Management Chapter 11 Homework Management The Morgan Company Obviously Failed Its

Strategy and Performance Excellence 14

3. Try to match the following companies with their actual mission statement in question 2. Could

you think of more appropriate mission statements for any of these organizations?

a. Volvo

b. AT&T

c. The International Red Cross

d. Caterpillar

e. DHL Worldwide Express

These are the actual organizations:

a) Caterpillar

b) DHL Worldwide Express

c) Volvo

d) AT&T

4. Contrast the following vision statements in terms of their usefulness to an organization.

a. To become the industry leader and achieve superior growth and market share.

b. To become the best–managed electric utility in the United States and an excellent company

overall and be recognized as such.

c. Being the best at everything we do, exceeding customer expectations; growing our business to

increase its value to customers, employees, shareowners, and communities in which we work.

As in Discussion Question 2, it is difficult to see how any of these vision statements would inspire

employees or customers to loyalty or long-term commitments to the company or its products.

a. The first statement is a vague, general statement that will be of little use to the organization. It would

appeal primarily to stockholders

Strategy and Performance Excellence 15

5. A Conference Board study found that CEOs identified the top global challenges they face as (1)

improving human capital within their organizations, (2) improving operational excellence, and (3)

enhancing innovation. Suggest some strategies that a typical company might undertake to meet

these challenges.

There are numerous ways to deal with these global challenges strategically, as suggested by the

Conference Board study. To improve human capital, organizations should work to: grow talent internally,

recruit the best talent possible from outside the organization if not available internally, provide employee

training and development, raise employee engagement, improve performance management processes and

6. Propose three applications for each of the seven management and planning tools discussed in the

chapter. You might consider some applications around school, such as in the classroom, studying for

exams, and so on.

This list may vary widely, depending on the imaginations of the students. For example, an affinity diagram

7. What are the core competencies of your school, college, or university? How are they leveraged

from a strategic perspective?

Core competencies of colleges and universities generally revolve around the traditional areas of

teaching, research, and service. In order for a specific college, such as a college of business or

engineering, to develop a strategic niche, they must do one or several things very well. For example, if

Strategy and Performance Excellence 16

8. Discuss how each of the Baldrige Core Values and Concepts (see Chapter 10) are reflected in

each question of the Baldrige criteria for Strategic Planning using the Baldrige Excellence Builder

available in the Baldrige Materials folder on the Student Companion Site.

Core Values and Concepts:

Systems Perspective

Visionary Leadership

Customer-Focused Excellence

Valuing People

Organizational Learning and Agility

Focus on Success

Here are some suggestions. This exercise can be useful in engaging students in class discussion, and

help them better understand the core values and criteria.

2.1 Strategy Development: How do you develop your strategy?

(1) how do you conduct your strategic planning? Visionary Leadership; Organizational Learning

and Agility; Focus on Success

(2) how does your strategy development process stimulate and incorporate innovation? Managing

for Innovation

(3) how do you collect and analyze relevant data and develop information for your strategic

planning process? Management by Fact

Strategy and Performance Excellence 17

2.2 Strategy Implementation: How do you implement your strategy?

(1) What are your key short- and longer-term action plans? Delivering Value and Results

(2) how do you deploy your action plans? Systems Perspective; Valuing People

(3) how do you ensure that financial and other resources are available to support the achievement of

your action plans while you meet current obligations? Focus on Success;

Delivering Value and Results

SUGGESTIONS FOR PROJECTS, ETC.

1. Use the Baldrige Organizational Profile questions to prepare an organizational profile for

your college or a local organization that would be willing to provide you with the information.

Use the format of the Arroyo Fresco case study in the Baldrige Materials folder on Student

Companion Site as a guide for writing the profile.

This project is designed to familiarize students with the Baldrige Organizational Profile questions and

2. Interview managers at some local organizations to determine whether they have well-defined

missions, visions, and guiding principles. If they do, how are these translated into strategy? If not,

what steps should they take?

Strategic planning styles will vary widely, depending on such factors as the type of organization, its

Strategy and Performance Excellence 18

3. Find several examples of mission and vision statements for Fortune 500 companies. Critique

these statements with respect to their usefulness, relevance to the organization, and ability to

inspire and motivate employees.

