QM

Chapter 5
Leadership and Strategic Planning
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, 2008 Thomson Higher Education Publishing
Leadership
The
ability to positively influence people and systems under ones authority to have a meaningful impact and achieve important results
Strategic Planning
The
process of envisioning an organizations future and developing the necessary goals, objectives, and action plans to achieve that future.
The Baldrige Leadership Triad

Strategic Planning Operations
Leadership Customer and Market Focus
Executive Leadership
Defining and communicating business directions Ensuring that goals and expectations are met Reviewing business performance and taking appropriate action Creating an enjoyable work environment Soliciting input and feedback from customers Ensuring that employees are effective contributors Motivating, inspiring, and energizing employees Recognizing employee contributions Providing honest feedback
Key Idea
Six key leadership competencies can be described as navigator, communicator, mentor, learner, builder, and motivator.
Dale Crownover, President, Texas Nameplate Co. (a 2-time Baldrige Award recipient)
Leadership Competencies
Navigatorcreates shared meaning and provides direction toward a vision,mission, goal, or end-result. Communicatoreffectively listens and articulates messages to provide shared meaning. Mentorprovides others with a role to guide their actions. Learnercontinuously develops personal knowledge, skills, and abilities through formal study, experience, reflection, and recreation. Buildershapes processes and structures to allow for the achievement of goals and outcomes. Motivatorinfluences others to take action in a desirable manner.
Leading Practices Leadership

(1 of 2)
Create and deploy a customer-focused strategic vision and clear quality values Create a sustainable organization and environment for performance improvement, accomplishment of the mission, innovation, agility, and learning Demonstrate personal commitment to organizational values, develop future leaders, and reinforce high performance Create a focus on action and communicate with, empower, and motivate all employees
Leading Practices Leadership

(2 of 2)
Address organizational governance to include management and fiscal accountability, protection of stakeholder interests, and conduct evaluations to improve the leadership system Create an environment that fosters legal and ethical behavior Integrate public responsibilities, resourcesustaining processes, and community support into business practices
Key Idea
The purpose of leadership theories is to explain differences in leadership styles and contexts.
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Leadership Theories
Classic
Trait
theories:
approach Behavioral approach Role approach

Contemporary
Situational
and emerging theories:
leadership Transactional leadership theory Transformational leadership theory Substitutes for leadership theory Emotional intelligence theory
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Key Idea
Emerging leadership theories build on or enlarge traditional theory by attempting to answer questions raised, but not answered, by earlier approaches.
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Leadership System
system how decisions are made, communicated, and carried out at all levels; mechanisms for leadership development, self-examination, and improvement Effectiveness of the leadership system depends in part on its organizational structure
Leadership
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Key Idea
An effective leadership system respects the capabilities and requirements of employees and other stakeholders, and sets high expectations for performance and performance improvements.
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Example: Solar Turbines, Inc.
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Governance
Governance the system of management and controls exercised in the stewardship of an organization.
Approving strategic direction Monitoring and evaluating CEO performance Succession planning Financial auditing Executive compensation Disclosure Shareholder reporting
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Leadership and Social Responsibilities

Ethics
Health,
safety, and environment Community support
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Key Idea
Practicing good citizenship refers to leadership and support within the limits of an organizations resources of publicly important purposes, including improving education, community health, environmental excellence, resource conservation, community service, and professional practices.
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Strategic Planning
A strategy is a pattern or plan that integrates an organizations major goals, policies, and action sequences into a cohesive whole.
Formal strategy includes:
Goals
to be achieved Policies to guide or limit action Action sequences, or programs, that accomplish the goals
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Leading Practices - Strategic Planning

Systematic planning systems for strategy development and deployment Understand the competitive environment and the factors and strategic challenges that determine success, and gather and analyze a variety of external and internal data Align short-term action plans with long-term strategic objectives, communicate them, and track progress Derive human resource plans from strategic objectives and action plans Identify key measures and indicators for tracking progress, reinforce organizational alignment, and compare performance with competitors
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Strategic Planning Process

Reason for existence Future intent Attitudes and policies
Mission
Vision
Guiding Principles
Environmental assessment
Strategies
Capabilities and risks
Broad statements of direction
Strategic Objectives
Action Plans
Things to change or improve

