Showing posts with label Planning. Show all posts
Showing posts with label Planning. Show all posts

Much smarter to build form around the substance of an idea.
Charlie Rose one time asked Bruce Springsteen, "When do you write?" His reply: "When I have an idea." As against when he doesn't have one. What a wonderful use of his time!
John Denver used to say (for you Millennials, he was RCA's second-biggest record seller after Elvis) that, "the songs come when they have a mind to." The idea for "Annie's Song," his largest hit, came to him while he was on a chair lift in the work of a day of skiing.
Springsteen & John Denver were both wise to know that you wait & watch for ideas, you don't force them in to being. Well, actually, you can listen to instances where each of them did try to force it — & got lousy songs as a result.
Steve Jobs was asked years ago about how he planned to compete with the Wintel monopoly. He said, "I'm going to wait for the next giant thing." He didn't say "I'm going to personally generate the next giant thing." Neither iTunes nor the iPod was his idea. The iTunes idea came from a small company called SoundJam MP, & the genesis of the iPod was a design inside the head of Tony Fadell, a tech consultant who went to work for Apple. Steve Jobs's brilliance was in keeping his eyes open for the ideas, recognizing the moment, connecting the dots, & "creating" iTunes & iPod as a technique that worked together, adding Jonathan Ive's designs, & promotion it all incredibly. He wasn't sitting at his table banging his head against the wall trying to force an idea out of the universe.
In fact, to the extent that you are punishing yourself for the shortage of an idea, or torturing yourself to come up with one, you may well miss the idea that is right under your nose, waiting to be acknowledged.
There's three simple rules I have learned about ideation: Look & wait.
Look. For years my company struggled to come up with the right slogan for our AIDS Rides. "Challenge yourself & you will grow." Yuck. "The adventure of a lifetime." Yawn. The more frustrated they got, the more the answer eluded us. Then one day they said to ourselves, "These events are impossible. You require to ride for grueling distances. You require to sleep in a tent & raise immense amounts of funds from your friends. Most people look at them & think, 'Impossible.'" Having admitted the truth, they stared at that word "impossible" for about an hour. & they noticed three words inside there. "I'm" & "possible." "I'mpossible." Our new slogan. It had been staring us in the face for six years. They weren't looking.
& as for waiting...This is tragic but instructive. In 1999 anyone close to me committed suicide. My grief & aching sadness wanted expression, & they found it in music. Ideas for songs about the tragedy started coming to me in quick succession. On long walks. In the automobile. Without me asking for them. They were asking for me. In about six weeks I wrote 13 songs, each of them based on an idea, & each of them better than most anything I had forced while banging away on my guitar in my loft years earlier. & they became my first album.
On top of that, an idea came for a suicide prevention event — called, "Out of the Darkness" — that has now raised millions for the cause. That idea would seldom have come to us sitting in our conference room at Pallotta TeamWorks trying to force an event in to being. It came from a confluence of tragedy & emotion & timing. &, as a result, it was authentic, not a contrivance.
The idea may not come when you require it to, but when it does, it will be right on time. & it will be true to who you are.
So, my advice to you: Go get an ice cream. Go ride your bicycle, or whatever it is you like to do. Relax a small bit. You cannot generate the next giant idea at will anymore than you can make the love of your life walk in to the room in the next half hour.
Look. & wait. & while you are at it, have a small faith — in life, in God, in the universe, in whatever you think in. The universe is pregnant with ideas. Your passion for them is . They don't go where they are not wanted. But ideas have lives of their own. They have their pride. & they don't reveal themselves to the impatient or the distracted.

The difficulty with company-wide strategic planning is that it often is comprised of disparate mountains of information. To get the big picture on your strategy, why not visualize your company on a "strategy canvas"—a picture of your company among its competitors. Southwest Airlines did it. This excerpt from Harvard Business Review by two INSEAD professors shows you how.

John Reed of Citicorp was known for insisting that his executives get the big picture. As chairman and CEO, he demanded that business unit heads present their proposed strategies in no more than a few slides. Executives who failed to meet Reed's exacting standards for brevity met with his unconcealed displeasure. And if it happened too often, they ran the risk of being left out of the loop on future strategy sessions.

