Organizational Wellness through Sequestration and Beyond Nov 2012

1. Organizational Wellness through Sequestration and Beyond Nov 2012 Proprietary Information Included

2. Facts on Sequestration • Cuts will be $1.2 trillion total. • Will be evenly divided over a nine-year period. • Cuts are evenly distributed between: • defense spending (except that on wars); • discretionary domestic spending (does not include Social Security, Medicare, Medicaid, Veteran’s Benefits). • Cuts are across the board • (no discretion by legislators). • Range from 7.6% to 9.6% • of each budget. • 2012 Budget $3.8 trillion. Cuts begin to take effect on January 1st, 2013 since the bipartisan supercommittee did not agree to a $1.2 trillion deficit-reduction package back in November of 2011.

3. Facts on Sequestration • 2012 Social Security, Medicaid, Medicare, Vets • benefits is $2.25 trillion. • Cuts in 2013 have to come in what is left over (about $1.6 trillion). • Can be avoided if Congress passes another budget deal that would achieve at least $1.2 trillion in deficit reduction. • Republicans don’t want to raise taxes to generate the revenue. • Democrats are reluctant to • make dramatic changes to • entitlement programs to • achieve savings. • There is talk of a stopgap • plan during the lame-duck • session to buy legislators • more time to come up • with a grand bargain. NSBA fears that small businesses will bear a disproportionate and unfair burden under the current sequestration plan.

4. What Can a Government Contracting Small Business Do ? • Identify government cost overruns and ensure government is aware that they are their responsibility. • Ensure all Firm-Fixed Price contracts are accurately assessed and that the government does not create mission creep at your expense. • Ask for performance reviews on time to show value to the government. • Market and Diversify your portfolio in terms of the following: • Types of contract vehicles (IDIQ, FFP, T&M, etc…) • Agencies supported (both Prime and Subs) • Capabilities Offered • Commercial and Government clients (domestic/International) • Conferences (such as VA Small Business Partnership) • Offer to restructure your contract vs. termination. NSBA fears that small businesses will bear a disproportionate and unfair burden under the current sequestration plan.

5. What Can a Government Contracting Small Business Do ? • Cross train vs. hiring after attrition. • Freeze wages and limit bonuses. • Lower overhead costs. • Only hire when there is a billable • position. • Solidify relationships with • in-person visits. • Find efficiencies and be • effective. • Measure performance • Develop and Maintain a • Strategic Plan. Improve your overall effectiveness through a mixture of marketing diversity and strategic planning.

6. Organization Wellness & Development Model Including Balanced Scorecard Strategic Planning As part of ensuring the wellness of an organization the Balanced Scorecard can be a key component. Understanding how each element within the BSC relates to one another for the betterment of the organization is paramount. Proprietary Information Included

7. Fictitious For-Profit Company Strategy Map Vision: To be a world-class organization. Mission: Through solid leadership and creating a culture where all employees thrive equally, efficiently and effectively produce and sell XXXX in the US and abroad. Core Values: Honor ~ Respect ~ Loyalty ~ Trust Effective Communication Business Process Excellence Enhanced Partnerships Operational Excellence Strategic Themes: Finance F 3.0 Improve Revenue Growth F 4.0 Increase Margins F 1.0 Improve Productivity F 2.0 Improve Shareholder Value Customer C 3.0 Improve Timeliness C 4.0 Build Relationships & Enhance Partnerships C 2.0 Optimize Operations C 1.0 Improve Quality Feedback Based Resource Reallocation Internal Process IP 3.0 Improve Marketing & Communications IP 2.0 Improve Adherence to Regulatory Processes IP 1.0 Improve Operational Business Practices Learning and Growth LG 1.0 Optimize Human Capital LG 2.0 Improve Infrastructure Usage LG 3.0 Leverage Technology Proprietary Information Included

8. Organizational Maturity Model Organizational maturity occurs when an organization not only develops measures of success, but puts goals to those measures and then drives strategy through measuring strategic performance in addition to project level performance. Proprietary Information Included

9. Organization Wellness & Development Model’s Transparency Model This model shows how Spider Software is integral to ensuring a transparent view of performance and strategic management aspects of your organization. This includes ROI of contract support which enables you to reach your strategic objectives and vision. Three functions, one software tool. Proprietary Information Included

10. Organization Wellness & Development Model Including Balanced Scorecard Strategic Planning In this Phase we get a flavor for the cultural constraints and enablers as well as preferred practices and techniques of the organization which ultimately ensures a smooth strategic transition. Proprietary Information Included

11. meals seating choices hub connectivity friendly service frequent departures price lounges bags Southwest Airlines Strategic Profile Factors of Competition Car high Southwest Other Airlines The strategic profile of Southwest Airlines differs dramatically from those of its competitors in the airline industry. Note how Southwest’s profile has more in common with the car than with the profile of other airlines. Investment low Adapted from Charting Your Company’s Future: “Harvard Business Review” Vol 80, No. 6

12. Organizational S.W.O.T. Beneficial Factors Adverse Factors Strengths: Weaknesses: Internal Environment Opportunities: Threats: External Environment Proprietary Information Included

13. OrganizationalCustomers & Stakeholders Stakeholders: Customers: Proprietary Information Included

14. Mission & Vision Statements

15. Core Values

16. Organization Wellness & Development Model Including Balanced Scorecard Strategic Planning In this Phase the backbone of your Strategy is developed including specific definitions of the meaning behind the strategic pieces to ensure a long-term understanding of the vision and mission. Proprietary Information Included

17. Strategic Themes & Results: “Pillars of Excellence”

18. “we will be as profitable as we possibly can be.” “and exceed the needs of our customers’ (internal and external)….” “and create the right day-to-day internal processes or operating procedures…." “If we recruit the right people, with the right skills, and provide them the right tools and organizational culture….”

