Showing posts with label SWOT. Show all posts
Showing posts with label SWOT. Show all posts

16 October 2024

𖣯Strategic Management: Strategic Perspectives (Part II: The Elephant in the Room)

Strategic Management Perspectives
Strategic Management Perspectives

There’s an ancient parable about several blind people who touch a shape they had never met before, an elephant, and try to identify what it is. The elephant is big, more than each person can sense through direct experience, and people’s experiences don’t correlate to the degree that they don’t trust each other, the situation escalating upon case. The moral of the parable is that we tend to claim (absolute) truths based on limited, subjective experience [1], and this can easily happen in business scenarios in which each of us has a limited view of the challenges we are facing individually and as a collective. 

The situation from the parable can be met in business scenarios, when we try to make sense of the challenges we are faced with, and we get only a limited perspective from the whole picture. Only open dialog and working together can get us closer to the solution! Even then, the accurate depiction might not be in sight, and we need to extrapolate the unknown further.  

A third-party consultant with experience might be the right answer, at least in theory, though experience and solutions are relative. The consultant might lead us in a direction, though from this to finding the answer can be a long way that requires experimentation, a mix of tactics and strategies that change over time, more sense-making and more challenges lying ahead. 

We would like a clear answer and a set of steps that lead us to the solution, though the answer is as usual, it depends! It depends on the various forces/drivers that have the biggest impact on the organization, on the context, on the organization’s goals, on the resources available directly or indirectly, on people’s capabilities, the occurrences of external factors, etc. 

In many situations the smartest thing to do is to gather information, respectively perspectives from all the parties. Tools like brainstorming, SWOT/PESTLE analysis or scenario planning can help in sense-making to identify the overall picture and where the gravity point lies. For some organizations the solution will be probably a new ERP system, or the redesign of some processes, introduction of additional systems to track quality, flow of material, etc. 

A new ERP system will not necessarily solve all the issues (even if that’s the expectation), and some organizations just try to design the old processes into a new context. Process redesign in some areas can be upon case a better approach, at least as primary measure. Otherwise, general initiatives focused on quality, data/information management, customer/vendor management, integrations, and the list remains open, can provide the binder/vehicle an organization needs to overcome the current challenges.

Conversely, if the ERP or other strategical systems are 10-20 years old, then there’s indeed an elephant in the room! Moreover, the elephant might be bigger than we can chew, and other challenges might lurk in its shadow(s). Everything is a matter of perspective with no apparent unique answer. Thus, finding an acceptable solution might lurk in the shadow of the broader perspective, in the cumulated knowledge of the people experiencing the issues, respectively in some external guidance. Unfortunately, the guides can be as blind as we are, making limited or no important impact. 

Sometimes, all it’s needed is a leap of faith corroborated with a set of tactics or strategies kept continuously in check, redirected as they seem fit based on the knowledge accumulated and the challenges ahead. It helps to be aware of how others approached the same issues. Unfortunately, there’s no answer that works for all! In this lies the challenge, in identifying what works and makes sense for us!

Previous Post <<||>> Next Post

Resources:
[1] Wikipedia (2024) Blind men and an elephant [link]


21 August 2024

🧭Business Intelligence: Perspectives (Part XIV: From Data to Storytelling II)

Business Intelligence Series

Being snapshots in people and organizations’ lives, data arrive to tell a story, even if the story might not be worth telling or might be important only in certain contexts. In fact each record in a dataset has the potential of bringing a story to life, though business people are more interested in the hidden patterns and “stories” the data reveal through more or less complex techniques. Therefore, data are usually tortured until they confess something, and unfortunately people stop analyzing the data with the first confession(s). 

Even if it looks like torture, data need to be processed to reveal certain characteristics, trends or patterns that could help us in sense-making, decision-making or similar specific business purposes. Unfortunately, the volume of data increases with an incredible velocity to which further characteristics like variety, veracity, volume, velocity, value, veracity and variability may add up. 

The data in a dashboard, presentation or even a report should ideally tell a story otherwise the data might not be worthy looking at, at least from some people’s perspective. Probably, that’s one of the reason why man dashboards remain unused shortly after they were made available, even if considerable time and money were invested in them. Seeing the same dull numbers gives the illusion that nothing changed, that nothing is worth reviewing, revealing or considering, which might be occasionally true, though one can’t take this as a rule! Lot of important facts could remain hidden or not considered. 

