#TheStrategicProcess #Communication

Communication is one of the key success factors during

#TheStrategicProcess!

One of the first important things that should take care of the Strategic Working Group (SWG) should be the communication between senior top management, themselves and the rest of the employees of the company. Indeed, there is nothing more important in #TheStrategicProcess development (SPd). Top management must be perfectly aligned with the Strategic Working Group (SWG) to define a system how to communicate the information generated in the process in a truthful manner following the progress of #TheStrategicProcess. 

The information can be transmitted and communicated in many ways, such as through internal newsletters, brochures, official company announcements, intranet, etc. The important thing is that no one member of the company feels neglected without to receive proper information about what is really changing in the company. 

Experience shows that lack of information is one of the main causes of failure in the SPd. Therefore, top management should give clear instructions to the SWG for this very important aspect, to develop a clear and effective communication process in order to communicate the most relevant topics of #TheStrategicProcess for the good governance of the process. I repeat, nothing is so important as the right communication to integrate the people into #TheStrategicProcess.

#TheStrategicProcess suposes an important change in the company and in many cases the change affects people because the new strategy requires new processes and sometimes new structures. Of course, #TheStrategicProcess is a very sensitive process and for that reason it is important to communicate the right topics and on time avoiding bad interpretations and rumours. 

The topics to be communicated are very important but also the manner, means how and when is necessary to communicate. I strongly recommend to nominate an official speaker selected in between the members of the Strategic Working Group, normally the member with better communication skills. 

We recommend a fortnightly information on small and medium companies and monthly information in larger enterprises. What is important is to inform with regularity but we will maintain also certain flexibility and so, we will reserve the right to announce any major changes without waiting for the rumours appears or do its presence in the company. 

Efectively, nothing is more harmful in a process of this type. If the statement is important and affects for example the structure and the organization of the company, top management shouldn't hesitate to report in person at a meeting or assembly on the most important issues discussed and conclusions that have been reached. Anything we can do to integrate the people of the company in the process with a clear and positive communication system, will be very positive as we move into #TheStrategicProcess development.

#TheStrategicProcess #StrategicTeam

So far until here the senior management has been involved in #TheStrategicProcess development (SPd) defining the Vision and Mission of the company, having also a clear statement about the Shared Values of the organization. From this point, top management should define the Strategic Team that will work to carry forward #TheStrategicProcess. 

The selected team should be made up of highly qualified people from different departments, areas or sections that form the structure of the company regardless of the level they occupy in the hierarchy. If we want to have a good Strategy we need to have the best Strategic Team to define and after to implement it. It is highly recomendable that all the Team or a big part of the people involved in the definition would be later involved in the implementation of #TheStrategicProcess. While doing in  this manner we have the compromise of the people from the beginning to the end of the process.

Experience tells us that these people will be working almost full time in a period of time ranging from three to six months for small to medium enterprises and between six and twelve months for medium to large companies only for the period of definition. Therefore the team should not be excessive because the company must continue to run in their day to day business. 

We recommend Strategic Teams of three to five people for small or medium businesses and five to ten people for medium and large companies. Onset #TheStrategicProcess development is a good time to delegate responsibilities and tasks within the company. 

As we begin to see #TheStrategicProcess development involves more than the willingness to change things because we will really change things. The structure of a company and all employees must consciously be prepared for this kind of process if we want to carried it successfully to the end. Remember that nine of ten companies fails in the implementation of #TheStrategicProcess and this is not acceptable from our point of view. 

The Strategic Team will be selected with extreme care and they must meet many skills that we will attend later, but it will be very important that the people involved in the team have the absolute confidence of senior management. Because very offen during #TheStrategicProcess many sensitive issues about the past, present and future of the company will be discussed.

#TheStrategicProcess #CompetitiveAdvantage

A company has different types of processes but I would highlight basically three:

1.) Strategic Processes are those intended to define and control the organisation's goals, policies and strategies. Also we call them Management Processes.

2.)   Operational Processes are these which are able to generate the product or the service being delivered to the customer. Are those that generate and deliver value to the customer.

3.)   Support Processes are those that cover and allow the necessary activities for the proper functioning of the Operational and Management Processes. We can highlight the processes for Finance, Control, Human Resources, Information Technology, etc.

What is important is to note that the origin of all processes should be the requirements set by the customers and the end of the process should be implemented in compliance with customer's expectations. Michael Porter introduced a tool called "Value Chain Analysis" where the sequence of the processes that enable to deliver products and services generated by a company to customers is identified. This tool can help companies to identify activities within the processes that we can make different or in a different manner as our competitors do. In this way, we will identify sustainable competitive advantages that allow us to define a Differential Competitive Strategy that makes our company more competitive. The processes in a company should be simple, designed with and for customers and this is the way and the shortest path for success and reward in a satisfactory manner for the shareholders.

