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Mission, Vision and Values

The Management Pocketbooks Pocket Correspondence Course

Pocketblog has gone back to basics. This is part of an extended management course.


Among the most frequent sources of confusion for managers – at all levels – are the distinctions between mission, vision and values.

As I started planning this article, I created a table for myself, to put my ideas down about how they compare. In the end, I decided that, if a picture is worth a thousand words, a table must be worth at least 500.

You can click on this image to get a full screen version of this table.

Mission, Vision, and Values

There is not much more to say

Your mission is a long-term definition of why you are in business, your vision sets out what you want to achieve within your strategic planning timescale, and your values determine the culture, behaviours and choices you want your business and its people to follow.

Values should drive your culture through every process: recruitment, appraisal, promotion, succession, procurement, development, sales, marketing, …

Mission should set up the basis for your values. Mission and values should help you find which of many possible visions is right for your business.

Mission, vision and values: one of those things that is fiendishly simple in concept, yet staggeringly hard to do well.

Further Reading

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Business Strategy Tools

The Management Pocketbooks Pocket Correspondence Course

Pocketblog has gone back to basics. This is part of an extended management course.


Over the years, Pocketblog has covered some important business strategy thinkers, so we will start by reviewing what we have.

Good Strategy/Bad Strategy

This is the name of Richard Rumelt’s book and it neatly frames any discussion of business strategy by defining what your outcome needs to look like. Take a look at ‘What makes good business strategy?

The Balanced Scorecard

In one of the all-time classic Harvard Business Review articles, Robert Kaplan and David Norton set out to ensure that our business strategies are balanced across a range of different areas of the business. The tool they introduced is nearly ubiquitous in the upper reaches of the management world, and no manager can get away without at least a passing familiarity with the Balanced Scorecard. Take a look at ’Balance is Everything’.

The McKinsey 7S Model

One of my own favourite tools is also about balance, but this time about ensuring all the elements of your business strategy and planning are all aligned. It was developed by consultants at top US firm, McKinsey: Tom Peters and Robert Waterman. The seven S model reminds us that shared values, style, skills, staff, structure, systems, and strategy must all be consistent with one another. Take a look at ‘On Competition: Internal Forces and the 7-S Model’.

The Awesome Michael Porter

Over the years, three blogs have featured the thinking of business strategy specialist, Michael Porter.

‘On Competition: Five Forces’ briefly introduced two of his principal ideas: the five forces model and his three generic business strategies that flow from them.

‘On Competition, again: Porter’s Five Forces’ took a deeper look at the five forces model.

‘On Competition – The Far End of the Value Chain’ focused on the three generic business strategies and his concept of the value chain. Here, I speculated that some businesses have found a fourth, very successful business strategy.

By the way, a recent entry in the Pocketblog Correspondence course returned to the idea of the value chain. Take a look at ‘The Value Chain’.

The Boston Consulting Group Matrix

Having finished reviewing the archives, let’s take a look at one business strategy tool. This is designed to help us answer a very simple question:

‘We have a number of products (or services) but limited resources to invest in their development and marketing. Which products (or services) should we focus our investment on?’

The folk at Boston Consulting Group who developed the tool suggested that two considerations are paramount in making our judgements:

  1. What is our market share?
    Do we have a dominant market position with this product/service, or a modest share. This dictates the base from which investment can grow or maintain our position.
  2. What is the growth potential of the market?
    Is this product in a growing, static or declining market? Clearly static and declining markets offer far less opportunity to recoup investments.

The result was a simple matrix that plots these two conditions against one-another and identifies four generic strategies. You can click on the image to enlarge it.

The Boston Consulting Group (BCG) Business Strategy Matrix

The Matrix gives us four strategies, three compelling labels for our products/services and one label that is, frankly, honest but lame.

Stars

Place your biggest investment bets on the products which dominate markets with high growth potential. If you are Samsung, you will be investing highly in mobile telephone products because the market continues to expand and you already have a dominant position.

Dogs

Do not invest – arguably, disinvest – in products which have a small share of a static or declining market. There is not much to win and you are not placed to take much of it.

