1. The Use of Strategic Goal Modeling
In the BSC Strategic Management Process
Al-Falak Electronic Equipment & Supplies Co.
Samer Abdulhadi, General Manager, Strategic Planning & Performance Management

2. Agenda
Modeling
The case
Conclusions
Q&A 2

3. Objective
Share with you our experience of using graphical goal models to reason about strategic initiatives and link them to BSC business strategies 3

4. Introduction Modeling Quantitative Qualitative Mathematical
Decision/Planning Tables 4

5. Introduction - + ++ - - +++ Availability [Disaster Management service]
Cost
Effectiveness
Accessibility
Security
Privacy
Cellular network - +
Ad hoc network ++
- -
Hybrid network
+++
Correlation matrix 5

6. Introduction Modeling Quantitative Qualitative Mathematical
Decision Tables
Graphical
Business Process Reengineering – Requirements Engineering
the i* modelling framework: Modelling Strategic Actor Relationships and Rationales
Strategy Map
Graphical Model
Goals and cause and effect links 6

7. Modeling Strategic Actor Relationships and Rationales
The i* modeling framework:
Modeling Strategic Actor Relationships and Rationales

8. Modeling Strategic Actor Relationships and Rationales
Introduced in 1995 by Prof. Yu through a PhD dissertation: Modelling Strategic Relationships for Process Reengineering.” at the UofT, Canada
In 2008 The i* framework became part of an international standard, The User Requirements Notation (URN), which received final approval as an international standard today in Geneva, Switzerland, as ITU-T Recommendation Z.151 8

9. Modeling Strategic Actor Relationships and Rationales
i* stands for “distributed intentionality, referring to the premise that actors are intentional and that they do not necessarily share common goals…
An actor interacts with other actors not only through actions or information flows but also relate to each other at an intentional level.”
(Source: Samavi, R., Yu, E., Topaloglou, T., 2007) 9

10. Strategic Actors – Main Concepts
have goals, beliefs, abilities, commitments – Implicit Intentionality
I want …
I can…
Strategic Dependency Relationship
(Source: Yu, 2001) 10

11. Strategic Actors – Main Concepts
depend on each other for goals to be achieved, tasks to be performed, resources to be furnished
(Source: Yu, 2001)
Task
Actor
Softgoal
Goal
Resource

12. Strategic Actors – Main Concepts
have choice, reasons about alternate means to ends (goals) – Explicit Intentionality
Means-Ends alternatives
(Source: Yu, 2001) 12

13. Strategic Actors – Main Concepts
functional/goal refinement/operationalization
(Source:Samavi, R., Yu, E., Topaloglou, T., 2007) 13

14. Linking Strategic Initiatives to Business Strategy
The Case:
Linking Strategic Initiatives to Business Strategy

15. The Case
"A strategy is an Integrated set of choices that position a firm in an Industry to earn superior returns over the long run."
Source: Rivkin, J., "Where do great strategies come from?” Harvard Business School Faculty Seminars and Lectures, as reported in the Palladium Kaplan and Norton BSC Certification Boot Camp Nov/Dec ( 15

16. The Case Five choices that need to be made to develop a strategy:
What will our economic model look like
Which customer will we serve, where, and what will we provide?
How can our organization serve these customers?
What skills do we need to have in our organization?
What is the portfolio of initiatives and their timing that we need to execute?
Source: Hambrick, D. and Fredrickson, H., 2005, “Are You sure You Have a Strategy?” Academy of Management Executives, 2005, Vol. 19, No. 4, as reported in the Palladium Kaplan and Norton BSC Certification Boot Camp Nov/Dec ( 16

17. The Case Help verify that initiatives are linked to business strategy
Help resolve conflicting goals of various actors across the organization
Note: Some actors, goals, and strategic initiative
alternatives are intentionally omitted and/or altered
for simplicity and to illustrate the modeling process
only, not the actual decisions made 17

18. Strategic Performance Management
The Case
Board of Directors
President & CEO
Business Divisions
Division 1
Division 2
Division 3
Division 4
Division 5
Strategic Performance Management
Support Departments IT HR
Accounts & Finance
Marketing
- Act as independent Companies
- Headed by General Managers
Shared Support Departments 18

19. Iterative BSC-Strategic Goal Models Translation Process
The Case:
Iterative BSC-Strategic Goal Models Translation Process
Copyright © Al-Falak, Samer Abdulhadi, 2010

20. Iterative BSC-Strategic Goal Models Translation process1 9 8
BSCs
Reflect on the BSCs and initiative
Make Decisions
- Company
- Business Divisions (BD)
- Support Departments (IT) 2 3 4 5 6 7
Identify Affected goals
Identify strategic initiative
Develop Strategic Dependency model
Develop initiative execution alternatives
Develop Strategic Rational Model
Analyze Strategic Rational Model
at all the required levels and initiative requirements
(Project Charter)
between BDs and Support (IT)
to execute the initiative
refinement and validation
Copyright © Al-Falak, Samer Abdulhadi, 2010 20

