when we develop our strategic plan? Many strategic planning teams struggle with this issue. While it is important to understand what you know as facts and what your assumptions for the future are, I have found that some good scenario planning helps a team prepare for a wider range of possibilities that might occur in the future. By looking at different scenarios, the team can assess what will work in each scenario and then select the approach that will benefit the company in the most likely scenario, but still balance that approach by not closing out options that will work if another scenario unfolds.

Generating Different Scenarios

Some teams generate a probable scenario and then move to generate an upside and downside. For example, the probable scenario is that we achieve 10% growth and the upside is 12.5% and downside in 8%. While this works, I find that high performing teams that discuss actual events/trends and then develop scenarios corresponding to possible outcomes, is a better way of generating scenarios. Some examples of trends and events include:

  1. Product launch is delayed by 12 months.
  2. Oil prices plummet and stay down longer than our probable scenario (this could be good or bad depending on what your company does and who your customers are).
  3. Acquisition has unexpected fall-out and customers leave and go to competitors.
  4. Customers’ preferences change faster than we anticipate (Blackberry).

You should have your team members come up with ideas for different scenarios. Generate what these environments will look like out 5-10 years. Ask the question: What will we need to do to be successful if this is the competitive landscape? You will notice before you start working, that several of the outcomes will have similar results. Select scenarios that will generate different actions.

Once you have generated different “success” strategies, then evaluate which scenario is most probable, and then look to see what you can do to accommodate other “success” strategies so that you maintain your flexibility moving forward.   While you may not be able to keep all options open, you may be able to keep some avenues open until time passes and you have a better view of what the future has in store for your company.

Another benefit of this exercise is it allows the team to think more broadly and be more aware of the external factors that impact your business. This will help the team deal with the changes that will inevitably happen during the planning horizon. As you start to see movement that makes another scenario unfold, bring the team back together and recast your strategy. If you anticipate this movement faster than your competition, it will help position your company to gain market share or weather an industry downturn better than your competitors.

If you are interested in discussion more about how to generate scenarios that will enhance your team’s flexibility please give me a call at: 910-763-5194 or email me at harrison@thestratplan.com.

(c) 2015 Spex, Inc. Strategic Planning and Execution