STRATEGIC PLANNING AND ORGANIZATION CLARITY

STRATEGICPLANNINGANDORGANIZATIONCLARITYCaseStudy ConceptsandDebatableIdeasKennyOngCNIHoldingsBerhad Intro CNI 20yearsoldCoreBusiness MLMOthers ContractManufacturing Export Trading eCommerceMalaysia Singapore Brunei Indonesia India China HongKong Philippines Italy Taiwan Oman UnitedStates VietnamStaffforce 500Distributors 200 000Products ConsumerGoodsandServices Thedigitalwatchdidn tcomefromestablishedwatchcompanies thecalculatordidn tcomefromslideruleoraddingmachinecompanies videogamesdidn tcomefromboard gamemanufacturersParkerBrosorMattel theballpointpendidn tcomefromfountainpenmanufacturers andGoogledidn tcomefromtheYellowPages BobSeidensticker Futurehype What swrongwithStrategicPlanningToday Long termPlansObjectivesStrategiesEnablersResources AlsoknownasL O S E R What swrongwithStrategicPlanningToday BiggestThreatsoftencomefromOUTSIDEyournormalindustryPlanningfromthebaseofan Existing organizationvs zero basedTraditionalAnalysis e g SWOT basedonlyonknownorexistingassumptionsorknowledgeSpendingtoomuchtimeinmarketresearchandanalysisDefiningthecompanyfromaProduct Serviceperspectivevs Categoryvs JTBD e g Coca cola WrongBenchmark alreadysuccessfulvs whatmadethemsuccessfulNewstrategy samepeople Today sAgenda Summary Today spresentation 1 BusinessModelClarity 2 StrategyClarity 3 ExecutionClarity WhatistheBusinessModel USP MarketDiscipline ProfitModel BusinessModel USP UniqueSellingProposition USP TargetedCustomer CoreBuyingPurpose CustomerValueProposition JobToBeDone JBTD BusinessModel USP TheProductisNottheProduct Whatisthecustomerreallybuying Whatisthe CoreBuyingPurpose Whatisthe JobToBeDone BusinessModel USP ObstaclestoJBTD InsufficientWEALTHInsufficientACCESSInsufficientSKILLInsufficientTIME WhatistheBusinessModel USP MarketDiscipline ProfitModel BusinessModel ProfitModel BusinessModel ProfitModel ProfitModelExamples GilletteShaveriPodandiTunesIBMandLenovoGMandGMFinanceGoogleandAdRevenueMcDandDrive thrurevenue SubsidizingHirePurchaseLoanvs reducepricetoprotectbrandOracleProjectFinancingover4yearscoveringevennon OraclecomponentsSaaSPAYUe g Siebel Salesforce WhoKilledDisney ProfitModelvs Competition DVDvs videogamesandonlinemoviescarsalesvs carleasingnewspapervs onlinenewsclientserversystemsvs SaaS Bussinessweek February192009 HollywoodIsWorriedasDVDSalesSlow yourgreatestcompetitorformarketshareisoftenadifferentprofitmodel WhatistheBusinessModel USP MarketDiscipline ProfitModel Intro MarketDiscipline Mamakstall Intro MarketDiscipline Theyarethemostinnovative Constantlyrenewingandcreative Alwaysontheleadingedge Agreatdeal Excellent attractivepriceMinimalacquisitioncostandhassleLowestoverallcostofownership Ano hasslesfirm ConvenienceandspeedReliableproductandservice ExactlywhatIneed CustomizedproductsPersonalizedcommunications They reveryresponsive PreferentialserviceandflexibilityRecommendswhatIneed I mveryloyaltothem Helpsustobeasuccess ProductLeadership OperationalExcellence CustomerIntimacy OperationalExcellence lowcostproducer Ref TheDisciplineofMarketLeaders MichaelTreacy1995 ProductLeadership bestproduct CustomerIntimacy besttotalsolution Strategy ValueDisciplines www myCNI com my www OOBEY com OperationalExcellence lowcostproducer Ref TheDisciplineofMarketLeaders MichaelTreacy1995 ProductLeadership bestproduct CustomerIntimacy besttotalsolution Strategy ValueDisciplines www myCNI com my www OOBEY com OperationalExcellence