Creating Vision and Strategic Direction for Competitive Advantage

1. Chapter 13 Creating Vision and Strategic Direction

2. Strategic Leadership The ability to anticipate and envision the future, maintain flexibility, think strategically, and initiate changes that will create a competitive advantage for the organization in the future

3. Ex. 13.1 The Domain of Strategic Leadership Vision Purpose? Mission Strategy Architecture for alignment and implementation

4. Vision An attractive, ideal future that is credible yet not readily available • Links the present to the future • Energizes people and garners commitment • Gives meaning to work • Establishes a standard of excellence and integrity

5. Ex. 13.2 Examples of Brief Vision Statements (selected) Motorola • Become the premier company in the world Ritz-Carlton (Amelia Island) Engineering Dept. • Where no hotel has gone before – free of all defects Johnson Controls Inc. • Continually exceed our customers’ increasing expectations New York City Transit • No graffiti Egon Zehnder • Be the worldwide leader in executive search

6. Ex. 13.3 The Nature of the Vision Vision Moving toward a desired future Staying the course Current reality

7. Common Themes of Vision • Vision has broad appeal • Vision deals with change • Vision encourages faith and hope • Vision reflects high ideals • Vision defines the destination and the journey

8. Self-reference: A principle stating that each element in a system will serve the goals of the whole system when the elements are imprinted with an understanding of the whole. • Good leaders give up the idea that vision emanates from only the top • “My job, fundamentally, is listening to what the organization is trying to say, and then making sure it is forcefully articulated” WSJ Article: Truth Telling Culture

9. Mission The organization’s core broad purpose and reason for existence

10. Strategic Management Strategic Management • The set of decisions and actions used to formulate and implement specific strategies that will achieve a competitively superior fit between the organization and its environment so as to achieve organization goals Strategy • The general plan of action that describes resource allocation and other activities for dealing with the environment and helping the organization attain its goals

11. Core Competence Something the organization does extremely well, even uniquely well, in comparison to competitors

12. Synergy and Value Synergy: the interaction of organizational parts to produce a joint effect that is greater than the sum of the parts Value: the combination of benefits received and costs paid by the customer

13. Strategy Formulation and Implementation Strategy Formulation • The integrating knowledge of the environment, vision, and mission with the core competence in such a way as to achieve synergy and create customer value Strategy Implementation • Putting strategy into action by adjusting various parts of the organization and directing resources to accomplish strategic goals

14. Ex. 13.7 Making Strategic Decisions Ease of Implementation Hard Easy High Impact, Hard to Implement. Major changes, but with potential for high payoff High Impact, Easy to Implement. Simple changes that have high strategic impact – take action here first High Strategic Impact Low Impact, Hard to Implement. Difficult changes with little or no potential for payoff – avoid this category Low Impact, Easy to Implement. Incremental improvements, “small wins;” pursue for symbolic value of success Low

15. Ex. 13.8 Linking Strategic Vision and Strategic Action High The Dreamer The Effective Leader Vision The Uninvolved The Doer Low High Low Action