Summary
The globalization of the market is motivating a growing need to design the future in a thoughtful way, away from improvisation or impromptu, leaving behind sudden inspiration and giving way to conceptual analysis and a methodological process based on the various aspects that make up the conjunctural environment., in the existing expectations and in the expected achievements.
Without abandoning their enriching experiences and their management dynamics, it is increasingly clear to business people the need to design the future of their decisions today and coherently select the most convenient and propitious alternatives to success. Such an aspiration will demand adequate support in Information Technology, which now, in the shadow of the corporate strategy umbrella, can be determined in a more rational way.
What do we understand by business strategy?
The Business Strategy is nothing other than the set of guidelines, goals and means that are identified in order to define a course for the company. It is like a great umbrella under which all the actions, tactics and operations, of that one are established. It is the frame of reference that delimits the corporate field of action and that allows integrating the activities and purposes of the various areas of the company and personnel, in particular, by pointing out the scope, limitations and priorities of what to do in business and its impact on the activities of each one.
As is known, personnel in the company carry out their activities at various levels, which are generally classified as operational, tactical and strategic. The tactical-level personnel, who come to be the intermediate managements, have the function of supervising the achievement of the operational functions and the establishment of short and medium-term work plans, and the strategic-level personnel, that is, the High Management has the fundamental task of defining and making business strategies viable, working normally for the medium or long term, evaluating results and clearing obstacles.
The referential framework provided by the Planning must conclude in specific actions that lead to the achievement of the achievements established therein, which must, finally, encompass all levels of the company that take the form of tactical and operational actions that is, projects and activities aimed at achieving the factors indicated by the strategy.
In the following video-lesson Professor Antonio Verdú, from the Miguel Hernández University of Elche, makes a presentation about the concept of strategy and its levels in the organization.
How can the strategic vision be developed?
There are several ways to achieve the strategic vision, that is, to design the business strategy.
The most common and direct is the one that is in the minds of managers and business owners. Because, without a doubt, every high-level executive has a strategy design that is the product of his years of experience, his knowledge of the business, his intuition and his propensity to risk. Many entrepreneurs, who have been very successful in putting this mental strategy into practice, find no reason not to continue using it at all times or circumstances, sometimes being reluctant to adopt alternative forms or to accept that others, other than themselves, can point out different approaches.
In reality there should be no contradiction since this way of looking forward is perfectly complementary to any other that follows a scheme guided precisely by such knowledge and intuition, which will always be invaluable capital within the company.
However, apart from this non-formalized strategy, there are various ways and methods to achieve the design of the strategic vision, which are basically differentiated by their scope (degree of detail and operational level of their results) and by their scheme methodological (time required to develop the Plan and measure consumption of personnel resources, especially at a high level).
In other words, the differentiating points between the different modalities of strategic planning approach are, the level of operation or detail of the results obtained and the time and cost of resources consumed for its development. We will talk about this in the next section.
All the methods conclude in a set of more or less common results, with slight differences between them. These results are known as Vision, Mission, Objectives, Strategies, Goals, Critical Success Factors, Analysis of Strengths / Weaknesses and Analysis of the Competitive Environment. We will develop these concepts in the following lines.
Do not confuse strategy with operability
As we have mentioned, every business strategy design process is linked to the depth or level of detail of the results to be obtained and the time and effort framework that the process will require when carried out. Although these concepts are normally closely related, the challenge lies in finding a procedure that, while simple and viable over time, produces results that do not remain with gaseous concepts. That will be discussed below.
In the day-to-day management of the company, "day-to-day" problems are generated, which occupy a pre-eminent place in the course of its operations. These problems consume most of the time and occupy the highest priority of the workers (Executives or employees), preventing them from seeing other aspects perhaps more important for the survival of the organization, but in which said importance is not self-evident., as in operations, but require a special effort of analysis and reflection for detection. Furthermore, a different approach is required to fly over everyday circumstances and, from above, envision a broader and more general picture. It is the transition from the short-term vision to that of the medium and long term.
That is why, when we are immersed in a business planning process and suggest turning our attention to the design issues of the future, letting go of the burden of everyday life, many executives find it difficult to do so, showing great impatience to achieve concrete results., of immediate application and showing great concern when such products are late in arriving. It is the fear, justified by the way, that all the time that is taken in a process of this nature may end in generalities or in common places that do not contribute much to the solution of the burning problems of the present.
Here it is good to make two reflections, on the one hand, it is not good to mix strategy with operability because they both walk at different times and the pressure to achieve short-term results can affect the quality of long-term vision. However, if services are to be contracted to develop the strategic vision, it is good to ensure that the results land, because the other extreme, "flight" without descent, is also not recommended.