lowcostproducer Ref TheDisciplineofMarketLeaders MichaelTreacy1995 ProductLeadership bestproduct CustomerIntimacy besttotalsolution Strategy ValueDisciplines www myCNI com my www OOBEY com OperationalExcellence lowcostproducer Ref TheDisciplineofMarketLeaders MichaelTreacy1995 ProductLeadership bestproduct CustomerIntimacy besttotalsolution Strategy Disciplines HPwell balancedportfolio masscustomization Acersuperleancoststructure aggressivepricing Applepowerfulproducts premiumpricing limitedrange StillDoingwellin2009 BusinessModelvs Competition CompetitorAnchoringvs BusinessModel AirAsiavs Busses TrainsTataNanovs MotorbikesiPodvs SonyBMGKindle Amazon vs iPhone Apple Googlevs Newspaper Ads vs Yahoo Search vs Microsoft Software McDvs Toys R Us ShiftyourBusinessModel andyourCompetitorwillchange OperationalExcellenceCompetitivepriceErrorfree reliableFast ondemand SimpleResponsiveConsistentinformationforallTransactional OnceandDone CustomerIntimacyManagementbyFactEasytodobusinesswithHaveityourway customization MarketsegmentsofoneProactive flexibleRelationshipandconsultativesellingCrossselling ProductLeadershipNew stateoftheartproductsorservicesRisktakersMeetvolatilecustomerneedsFastconcept to counterNeversatisfied obsoleteownandcompetitors productsLearningorganization Strategy ValueDisciplines www myCNI com my www OOBEY com TheMcPlaybook Makeiteasytoeat50 drive thruMealsheldinonehand MakeiteasytoprepareHighTurnoverTaskssimpletolearn repeat Makeitquick FastFood TestsnewproductsforCookingTimes MakewhatcustomerswantProwlsmarketfornewproductsMonitoredfieldtests Adaptedfrom Businessweek Februrary5th2007 www myCNI com my www OOBEY com OperationalExcellence lowcostproducer Ref TheDisciplineofMarketLeaders MichaelTreacy1995 ProductLeadership bestproduct CustomerIntimacy besttotalsolution Strategy Disciplines BusinessModel 1 changeone effectthree 2 changeone changemodel Summary Today spresentation 1 BusinessModelClarity Done 2 StrategyClarity 3 ExecutionClarity 2 StrategyClarity Hope isnotastrategy WhatisStrategicPlanning StrategicPlanning Variables ResearchGrowthRisksStakeholdersConstraintsSWOTMisc Output PlansPrioritiesKPIs Beforewestart Whichcomesfirst Strategies KPI KPI Strategies Beforewestart Whichcomesfirst Strategies KPI KPI Strategies alreadyknowourpriorities awareofallstrategyoptionsavailablecreatingsomethingUNIQUE INNOVATIVEandDISRUPTIVEe g AirAsiaconductingabusinessTurnarounde g MAS Beforewestart Whichcomesfirst Strategies KPI KPI Strategies wanttofindoutpossiblestrategies determineourprioritiesfirstthruselectionofimportantKPIs growingthrough normal business notaTurnaround BusinessSituationvs Focus Upturn Flat Downturn FightComplacencySharpenEdgeKeepMomentumConquer Change mgmtReduceFatContinuityEveryoneHappy InnovationAcquireProfitsBuildmomentum SalesCashFlow TalentMgmtInnovation R DEarlywinsSlowDownHRCosts TopTalentfocusSales Sales SalesIncreaseattrition www myCNI com my www OOBEY com BusinessSituationsvs Focus Upturn Flat Downturn FightComplacencySharpenEdgeKeepMomentumConquer Change mgmtReduceFatContinuityEveryoneHappy InnovationAcquireProfitsBuildmomentum SalesCashFlow TalentMgmtStackR DEarlywinsSlowDownHRCosts TopTalentfocusStackSalesIncreaseattrition Manytimes youneedadifferentCEO Leader ManagementTeamforeachbusinesssituation www myCNI com my www OOBEY com WhatisyourGoal CostReductionGrowthBoth GrowthStrategy Double DigitGrowth MichaelTreacy www myCNI com my www