Chapter 13 Creating Vision and Strategic Direction 1

Chapter 13 Creating Vision and Strategic Direction 1

Chapter Objectives Explain the relationship among vision, mission, strategy, and implementation mechanisms. Create your personal leadership vision. Use the common themes of powerful visions in your life and work. Understand how leaders formulate and implement strategy. Apply the elements of effective strategy. 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 Mission Strategy Architecture for alignment and implementation 4

Vision An attractive, ideal future that is credible yet not readily available 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 Mo vin gt ow a fut rd a d ure esi red Vision Current reality Staying the course 7

Common Themes of 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

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

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 10

Core Competence Something the organization does extremely well in comparison to competitors 11

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 12

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 13

Ex. 13. 7 Making Strategic Decisions Ease of Implementation Hard High Strategic Impact Low High Impact, Hard to Implement. Major changes, but with potential for high payoff Low Impact, Hard to Implement. Difficult changes with little or no potential for payoff – avoid this category Easy High Impact, Easy to Implement. Simple changes that have high strategic impact – take action here first Low Impact, Easy to Implement. Incremental improvements, “small wins; ” pursue for symbolic value of success 14

Ex. 13. 8 Linking Strategic Vision and Strategic Action High The Dreamer The Effective Leader The Uninvolved The Doer Vision Low High Low Action 15