A company that defines its strategy based on winning markets with very competitive prices should attend and maximise the industrialisation of its entire value chain, from product design, process and product industrialisation, production, logistics chain service, promotional marketing, sales strategy process up to the distribution of the products. The entire value chain must be refined and the costs adjusted to the maximum for the company to implement a competitive pricing strategy. On the opposite, a company that defines its strategy based on products and services with high added value and determine to follow all the technological changes in the industry, should primarily attend to the process of technological and product innovation, continuous training of its employees, development of patents, etc.

Both companies have very different concepts, different missions, processes and also fully differentiated employees. Any beginning of changing in corporate strategy and of #TheStrategicProcess development (SPd) will have to be addressed from a different perspective that will be analysed in our blog.

#TheStrategicProcess #Corporate Mission

The Mission statement is a short text that defines for the company the reason to be. The Mission must describe the fundamental purpose of the organisation and, particularly, that which gives or offers to customers. In the case of public sector or non-profit organisations will be what is offered to citizens and beneficiaries. 

According to Professor Fredmund Malik's book of Management ("Das A und O des Handwerks") the primary purpose of any institution, company or business is to convert resources (knowledge) in achievement, use or performance for customers. Thus, as Professor Malik considers, the three basic elements of a Business Mission or Corporate Mission must answer the following three questions:

1) What are the market needs? Or to put it in another way: Why and for what the customers pay us?

2) Where lies our superiority or supremacy? Or to put in another way: What we do better than others?

3) How our strength comes from? Or expressed in another way: What we believe?

Normally the Corporate Mission is defined by the Board of Directors interacting with the top management of the company.

Ultimately the Mission defines the business to which the company is engaged, the needs covered with its products and services, the market in which the activity is developed and the public image it wants to reflect as a company or organisation being all the answers to the question: why the company or the organisation exists?

Here are three more examples to illustrate this:

KPMG Enterprise Mission: "Transforming knowledge into value for the benefit of our customers, our people and the capital markets"

Ford Company Mission: "We are a global, diverse family with a proud, confident and passionate heritage to provide exceptional products and services."

Disney Company Mission: "We create happiness by providing the finest in entertainment for people of all ages anywhere"

Do you know the Mission of your institution, company or business? Would you know how to define it? Personally I think it is a fundamental exercise that must be undertaken. Sometimes it is highly interesting to define also your personal Vision and Mission  to know oneself and to contribute more to the family, to our immediate environment, to our company and consequently to the whole society. In the end we are what we want to be.

#TheStrategicProcess #VisionMission

What is first the Vision or the Mission? 

In my understanding there are two concepts that are closely linked. A person may have a Vision to start a new business and then asking him if his mission is the adequate that means, if he is ready or if he has the skills required to meet the proposed Vision. 

Obviously he could not be prepared but be willed to do so and therefore the time factor in defining the Vision is so important. Serving readers in the Spanish version, it is possibly that the Spanish word "Misión" confuses all of us, because according to the Dictionary of the Royal Spanish Academy (DRAE), the most used definition is: "Power given to someone going to play a role". However, if we translate the English word "mission" we find "work, task" as closer to what we want to define. Here's an example: What works, what task is carried out by this company? "The Mission (work, task) of this company is to inform consumers of their rights" so what the company does and for what this company is prepared to is to inform about the rights to consumers. 

If we use the Wikipedia: "A mission statement is a statement of the purpose of a company, organization or person; its reason for existing; a written declaration of an organization's core purpose and focus that normally remains unchanged over time", and:

"A mission is different from a vision in that the former is the cause and the latter is the effect; a mission is something to be accomplished whereas a vision is something to be pursued for that accomplishment. Also called company mission, corporate mission, or corporate purpose ".

"A vision statement says what the organization wishes to be like in some years’ time. It’s usually drawn up by senior management, in an effort to take the thinking beyond day-to-day activity in a clear, memorable way". (Graham Kenny)

There’s also the mission, which describes what business the organization is in (and what it isn't) both now and projecting into the future" (Graham Kenny)

Usually the concepts of Vision and Mission appear when businesses, companies or entities of different nature intend to start with #TheStrategicProcess development (SPd) either because they want to start with a new strategy or change, improve the existing one. Therefore a business, a company or an organisation already have an existence and a Mission (work, task) defined. 