OOBEY com HowMarketsdetermineGrowthStrategies 1 GrowthRate www myCNI com my www OOBEY com ChurnRate HowMarketsdetermineGrowthStrategies 2 www myCNI com my www OOBEY com HowMarketsdetermineGrowthStrategies 3 Example XYZSector www myCNI com my www OOBEY com DownturnStrategy DownturnStrategy DownturnStrategy DownturnStrategy SideNotesonCostReductionStrategy CostReduction 5 30 30 80 BusinessSituationvs Sales Upturn Flat Downturn FightComplacencySharpenEdgeKeepMomentumConquer Change mgmtReduceFatContinuityEveryoneHappy InnovationAcquireProfitsBuildmomentum SalesCashFlow TalentMgmtInnovation R DEarlywinsSlowDownHRCosts TopTalentfocusSales Sales SalesIncreaseattrition www myCNI com my www OOBEY com Optimizecustomers currentassetsOffsetcustomers costsFocusmarketshareCEOandSr MgmtinthefieldSellupthebuyerchainMotivatetroopsAddextraservicesControltroopemotionsSpecializedvs generalteams i e sellsupportservices sellequipment existingcustomersetc e g Xerox MarketingClarity GoodsReturnPolicy Idon tcareiftheyreturnaGoodyeartire Iftheysaidtheypaid 200 paythem 200 Nordstromdoesnotselltires MarketingClarity CNI CNIismorethanbusiness WestronglybelievethateveryindividualhastheopportunitytoattainabetterlivingthroughCNI MarketingClarity Segment Target Who Experience Swing Former Opposition BrandingClarity Segment Target Whoareyouattractedto BrandingClarity Basics Differentiators Segments Targets Targets Basics Differentiators Experience Branding SwingLoyalty SwingCustomersare loyal because IndividualRelationshipsConvenience atthatpointintime Tied upProductUniquenessPromotionsNobetteralternativeDownlinesNoknownalternativePsychologicallylazy Swing BestalternativeatthecurrentmomentuntilIfindanotheralternative Swing Marketing IncreaseswitchingcostsMegapackagesCommunityRewardprograms Points MembershipSubscriptionEmailcommunication NewslettersPersonalizedalertsSurveySuggestionBoxSwitchingTechniques e g BalanceTransferofcreditcards R DClarity The Old Days Invent R D R DClarity The New Days Invent Build Market Sell R DClarity Marketing101 R DClarity Marketing R D Features Brand Target Logistics R DClarity Marketing R D Features Brand Target Logistics Price Promotion Place Product IKEAAppleNestleAsus R DClarity RD D GarnierDigi DesignPoint1 DesignedtoSELLDesignPoint2 Before AfterR D R DClarity RD D CNIWaterlife DesignPoint1 DesignedtoSELLDesignPoint2 Before AfterR D R DClarity RD D Research Development DESIGN FeaturesBenefitsDifferentiation R DClarity RD D Research Development DESIGN FunctionAestheticsLogistics DesignPoint1 DesignedtoSELLDesignPoint2 Before AfterR D InnovationClarity Product Service Process BusinessModel Break through Sub stantial Incre mental Summary Today spresentation 1 BusinessModelClarity Done 2 StrategyClarity 3 ExecutionClarity Done 3 ExecutionClarity Accountability Benchmarking BSC KPIsandotherevils inthepast18months wehaveheardthatprofitismoreimportantthanrevenue qualityismoreimportantthatprofit peoplearemoreimportantthanprofit customersaremoreimportantthanourpeople bigcustomersaremoreimportantthansmallcustomers andthatgrowthisthekeytooursuccess Nowonderourperformanceisinconsistent CEO Anonymous WrongKPIs Whatisthemoralofthestory KPIsandBehavior Before HandleTime PerCallMotivatedCallCentrestafftotransfercallers gettingridofcomplainers makingthemsomeoneelse sproblemCallersat45 chanceofbeingtransferred7 000customerseachweeksufferedtransfers7timesormore KPIsandBehavior After