As in discussion questions 2, 3, and 4, above, even Fortune 500 companies will often be found not

4. Does your university or college have a mission and strategy? How might policy deployment be

used in a university setting? Discuss with a senior executive administrator at your college or

university (such as the VP of administration or the VP of academic affairs/provost) how policy

deployment is, or might be, done.

More and more colleges and universities are developing well-defined mission and vision statements

5. Research the strategic planning practices of recent Baldrige Award winners. Discuss different

approaches that these firms use and why they seem appropriate for their organizations. How do

they reflect the leading practices described in this chapter?

This project will provide an opportunity for students to delve into the strategic planning requirements

6. In your role as a student, develop your own statements of mission, vision, and guiding

principles. How would you create a strategy to achieve your mission and vision?

Personal mission, vision, and statements of guiding principles can be extremely beneficial to college

Strategy and Performance Excellence 19

7. Compare the organizational structures of several manufacturing or service firms. What

differences are reflected in their quality approaches and results?

Key contextual factors that affect organizational structure include:

• Company organizational and organizational guidelines

• Management style

• Customer influences

• Company size

8. Try to identify and contrast the core competencies of two different organizations within the

same industry, such as Dell and Apple, Toyota and General Motors, or Sears and Walmart, for

example. Does your research suggest that these competencies are reflected in their supply chain

or strategic directions?

Answers will vary, depending on the organizations compared. For example, Dell’s strategy is to

provide rapid turnaround with high volume, essentially commodity-type computers while still

ANSWERS TO CASE QUESTIONS

The Morgan Company

1. How did management fail in its strategic planning?

Management at the Morgan Company obviously failed in its strategic planning process. The most

Strategy and Performance Excellence 20

2. What principles and ideas discussed in this chapter might have helped this organization

succeed in meeting the new strategy?

To be effective, the principles and ideas discussed in this chapter must be taken seriously, rather than

just be given lip service. The new strategy would require a concerted effort to understand contextual

factors, including:

• Company organizational and organizational guidelines

• Management style

• Customer influences

A Strategic Bottleneck

To achieve its strategic goals of lower cost and improved customer performance, what could this

company do to align the goals of the forming and selecting departments?

The company has a challenge as it strives to achieve the strategic goals of lower cost and improve

customer performance. The company finally realized that by developing a cooperative culture and

creating common goals it could improve both quality and morale, while contributing substantially to

Strategy and Performance Excellence 21

Consolidated Metal Works

1. Comment on the current mission statement. Does it provide the strategic direction necessary

for success for this company?

The current mission statement of Consolidated Metal Works (CMW) appears to lack focus. It doesn’t

tell why the company is in business, other than to “improve return on investment.” Therefore, it is not

2. How can the mission statement be improved? Suggest a better statement of mission, vision, and

values/guiding principles.

The mission statement could be improved by including a definition of products or services, types of

markets, important customer needs, or distinctive competencies. Their mission statement might be:

CMW’s mission is to produce superior customized cast metal products for markets in the

Their vision might be:

CMW’s vision is to be an outstanding company that leads the industry in quality, technological

innovations, service, and productivity. We will strive to accomplish our vision by embracing

Their implied values/guiding principles seem to be:

• Quality and service

• Teamwork

• Financial accountability

Strategy and Performance Excellence 22

Arroyo Fresco – Assessing Strategic Focus

This case is taken from Baldrige training case studies and designed to help students understand how to

interpret the criteria questions and gain insight into how a Baldrige examiner might assess an

organization. We don’t expect students to be able to do this easily (even first year examiners have a

Instructors might consider an alternative option that the author has found effective; namely,

provide feedback comments and ask students to explain, using the case, why these comments were

made.

These are the questions from the Baldrige Excellence Builder:

2.1 Strategy Development: How do you develop your strategy?

(1) How do you conduct your strategic planning?

(2) How does your strategy development process stimulate and incorporate innovation?

(3) How do you collect and analyze relevant data and develop information for your strategic

planning process?

(4) How do you decide which key processes will be accomplished by your workforce and which

by external suppliers and partners?