Cash Cows

What do you do if you are a dominant player in a static or declining market? BCG suggested it is like having invested in a cow: you should look after it and milk it while it is healthy. This is how I read the men’s razor market. If you are one of the big players in your region (Gillette, Wilkinson Sword, Bic, for example, here in the UK), then you have a lot of investment in products and marketing, and a strong, valuable revenue stream. Over investment can gain little, as the market will never expand until men grow two heads or we need to shave more of ourselves. But if you don’t invest, you will lose the benefit of your position to your rivals. So, what do we see? Incremental investment in new – but hardly innovative – products. When I started shaving, two blades was new. Now we are up to five. By the time I no longer need to shave (about thirty years or so, I guess) I predict an eight bladed razor will be common.

Question Marks

What to call these pesky products… Does the label attach to the products or the challenge BCG found in labelling them with a cute title? Set aside that curious linguistic conundrum and we face the most difficult challenge of all. Your market is growing, so there is a big prize for the skilled/lucky investor. But your market position is weak, so you have a low chance of success against bigger rival products. Like many good tools, the BCG matrix does not give you all the answers. But it does bring your choices into stark relief.

Further Reading

From the Management Pocketbooks series:

  1. The Strategy Pocketbook
  2. Business Planning Pocketbook
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SWOT, PESTLE and Waterfall Analysis

The Management Pocketbooks Pocket Correspondence Course

Pocketblog has gone back to basics. This is part of an extended management course.


I used to be a director in a business where, like many businesses, once a year we would have a ‘strategy meeting’ to look at our strategy for the next year. How could we understand the market and what could we do to improve our competitive position. In the next blog, we will look at some of the more sophisticated strategy planning tools available to you. Here, I want to focus on three that have the overwhelming merit of simplicity.

Every year we would follow the same process… until, that is, until I got heartily sick of it and introduced another. But let’s start with the two tools that made up that much used process, before I offer you a powerful alternative that is guaranteed to give you insights into how your business can make more money.

SWOT Analysis

Perhaps the best known strategic analysis tool is SWOT Analysis – a structured review of your organisation’s Strengths, Weaknesses, Opportunities and Threats – often presented as a grid like this:

SWOT Analysis

The secret to making SWOT Analysis work is frankness and a determination to be really objective about how your organisation measures up to the market. Being good at something is not a competitive strength if your competitors are also good at it – or even better.

The hardest part is to understand what is coming over the horizon by way of threats and opportunities. Because it is when you pair up the top of the chart with the bottom that you start to see what strategic changes you need to make. So, how do you spot opportunities and threats?

PESTLE Analysis

Of all the tools for horizon scanning, PESTLE analysis is the simplest. We just take stock of all of the changes we can foresee under a range of headings:

 

PESTLE Analysis

Waterfall Analysis

When you get bored with these, focus on revenue. Waterfall Analysis splits your entire market into your market share and the market share you leak to your competitors. It further subdivides these to give five components and hence five parts to your strategy. It will not give you the answers, but it will focus your thinking. People who have used this for a first time often find it leads to revelatory ‘aha moments’; so why not give it a try?

Click on the figure to enlarge it

Waterfall Analysis

Further Reading

From the Management Pocketbooks series:

  1. The Strategy Pocketbook
  2. Business Planning Pocketbook

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The Value Chain

The Management Pocketbooks Pocket Correspondence Course

Pocketblog has gone back to basics. This is part of an extended management course.


The Value Chain is the complete set of processes that links everything an organisation does. Let us say you make widgets. The value chain starts with the process of sourcing raw materials, which you then purchase from a supplier, who then delivers them to you, which you process into finished widgets, that you market and sell, after which you deliver them to your customers, who incorporate your widgets into their value chain.

Most often, the value chain is represented as links in a single chain. I think that this is unrealistic. Instead, it is better to think of it as links in multiple chains, all joined up…

Value Chain

Understanding the value chain is essential for any manager who wants to step beyond their parochial role within it. Understanding and analysing your value chain will allow you to:

  • spot opportunities to create efficiencies within your part of the value chain
  • improve hand-offs with other parts of the value chain
  • appreciate the full strategic scope of the value chain and where you fit into it
  • determine where most and least value  is added and review how to improve the value to cost ratio
  • find where your competitive advantages lie
  • benchmark your performance against industry norms and best practices

Michael Porter distinguished primary business activities (the value generating activities described in the value chain) from secondary business activities, which are necessary in supporting the primary activities. These include:

  • technology and systems infrastructure implementation and maintenance
  • personnel and human resource management, including recruitment, development, appraisal, remuneration, succession, discipline
  • financial planning and management

We can view these as further side links to the value chain.

