Chapter 1-How to set a strategy
Vision: Vision statement emphasis more on the future aspects of any organization or business. This statement basically answers the question that if any organization achieves all of its present goals where wills it stand in the next 10 years or so? This statement should challenge its employees and give them direction.
Mission: Mission statement justifies the existence of any organization. This statement gives out the overall purpose and its intentions. Mission directly supports the vision and acts as a bridge to pass out the directions to the employees and customer and every stakeholder accordingly.
Values: Values simply mean what the organization stands for. It’s the basic core culture of an entity which evolves with the passage of time. These are the beliefs that underpin the entity’s conduct and activities.
Target goal objectives Long-Term Objectives: Long-term goals and objective define the entity’s outlook after 3-5 years of time span. These help the entity to fulfill their overall objective plus guide the entity towards its final goal.
Gap analysis (external input; internal input): Gap analysis helps to identify the deviation of present circumstances and that of defined goals set by the entity. This helps to steer the company’s direction towards minor and major deviations. This is a constant process which never ends until the end of the project.
Research: Research forms the very basic backbone of any entity. Falling into the ocean without knowing the depth is nothing less than suicide. Researchers help the entity in establishing solid grounds upon which the building could be erected. A long process which eventually pays off at the end provided true shots were fired during the testing phase.
Chapter 2: Build the plan before you develop the project
SWOT Analysis:
The SWOT analysis enables the user to integrate various models such as PESTLE, resource, and result from analysis. It comprises of four main factors which help to determine the strategic where about of an entity. The factors are Strength, weaknesses, opportunities, and threats. The first 2 being internal factors meaning we have the control over them and second 2 being the external factors meaning we do not have the control over them but we can always play safe and try to divert them as much as we can. This diversion factor is basically determined through risk analysis which constitutes an integral part of such analysis.
The PESTLE analysis which is the part of the SWOT analysis covers the external evaluation of an entity. The PESTLE stands for political, economic, social, technological, legal and environmental. These are the factors which determine the impact on the organization from outside. These mostly cove the socio-economic factors which are volatile for any entity.
Organizational Objectives:
Organizational objectives are of paramount importance. These can be divided into 3 categories. Short, medium and long-term. Short term objectives are basically for steering the company into the right direction and long-term objection are for a strategic shift. These require massive planning and capitalization to succeed.
Setting KPI’s:
Key Performing Indicators are used to identify the areas which are of core importance for the entity. Establishing them requires a real understanding of the entity. These help to determine whether we are moving in the right direction or not. These are points which help to establish a benchmark for measuring performance.
Budget:
Budgets play a very basic and primary role. They help to establish a basic framework which can be translated into reality. Budgets are of various models like rolling budget, fixed budget, Zero-base budgeting, variable budgeting etc. These all have one basic objective and that is to have a basic framework in place so that the entity does not run out of money and options. Budgets are complex and very difficult to make since they require quite in-depth analysis of the entity. These are used for real-time analysis by comparing actual results with that of the budget.
Chapter 3: How to develop a project
Planning: Developing a project requires planning Sat all stages. A project may have multiple phases which require in-depth study and coordination within departments. Planning phase brings all the stages on a single platform and then works its way out to achieve final objectives. Planning requires the development of core issues and then making sure these are resolved via brainstorming discussion and evaluation of plans being put in place. There are times when planning does not go according. This may be the case but such circumstances are always there and can be resolved accordingly.
Risk management plan
No matter how carefully any project is planned, there are always risks involved and any un-expected problem can come. A risk simply put is any uncertainty that can affect the business or organization over-all. In this part, the management prepares and foresees the risks, how they can overcome them, how they can avoid certain issues beforehand and define responses to certain negative issues and scenarios.
Communication plan
Any business or organization will most likely have a hierarchy of roles and responsibilities defined at one point or another. No matter how much transparency exists and even in the case of flat hierarchy system, accountability trickles down from top to bottom depending on responsibilities assigned. An established communication plan helps in understanding that who is accountable to whom, what communication methods should be adopted.
Human resource plan
HR always plays a crucial role in any business or organization. Proper resource management is the crux of the success of any business. This involves both the people who work for the company and those who are managing it. The main responsibility of HR is to focus on resource management, their development, and growth, induce motivation and help them achieve the goals overall.
Budgeting:
A budget gives in the forecast of the expenditures and incomes respectively based on which any business or company can identify their future financial expenses and plans for profit and loss. Most of the budget plans are divided monthly, quarterly or yearly depending on how the company is executing. It’s important to keep in next year’s goal while defining the budget.
Breaking down budgets:
The budgets can be divided based on:
- Master Budget: Set of budgets dedicated to a certain period.
- Static Budget: Expected capacity level.
- Flexible Budget: Budget at present capacity level.
- Operational Budget: Budget required executing day to day operations.
Project schedule:
Schedules are important for any project undertaken. Schedules give a timeline to follow and give a time bucket to the team members on the basis on which they can define their tasks and responsibilities. To ensure the success of the project, realistic time frames should be set, resources assigned to the project should be as per the skills required. Schedules list down milestones achieved, deliverables, risks, and timeline required to complete tasks assigned. A properly defined project schedule ensures a smooth working and makes people accountable which in turn ensure that things get completed on time.
Chapter 4: Identifying Strategic Risks
Strategic risks are crucial yet often overlooked when it comes to overall management. This risk comes on the surface when any company fails to foresee the requirement of market needs and plan on how to meet them.
Identifying the risks:
There are two metrics which can be used to measure risks. First is economic capital which is the total amount required to cover up any unexpected loss and second is a risk-adjustment return on capital, which a framework is used for analyzing financial problems after being risk-adjustment and also giving a cross profit view across the organization.
Mitigating the risks:
By defining proper objectives and strategy for business strategic risk can be mitigated. There are a number of frameworks available which can be easily used. Key performance indicators are crucial and how they are defined is even more important. Proper defined KPI’s can give a lead on how the business is going and whether it’ heading in the right direction or not.
Chapter 5: Managing Performance
Performance management is the driving force for motivating the resource to give in their optimal. Regular reviews of the work, skill, feedback loops and appraisal meetings can not only reduce any communication gaps but also give a positive vibe to the resources that management is keen on their development and is striving for the personal and professional growth. Employees are more satisfied in places where they get regular performance feedback. Strategic planning guide needs to manage performances. There can be number of methods for adding the ways through which performance evaluation can be highlighted. Feedbacks that consist of number of questions related to projects needs to be reviewed daily. In this case, more involvement is needed by the managers of the companies planning on strategic management guidelines. Managing performances hence, is an important part of the process of strategic planning.