19. Resource Reallocation

20. Strategic Objectives - the building blocks of your strategy

21. Cause and Effect Strategic Theme: Operational Excellence F 3.0 Improve Revenue Growth Finance C 1.0 Improve Quality C 2.0 Optimize Operations Customer IP 1.0 Improve Operational Business Practices IP 2.0 Improve Adherence to Regulatory Processes Internal Processes LG 1.0 Optimize Human Capital LG 2.0 Improve Infrastructure Usage Learning and Growth Proprietary Information Included

22. Fictitious For-Profit Company Strategy Map Vision: To be a world-class organization. Mission: Through solid leadership and creating a culture where all employees thrive equally, efficiently and effectively produce and sell XXXX in the US and abroad. Core Values: Honor ~ Respect ~ Loyalty ~ Trust Effective Communication Business Process Excellence Enhanced Partnerships Operational Excellence Strategic Themes: Finance F 1.0 Improve Productivity F 2.0 Improve Shareholder Value F 3.0 Improve Revenue Growth F 4.0 Increase Margins Customer C 1.0 Improve Quality C 3.0 Improve Timeliness C 4.0 Build Relationships & Enhance Partnerships C 2.0 Optimize Operations Feedback Based Resource Reallocation Internal Process IP 3.0 Improve Marketing & Communications IP 2.0 Improve Adherence to Regulatory Processes IP 1.0 Improve Operational Business Practices Learning and Growth LG 1.0 Optimize Human Capital LG 2.0 Improve Infrastructure Usage LG 3.0 Leverage Technology Proprietary Information Included

23. Including Balanced Scorecard Strategic Planning Organization Wellness & Development Model In this Phase the Scorecard is carefully developed. Human capital, time and financial resources are allocated to specific projects, called initiatives, thereby setting your organizational strategy into action. Proprietary Information Included

24. The Scorecard is… • developed from the strategy map. • translates strategic objectives into a comprehensive set of performance measures, targets and initiatives. …turns Strategy into Action! Proprietary Information Included

25. Objective Statements The objective statement (commentary), which defines what success looks like for an objective, when written well will make finding your measures and supporting initiatives easy to discover. If during a strategic review you find that the discussion continues to evolve around changing the measure for an objective, the focus should not be on the measures. Instead change or clarify your objective statement. Proprietary Information Included

26. A Strong Measure Validated – to ensure it measures the right thing Verifiable – to ensure accuracy Leading – process in nature Lagging – outcome in nature Measures tell us if there is a cause-effect relationship between the initiatives and objectives in the desired direction we want the objective to move. Proprietary Information Included

27. Targets & Thresholds A negotiated process w/the leadership team. Should not be arbitrary! Should reflect best practices (benchmark) Should not celebrate mediocrity, use BHAGs (from Built to Last) Should reflect needs of those who benefit from the objective. Targets are the desired values of performance for the objective to change from Amber to Green. Thresholds are the desired values of performance for the objective to change from Red to Amber. Proprietary Information Included

28. Strategic Review Discussions Should Focus Around Initiatives All too often the topic of conversation in a strategic review are objectives and their measures, targets, and thresholds.  Leadership has to ensure that the relationship between the objectives, measures (target/thresholds) and initiatives are fully understood. Objectives (which represent the highest priorities of an organization) are important, as this is your end state; what you are trying to achieve. The key discussions an organization should have at its strategic review, after checking the status of an objective, are around the initiatives. Proprietary Information Included

29. Initiatives (Projects) Initiatives (or projects) have a hypothetical relationship with the objectives they support.  Once these initiatives (projects) are completed, the measures attached to the objective tell us if the objective is trending in the desired direction.  If the completion of the initiative (project) pushed our objective in its desired direction, the measures will tell us so and our initial hypothesis of a cause and effect relationship will have been true.  Initiatives are where resources are obligated. Dollars are spent, time is allocated, and human capital is invested over time. Proprietary Information Included

30. Initiatives and Project Management Initiatives may be small (write an SOP, buy some equipment) or they may be large (standardize an enterprise-wide process, purchase enterprise-wide software). • If small, there is limited budget and human capital expended. • If large, there may be large amounts of money and human capital expended. Initiatives that are large expend large amounts of resources need to be managed through the Project Management Model to ensure they are as efficient and effective as possible. Proprietary Information Included

