CBI MSB summit 1st December 2014 – Helping the UK’s mid-market firms realise their potential
What makes a good strategy?
- You need to be different from your competitors.
- Say no to some opportunities – be focused ‘the essence of good strategy is choosing what not to do… You can’t be all things to all people.’ Michael Porter Plays to your strengths Gets communicated persistently and consistently Gets executed, monitored and is consistent
- Look for the biggest opportunities that are most relevant to your strengths.
- Understand your clients business better than they do. This will allow you to come up with a strategy to support them.
Does your people planning process support your business strategy?
- The HR maturity scale – moves from reactive to strategic, from cost to delivering value (Paul Kearns 2012). Starts with ‘no conscious HR system’ then moves to ‘personnel administration’ then on to ‘Good professional practice’ towards ‘Effective HR’
- There is a wall with Executives who are resistant to the concept of people as human capital.
- Businesses need to see HR as integral to business in order to transition it to have a more strategic focus
Leadership Risks and succession planning has four phases to ensure effective leadership succession organisations must build a succession system addressing four leadership risks.
1) Vacancy: What are the key roles? Risk of critical leadership vacancy
2) Readiness: Risk of undeveloped successors
3) Transition: Risk of poor assimilation of exec talent into business, new hire
4) Portfolio risk: Risk of poor deployment of talent against business goals.
Assessment of risk in the strategy of a business
Competitive advantage, plus scale and scope and diversity and operating efficiencies = profitability Compared to level of profitability vs. peers And Volatility of profitability = competitive position
How can a third party opinion support strategy?
Obvious answer is to Support financing strategy. Less obviously to support business strategy ‘a truly independent opinion can act as a mirror for a company’.
- Feedback on capital structure, risk profile, management / supervisory board.
- Set internal financial Kpi’s
- Comparable to local and international peers.
- Public investor relations
Giving 360 approach to strategy – Consider markets vs products. Existing markets/new products and existing products/new markets. Then look at New products/new markets.
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