Many leaders share Reed's obsession with the big picture, yet our research shows that few companies actually have a clear strategic vision. The problem, we believe, stems from the strategic planning process itself. The process usually involves the preparation of a large document—culled from a mishmash of data provided by people from various parts of the organization who often have conflicting agendas and poor communication. The report typically begins with a lengthy description of the industry and the competitive situation. There follows a discussion of how to increase market share here and there, capture new segments, or cut costs, which leads to an outline of numerous goals and initiatives. A full budget is almost invariably attached, as are lavish graphs and a surfeit of spreadsheets.

No wonder so few strategic plans turn into action; executives are paralyzed by the muddle. But it doesn't have to be that way. We suggest an alternative approach to strategic planning, based not on preparing a document but on drawing a picture we call a "strategy canvas." This approach consistently produces strategies that are easy to understand and communicate, that engage more people within an organization, and that unlock the creativity of participants. First, though, let's look at what makes a good strategy canvas.

Revealing your strategic profile
Academics and consultants have developed an armory of tools to help companies understand their strategic positioning, and many of those tools have yielded successful strategies. Our approach—drawing a strategy canvas—is unique because it does three things in one picture. First, it shows the strategic profile of an industry by depicting very clearly the factors that affect competition among industry players, as well as those that might in the future. Second, it shows the strategic profile of current and potential competitors, identifying which factors they invest in strategically. Finally, our approach draws the company's strategic profile—or value curve—showing how it invests in the factors of competition and how it might invest in them in the future. The basic component of our strategy canvas, the value curve, is a tool we developed in our research and consulting work. (For a full description, see our previous HBR articles "Value Innovation: The Strategic Logic of High Growth," January-February 1997, and "Creating New Market Space," January-February 1999.)

To illustrate how a strategy canvas works, we'll take you through one we've created for the short-haul airline industry. In the exhibit "The Strategy Canvas of the Short-Haul Airline Industry," the factors of competition for the industry are listed on the horizontal axis. The vertical axis indicates the degree to which airlines and the providers of alternative services invest in the competitive factors. A relatively low position means a company invests less and, hence, offers less in that factor—or, in the case of price, asks for less. If you look at meals, for example, Southwest provides little in the way of free refreshment, though not as little as you would get if you drove yourself. By connecting the dots across all the factors for each player, you reveal the strategic profiles of Southwest, its direct competitors, and its main alternative, the car.

Southwest Airline's profile is a perfect example of a good strategy, because it shows the three complementary qualities that characterize an effective strategy: focus, divergence, and a compelling tag line. If your company's strategic profile does not clearly reveal those qualities, your strategy will likely be muddled, undifferentiated, and hard to communicate.
Focus. Every great strategy has focus, and a company's strategic profile, or value curve, should clearly show it. Looking at Southwest's profile, for example, you can see at once that the company emphasizes just three factors: friendly service, speed, and frequent point-to-point departures. By focusing in this way, Southwest has been able to price against car transportation; it doesn't make extra investments in meals, lounges, and seating choices. By contrast, Southwest's traditional competitors invest in all the airline industry's competitive factors, which makes it much more difficult for them to match Southwest's prices. Across-the-board investing is often a sign that competitors' moves are setting a company's agenda.

Divergence. When a company's strategy is formed reactively as it tries to keep up with the competition, it loses its uniqueness. Consider the similarities in most airlines' meals and business-class lounges. On the strategy canvas, therefore, reactive strategists tend to share a profile. Indeed, in the case of Southwest, we found that the value curves of the company's competitors were virtually identical, which is why they share the same value curve in the exhibit. By contrast, the value curves of innovators' strategies always stand apart. They might eliminate or substantially reduce investments in certain factors, or they might dramatically increase investments in others. Sometimes they even create new factors, thereby changing the industry's overall profile. Southwest, for instance, pioneered point-to-point travel between midsize cities; previously, the industry operated through hub-and-spoke systems.