One can suppose that there are businesses in which something important seldom happens and an alert can do a better job than reviewing a dashboard or a report frequently. Probably an alert is a better choice than reporting metrics nobody looks at! 

Organizations usually define a set of KPIs (key performance indicators) and other types of metrics they (intend to) review periodically. Ideally, the numbers collected should define and reflect the critical points (aka pain points) of an organization, if they can be known in advance. Unfortunately, in dynamic businesses the focus can change considerably from one day to another. Moreover, in systemic contexts critical points can remain undiscovered in time if the set of metrics defined doesn’t consider them adequately. 

Typically only one’s experience and current or past issues can tell what one should consider or ignore, which are the critical/pain points or important areas that must be monitored. Ideally, one should implement alerts for the critical points that require a immediate response and use KPIs for the recurring topics (though the two approaches may overlap). 

Following the flow of goods, money and other resources one can look at the processes and identify the areas that must be monitored, prioritize them and identify the metrics that are worth tracking, respectively that reflect strengths, weaknesses, opportunities, threats and the risks associated with them. 

One can start with what changed by how much, what caused the change(s) and what further impact is expected directly or indirectly, by what magnitude, respectively why nothing changed in the considered time unit. Causality diagrams can help in the process even if the representations can become quite complex. 

The deeper one dives and the more questions one attempts to answer, the higher the chances to find a story. However, can we find a story that’s worth telling in any set of data? At least this is the point some adepts of storytelling try to make. Conversely, the data can be dull, especially when one doesn’t track or consider the right data. There are many aspects of a business that may look boring, and many metrics seem to track the boring but probably important aspects. 

18 March 2024

♟️Strategic Management: Strategy [Notes]

Disclaimer: This is work in progress intended to consolidate information from various sources. 
Last updated: 18-Mar-2024

