DAY TWO: Thursday, September 30, 2010

Stage 4a: Link Strategy to Operations

 
While alignment creates value, the benefits cannot be sustained unless the strategy is integrated into the operational processes of the business. This linkage constitutes Stage 4 of the BSC system. Several dimensions of the linkage process will be explored including: 1. linking operational process improvements to strategic objectives such as the role for performance improvement programs (TQM, Six Sigma, Lean) and designing operational dashboards of KPIs that drive continuous improvement; and 2. linking to resource management such as sales planning and rolling forecasts, resource capacity planning, and developing dynamic budgets and pro forma profitability statements.
 
Key Issues

• Aligning quality and process improvement programs to strategic priorities
• Applying analytics to develop operational dashboards
• Using time-driven ABC to forecast and fund the resource capacities required to produce and deliver the strategic plan
  

Stage 4b: Align Risk Management to Strategy Execution

Risk management has become essential for successful and sustainable strategy execution. Many organizations, however, despite having a designated risk management officer and even a risk management department, have suffered massive losses from their failure to understand and manage the risks inherent in their strategies. Bob Kaplan will share insights on how organizations can incorporate risk objectives into the Balanced Scorecard’s financial and process perspectives, as well as formally incorporating discussions of risk exposure in periodic strategy review management meetings.

Key Issues

• Interactive case discussion on managing strategic risk
• Linking strategy map objectives to risk events
• Developing key risk indicators
• Selecting and funding risk mitigation initiatives

Stages 5 & 6: Monitor, Learn, Test, and Adapt the Strategy

 
Strategy is a hypothesis on how to satisfy shareholder/stakeholder objectives. A management system must not only define these hypotheses (accomplished in Stages 1 through 4), but also monitor, adapt, and test these theories based on real world experiences. The BSC management system achieves this objective at several levels including conducting operational and strategy review meetings as well as statistical testing of the strategy.
 
Key Issues

• Operational review meetings for problem solving, learning, and sharing best practices
• Strategy review meetings to fine tune performance and the execution of strategic initiatives
• Using analytics to test and adapt the strategy

Best Practice: The Elkay® Management System: Driving Performance through Alignment, Analytics, and Accountability

Eyal Altman, Director of Strategy Management, Elkay Manufacturing Co.

Elkay, a manufacturer of stainless steel sinks, water coolers, drinking fountains, and faucets, as well as cabinetry and counter tops, has more than 2,800 employees in facilities across the United States and select international markets. To align the thousands of Elkay employees operating in different locations and functions behind the common goal of business execution, Elkay implemented an innovative management system consisting of four primary components and related business practices which has provided greater transparency, knowledge, and enhanced, actionable analytics. Delegates will learn how Elkay’s management system drives the company towards its long-term strategic goals and has transformed organizational behavior and culture to one where employees take accountability, develop, and perform.

Making Strategy Management a Core Competency

The new BSC strategy management system does not manage itself. This session will discuss how a new competency and a new organization, the Office of Strategy Management, has emerged to play this role. Discussions will address your performance management philosophy and management system—static or dynamic / silos or platform.
 
Key Issues

• What is Your Performance Management Philosophy?
  • Why you need one?
  • Different options
  • The Balanced Scorecard as a PM system
• The Management System:  Static or Dynamic?
  • How does a strategy management system help me during a recession?
• The Management System: Silos or Platform
  • How can a management system integrate the many islands of creativity that have sprung up to facilitate strategy?
• The Office of Strategy Management
  • What it is and why you need one?

 Open Forum with the Strategy Experts

Join Drs. Kaplan and Norton in this Open Forum to learn about their latest thinking on strategy management, including topics such as leadership, change management, integrating risk management into your strategic plan, and more. An excellent opportunity to dialogue with the experts, challenge views, and learn from your peers!