31. Project Management and Quality Assurance • If large in nature they are expending budgeted strategic dollars, valuable organizational time and human capital resources. • The project needs to be managed through an EVM tool, and…. • …be subjected to a QA program such as LSS, CMMI or ITIL. Projects that expend large amounts of resources should be subjected to a quality assurance program to ensure they are as efficient and effective as possible. Proprietary Information Included

32. Organization Wellness & Development Model Including Balanced Scorecard Strategic Planning Phase Four is the key area for automation and long-term sustainability. This is the crucial point where the hired consulting staff leaves your organization and you fly solo. Your ability to understand this phase will determine your strategic survivability. Proprietary Information Included

33. The Power of Enterprise-wide Alignment! Organizational Alignment Drives: • Common organizational vision • Common organizational strategic priorities • Subordinate performance contributes to, and is aligned with, the enterprise-wide target performance Proprietary Information Included

34. How Do Complex Organizations Assemble, Track, and Maintain their Scorecard Strategy Management requires the ability to know how your strategy is performing at every level of your organization at every moment. Automating your organization’s scorecard provides you timely, accurate information on your current performance from anywhere in the world. If you want to know how your organization is performing...how many different reports or systems do you have to check? How many people do you call or email? Proprietary Information Included

35. Automating your organization’s scorecard provides you timely, accurate information on your current performance from anywhere in the world. Proprietary Information Included

36. Dashboards and Strategy Maps can help to identify problem areas at a glance. Through these gauges we can drill down to the details of each objective and make sound decisions based on current data. Proprietary Information Included

37. Organization Wellness & Development Model Including Balanced Scorecard Strategic Planning Phase Four is the key area for automation and long-term sustainability. This is the crucial point where the hired consulting staff leaves your organization and you fly solo. Your ability to understand this phase will determine your strategic survivability. Proprietary Information Included

38. Avoid the 10 Pitfalls to Success Measure Everything – too many measures ensures you are good at nothing. Use PP to manage your Strategic Model – a good software tool is needed here. Leadership fails to Tell the Story – leadership has to be committed to telling the organizational strategic story. Everyone has to know the BSC value added story – if not, no one will buy-in to the change. There must be BSC Champion – this person meets with individuals and small groups to keep everyone engaged in the BSC process. Failure to flex the model to the organization – the model is imperfect in nature and must flex to the needs of the organization, when appropriate. Know when to flex the organization to the model – otherwise the model will fail the organization. Don’t stop the organization from functioning while implementing this model – it must be allowed to operate at-speed while making the transition. Governance – failure to implement management and sustainment instructions are the most common reasons the model is ineffective. Failure to prioritize initiatives – failure to prioritize your initiatives against established criteria could lead to overspending your budget and stalling your path to the organizational vision. Proprietary Information Included

39. Past Performance We have past performance within The National Institutes of Health, U. S. Army Corps of Engineers, U. S. Army Office of The Surgeon General, The Balanced Scorecard Institute, Department of the Navy….. We are proud of our past performance in the governmental, non-profit and commercial Balanced Scorecard arena. Proprietary Information Included

40. Spider Strategies, Inc. Executive VP Bio. Timothy J. Ciampaglio is the Executive Vice President of Operations for Spider Strategies, Inc, a small government contracting and consulting business focusing on Balanced Scorecard Strategic Planning consulting and automation. Mr. Ciampaglio currently holds a TS Clearance and is a 23 year veteran of the United States Coast Guard where he focused on Maritime Operations, Training and Education, and Balanced Scorecard Strategic Planning. As a consultant of The Balanced Scorecard he holds a Master Professional Certification and is the Senior Consultant for The Army’s Surgeon General in the automation, development and methodology of The Balanced Scorecard. He has developed and managed BSCs for US Army Corps of Engineers, USCG and other commercial entities. He is currently an adjunct professor at The George Washington University Graduate School of Arts and Sciences teaching Strategic Human Resources Planning and Management. He holds a B. S. in Psychology from Towson University and a Masters of Public Policy and Management, from Carnegie Mellon University. tim.ciampaglio@spiderstrategies.com 540-645-1861 Proprietary Information Included

41. Spider Strategies Inc. COO’s Bio Conor D. Crimmins is the Chief Operating Officer of Spider Strategies, Inc., and has nearly 10 years of experience in performance and strategy management, metric development and strategy automation. Mr. Crimmins’ primary focus is on performance management integration and cascading alignment in multi-tiered organizations. At present, Mr. Crimmins serves as the Software Project Manager for the US Army Strategic Management System (SMS), the Army’s Enterprise Performance Management Program Office. Mr. Crimmins holds a Bachelor of Arts in Political Science and International Relations from Carleton College and a Certificate in Political Economy from The Center for European Studies at Maastricht University. Mr. Crimmins is a visiting presenter on Balanced Scorecard Automation at the Balanced Scorecard Institute; a participating member of the Secretary of the Army’s Initiative Group; and the Software Project Manager for the US Army’s Strategic Management System Program Office. Mr. Crimmins holds a Top Secret Clearance from the Department of Defense. conor.crimmins@spiderstrategies.com 202-374-9708 Proprietary Information Included