Strategy

  • {definition} "the determination of the long-term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals" [4]
  • {goal} bring all tools and insights together to create an integrative narrative about what the  organization should do moving forward [1]
  • a good strategy emerges out of the values, opportunities and capabilities of the organization [1]
    • {characteristic} robust
    • {characteristic} flexible
    • {characteristic} needs to embrace the uncertainty and complexity of the world
    • {characteristic} fact-based and informed by research and analytics
    • {characteristic} testable
  • {concept} strategy analysis 
    • {definition} the assessment of an organization's current competitive position and the identification of future valuable competitive positions and how the firm plans to achieve them [1]
      • done from a general perspective
        • in terms of different functional elements within the organization [1]
        • in terms of being integrated across different concepts and tools and frameworks [1]
      • a good strategic analysis integrates various tools and frameworks that are in our strategist toolkit [1]
    • approachable in terms of 
      • dynamics
      • complexity
      • competition
    • {step} identify the mission and values of the organization
      • critical for understanding what the firm values and how it may influence where opportunities they look for and what actions they might be willing to take
    • {step} analyze the competitive environment
      • looking at what opportunities the environment provides, how are competitors likely to react
    • {step} analyze competitive positions
      • think about  own capabilities are and how they might relate to the opportunities that are available
    • {step} analyze and recommend strategic actions 
      • actions for future improvement
        • {question} how do we create more value?
        • {question} how can we improve our current competitive position?
        • {question} how can we in essence, create more value in our competitive environment
      • alternatives
        • scaling the business
        • entering new markets
        • innovating
        • acquiring a competitor/another player within a market segment of interest
      • recommendations
        • {question} what do we recommend doing going forward?
        • {question} what are the underlying assumptions of these recommendations?
        • {question} do they meet our tests that we might have for providing value?
        • move from analysis to action
          • actions come from asking a series of questions about what opportunities, what actions can we take moving forward
    • {step} strategy formulation
    • {step} strategy implementation
  • {tool} competitor analysis
    • {question} what market is the firm in, and who are the players in these markets? 
  • {tool} environmental analysis
    • {benefit} provides a picture on the broader competitive environment
    • {question} what are the major trends impacting this industry?
    • {question} are there changes in the sociopolitical environment that are going to have important implications for this industry?
    • {question} is this an attractive market or the barrier to competition?
  • {tool} five forces analysis
    • {benefit} provides an overview of the market structure/industry structure
    • {benefit} helps understand the nature of the competitive game that we are playing as we then devise future strategies [1]
      • provides a dynamic perspective in our understanding of a competitive market
    • {question} how's the competitive structure in a market likely to evolve?
  • {tool} competitive lifestyle analysis
  • {tool} SWOT (strengths, weaknesses, opportunities, threats) analysis
  • {tool} stakeholder analysis
    • {benefit} valuable in trying to understand those mission and values and then the others expectations of a firm
  • {tool} capabilities analysis
    • {question} what are the firm's unique resources and capabilities?
    • {question} how sustainable as any advantage that these assets provide?
  • {tool} portfolio planning matrix
    • {benefit} helps us now understand how they might leverage these assets across markets, so as to improve their position in any given market here
    • {question} how should we position ourselves in the market relative to our rivals?
  • {tool} capability analysis
    • {benefit} understand what the firm does well and see what opportunities they might ultimately want to attack and go after in terms of these valuable competitive positions
      • via Strategy Maps and Portfolio Planning matrices
  • {tool} hypothesis testing
    • {question} how competitors are likely to react to these actions?
    • {question} does it make sense in the future worlds we envision?
    • [game theory] pay off matrices can be useful to understand what actions taken by various competitors within an industry
  • {tool} scenario planning
    • {benefit} helps us envision future scenarios and then work back to understand what are the actions we might need to take in those various scenarios if they play out.
    • {question} does it provide strategic flexibility?
  • {tool} real options analysis 
    • highlights the desire to have strategic flexibility or at least the value of strategic flexibility provides
  • {tool} acquisition analysis
    • {benefit} helps understand the value of certain action versus others
    • {benefit} useful as an understanding of opportunity costs for other strategic investments one might make
    • focused on mergers and acquisitions
  • {tool} If-Then thinking
    • sequential in nature
      • different from causal logic
        • commonly used in network diagrams, flow charts, Gannt charts, and computer programming
  • {tool} Balanced Scorecard
    • {definition} a framework to look at the strategy used for value creation from four different perspectives [5]
      • {perspective} financial 
        • {scope} the strategy for growth, profitability, and risk viewed from the perspective of the shareholder [5]
        • {question} what are the financial objectives for growth and productivity? [5]
        • {question} what are the major sources of growth? [5]
        • {question} If we succeed, how will we look to our shareholders? [5]
      • {perspective} customer
        • {scope} the strategy for creating value and differentiation from the perspective of the customer [5]
        • {question} who are the target customers that will generate revenue growth and a more profitable mix of products and services? [5]
        • {question} what are their objectives, and how do we measure success with them? [5]
      • {perspective} internal business processes
        • {scope} the strategic priorities for various business processes, which create customer and shareholder satisfaction [5] 
      • {perspective} learning and growth 
        • {scope} defines the skills, technologies, and corporate culture needed to support the strategy. 
          • enable a company to align its human resources and IT with its strategy
      • {benefit} enables the strategic hypotheses to be described as a set of cause-and-effect relationships that are explicit and testable [5]
        • require identifying the activities that are the drivers (or lead indicators) of the desired outcomes (lag indicators)  [5]
        • everyone in the organization must clearly understand the underlying hypotheses, to align resources with the hypotheses, to test the hypotheses continually, and to adapt as required in real time [5]
    • {tool} strategy map
      • {definition} a visual representation of a company’s critical objectives and the crucial relationships that drive organizational performance [2]
        • shows the cause-and effect links by which specific improvements create desired outcomes [2]
      • {benefit} shows how an organization will convert its initiatives and resources–including intangible assets such as corporate culture and employee knowledge into tangible outcomes [2]
    • {component} mission
      • {question} why we exist?
    • {component} core values
      • {question} what we believe in?
      • ⇐ mission and the core values  remain fairly stable over time [5]
    • {component} vision
      • {question} what we want to be?
      • paints a picture of the future that clarifies the direction of the organization [5]
        • helps-individuals to understand why and how they should support the organization [5]
    Previous Post <<||>> Next Post

    References:
    [1] University of Virginia (2022) Strategic Planning and Execution (MOOC, Coursera)
    [2] Robert S Kaplan & David P Norton (2000) Having Trouble with Your Strategy? Then Map It (link)
    [3] Harold Kerzner (2001) Strategic planning for project management using a project management maturity model
    [4] Alfred D Chandler Jr. (1962) "Strategy and Structure"
    [5] Robert S Kaplan & David P Norton (2000) The Strategy-focused Organization: How Balanced Scorecard Companies Thrive in the New Business Environment

    20 February 2016

    ♜Strategic Management: SWOT Analysis (Definitions)

    "A scan of the business environment to identify the organization's strengths and weaknesses and the opportunities and threats it faces." (Teri Lund & Susan Barksdale, "10 Steps to Successful Strategic Planning", 2006)