Compelling tag line. The final test of a good strategy picture is how well it lends itself to a tag line. "The speed of the plane at the price of the car—whenever you need it." That's the tag line of Southwest Airlines, or at least it could be. What could Southwest's competitors say? Even the most proficient ad agency would have difficulty reducing the conventional offering of lunches, seat choices, lounges, and hub links with standard service, slower speeds, and higher prices into a memorable tag line. A good tag line must not only deliver a clear message but also advertise an offering truthfully, or else customers will lose trust and interest. If you can't come up with a strong and authentic tag line, chances are you don't have a strong strategy, either.

Drawing a strategy canvas is not, of course, the only part of the strategic-planning process. At some stage, numbers and documents must be compiled and discussed. But we believe that the details will fall into place more easily if managers start with the big picture. Completing the four steps of visualizing strategy will put strategy back into strategic planning, and it will greatly improve your chances of coming up with a winning formula. As Aristotle pointed out: "The soul never thinks without an image."
hardvard business school

Competitiveness of any company depends on a wide range of factors, among which also ability to accommodate to changes belongs. The beginning of this millennium can be characterized by high growth and globalization of competition and by remarkable development in the areas of utilization of information and communication technologies. Information and communication technologies thus enable occurance of new ways of managing the relationships between suppliers and consumers. These relationships can be characterized by a large degree of automation, and by use of the Internet as the main communication tool.
Implementation of Online shopcan be considered as a medium-term investment, which has to be controlled systematically, in order to achieve the desired effect. If a company decides to implement e-commerce, it is very important to make preparations first. The main point of these preparations is creating an Online shop strategy.

Analysis of the current state in the area of Online shop
The Czech Statistical Office presents four basic features of ,,New Economics", which are, according to the Eurostat (the Statistical Office of the European Communities), agreed upon by most experts (1): knowledge and new branches with high added value, utilization of new information and communication technologies that increase competitiveness, virtual communities that are based on common interests, decreasing role of brokers thanks to increasing utilization of information and communication technologies
Online shopis made up by a complex of links between individual participants in the given commercial transaction.

Online shop in the Czech Republic
Also the Czech Statistical Office is concerned with research in the area of utilization and development of e-commerce: every fourth household in the Czech Republic has a computer (8). The results of the researches show that up to 70 % of Internet users shop online. 75 % of Internet users have experience with shopping online ­ the purchasers are men, who made up 54 % of all purchasers.
Approximately one third of all purchasers is made up by people aged 20-29 years (9). The highest interest is in books, magazines and text-books (37 %). The second most favourite goods were electronic devices (28.9 %). These were followed by tickets to cultural events (23.6 %), clothes and sports equipment (21.4 %), services in the area of travelling and accommodation (16.2 %), films and music (16.2 %).(8). 56 % of the purchasers chose to pay for the purchased goods by means of cash on delivery. 26 % of the purchasers paid by means of banking transfer, 19 % paid cash, 6 % by means of a postal order and 4 % by means of a credit card.

Utilization of Online shopin the business sphere
The volume of purchases by means of the Internet in the Czech Republic reached approximately 2.8 % of total purchases. The volume of sales by means of the Internet reached 2.1 % of total sales. It is thus obvious, that the companies more and more often utilize the Internet for purchasing, the sale on the other hand interannually rather fluctuates.

Formulation of the Online shop strategy
Management can generally be divided into three basic groups, namely strategic, tactical, and operative management. These three types of management are hierarchically arranged and, on the basis of this, can be stated that every company that wants to be successful has to have a quality system of strategic management. It namely is the basis of management in general, from which then tactical and operative management follows.

Strategic management is a never-ending, continuous process, oriented primarily on retaining harmony between corporate mission, long-term objectives, available resources, but also on achieving harmony in mutual interactions with the environment that the company finds itself in. Strategy can be in a simplified way characterized as basic notions of the manner of achieving the determined objectives. Strategy can be defined by means of the following eight attributes:
• Strategy points to the more distant future
• Strategy should secure the company a specific competitive advantage
• Strategy determines primarily basic parameters of business activity, set of products, services, volume of production, markets etc.
• Strategy should aim at achieving harmony between activities of the company and its environment
• Strategy should base on key resources and abilities of the company
• Strategy should delimit basic ways of securing resources that are necessary for its implementation
• Strategy fundamentally determines objectives on the tactical and operative level of management
• Strategy also has to reflect corporate values, expectations of the stakeholders, and corporate culture

A company can be successful only then, when it chose a suitable strategy. This strategy has to deal with a wide range of areas related to the given business, and if the company is also involved in e-commerce, it has to contain functional strategy that solves the particular problem ­ Online shop strategy. It is suitable to implement the Online shop strategy only in case, when there is a significant strategic gap that can be filled exactly by implementing the Online shop strategy.

