Summary:

For years Robert Bradford, strategic planning expert, focused on four variables in the Simplified Strategic Planning Process– value, probability, management effort and financial risk when assessing strategic opportunities.  However, recently he decided to include a secondary analysis of opportunities, undertaken when reviewing opportunity screening worksheets.

The purpose of this screen is to enable your team to quickly sort out the opportunities with the greatest strategic potential for your organization. Start by asking the team to rate each opportunity on two dimensions – resource requirements and strategic impact on the organization. This process helps management prioritize initiatives and justify saying “no” to those that impede the strategic progress.

In evaluating initiatives, the no-brainers are those with high impact and low resource requirements.  The tricky discussions – and often the most strategically dangerous issues – occur in the middle level zone – opportunities with moderate impact and/or moderate resource requirements. These opportunities can mire your strategic level resources in initiatives that produce only incremental improvements in your organization’s performance, while more fundamental, truly strategic opportunities are starved for resources because they are “too difficult”.

Article Quote:

“This screening is particularly useful when you are evaluating far more opportunities than your team can realistically handle (in my experience, from three to ten strategic opportunities, depending on the team and its resources). ”

Link: http://www.cssp.com/strategicplanning/blog/?p=557

Evaluating strategic initiatives with this process creates better focus on those initiatives that provide the greatest strategic potential for the organization. The company will be in a better position if it can accomplish a few key initiatives well than to work on several with no real results.

For more on strategic planning, seehttp://www.performancesolutionstech.com/category/strategicplanning/

Summary:

Boeing’s 787 Dreamliner has not hit its development milestones, causing Boeing to take a $2.5 billion charge against earnings.  The key to Boeing’s past success has been its ability to achieve its “big hairy audacious goals or BHAGs” (fromBuilt to Last by Jim Collins and Jerry Porras).

Boeing decided to outsource not only the manufacturing of components but also the design, in order to keep development costs on the 787 Dreamliner low and to please Wall Street investors. By outsourcing, Boeing was able to spread some of the financial risk of the project to its contractors.  While this may have spread the financial risk, it increased the execution risk.

Article Quote:

“Boeing’s problems did not just come from the outside; they were a direct result of actions taken by Boeing.  Talk about the good ideas that you have, but also about the possible unexpected outcomes.  For example, it was a good idea to mitigate the financial risk, but the unexpected outcome was to increase the execution risk.”

Link: http://www.cssp.com/strategicplanning/blog/?p=514

As your company ramps up a significant new development effort, take the time to assess the risks.  Take a look at threats - things that can impact you from the outside.  Also, look for ways to prevent threats or reduce exposure.  What are some early warning signs?  Set up contingency plans and hedge your risk if you can.  These are the traditional risk assessment and mitigation steps.

Boeing may have avoided much wasted time if they had implemented strategic planning technology. Boeing could have developed more advanced communication tools earlier. For example, technology allows you to video conference and share designs so that there is clarity around the issues being discussed – simple emails often do not communicate the full complexity of a specific issue – especially when there were 28 different languages between the various sub-contractors.

For more on strategic planning technology, see http://www.performancesolutionstech.com/category/strategicplanning/