    "A general method used as an element of strategic planning. SWOT is an acronym for strengths, weaknesses, opportunities, and threats. Within the context of Product Management, SWOT is used to synthesize the many elements of the business environment for a product or product line (as opposed to a corporate or divisional entity). The generalized quadrant structure of the SWOT model is used." (Steven Haines, "The Product Manager's Desk Reference", 2008)

    "A method of analyzing a situation or business to determine whether it’s viable." (Sue Johnson & Gwen Moran, "The Complete Idiot's Guide To Business Plans", 2010)

    "A method that enables companies to view strengths, weaknesses, opportunities, and threats together." (Annetta Cortez & Bob Yehling, "The Complete Idiot's Guide® To Risk Management", 2010)

    "A planning method used to evaluate the strengths, weaknesses, opportunities, and threats involved in a particular strategic direction for your business." (Gina Abudi & Brandon Toropov, "The Complete Idiot's Guide to Best Practices for Small Business", 2011)

     "A type of analysis that provides companies with both internal and external factors that could affect the long-term success of the company." (DAMA International, "The DAMA Dictionary of Data Management", 2011)

    "An analysis used to determine strength and weak sides of the performance of an organization and to identify opportunities and dangers in the form of weaknesses and both internal and external threats. The four attributes of SWOT are: Strengths, Weaknesses, Opportunities, Threats." (International Qualifications Board for Business Analysis, "Standard glossary of terms used in Software Engineering", 2011)

    "Involves the evaluation of strengths and weaknesses, which are internal factors, and opportunities and threats, which are external factors." (Linda Volonino & Efraim Turban, "Information Technology for Management" 8th Ed., 2011)

    "Method of studying and identifying an organization's strengths, weaknesses, opportunities, and threats." (Leslie G Eldenburg & Susan K Wolcott, "Cost Management" 2nd Ed., 2011)

    "This information gathering technique examines the project from the perspective of each project's strengths, weaknesses, opportunities, and threats to increase the breadth of the risks considered by risk management." (Cynthia Stackpole, "PMP Certification All-in-One For Dummies", 2011)

    "A problem-solving or decision analysis technique in which strengths, weaknesses, opportunities, and threats to the project or organization are examined." (Bonnie Biafore & Teresa Stover, "Your Project Management Coach: Best Practices for Managing Projects in the Real World", 2012)

    "A SWOT analysis is an approach to developing strategy that begins by identifying an organization’s strengths, weaknesses, opportunities, and threats (hence SWOT). From these categories, an organization can identify ways to build on its strengths, improve its weaknesses, take advantage of opportunities, and minimize the potential impact of threats." (Laura Sebastian-Coleman, "Measuring Data Quality for Ongoing Improvement ", 2012)

    "An analysis process highlighting strengths, weaknesses, opportunities, and threats to an entity." (Joan C Dessinger, "Fundamentals of Performance Improvement" 3rd Ed., 2012)

    "The analysis of strengths, weaknesses, opportunities, and threats of an organization, project, or option." (Project Management Institute, "Navigating Complexity: A Practice Guide", 2014)

    "An analysis of the company’s strengths and weaknesses compared to the opportunities and threats in the market place." (Pamela Schure & Brian Lawley, "Product Management For Dummies", 2017)

    "Analysis of strengths, weaknesses, opportunities, and threats of an organization, project, or option." (Project Management Institute, "A Guide to the Project Management Body of Knowledge (PMBOK Guide)", 2017)

    "The main purpose of this analysis is to determine the extent to which an organisation 'fits' with the demands of its context." (Duncan Angwin & Stephen Cummings, "The Strategy Pathfinder 3rd Ed.", 2017)

    "The SWOT framework classifies the factors relevant for a firm’s strategic decision making into four categories: strengths, weaknesses, opportunities, and threats." (Robert M Grant, "Contemporary Strategy Analysis" 10th Ed., 2018)

    "Technique that reviews and analyses the internal strength and weakness of an organization, and the external opportunities and threats it faces" (ITIL)

    Related Posts Plugin for WordPress, Blogger...

    About Me

    My photo
    Koeln, NRW, Germany
    IT Professional with more than 24 years experience in IT in the area of full life-cycle of Web/Desktop/Database Applications Development, Software Engineering, Consultancy, Data Management, Data Quality, Data Migrations, Reporting, ERP implementations & support, Team/Project/IT Management, etc.