If a company is able to find answers to previous questions and comes to the conclusion that implementation of Online shop might be an asset, it can start developing an Online shop strategy. It is a demanding process, which can be divided into five basic stages.
Online shop strategy is a functional strategy that contains objectives of the given company and ways how to achieve them that focus on the area of e-commerce. Online shop strategy can be part of another functional strategy, e.g. IS/IT strategy, which represents a separate functional strategy that blends together with other functional strategies of the given strategic business unit. A typical example of this blending can be e.g. e-marketing. E-marketing can be part of both Online shop strategy, and marketing strategy. An important condition however is preservation of consistence, i.e. that the given issue is divided into technical and logical part, or is elaborated comprehensively as part of one of the given strategies.
Online shop strategy is analogous to corporate strategy. It differs only in being oriented on how the company should be adapted to new business conditions or how should a new company operate electronically.
This approach concerns basically all companies, large as well as small ­ all of them have to consider the online shop strategy. It may come in useful here to mention the statement of M. Dell, the founder of Dell Computers: Internet is like a weapon on your desk, you either pick it up and use it or your rival does. In this case it is of no importance to ask WHETHER, but only WHEN".

It is very difficult to harmonize the corporate strategy with new perspective technologies and it requires considerable effort of the management. One of the methods of formulation of Online shop strategy is the model by R. Plant (6), which is based on seven key factors. Four of these seven factors - technologies, market, services and brand ­ are the main pillars. These four pillars are connected by means of other three factors ­ management, infrastructure and training, without which the pillars given above would occur in isolation.
It is important that all factors ­ technologies, brand, services, market, management, infrastructure, a learning organization ­ are mutually balanced and connected. This mutual cohesion and balance is secured by means of effective infrastructure. It can be characterized for example by means of the 7S model of consultants R.T. Pascal and A. Athos from the company McKinsey.
New companies starting to operate on the Internet usually have a flat organizational structure and their main objective is primarily cost minimization. The costs however usually grow with increasing market requirements. This type of companies also tries to achieve the biggest possible understanding of the market.
Unlike ,,start-up" companies, the companies that already operate on the Internet and are well-established try to find and make use of new distribution channels or services and try to provide answers to questions such as:
What makes us better than the competition? What are our weaknesses? How effective is the utilization of information and data? How can we optimise the key processes, etc.-? And exactly this knowledge-guided approach to management is the key to success. A company that wants to succeed in the current globalised market however has to combine both approaches mentioned above: flexibility and low costs, knowledge management and knowledge of the market.
Evaluation of the Online shop strategy has three basic stages:
- Analysis of the company and choice of Online shop model from the point of view of brand, technology, market and services.
- Proposal of balanced metrics, which are going to be utilized in evaluation of financial impacts, competitiveness, brand, provided services, market, technologies and style of the web pages. Each of these areas should contain a large number of questions concerning influence of the strategy on the organization. Balanced evaluative criteria are going to be proposed for each dimension of the online shop strategy (e.g. verbal ­ questions that express the influence of the given factor on the strategy). Results of the metrics should then be evaluated carefully, primarily on account of their mutual connection. Customer satisfaction measurement, for example, can have an influence on a low interest in customer on-line centre, because the customer prefers calling by phone and at the same time Online shop prefers on-line communication by means of the Internet.
- To evaluate the Online shop strategy can be chosen e.g. the 10-point scale, which shows the influence of key factors on the selected strategy, where 1 expresses absolutely negative and 10 - absolutely positive influence. Sum of the points of each factor is then expressed by means of a polar graph.