Did Somebody Say Strategy?

Boeing CEO discovers the power of the extranet

On Boeing’s earnings call yesterday, the company sighted some of the causes of delays in shipping the new 787 Dreamliner, including a lack of information, communication, and documentation from many of the Dreamliner suppliers.  There were too many surprises when sub-assemblies showed up to the Boeing’s final assembly line.

So Jim McNerney, Chairman and CEO, said they are deploying a “small army” (hundreds) of Boeing professionals (manufacturing and procurement experts) to go work in the suppliers’ facilities.

He also said this: “(we) realized we really need to work with (suppliers) to make sure we have better visibility…we need that data transparency across all of the build in order to execute the plan that we’ve laid out.”

Front-line Scorecard Success (preview of a new book)

I had the pleasure of reviewing a very practical new book called ‘Scorecard Best Practices: Design, Implementation, and Evaluation’ by Raef Lawson, Toby Hatch, and Denis Desroches (John Wiley & Sons, Inc.).  Denis was my first Hyperion Performance Scorecard Instructor and Toby is my go-to pro for how Scorecarding fits into extended performance management.  These folks have been designing and implementing enterprise scorecards for over 10 years – they are true pioneers.

While Raef, Toby & Denis could have easily just told us the best practices, they decided to let us hear it directly from the front-lines: this book is based on surveys of almost 400 respondents from 44 countries!

The book comes out in November, but Wiley has generously given us 32 pages of the book to share with you now.  See the link below.

Berkshire Hathaway’s Owner’s Manual

Have you seen this?  I just got tipped off to it by Bobby Kotick, CEO of ActiVision (in this month’s Fortune Magazine) -- It’s Warren Buffet’s booklet he sent to shareholders ten years ago.  It’s candid, wise, and still relevant today.

Savvy Financial Modeling

One of the key components of extended performance management (xPM) is financial modeling. 

It lives in the ‘Debate’ domain of xPM and is what organizations use to answer questions like:
- What will our financial statements look like in 5 or 10 years, given current rates of growth?
- How will an acquisition impact cashflow in 3 years?
- How aggressive should we be in communicating synergies?
- What’s our optimum debt model, given our market share & growth strategy?
- What happens to margin if we get more aggressive on hiring and pricing simultaneously?

CIO as Full Business Partner

There’s a good Knowledge@Wharton interview with Mark McDonald, head of Gartner Executive Programs on the top of CIO as full business partner at http://knowledge.wharton.upenn.edu/article.cfm?articleid=1828  Also in the interview are Michael Shannon, CIO for Dechert LLP and Tony Habash, CIO for the APA.

In the interview, we learn that CIO’s have several priorities to balance:
- delivering technology that improves business performance
- help drive competitive growth
- enable operational efficiency
- contribute to and be the backbone for executing corporate strategy

One way to deliver on all of the CIO’s strategic priorities is to implement a unified management operating system using xPM.

A few xPm Podcasts I’ve been listening to

You can listen to these at your desk or on your iPod while you're taking the dog for a walk.

Enterprise Architecture

In order to execute your strategy, you must first build a foundation.

Enterprise Architecture is a foundation for execution: it includes technology embedded in processes that allows your organization to be more flexible (adopt to external market conditions and internal organizational changes), more efficient (reduce complexity, reduce redundant systems & processes, automate things like data extraction/transformation/loading, manage the organizations master data including alternate hierarchies), and more reliable (improving belief in the numbers, focusing on what to do about results rather than where the results came from).

Closing the gap between strategy and execution

I was tipped off to this excellent paper (which originally appeared here in the Summer ’07 edition of the Sloan Management Review) via the London Business School Research news feed.

Professor Donald Sull’s “Strategy loop” is the best model I’ve seen that describes how xPM works.  xPM is the (business) foundation for an organization’s management operating system.

Business Strategy, Performance Management, and BI Blogs

I asked “What are your favorite BLOGS on business strategy, performance management, or business intelligence?” in the Blogging and Budgeting sections of LinkedIn Answers last week.  Here is a list of all the responses I got, and our favorites:

Premium content from the McKinsey Quarterly

The McKinsey Quarterly wants me to share some of their latest articles with my colleagues.
The links below provide free access (for a limited time) to 3 of their ‘Premium’ articles in the areas of Organization, Operations, and Corporate Finance: