1. Leadership and Strategic Planning
Chapter 5
Leadership and
Strategic
Planning
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

2. Leadership
The ability to positively influence people and systems under one’s authority to have a meaningful impact and achieve important results
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

3. Strategic Planning
The process of envisioning an organization’s future and developing the necessary goals, objectives, and action plans to achieve that future.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

4. The Baldrige “Leadership Triad”
Strategic
Planning
Operations
Leadership
Customer and
Market Focus
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

5. Executive Leadership Defining and communicating business directions
Ensuring that goals and expectations are met
Reviewing business performance and taking appropriate action
Creating an enjoyable work environment
Soliciting input and feedback from customers
Ensuring that employees are effective contributors
Motivating, inspiring, and energizing employees
Recognizing employee contributions
Providing honest feedback
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

6. Leading Practices – Leadership (1 of 2)
Create and deploy a customer-focused strategic vision and clear quality values
Create a sustainable organization and environment for performance improvement, accomplishment of the mission, innovation, agility, and learning
Demonstrate personal commitment to organizational values, develop future leaders, and reinforce high performance
Create a focus on action and communicate with, empower, and motivate all employees
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

7. Leading Practices – Leadership (2 of 2)
Address organizational governance to include management and fiscal accountability, protection of stakeholder interests, and conduct evaluations to improve the leadership system
Create an environment that fosters legal and ethical behavior
Integrate public responsibilities, resource-sustaining processes, and community support into business practices
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

8. Leadership Competencies
Navigator—creates shared meaning and provides direction toward a vision,mission, goal, or end-result.
Communicator—effectively listens and articulates messages to provide shared meaning.
Mentor—provides others with a role to guide their actions.
Learner—continuously develops personal knowledge, skills, and abilities through formal study, experience, reflection, and recreation.
Builder—shapes processes and structures to allow for the achievement of goals and outcomes.
Motivator—influences others to take action in a desirable manner.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

9. Key Idea
The purpose of leadership theories is to explain differences in leadership styles and contexts.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

10. Leadership and Social Responsibilities
Ethics
Health, safety, and environment
Community support
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

11. Governance
Governance – the system of management and controls exercised in the stewardship of an organization.
Approving strategic direction
Monitoring and evaluating CEO performance
Succession planning
Financial auditing
Executive compensation
Disclosure
Shareholder reporting
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

12. Strategic Planning
“A strategy is a pattern or plan that integrates an organization’s major goals, policies, and action sequences into a cohesive whole.”
Formal strategy includes:
Goals to be achieved
Policies to guide or limit action
Action sequences, or programs, that accomplish the goals
Do the “point north” thing
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

13. Leading Practices - Strategic Planning
Systematic planning systems for strategy development and deployment
Understand the competitive environment and the factors and strategic challenges that determine success, and gather and analyze a variety of external and internal data
Align short-term action plans with long-term strategic objectives, communicate them, and track progress
Derive human resource plans from strategic objectives and action plans
Identify key measures and indicators for tracking progress, reinforce organizational alignment, and compare performance with competitors
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

14. Strategic Planning Process
Reason for existence
Future intent
Attitudes and policies
Mission
Vision
Guiding Principles
Environmental assessment
Capabilities and risks
Broad statements of direction
Strategies
Things to change or improve
Strategic Objectives
Action Plans
Implementation
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

15. Mission
Definition of products and services, markets, customer needs, and distinctive competencies
Solectron: “…to provide worldwide responsiveness to our customers by offering the highest quality, lowest total cost, customized, integrated, design, supply chain, and manufacturing solutions through long-term partnerships based on integrity and ethical business practices.”
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

16. Vision Where the organization is headed and what it intends to be
Brief and memorable - grab attention
Inspiring and challenging - creates excitement
Descriptive of an ideal state - provides guidance
Appealing to all stakeholders - employees can identify with
Solectron: “Be the best and continuously improve”
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

17. Values (Guiding Principles)
Define attitudes and policies for all employees, which are reinforced through conscious and subconscious behavior at all levels of the organization.
Alcoa: integrity, environmental health and safety, customer, excellence, people, profitability, accountability
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

18. Key Steps in Developing a Mission
Have each person think about the team, its core purpose, reason for existence, methods, strategic/long-term function.
Write down key words, figures, phrases or diagrams that communicate the essence of the core purpose; each person does this individually.
Collect these ideas on a flip-chart in round robin fashion.
Combine and clarify to identify only items which stand alone.
Do priority ranking. Discuss criteria for rankings to get sense of what is valued and why.
Each person writes a brief mission statement using the key ideas.
Read all statements aloud.
Discuss the draft statements and pick one to serve as a strawman.
Revise as needed.
Formally adopt the mission statement.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

19. Environmental Assessment
Customer and market requirements, expectations, and opportunities
Technological and other innovations
Organizational strengths and weaknesses
Financial, societal, ethical, regulatory and other potential risks
Changes in global or national economy
Factors unique to the organization, such as partner and supply chain needs
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

20. Key Idea
Strategies are broad statements that set the direction for the organization to take in realizing its mission and vision.
Strategic objectives are what an organization must change or improve to remain or become competitive.
Action plans are things that an organization must do to achieve its strategic objectives.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

21. Strategy Deployment
Developing detailed action plans, defining resource requirements and performance measures, and aligning work unit, supplier, or partner plans with overall strategic objectives.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

22. Policy Deployment (Hoshin Kanri)
Top management vision leading to long-term objectives
Deployment through annual objectives and action plans
Negotiation for short-term objectives and resources (catchball)
Periodic reviews
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

23. Key Idea
Strategic objectives and action plans often require significant changes in human resource requirements, such as redesigning the work organization or jobs to increase employee empowerment and decision making, promoting greater labor/management cooperation, modifying compensation and recognition systems, or developing new education and training initiatives.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

24. Key Idea
As more and more companies accept the process view of organizations, they are structuring the quality organization around functional or cross-functional teams.
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

25. Team-Based Organization Chart
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

26. Leadership in the Baldrige Criteria
The Leadership Category examines how an organization’s senior leaders address values, directions, and performance expectations, as well as a focus on customers and other stakeholders, empowerment, innovation, and learning. Also examined is the organization’s governance and how the organization addresses its public and community responsibilities.
1.1 Senior Leadership
a. Vision and Values
b. Communication and Organizational Performance
1.2 Governance and Social Responsibilities
a. Organizational Governance
b. Legal and Ethical Behavior
c. Support of Key Communities
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing

27. Strategic Planning in the Baldrige Criteria
The Strategic Planning Category examines how an organization develops strategic objectives and action plans. Also examined are how chosen strategic objectives and action plans are deployed and how progress is measured.
2.1 Strategy Development
a. Strategy Development Process
b. Strategic Objectives
2.2 Strategy Deployment
a. Action Plan Development and Deployment
b. Performance Projection
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, © 2008 Thomson Higher Education Publishing