MinutesPerResolution ofaproblemResolutioninONECALLbecomethecoregoalReducedprobabilityofcalltransfersfrom45 to18 WhyBSC Reason1 BalancedReason2 Cause and Effect www myCNI com my www OOBEY com Financial Tosatisfyourstakeholders whatFinancialobjectivesmustweaccomplish CauseandEffect RevenueGrowth BaseRetention ShareGain Positioning AdjacentMarket NewBusiness OperationalExcellence ProductLeadership CustomerIntimacy Competencies InformationSystems Motivation empowerment alignment Financial Learning Growth InternalProcess Customers InvestmentStrategy Productivity MarketValue LinkingBSCtoStrategy Financial Learning Growth InternalProcess Customers Distributors CauseandEffect AnExample Example SelectionofKPIsforBSC CustomersatisfactionCustomerloyaltyMarketshareCustomercomplaintsComplaintsresolvedonfirstcontactReturnratesResponsetimepercustomerrequestPricerelativetocompetitionTotalcosttocustomerAveragedurationofcustomerrelationshipCustomerslostCustomerretentionCustomeracquisitionratesPercentageofrevenueformnewcustomersNumberofcustomersAnnualsalesperturnover Winrate salesclosed salescontact CustomervisitstothecompanyHoursspentwithcustomersMarketingcostasapercentageofsalesNumberofadsplacedNumberofproposalsmadeBrandrecognitionResponserateNumberoftradeshowsattendedSalesvolumeShareoftargetcustomerspendingSalesperchannelAveragecustomersizeCustomersperemployeeCustomerserviceexpensepercustomerCustomerprofitabilityFrequency numberofsalestransactions Financial Learning Growth InternalProcess Customers Distributors Example 1stLevelBSC KPIs ProfitafterTax Revenue Cash to cashcycle Operatingcashflow AverageRevenuePerUser ARPU CustomerComplaints CustomerAcquisitionRate ProductAvailability ProductQuality Service RenewalAnnualSubscription No ofActiveMembers No RetailPoints CustomerDatabaseAvailability AccuracyofForecastPlanning ContinuousImprovement ResponseTimetoCustomerNeeds PerfectOrderFulfillment InventoryTurnover NumberofEffectiveLoyaltyPrograms OnTimeDelivery NumberofEffectiveA P ofstaffevaluatedonCoreCompetencyFramework ofstaffwithCareerDevelopmentPlans No oftraininghourscompletedperstaff ofstaffwithaccesstostrategicinformation Q12Index staffevaluatedonCulturealignment Sample Other1stLevelKPIsacrossindustries LaggingandLeadingKPIs Historical Outcome Results 1stLevel UsuallyFinancialortangible QuarterlyandAnnually Current Indicators Drivers 2ndLevelonwards usuallynon financialorintangible Weekly MonthlyandQuarterly Developing Driver KPIs WhatistheObjective Do or Die KPIsforCNIRevenueARPUSponsoringRetentionCommissionPlan BDP ProductCorporateImage OperationalExcellence lowcostproducer Ref TheDisciplineofMarketLeaders MichaelTreacy1995 ProductLeadership bestproduct CustomerIntimacy besttotalsolution Strategy Disciplines Priorities andKPIs OperationalExcellenceCompetitivepriceErrorfree reliableFast ondemand SimpleResponsiveConsistentinformationforallTransactional OnceandDone CustomerIntimacyManagementbyFactEasytodobusinesswithHaveityourway customization MarketsegmentsofoneProactive flexibleRelationshipandconsultativesellingCrossselling ProductLeadershipNew stateoftheartproductsorservicesRisktakersMeetvolatilecustomerneedsFastconcept to counterNeversatisfied obsoleteownandcompetitors productsLearningorganization Strategy Disciplines Priorities andKPIs OperationalExcellenceMoveknow howfromtopperformingunitstoothersBenchmarkagainstbestinclassEnsureoperationstrainingforallemployeesUsedisciplineslikeTQMforcontinuouslearningtoreducecostsandimprovequality