• Quality planning is business planning
• Long-term horizon
• Aggressive planning ‘drivers’ (benchmarks) derived from study of world leaders
• Covers products, services and processes
• Key targets derived from customer requirements and market directions:
  • current and future
  • deployed to all units
• Linked to suppliers/partners

2.1	Strategy Development (40 points)
	Describe your organisation's strategy development process to strengthen organisational performance and competitive position. Summarize your key strategic objectives.

Key words and phrases for this item

• Strategy development
• Strategic objectives and timetable

Strategy development is looking for high-level processes - how you scan the future to plot a best path forward, and how you turn your understanding and judgment into specific objectives and a timeframe .

2.1a	Strategy Development Process

• These three questions (what’s the process, who’s involved, what are the key steps) are often best answered with a diagram.
• See the exhibit Strategic planning at Boeing A&TP for an example of a sophisticated and mature strategic process that pervades and sets the agenda for an organisations whole annual business cycle. If you’ve got something like this, it’ll be the core of your answer.
• Brown (1998) stresses thorough and efficient as the key ideas to impart to examiners. Your process should cover all the bases, and it shouldn’t absorb your key managers and leaders for too long, but …
• … Brown rather misses the point when he suggests 4 weeks every year is sufficient, especially if it’s a 4 week block at the same time every year. If you’re becoming an e-business (and who is not?) or you’re anywhere near the e-economy, 12 months is too long to sit on a strategy. By next year you could be dog tucker. And anyway, four weeks at the same time each year sounds a bit too much like ritual, not enough like a real process.
• The point? An effective strategic planning process will likely be dynamic, frequently updated, and on the wall, not in a drawer.
• See the 3M Dental case study for a recognised best practice example of a strategy process that lasts almost all year.

The factors are:

• customer and market needs/expectations, including new product/service opportunities
• your competitive environment and capabilities, including use of new technology
• financial, societal, and other potential risks
• your human resource capabilities and needs
• your operational capabilities and needs, including resource availability
• your supplier and/or partner capabilities and needs

• This area is asking for a comprehensive situation analysis. You’ve almost certainly done one, whether it’s written down or not, and maybe it’s quite dynamic. This is the time to write it down. Or at least to write down the process.
• If you’ve put some work into analysing and developing your organisation’s core competencies, include material on that process here as well.
• A tabular summary (see Brown, 1998, p106, and the Writing an Application workshop) is a good way to summarise lots of information, remember you’ve only got 4 pages for all of category 2
• See Writing an Application for examples of tabular presentations of information

APQC on aligning IT and strategy

2.1b	Strategic Objectives

What are your key strategic objectives and your timetable for accomplishing them? In setting objectives, how do you evaluate options to assess how well they respond to the factors in 2.1a(2) most important to your performance?

• How do your situation analyses and strategy processes translate into objectives, what are your objectives, and what’s the timeframe for making them real?
• It’s important to show clearly (with closed-loop process diagrams if possible) how all the elements in item 2.1 link together.

2.2	Strategy Deployment (45 points)
	Describe your organisation's strategy deployment process. Summarize your organisation's action plans and related performance measures. Project the performance of these key measures into the future.

Key words and phrases for this item

• Action plans and measures
• Human resource plans
• Performance projections

Strategy deployment is looking for explanations of how you turn your high-level strategy into concrete action down on the factory floor, how you allocate resources, measure and evaluate progress, project your planned activities forward and compare your activities to others, to benchmarks, and to your own past.

Granite Rock customer service

• See Granite Rock in the Baldrige Eight case study collection

2.2a	Action Plan Development and Deployment

• Now, the next step, how do you develop action plans that give reality to your strategies?
• Many organisations do a commendable job of creating strategic plans, but not many are as good at turning those plans into coherent, year-long action
• Your response should explain, with examples, how plans drive action throughout your organisation - how the links are made (meetings, agendas, wall charts, cross-functional teams …). Also explain what you do (and how you find out) if things don’t happen
• Link back to criteria 1, leadership, to explain the role of senior leaders in these processes
• See the exhibit Strategic plans for examples of strategic plans that span organisations from mission and vision statements through action plans to key performance indicators

• Examiners will want to see that your human resource planning links to high level strategic processes æ that the two are aligned so that your people are adequately resourced to make the strategy work … Brown says that to score well here, you’ll need to show ‘a clear and logical relationship’ between HR and high level strategy. Commonly, HR planning is in a world of its own, seriously disconnected from the rest of the organisation
• Examples will be useful æ if one of your strategic intentions is to establish an Internet presence, for one example, or you have a specific goal to reduce transaction costs by migrating your key supplier relationships to a shared intranet, for another, there will be recruiting and/or training implications. How are you going to do it; what do the HR plans look like, where do they link to the high-level strategy, what’s the process?

• If your strategic planning is real, and cascades down through goals and action plans, there will be resource allocation issues - how do you make allocation decisions, who makes them, can you write a process description? Or better still, draw a process diagram.
• For an example of a best practice allocation process, see the exhibit 3M Dental resource allocation

• Alignment is the key word in this area
• Baldrige winners often acknowledge that in their early attempts, alignment is both an important concept, and the one they struggle most with.
• Rufus White of Boeing A&TP talks about line of sight, and several other Baldrige Eight firms have similar concepts. Line of sight means that an anyone, and everyone, can see clearly what the senior leadership’s intentions are, and leaders can see clearly how their intentions translate into action on the factory floor.
• Ghoshal and Bartlett (1999, p166) explain line of sight in a Philips Semiconductor context, where … "broad targets established by top managers were allocated and translated into specific action [and cascaded down] to business groups, product groups, individual factories, and local development teams, so that individuals not only had focused targets, but a clear picture of how their own tasks contributed to the overall performance of the company. Philips Semiconductor employees believed that the explicit line of sight between their own work and the company’s priorities created a sense of personal ownership that gave meaning to their work.
• Catchball processes are used in some organisations to deploy strategic objectives by negotiation. The exhibit Catchball at Raytheon provides an example.

2.2b	Performance Projection

• Again, you’ve got them, or you don’t.
• A matrix will provide a compact description, help identify any gaps. See Writing an application for examples

• This area should read like an annual report to shareholders - it’s the only area where you get credit for intentions (everywhere else in the criteria you’ll only get credit for what you’ve done)
• Your job here is to convince the examiners that you know where your organisation will be in the future
• If you must use ‘world-class’, define what you mean (it’s an overused expression)
• Project your key indicators forward, and show how you expect your projections to compare to your competitors, industry standards, and any benchmarks you can find.
• Explain how you gather competitive and benchmark information.
• And see the Benchmarking exhibit for a background to this technique.