Here are some other examples of Vision and Mission or Mission and Vision:

"Our Mission is to manufacture high quality electrical components for markets in machinery and equipment manufacturers. Our Vision is to be one of the three world leaders in our industry reaching a total of 500 Mill. Euros in 2020”

"Our Vision is to be leaders in strategic training for small and medium businesses reaching a figure of 5 Mill. Euros in 2020. Therefore our Mission in "distance learning method" will be developed with the necessary skills for a "customised distance learning method" "

#TheStrategicProcess #Application

(Mr.David Bertrán from Kuadrotek (right) and Mr. José Carlos Álvarez Tobar from Weidmüller (left) signing the cooperation contract)

Let me come here with one practical application of #TheStrategicProcess that can help us to better understand how these processes are working in real life.

Company: Weidmüller Interface GmbH & Co. KG with head quarters located in Detmold (Germany) and Global Application Centre (GAC) for renewable energy located at Weidmüller, S.A. in Barcelona (Spain).

Case: the company strategy defined the development of the renewable energy (especially photovoltaic) as worldwide key market and set high level targets for the next years.

Status: the company started the activities in the photovoltaic segment five years ago in Spain with the booming of the market in this country, acquiring the company rapidly a high level of know how especially in combiner boxes and monitoring systems. The production of combiner boxes was adequate for the Spanish and South European countries but not for the worldwide market. It was necessary to find the right process to produce 10 times more units of combiner boxes with a high quality performance adequate to the Japanese market and this all in six months.

Solution: the company defined a working team for #TheStrategicProcess revising all the processes steps from the definition, design and development of combiner boxes till the production based on external suppliers with semi automatic processes. It was necessary at the end to modify conveniently the company structure, introducing two main changes: first one was the figure of "Operations" covering Purchasing, MRP (Material Replenishment Planner), Production and Quality. Second one was the figure of "Industrialization" a figure working between the GAC (Design and Development) and the "Operations".

This was necessary to pass from a semi automatic production to a high automatic production in order to cover the mass production planned for the future. In addition, the Quality Process was strongly documented and defined with three inspection levels in order to improve quality ratios and adequate it to the demanding Japanese market.

This complex process involved the Division AS / OEM in Germany, people from Operations Germany and big part of the Management in Weidmüller, S.A. (Barcelona).

Between couples of different solution the company selected the cooperation with a high qualified partner for the mass production. Finally was selected the company Kuadrotek (Grupo Elektra) where the company installed in strongly cooperation with the partner two high automatic production lines capable to manufacturing combiner boxes with and without monitoring systems.

The exceptional team working spirit, the communication between all people implicated in the process, the good relationship with the partner selected and especially the passion for doing #TheStrategicProcess coming to real life were the main factors for the success.

(Partial view of one of the assembly lines for monitoring combiner boxes at Kuadrotek)

#TheStrategicProcess (II) #Mission

The company, or rather senior management, have already defined the Vision or the end point where we want to go in a period of time. It outlines what the organization wants to be in the long term view. This will be taken into account which is the Mission of the company, that is, who we are and what we really do. The Mission defines the fundamental purpose of the company and answer to three important questions:

1.) What does the company do?
2.) Whom does the company work for?
3.) How does the company do it?

Vision and Mission are pretty close and we will illustrate it with a simple example. A father asks his son who will soon enter in a college: "What do you really want to study?"  His son replies with his Vision: "Dad, I want to study and become an engineer". Right first seems an ambitious goal. The son adds: "Besides I plan to get a degree in three years instead of five". Vision becomes an almost unreachable goal also because the father says to his son: " I think you are wrong in your approach because I have to remind you that you are wearing five straight years without passing the mathematics, that means, you fail the basics. You have no idea about  maths (your Mission is wrong) and you want to make an engineering career without knowing mathematics. And also in three years seems a difficult challenge to overcome. Don't you agree? 

Unattainable Vision and wrong Mission clearly leads to failure. Why we exist as a company, which is what we really do and what our customers are willing to pay? Which are the differentiators for our customers for choosing us and not the competition? All these questions must be answered to understand and clearly define what our Mission as a company is. Following some examples about Vision and Mission:

Chevron
Mission Statement
At the heart of The Chevron Way is our Vision to be the global energy company most admired for its people, partnership and performance.

The Dow Chemical Company
Mission Statement
To constantly improve what is essential to human progress by mastering science and technology.

Ford Motor Company
Mission Statement
We are a global family with a proud heritage passionately committed to providing personal mobility for people around the world.

But we insist, the defined  strategy has to be very consistent in the things that make us different from our competitors. From our differences we have to obtain competitive advantages so that the defined strategy becomes the most appropriate way to achieve the ambitious Vision we have established. Doing so we entering in the interesting world of #TheStrategicProcess