Value Proposition

Value Proposition

Objectives and Goals

Strategic Plan

Strategic posture: shape, adapt, reserve

Resource allocation (priorities)

Rules of engagement across critical business drivers

Resource Plan (requirements, application, sources)

Human

Financial

Technical

Operational

Action Plan

ActionsTimingResponsibilitiesLinkages

Near-term

Long-term

Performance Management Plan

Operating and financial performance standards

Measures and goals

Notes:

Value Proposition – The value you deliver to the people you serve.

Whom you serve and the problem you solve for them (Why)
What value you deliver to the people you serve (What)
How you uniquely deliver that value (How)

The price of everything gets competed down to its marginal cost over time. In spelling out your unique combination of why, what and how, your value proposition guides every other choice you make. For example: Apple – innovation, Amazon – low cost provider, PrimeGenesis – service,

Apple serves design-conscious people with more attractive, user-friendlier products and services flowing from its continuous innovation.
Amazon serves people dissatisfied with the inefficiencies in the current product distributions system by delivering the same products with better information at a lower price by cutting out brick and mortar intermediaries.
PrimeGenesis serves senior leaders going into complex new roles by helping them reduce failures and deliver better results faster based on our team, tools & perspective.

Objectives – General things you want to accomplish (like market share, revenues, profits – e.g. “market leadership”, “revenue growth”, “industry leading profits”

Goals – Objectives quantified – e.g. 51% market share, $2B in revenue, $1B in profits)

Strategic Plan – Guides business planning. Some teams/units can move straight from the overall strategic plan to their own business plans. Some teams/units may need to do their own strategic plan nested within the overall strategic plan. In either case, the strategic plan should spell out posture, resource allocation and rules of engagement

Strategic posture: shape, adapt, reserve:

- Shaping is a leadership role to define or redefine the context

- Adapting is a choice around following changes to the environment

- Reserving is about keeping options open to adapt as appropriate later

Resource allocation: This is about what you want and what you’re willing to give up to get it. Each planning unit needs to understand their objectives and goals and the human, financial, technical and operational resources they have available to achieve those objectives and goals.

This tends to look like 3-5 priority areas for investment. For example, Amazon might say:

Build and maintain the world’s best-in-class online customer interface.
Build and maintain a world class product supply and distribution system
Build and maintain a culture driving continuous innovation in the first two.

(“Best in class” means superiority - better than at least 90% of the rest of the world. “World class” means parity with the best – better than at least 75% of the rest of the world. “Strong” means above average – better than 50% of the rest of the world. “Good enough” is just that.)

Rules of engagement across critical business drivers. Clarify the difference between:

POLICY: A mandatory, definite course or method of action that all must follow.

GUIDELINE: A preferred, but not mandatory, course or method of action that all should generally follow.

FRAMEWORK:A basic supporting part or structure upon which to build or act.

PROCESS:A series of actions that produce something or that lead to a particular result.

Resource Plan (requirements, application, sources). Strategy is about the creation and allocation of resources to the right place in the right way at the right time over time. Stepping down from the overall strategic plan (and the allocation of resources to the working unit), business planning starts with laying out the allocation of resources to achieve the objectives and goals:

Human

Financial

Technical

Operational

Action Plan – This is the heart of business planning. Needs to consider two time frames:

1)Near-term actions to deliver near-term goals

2)Long-term actions to start now in order to achieve long-term objectives and goals.

ActionsTimingResponsibilitiesLinkages

Near-term

Long-term

Performance Management Plan – Nothing happens unless it’s measured. Get clear on what’s going to get measured, how and when.

Operating and financial performance standards

Measures and goals

Annual Operating Plan - Align all around actions to be taken over the coming year and the application of resources to produce desired results.

“Plans are nothing; planning is everything.” - Dwight D. Eisenhower

Flow from strategic plan
Use most recent forecast of current year’s results as a base
Issue briefing document/schedule/milestones with going-in assumptions and expectations (revenue, gross margin, net profits, cash flows, ROIC)
Work with appropriate groups to generate targets, action plans, human, operational, technical, financial resource application, risks and opportunities for:

-Revenue generation by product/service/category, customer, geography, timing

-Direct cost of goods/services (sales, marketing, product supply)

-Indirect/corporate expenses

-Extraordinary activities/expenses

-Capital expenditures

Create first draft of annual financials (P&L, Cash Flow, Balance Sheet)
Iterate assumptions, plans and financials as required
Finalize plans and financials

This form is described in The New Leader's 100-Day Action Plan by George Bradt et. al. (4th Edition) and may be customized and reproduced for personal use and for small scale consulting and training (not to exceed 100 copies per page, per year). Further use requires permission.