21. Identify Affected goals
Company - BSC 1
BSCs
Financial 2
Customer
Identify Affected goals
Internal
Learning

22. Business Division 1 - BSC
BSCs
Financial 2
Customer
Identify Affected goals
Internal
Learning

23. Company and Business Davison 1 - BSCs
Contribution 1 2
Financial
Customer
Internal
Learning
Support

24. Business Division 1 – BSC and Initiative3
Identify strategic initiative
Financial
Customer
Initiative
New System
Internal
- Jobs
- Competencies
Project Charter
Budget
Learning

25. Business Davison 1 and IT Department - BSCs
Contribution
Financial
Customer
Internal
Learning
Initiative
New System 3
Strategic Dependency

26. Division 1 and IT Department – SD Model4
Develop Strategic Dependency model
Initiative
New System 26

27. IT Strategic Rational Model5
Develop initiative execution alternatives 27

28. Division 1 Strategic Rational Model2 6
Identify Affected goals
Develop Strategic Rational Model 28

29. Strategic Rational Model6
Develop Strategic Rational Model 29

30. Strategic Rational Model
Contribution 6
Develop Strategic Rational Model 30

31. Strategic Rational Model2 6
Identify Affected goals
Develop Strategic Rational Model

32. Strategic Rational Model
Leaf 6
Develop Strategic Rational Model 32

33. Strategic Rational Model
Leaf 6
Develop Strategic Rational Model 33

34. Develop Strategic Rational Model6
Develop Strategic Rational Model 34

35. Develop Strategic Rational Model6
Develop Strategic Rational Model 35

36. Develop Strategic Rational Model6
Develop Strategic Rational Model 36

37. Analyze Strategic Rational Model7
Analyze Strategic Rational Model
Evaluation
Horkoff, Yu, Liu, 2006) 37

38. Analyze Strategic Rational Model7
Analyze Strategic Rational Model 38

39. Analyze Strategic Rational Model7
Analyze Strategic Rational Model 39

40. Analyze Strategic Rational Model7
Analyze Strategic Rational Model 40

41. Analyze Strategic Rational Model7
Analyze Strategic Rational Model 41

42. Analyze Strategic Rational Model7
Analyze Strategic Rational Model 42

43. Analyze Strategic Rational Model7
Analyze Strategic Rational Model
What if? 43

44. Develop Strategic Rational Model6
Develop Strategic Rational Model 44

45. Analyze Strategic Rational Model7
Analyze Strategic Rational Model 45

46. Analyze Strategic Rational Model7
Analyze Strategic Rational Model 46

47. Analyze Strategic Rational Model7
Analyze Strategic Rational Model 47

48. Analyze Strategic Rational Model7
Analyze Strategic Rational Model 48

49. IT Department – Modified BSC8 9
Make Decisions
Reflect on the BSCs and initiative
- Jobs
- Competencies
Project Charter
Budget
Initiative
New System
Developer 49

50. The Case:
Conclusions

51. Some Concerns about the Process
Adds a layer of complexity to the strategic analysis and management process
Time consuming, specially with large models and very busy management agendas
Visualization issues arise with very large models
Involves human judgment that is subject to errors and subjectivity
Unfamiliar to analysts, strategists, executives, and practitioners that we met. Requires familiarization training
However, it … 51

52. Some Benefits of the Process
Engaged decisions makers in a collective strategic decision making process, specially when used
(a) for key and strategic initiatives and decisions
(b) for few (5 to10) critical goals
(c) for few major actors (3 to 5)
Helped capture tacit domain knowledge systematically, grasp the basic assumptions, make them explicit, and document and communicate the rationale behind the decisions
Helped qualitatively validate and align the strategic initiatives to the divisions’ and company’s BSC strategies by reasoning about goals, analyzing tradeoffs, resolving conflicts, and identifying and responding to risk 52

53. Some Benefits of the Method
Helped provide a basis to deal explicitly with change
Can be generalized to qualitatively analyze goals at and between various organizational and strategy levels/BSC perspectives
It also helped promote strategic thinking, which is “fundamentally an act of imagination” (Coyle, 2008) and an “intense judgment” (Galt et al. 1997, as reported in Coyle, 2008) using models that explicitly provide the foundation to stimulate further insight 53

54. References
Coyle, 2008, Chapter 11, Scenario Thinking and Strategic Modelling, The Oxford Handbook of Strategy, Oxford University Press, 2003
Horkoff, J., Yu, E., and Liu, Li. (2006) Analyzing Trust in Technology Strategies. International Conference on Privacy, Security and Trust (PST 2006), Markham, Ontario, Canada.
i* website, 2004, an agent-oriented modelling framework
i* Wiki, 2010,
Samavi, R., Yu, E., and Topaloglou, T., 2007, Strategic Reasoning about Business Models: A Conceptual Modeling Approach, Inf. Syst. E-Business Management (7): (2009).
Yu, Eric, 2001, Strategic Actor Relationships Modelling with i*, A tutorial given at IRST/University of Trento, Italy, December 2001, Italy, extracted from 54

55. Thank You
Q & A 55