Strategic Initiatives

Nine Steps to Success™ – Step 6 Strategic Initiatives

Strategic Initiative is the sixth step of the Balanced Scorecard Institutes framework for strategic planning and management, the Nine Steps to Success™.

At the end of the day it is the implementation of initiatives and projects that cause change. When a business is stagnant or failing, setting a strategy, building objectives, setting targets and measure will be to no avail unless an activity is put in place to evoke change. Strategic Initiatives can cause significant organisational impact. They can be long-term or short-term and they must be associated to one or more strategic objectives.

Strategic Initiatives are usually defined during the workshop sessions carried out in the earlier steps of the Nine Steps to Success™ process. The initiative list can also include existing initiatives.

There are five major stages to consider:

1. Generating a list of candidate initiatives
2. Develop a set of selection criteria
3. Select and prioritise the initiatives
4. Formally describe the prioritised initiatives
5. Fund, implement and manage the initiatives

1. Generating the list of initiatives

During steps 1-5 of the Nine Steps to Success™ process, many candidate strategic initiatives will have been identified and ‘parked’ until this step. It is not unusual to have a list of 10’s or even 100’s of initiatives. The first task is to simply list them all in a single place and use an affinity grouping technique to remove or join any duplicates.
It is important at this stage to not get bogged down as to whether or not an initiative is valid or whether there is funding available or resources to allocate to the initiative. It is important to maintain the complete list as buried within it may be a crucial game-changer.

2. Develop a set of selection criteria

This is the first filtering stage. By developing a set of selection criteria and applying the criteria to each item on the list to assess strategic significance, the list will be reduced dramatically.

Consensus has to be reached on the most important criteria. This should not be overly complex and the criteria should be few in number, ideally just three items. Selection complexity and additional criteria can be added in the next stage. This is an activity for the strategic management team who will discuss and cull. Typical criteria for this stage might be:

• The potential strategic gains related to the organisational vision
• A judgement on the anticipate implementation and operational cost
• The time required to implement the initiative

This stage will take out those initiatives that might be described as ‘nice-to-have’ but in reality have no real strategic significance.

3. Select and prioritise the initiatives

With a manageable number of initiatives left (and this really depends on the size of the organisation but should be no more than 15) a more formal ranking framework can be applied. There are several methods traditionally used which include:

Consensus voting – based on the criteria developed and some additional more specific criteria, participants in a workshop can vote on what they consider to be the most important initiatives. Care must be taken to ensure the right people are attending, i.e. those with a good knowledge of the business and strategic process to date. Discussion will need to take place after the voting to establish ‘good-reason’ for a vote to avoid votes for a vested interest rather than the good of the organisation.

Matrix Scoring – This is a good way to present a visual framework. Usually done in the form of a two-by-two matrix on a wall with the X and Y axis being something like Impact and Cost respectively. In this case the group placed in the low-impact, high-cost are usually eliminated and a judgement taken on the remainder.

Weighting Criteria Scoring – Probably the most ‘scientific’ approach. The existing criteria and any additional criteria can be added to a table. A weighting to each criteria is established and each initiative scored against the criteria. This can take a long time and requires good disciple from the participants but it does provide a very good output for the next stage

When the selection method has been applied, the remaining initiatives, which should number 5 or 7, can be prioritised. This is usually the task of a senior management team who will once again refer to the overall selection criteria and relevance to the organisational vision and strategy.

4. Formally describe the prioritised initiatives

This is a relatively simple but vitally important step. The output from the selection should be documented for each strategic initiative. This will be reviewed and agreed by everyone. It sets the stage for funding, implementation and management. The strategic initiative description document need not be overly detailed, but it must capture precisely what is required and which objectives will be impacted. An example of a strategic initiative description format follows:

Strategic Initiatives - Description

5. Fund, implement and manage the initiatives

All projects will require funding and it is this stage that often causes the most heated debate. If the previous four stages have been gone through with care, then funding should not be a barrier at this stage. Funding should have been considered in the selection criteria. Something that does often happen at this stage however, is that the highest priority project is usually the most expensive and could use the whole budget in one hit.

It is therefore not unusual to re-priorities at this stage to look for lower-cost projects that can be implemented quickly and drive a significant change. This may require the team to look at ways of staging or delaying the highest priority initiative to release funds for priority 2 and 3 initiatives.

When the funding issues have been resolved, then the implementation can begin. The initiatives then become projects and are assigned a project manager (this is crucial!) who will manage the project to completion. Project management is a science in itself and will not be described here!

In conclusion, the strategic planning process uses Strategic Initiatives to provide the means to achieve Strategic Objectives. This connection has to be maintained. Strategic Initiatives are useless in isolation. Just because an initiative has been completed, does not necessarily mean and improvement has been made, it just means the initiative is complete. If an initiative is connected to an improvement objective, then we can measure whether or not an impact has been made.

Strategic Initiative is the sixth step in a strategic planning journey. The Nine Steps to Success™ is a strategic planning methodology created by the Balanced Scorecard Institute. For more information on how to be trained as a Balanced