Implementation
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Mission
Definition of products and services, markets, customer needs, and distinctive competencies Solectron: to provide worldwide responsiveness to our customers by offering the highest quality, lowest total cost, customized, integrated, design, supply chain, and manufacturing solutions through long-term partnerships based on integrity and ethical business practices.
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Vision
Where the organization is headed and what it intends to be

Brief and memorable - grab attention Inspiring and challenging - creates excitement Descriptive of an ideal state - provides guidance Appealing to all stakeholders - employees can identify with
Solectron: Be the best and continuously improve
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Values (Guiding Principles)

Define
attitudes and policies for all employees, which are reinforced through conscious and subconscious behavior at all levels of the organization. Alcoa: integrity, environmental health and safety, customer, excellence, people, profitability, accountability
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Environmental Assessment
Customer
and market requirements, expectations, and opportunities Technological and other innovations Organizational strengths and weaknesses Financial, societal, ethical, regulatory and other potential risks Changes in global or national economy Factors unique to the organization, such as partner and supply chain needs
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Key Idea
Strategies are broad statements that set the direction for the organization to take in realizing its mission and vision.
Strategic objectives are what an organization must change or improve to remain or become competitive.
Action plans are things that an organization must do to achieve its strategic objectives.
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Strategy Deployment
Developing
detailed action plans, defining resource requirements and performance measures, and aligning work unit, supplier, or partner plans with overall strategic objectives.
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Policy Deployment (Hoshin Kanri)

Top
management vision leading to longterm objectives Deployment through annual objectives and action plans Negotiation for short-term objectives and resources (catchball) Periodic reviews
See Figure 5.5!
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Key Idea
Strategic objectives and action plans often require significant changes in human resource requirements, such as redesigning the work organization or jobs to increase employee empowerment and decision making, promoting greater labor/management cooperation, modifying compensation and recognition systems, or developing new education and training initiatives.
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Link Human Resource Plans and Business Strategy

Examples
Redesign
work organization to increase empowerment Promote greater labor/management cooperation Foster knowledge sharing and organizational learning Establish partnerships with education to better prepare future employees
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The Seven Management and Planning Tools

Affinity
diagrams Interrelationship digraphs Tree diagrams Matrix diagrams Matrix data analysis Process decision program charts Arrow diagrams
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Leadership and Organizational Structure

Basic
types of organizational structures Line organization Line and staff organization Matrix organization
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Key Idea
As more and more companies accept the process view of organizations, they are structuring the quality organization around functional or cross-functional teams.
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Team-Based Organization Chart
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Leadership in the Baldrige Criteria

The Leadership Category examines how an organizations senior leaders address values, directions, and performance expectations, as well as a focus on customers and other stakeholders, empowerment, innovation, and learning. Also examined is the organizations governance and how the organization addresses its public and community responsibilities.
1.1 Senior Leadership a. Vision and Values b. Communication and Organizational Performance 1.2 Governance and Social Responsibilities a. Organizational Governance b. Legal and Ethical Behavior c. Support of Key Communities
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Strategic Planning in the Baldrige Criteria

The Strategic Planning Category examines how an organization develops strategic objectives and action plans. Also examined are how chosen strategic objectives and action plans are deployed and how progress is measured. 2.1 Strategy Development a. Strategy Development Process b. Strategic Objectives 2.2 Strategy Deployment a. Action Plan Development and Deployment b. Performance Projection
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Chapter 5

Leadership and Strategic Planning

The Baldrige Leadership Triad

Leadership Customer and Market Focus

Leading Practices Leadership

Leading Practices Leadership

approach Behavioral approach Role approach

and emerging theories:

Example: Solar Turbines, Inc.

Leadership and Social Responsibilities

safety, and environment Community support

Leading Practices - Strategic Planning

Strategic Planning Process

Capabilities and risks

Broad statements of direction

Things to change or improve

Where the organization is headed and what it intends to be

Solectron: Be the best and continuously improve

Values (Guiding Principles)

Policy Deployment (Hoshin Kanri)

Link Human Resource Plans and Business Strategy

The Seven Management and Planning Tools

Leadership and Organizational Structure

Team-Based Organization Chart

Leadership in the Baldrige Criteria

Strategic Planning in the Baldrige Criteria

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