So how do you achieve terrestrial results without compromising the quality of strategic vision development?
The answer lies in the methodology to be followed, that is, in the structuring of a process that goes from the most general to the most particular and where there is no contradiction, but rather collaboration, between the two approaches.
What is planning?
Many times the Plan tends to be confused with the Planning. This is a misconception because the Plan is a result, the initial result of Planning, which is a process and even more, it must be a philosophy, a concept that must be part of the business culture and that involves support, commitment and attitudes. change management at all levels.
Change management: plan update
The plan is nothing more than a set of assumptions and goals to be achieved through the use of resources, both human and technical or financial, in determined terms and with expected benefits. However, it should be kept in mind that this set of actions and projects corresponds to a »snapshot» taken at the time the Plan was developed, based on the prevailing conditions at that time. But as these conditions change continuously, the Plan is reviewed and updated including new activities, verifying the conclusion of others and reprioritizing the set in accordance with the new characteristics of the environment. This is the Plan administration process, which is an integral part of the Planning process and which is often neglected or ignored.
Let us emphasize, it is not enough to have built an excellent and well thought-out Plan, since it will lose its validity soon after its elaboration. It is extremely important to prepare, and incorporate into the business culture, a Plan administration procedure that guarantees its permanent updating. Of course, in a viable way, that is, that it will not happen that updating the Plan is more expensive than its own development. Later we will expand concepts about the Plan administration scheme.
Summarizing:
In summary, Planning is a process that must be incorporated into the business culture and, therefore, must be supported by the highest executives and be known and executed with the participation of all organizational levels. A key success factor is the methodical and permanent updating of the Plan, which must be achieved by consuming the shortest time possible for senior managers but at the same time allowing a clear and faithful image of the state of its development and at all times. so that its content corresponds to current requirements. When the latter does not happen, the Plan becomes outdated, loses validity and credibility and ends up being forgotten at the bottom of a shelf.
Mission and vision
Let's go with an intellectual exercise. Throughout the following paragraphs we will ask you to develop the topics that we will discuss. In the end, if luck and patience are with us, we may have something like an elementary strategic scheme for your company (or yourself).
We must first describe what our company is. Indicate the main line of business, its scope, its market penetration, its expectations and those of its associates and workers, and, finally, its projection in society. This is known as the Mission of the company. It can be a paragraph of a few lines or a description of a page or more. Everything is to the customer's liking. Our recommendation is that you synthesize, keep it short and put in the minimum space all the topics that we mentioned above and that constitute the description of what your company is.
Once the above description was achieved, very close to reality and to what is happening in our company today, let's move on to the moment of dreams. Let's go on to describe the Vision.
Describe in another paragraph your dreams about your company. Put what you would like to achieve in the long term (ten years would be fine), no matter that now it may seem crazy or exaggerated. Anything goes when developing this image of what our most expensive aspirations intimately long for. There is no place for shyness or humility when we develop the Vision of our company. Ahead.
To finish put both definitions on different pages and analyze them in a few days, to see to what extent they identify your feelings about it.
The vision and mission are two concepts that are developed in the initial stage of the elaboration of the Business Strategic Plan, with the participation of a group of executives of the highest level of the company.
Objectives and critical success factors
Continuing with the exercise, identify a set of achievements to be achieved that are of the utmost importance for the fulfillment of the Mission. Do not confuse them with projects or tasks. These, projects or tasks, are a set of activities that are carried out within a specific time frame, with the use of company resources, that have a beginning and an end and that generate specific products, while the objectives are, more Well, purposes, achievements to be achieved and its timing is not necessarily defined specifically. Oh, and try to make it very few between five and ten will be fine. They have to be related to the company as a whole, so when you identify them, don't put on the cap of any particular function or management, think about the company.
What things, aspects, areas or activities of the company cannot fail, because if they fail they will fail our most expensive purposes, make it impossible to achieve the objectives and keep us from fulfilling the Mission? Try to think about what they are, also think about what are the things, aspects, areas or activities that are key to achieving these goals. These concepts are known as Critical Success Factors. They should also be very few, three to five will be fine. Redáctelos and pass them clean for later review.
- Ford or opedepo analysis. Competitive forces. Problems.
The word FORD comes from the first letters of Strengths, Opportunities, Risks and Weaknesses. The word OPEDEPO comes from Opportunities, Dangers, Weaknesses and Potentials. They are exactly the same thing, use the one you like best. Here we will talk about OPEDEPO.