Strategy ValueDisciplines Strategy ValueDisciplines CustomerIntimacyCaptureknowledgeaboutcustomersUnderstandcustomerneedsEmpowerfrontlineemployeesEnsurethateveryoneknowsthecustomerMakecompanyknowledgeavailabletocustomers ProductLeadershipReducetimetomarketCommercializenewproductsfastEnsurethatideasflowReusewhatotherpartsofthecompanyhavealreadylearnedEnsuretherearemultiplesourcesoffunding Strategy ValueDisciplines OperationalExcellence lowcostproducer Ref TheDisciplineofMarketLeaders MichaelTreacy1995 ProductLeadership bestproduct CustomerIntimacy besttotalsolution Strategy ValueDisciplines OperationalExcellence lowcostproducer Ref TheDisciplineofMarketLeaders MichaelTreacy1995 ProductLeadership bestproduct CustomerIntimacy besttotalsolution Strategy ValueDisciplines SampleKPIsforEachDiscipline OperationalExcellencePriceSelectionConvenienceZeroDefectsGrowth CustomerIntimacyCustomerKnowledgeSolutionsOfferedPenetrationCustomerDataCustomer successfocus ProductLeadershipMarketingFunctionality ofSuccesses ofFailuresLearnfromkeyusersInterdisciplinaryteamsPipeline Execution 4 WheelsAlignment Culture BusinessModel StrategicPlanning Execution 4 WheelsAlignment FocuspointAlignmentQualityInnovation DifferentiationRisktakingPerformanceManagementCorporateobsessionDecisionmaking Culture Execution 4 WheelsAlignment OrgStructureJobDesignC BPolicies proceduresDecisionmakingJobfitManagementSystemsBSCandKPIsDecentralized Empower Execution 4 WheelsAlignment RolemodelingVision Mission PhilosophyLeadershipStyleDelegation EmpowermentC B PromotionsSenseofUrgencySpeakregularlyaboutPerformance Execution 4 WheelsAlignment RecognitionRecruitmentTrainingProfitsharingValuesMotivationSelfEfficacyAwarenessUsefulCompetenciesCareeraspirationsAttribution control E3 DepartmentBSC FinancialPerspective Budgeting ResourceAlignment EnablersTechnologyEquipmentMaterialsHumanIntellectualPropertyPartnersProperty FundingCAPEXOPEX OperationalExcellence CustomerIntimacy ProductLeadership Organization jobs skills Managementsystems Informationandsystems Culture values norms EachDisciplineRequiresDifferentPriorities Resources OperationalExcellenceCentralauthority lowlevelofempowermentHighskillsatthecoreoftheorganizationDisciplinedTeamworkProcess product drivenConformance onesizefitsall mindsetIntegrated lowcosttransactionsystemsThesystemistheprocessCommandandcontrolQualitymanagement Organization jobs skills Managementsystems Informationandsystems Culture values norms EachDisciplineRequiresDifferentPriorities Resources Organization jobs skills Managementsystems Informationandsystems Culture values norms ProductLeadershipAdhoc organicandcellularHighskillsaboundinloose knitstructuresConcept future drivenExperimentationand outofthebox mindsetPerson to personcommunicationssystemsTechnologiesenablingcooperationRewardingindividuals innovativecapacityRiskandexposuremanagementProductLifeCycleprofitability EachDisciplineRequiresDifferentPriorities Resources Organization jobs skills Managementsystems Informationandsystems Culture values norms CustomerIntimacyEmpowermentclosetopointofcustomercontactHighskillsinthefieldandfront lineCustomer drivenVariationand haveityourway mindsetStrongcustomerdatabases linkinginternalandexternalinformationStronganalyticaltoolsCustomerequitymeasureslikelifetimevalueSatisfactionandsharemanagementFocuson ShareofWallet EachDisciplineRequiresDifferen