Porter was clear that a successful business must ensure that all links between elements of this full value chain are strong, if it is to thrive under the pressures of competition.

Further Reading

Two previous Pocketblogs will add to your understanding of the Value Chain:

  1. On Competition: Internal Forces and the 7-S Model
  2. On Competition – The Far End of the Value Chain

You may also like The Strategy Pocketbook

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Sunk Cost and the Sunk Cost Fallacy

Sunk Cost

‘You’ve bought it now. The money’s gone.’ That snarky comment made by thousands of parents (mine included) to their reckless child encapsulates the meaning of sunk cost. Once you met the cost, it’s gone: sunk. You’ve sunk it into the investment for good or for ill.

This, then, could be the shortest Big Ideas article yet. Sunk Cost is a familiar and easy concept.

Continue reading Sunk Cost and the Sunk Cost Fallacy

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Technology Quotient (TQ): Measuring Digital Savvy

Technology Quotient (TQ)

Technology Quotient (TQ)It is a cliché to assert that technology is ubiquitous in the workplace. Yesterday’s innovations will eventually become today’s commonplace tools. So, we all live with and easily manage technology our great grandparents would have found strange and maybe alarming. But some of us are comfortable with the very latest creations – those that will only be deeply familiar to the coming generations. And we might describe these people as having a high TQ: a high Technology Quotient.

The Big Idea, ‘Technology Quotient’ takes its inspiration from IQ, Intelligence Quotient. But what does it measure and is it a useful concept?

Continue reading Technology Quotient (TQ): Measuring Digital Savvy

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Robotic Process Automation: RPA

Robotic Process Automation: RPA

Robotic Process Automation: RPAImagine an army of tiny robots. Each one can do one thing. It does it precisely and tirelessly. And when it completes it, another robot takes over and does another thing. This chain of ‘bots’ can together do what people can do. But without error, rest-breaks, or complaint. Welcome to the world of Robotic Process Automation.

Although it’s often abbreviated to RPA, we’ll stick with Robotic Process Automation. Because, if you’re reading this, you are probably not familiar enough yet, for the acronym to register easily. Because this article purports to be only one thing: a basic primer for the uninformed.

For more depth, you’ll need to seek out an expert on Robotic Process Automation. Maybe, by the time you read this, that expert will look like a little bot in the bottom right-hand corner of your screen. And, sitting behind it will be a series of other bots. Collectively, they may be a robotic process automation that answers questions about robotic process automation. How weird would that be?

Continue reading Robotic Process Automation: RPA

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Business Case: Investment Appraisal and More

Business Case

Business CaseA Business Case is a valuable tool. It’s the corporate world’s equivalent of the scales of justice. Like a mini adversarial system wrapped up as a document of record.

As a project manager, business cases are like mother’s milk to me. But they won’t be for everyone. So before I introduce yet another gratuitously clichéd metaphor, let’s explain what a business case is, and why you need it.
Continue reading Business Case: Investment Appraisal and More

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The Internet of Things: IOT

Internet of Things - IOT

Internet of Things - IOTLike many big ideas, the Internet of Things operates at many levels. It may sound frighteningly complex to you. But in fact, the core of the idea is very simple.

But, underlying a simple concept, the technology that makes the Internet of Things (IOT) possible is fiendishly complex. Indeed, it is really the convergence of many advanced technologies.

We shall not be taking a dive into the technology (you may be glad to hear). However, any well-informed manager needs to understand the big picture of:

  • what it is
  • what it can do
  • where it is going, and
  • the concerns we might have

So, in this article, we’ll give you your primer on the Internet of Things.

Continue reading The Internet of Things: IOT

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The Learning Organisation: Advantage through Adaptation

Learning Organisation

Learning OrganisationWhat’s the biggest long-term competitive advantage an organisation can have? It’s the ability to adapt rapidly to changing circumstances. And for that, it needs to learn. That’s the Big Idea behind Peter Senge’s Learning Organisation.

The Learning Organisation sits at the confluence between two powerful forces for good:

  1. Individual learning, development, and personal growth
  2. Systems thinking that allows us to mentally connect up the network of parts into a complex whole

What it means is simple in concept, though fiendishly hard to achieve in practice. A learning organisation is one that continually develops and evolves so that everyone shares a consistent vision and collectively prepares themselves to meet the next challenge in achieving it.

Continue reading The Learning Organisation: Advantage through Adaptation

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