Continuing with the exercise, now analyze things from two different positions. First, start by thinking about the factors internal to your company, those over which you have the power to intervene directly, modifying or reinforcing them. We will call these potentialities (or Strengths) and weaknesses. Make two lists, one with those things in which your company is well, in which it is strong and another list with the things in which your company is not well, which must be improved or changed because they constitute real weaknesses that threaten achievement of the objectives and fulfillment of the Mission.
Then do the same but meditating on the factors of the environment, those on which you do not have the capacity to act, who belong to the environment that interacts with our company. Again, make two lists, one of them identifying those that can be used for the benefit of our company, if the appropriate measures are taken. These are the Opportunities. The other list prepare it with those aspects of the environment threatening and can harm us if we do not act in a timely manner, these are the Dangers (Threats, Risks.
These four lists are a self-critical analysis of the utmost importance to set courses in the most consistent way with what we can and cannot do (internal analysis) and with the things that we can take advantage of or that can threaten our achievements (external analysis). You can place them on separate pages but, if they fit, it is preferable to have the page divided into four parts and put the lists on them, on a single page.
We can complement this analysis by incorporating the fundamental characteristics of the central forces of competitiveness, that is, those factors or market segments that determine our business in the field of competitiveness and our relationship with them. Let's specifically identify them and point out how they affect our business, clearly and very briefly.
The analysis would not be complete if we do not incorporate "day to day", that is, the relationship of the main problems that affect us today and that compromise the achievement of the Goals. Identify them, list them, focus only on the main problems, do not repeat or redound, overturn, concretely but effectively, your vision of the main situations that are hindering the progress of your business.
Closing the circle
What to do with all the material produced? Let's see, the first thing is to stop singing and review it with other eyes a day or two later. After having submitted it to this review and its corresponding corrections, there are several ways to take.
A scheme is to start with the Objectives and, for each of them, identify actions that contribute to their achievement. Then it is necessary to go on to determine the actions that will protect the achievement of the first actions identified and, finally, to determine quantitative measures of the achievement of these various actions (metrics). These quantitative measures have to do with numerical factors and temporal aspects (what to achieve - numerically - and when).
Subsequently, these objectives and goals must generate objectives and goals in the different functions of the company, which will also have their own metrics and deadlines, and then with the sub-functions and so on.
Another scheme consists of identifying Projects that contribute to the achievement of the entire scheme developed, with deadlines and those responsible. These projects may be short, medium or long term, depending on the factor they contribute to solving, and would become part of a portfolio of concrete and measurable actions to be carried out over time.
Use one and only one, whichever you consider most convenient, and prepare your portfolio of projects or Goals.
Plan administration
Complementing what was expressed in the initial parts of this article, let's say that the administration of the plan is something that should not be left aside or put as irrelevant. It is of the utmost importance if we want the Planning to meet its objectives and have been worth the time it took to prepare.
Only two central ideas in this regard. First, there must be a high-level Committee, which meets what is strictly necessary to verify progress, manage delays and incorporate, as a priority, new projects, as well as a team responsible for the administration of the Plan, to prepare situation reports for the Committee sessions coordinating with those responsible for the Plan's activities to obtain the information related to their projects. Second, this handling should be light and not overwhelming. The use of appropriate software tools is essential and for them it is advisable to have a network scheme that allows to manage in the most convenient and distributed way all the changing planning information.
Once a year, an exhaustive review of the Plan can be made, which, if it has been updated periodically, can be very simple, but which would allow incorporating other aspects such as the measurement of the achievement of benefits and the impact of the achievements in the various areas of the company and facing the competition.
A final thought
Planning is a process of corporate scope, it must correspond to the creation of a culture that permanently incorporates and stimulates it, starting with senior management.
The elaboration of the Strategic Business Plan should be, as far as possible, brief, spontaneous, creative. A process of elaboration of the Plan that takes several months will mainly lead to operational actions, to the development of specific projects, perhaps diluting the optics of the great contour to lose itself in specificities and thus return to day to day with all its weaknesses. However, be careful, this does not imply reaching the development of extremely simplistic models or that only reach generic definitions, at the top of the strategy, that are not connected with the pragmatic need for specific achievements, measurements and assignment of responsibilities.
Finally, we must point out that the elaboration of the Business Strategic Plan is convenient for the organized and coherent management of Information Technologies since it will allow the elaboration of a Plan of said Technologies based on the parameters, directions and priorities indicated by it and which are indispensable for the adequate and effective design of the hardware and software resources that the company requires to support its operations in the present and the future.