(5) What are your organization’s key strategic objectives and timetable for achieving them?

(6) How do your strategic objectives achieve appropriate balance among varying and potentially

competing organizational needs?

2.2 Strategy Implementation: How do you implement your strategy?

(1) What are your key short- and longer-term action plans?

(2) How do you deploy your action plans?

(3) How do you ensure that financial and other resources are available to support the

achievement of your action plans while you meet current obligations?

(4) What are your key workforce plans to support your short- and longer-term strategic

objectives and action plans?

(5) What key performance measures or indicators do you use to track the achievement and

effectiveness of your action plans?

(6) For these key performance measures or indicators, what are your performance projections

for your short- and longer-term planning horizons?

Strategy and Performance Excellence 23

(7) How do you establish and implement modified action plans if circumstances require a shift in

plans and rapid execution of new plans?

Here are the comments from the case study evaluation team:

2.1 Strategy Development

Your score in this Criteria item for the Consensus Review is in the 50–65 percentage range. (Please

refer to Figure 5a, Process Scoring Guidelines.)

STRENGTHS

• a(1) The well-deployed, systematic SPP (Figure 2.1-1), used since 1996, evidences AF’s

core competency of collaborative relationships. Key SPP elements are organized by

calendar year. Senior leaders participate in all SPP activities; a cross-location team

ensures that staff members in all services, functions, and locations provide input.

Community members provide input, and key stakeholder groups provide input and

review. In a 1998 improvement, external stakeholders, payors, volunteers, and patient–

family advisory boards were added to the Partners Committee.

• a(3) Multiple methods to collect and analyze relevant data for the SPP ensure that all key

elements are covered. Data sources include board retreats, as well as regular meetings with the

staff, volunteers, and other partners and stakeholders. Strategic advantages and challenges are

OPPORTUNITIES FOR IMPROVEMENT

• b(2) AF’s strategic objectives and action plans (Figure 2.1-2) do not appear to address all

strategic challenges. For example, financial objectives (e.g., to decrease

administrative/indirect patient costs) do not align with action plans to improve collection

rates and relative value units, and no action plans align with the strategic challenges

related to recruiting paid staff members. The lack of alignment between strategic

objectives, action plans, and strategic objectives may limit AF’s ability to maintain its

competitive position and fulfill its mission.

• a(4) A systematic approach to determine which key processes will be accomplished by AF’s

workforce and which by external partners is not evident. For example, the decision-making

process does not appear to include data and information from the SPP People Review (Figure

2.1-1, May) or evidence to support decisions related to improving or augmenting work systems

Strategy and Performance Excellence 24

2.2 Strategy Implementation

Your score in this Criteria item for the Consensus Review is in the 50–65 percentage range. (Please

refer to Figure 5a, Process Scoring Guidelines.)

STRENGTHS

• a(1,2) In support of its value of performance, AF uses the FOCUS balanced scorecard to

identify and organize short-and longer-term action plans, strategic objectives, strategic

advantages, and strategic challenges (Figure 2.1-2). Leaders develop plans at four levels, and

the Senior Leadership Team and local clinic managers deploy them to work units after the

strategic plan is validated and budgets are developed. The Pugh matrix is used to validate

resource availability, and it subdivides annual plans at three levels into 90day plans.

OPPORTUNITIES FOR IMPROVEMENT

• a(1) AF’s action plans do not appear to align with its strategic objectives (Figure 2.1-2) and

longer-term planning horizons. For example, the strategic objectives do not address leadership

Strategy and Performance Excellence 25

• a(2) A systematic approach to deploy action plans to AF’s partners is not evident. For example,

key performance metrics for the achievement of strategic objectives and goals (Figure 2.1-2) do

plans to suppliers and partners may help improve patient outcomes.

• a(6) A systematic approach is not evident for addressing gaps in performance against

competitors and comparable organizations in action plans. For example, clinical excellence

action plans (Figure 2.1-2) do not appear to reflect priorities for closing gaps; nor do action

• b AF’s SPP (Figure 2.1-1) does not appear to incorporate the implementation of modified action

plans in response to changes in the regulatory environment, federal law, and customer base,