I have recently started reading Daniel Lambert‘s book ‘Practical Guide to Agile Strategy Execution: Design, Architect, Prioritize, and Deliver your Corporate Future Successfully‘. The book goes on to explain the Strategy Execution Model.
Strategy Execution Model consists of the following elements:-
- Business Design & Strategy
- Architecting Transformation
- Initiative Planning
- Agile Delivery & Execution
- Success Management
As a technologist, I have focused on delivering technical solutions with limited focus on business outcomes. I always viewed understanding business strategies as important but did not have any method to holistically capture the business strategy and design.
Business strategy & design consists of the following key components:-
What is an organization? There are multiple definitions.
A social unit of people that is structured and managed to meet a need or to pursue collective goals. All organizations have a management structure that determines relationships between the different activities and the members, and subdivides and assigns roles, responsibilities, and authority to carry out different tasks. Organizations are open systems–they affect and are affected by their environment.Business Dictionary
I personally favor the Business Dictionary definition, which leads to the next question. What is an enterprise and how is it different from organization? Tom Graves has provided a very detailed explanation about the difference in his post. My simplified understanding is as follows. Organization focuses on people, process and technology completely owned by the entity. It is an inside-out view, focused solely on the activities of the people under the entity’s direct or indirect employment to deliver a common goal. Enterprise takes an outside-in view and provides a holistic view covering the inter-relationships between the organization and other stakeholders like collaborators/partners, customers, Government, regulators etc.
The output of an organization is a product or a service. Apple creates products iPod, iPhone, iPad etc. Amazon delivers a service, an online selling huge catalog of products which on purchase are home delivered in quick time.
To elaborate products represent something tangible that is put on the market for acquisition, attention, or consumption, while service is an intangible item, which arises from the output of one or more individuals. For example, software products like Microsoft Word, iPhone etc. Services on the other hand are performed by other persons for you or to you like car washes, laundry, AC maintenance etc. Products and services are closely aligned. Some products come with a service component. For example, you buy a product with warranty or yearly maintenance.
A detailed differentiation of products and services on the following parameters is available here.
- Tangible vs Intangible – Products can be counted, touched or are visible
- Production vs Interaction – Same product is showcased to all customers, level of service varies based on experience of service provider
- Perishable vs Imperishable – Products can be stored, service is consumed on production
Mission & Vision
Every organization has a mission and vision statement. So what is a mission statement? Wikipedia states missions statement as
A mission statement is a short statement of why an organization exists, what its overall goal is, identifying the goal of its operations: what kind of product or service it provides, its primary customers or market, and its geographical region of operation.Wiki
A mission statement articulates a company’s purpose. It announces to the world at large why your company exists. It is focused on today.
So what is a vision statement?
A vision statement focuses on the future and what the organization ultimately wants to become.
A good reference to understand difference between the two is available here. In the article have a look at Pearsons mission and vision statement.
Here’s Pearsons Vision Statement
For each of our stores to be loved, valued and the first choice of local people,
And the Mission Statement is
We aim to provide quality merchandise that offers both value for money and meets the needs of our local customers.
This will be delivered by well trained staff who will offer high level of customer service.
I have seen mission and vision statements being mixed or organization only retaining vision statements. Some examples
Google’s Mission Statement is
Our mission is to organise the world’s information and make it universally accessible and useful.Google About
Here’s LinkedIn mission and vision statement.
The mission of LinkedIn is simple: connect the world’s professionals to make them more productive and successful.
Create economic opportunity for every member of the global workforce.LinkedIn:About
That takes us to the business end of this article. What are strategies, goals, tactics and objectives.
Strategy, Goal, Tactic, Objective
A goal is a broad primary outcome. A goal is a brief, clear statement of an outcome to be reached within a specific time frame. A goal is a broad, general, tangible, and descriptive statement. It does not say how to do something, but rather what the results will look like. Goals focuses on ‘What’ you want to achieve and not on ‘How’ you want to achieve them. They are measurable in terms of quality and quantity.
A strategy is an approach a business takes to achieve a goal. Strategy is basically the plans that will help to achieve goals. You have to decide which plans can cope up with the goals. The strategy can also be the solution to a problem.
An Objective is a measurable step you take to achieve a strategy. Objectives are always targeted and number focused, unlike goals which talk about the bigger picture. Objectives should be achievable and measurable, that lets us determine whether we are making any progress or not.
Objectives are SMART:
S — Specific — What EXACTLY do you want to achieve? M — Measurable — How will you know when you have achieved it? A — Attainable — Is it something that you have control over? R — Relevant — Is it applicable to the place you are in your life right now? T — Time-Bound — What is your deadline?
Tactics are tricks and patterns developed to drive and support the strategy and to get closer to the objective.
Using Intel’s line of Core processors as an example,
Goal: Make our Core PC microprocessors a category leader in sales revenue by year X.
Strategy: Persuade buyers that our Core processors are the best on the market by associating with large, well-established PC manufacturers.
Objective: Retain 70 percent or more of the active worldwide PC microprocessor market, according to Passmark’s CPU benchmark report.
Tactic: Through creative ads that underlies our messaging, leverage hardware partner brand awareness to include key messages about the Intel Inside program.
To summarize organization’s vision statements leads to goals. Goals need strategies to help achieve goals. Goals are broken down into short term goals or objectives which use tactics to help enable in achieving them.