Strategy Formation Process:
In general, the strategy formation process is straight forward. The process brings all key factors for consideration before the strategy is formed. Participation of all strategy formation stakeholder of the organization brings the internal and external reality, strength, weakness, opportunities and threats into the process. All organization exists for a purpose. The core objective of any profit organization is to create value to customer and generate profit to the share holder or the owner of the organization. The value dynamics is applicable to all profit organization. The value to the customer is generated by providing a product or service.
The steps involved in the competitive strategy formation are listed below.
- Review four perspectives of the strategy map and its alignment. Choose learning & growth or people perspective based on the organization.
- Identify the strategic objectives for each perspective and emphasis on the identified key words from the vision and mission statement.
- Describe each strategic objective by a vivid statement
- Assess the feasibility and availability of metrics for the key performance measures.
- Refine the key performance measure if the metrics are not available with in the organization and unrealistic to generate the metrics.
- Set the target for the long term
- Incrementally assign the targets into different duration. (per year or per quarter)
- Theme is a group of the related initiates in duration.
- Identify a theme owner
- Identify a owner for each initiative
The core challenge in the strategy formation is to identify the differentiators. Even when an organization has a differentiator in the respective market segment, implementation of the strategy is critical for the organization success. Execution of the strategy contains two major parts. One is to identify the projects or initiatives and second part is to align the whole organization towards the strategy.