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December 19,2018 Strategic Planning

Agile Planning for Global Execution

Agile Planning for Global Execution

The Problem: Organizations fail to apply agile planning which limits their global execution. Global expansions experience growing pains by not being able to adjust quickly enough to foreign market conditions

Why it Happens: By failing to engage global insight into strategic planning processes and not having a dynamic planning process that can be flexible in a continually changing environment

The Solution: Implementing a cascade based strategic planning model that is grounded in the agile project management philosophy

Groupon’s Learnings From Expanding Into China

Launched in 2008, Groupon, skyrocketed into the world as a digital marketplace linking customers with local businesses enabling discounted transactions. Expanding from city to city in the United States, by 2010 they had a valuation of over a billion dollars and were operating in over 250 cities. This put forward the plans to expand into the next frontier, China.

This region represented an incredible opportunity of linking a mass of local businesses with a magnitude of buyers. They had strong indicators of success to reach into the market with a sound business model, cash on hand, foreign market experience, and a population known for searching for the best deal. Groupon opted to drive this initiative through western-based MBAs instead of local talent and stalled immediately into the initiative.

Speed Bumps

While most expansions will run into growth speed bumps, Groupon faced greater issues as they attempted to manage the transition from afar without understanding the local preferences and purchasing habits. Compounding this issue was an inability to link corporate strategy and tactics to local realities. Within seven months, Groupon had lost over $47 million dollars and only pulled in $2 million in revenue, making the situation worse, local companies had been able to replicate the Groupon model and execute it with greater success.

The world economy has become more interconnected as well as shown an increase in the number of global organizations that are currently operating across foreign boundaries. That added complexity has created issues with aligning operational goals between domestic and foreign headquarters creating a significant gap between expectations and performance.

Global Understanding

Research on emerging markets speculates organizational defeat if a global company does not establish strategies for incorporating local infrastructures into their value chain processor having a connecting link to the corporate headquarters. One area where a number of organizations have failed during expansions into emerging markets is the assumption that they can conduct operations in the same manner that they do domestically dismissing the belief that there is a cultural intelligence needed to bridge the expectations of organizational goals with foreign business cultures and practices.

Disney Paris

Global markets represent potential and that potential leads many leaders to overlook the challenges. Logistically foreign markets enhance the management complexity factoring in time and proximity. Cultural, behavioral, norms, and visions can vary significantly from the home market where success was originally gained. These differences highlight marketplace uniqueness, as Disney learned during their initial failure trying to scale into France.

Corporate Agility

One key element to global expansion in the ability to execute plans. Then having the agility to adjust quickly to the new realities of the move. There has been a great deal of research that has been completed on strategic planning, global leadership, and agile planning. In that research though, there is a gap between how those three areas intersect. Most notable is the lack of research on the agile planning methodology on a macro or global scale. The intersection between these three attributes is the ability to engage remote workers into strategic planning thus ensuring an aligned execution of strategy.

Opportunities To Nail A Global Expansion

While a number of issues that are identified with expanding globally, there are opportunities to nail a global expansion. The potential for a successful growth opportunity presents itself in the planning processes. Beginning with the opportunity for co-created strategic plans. Global locations partnering with the headquartered office to create strategies with a greater global perspective. This application would also address alignment issues between the two partners. They both have a vested interest. Two linked enhancements to this approach are incorporating a professional facilitator. They can guide this process to ensure a balance of strategy and idea generation. The associated enhancement is creating an open-source mechanism within the organization. This will openly share feedback and ideas across boundaries with rapid speed.

Also, Agile Project Management

The second prime opportunity for enhancing global operations is applying the agile project methodology. The iterative nature of the methodology can create an environment of repeatable, open communication that ensures alignment of priorities and accountability of accomplishments. This leads to real-time self-assessment of progress, issues, and opportunities that could position an organization with the flexibility to successfully adapt to emerging markets.

Hence, Continued Development

Lastly, is the opportunity for the continued development of organizational global leaders. With expanding influence into foreign markets, the need presents itself for savvy leaders to conform to the cultures they are in and to learn how to capitalize on that gained knowledge. This can also be a cross-learning experience by developing foreign leaders into organizational global leaders further expanding the cultural depth of the organization. This greater organizational perspective potentially increases the organization’s competitive advantage not only in its foreign environments but in domestic markets as well.

Global Misfire

Misfiring on a global expansion can spell the death of a company, there is trouble with trying to expand globally. Take Borders example of not investing in an e-commerce platform and digital readers because they were failing in an attempted overseas expansion. Being able to successfully expand into global shores is the jackpot for every company, but specific considerations must be accounted for to ensure that the beachhead is successful and not just a temporary landing.

Engaging Remote Teams

The first challenge is being able to engage the remote team in the day to day operations. Typically, there are significant time and distance issues with a remote team, where many times their workday is ending the same time the home office is just starting which leads to decreased leadership attention that foreign leaders receive. Due to location and time zone challenges, remote leaders often become ignored out of convenience and proximity.

This is the opposite of desired intentions as remote leaders have a greater need to communicate with their leadership to maintain strategic alignment and to fully communicate the unique roadblocks and difficulties a foreign culture can create that slows progress. Lastly, a lack of frequent and routine communication between domestic and global bodies creates the opportunity for the remote employee to feel stranded and disassociated from their organization. This disassociation holds true for the homebody as they will be missing the cultural exposure and link to those markets unless they are engaged with their foreign correspondent.

Stagnant Strategic Planning

Secondly, organizations are predisposed to practice parochial strategic planning. The negative impact of having a single perspective on domestic strategies may be overcome. However, a singular outlook for a global strategy can prove to be fatal for an organization. Much of the research and studies highlight the endeavors of global field offices aligning to the home country’s strategy versus the shaping of the organizational strategy to the conditions of their global markets. This creates the opportunity for potential misfortune by lacking the cultural cognizance to understand how strategies will be received in an emerging market. This one-way communication can also lead to the inability to recognize new opportunities that can be exploited and new innovative ways that value can be created.

Maintenance

Lastly, the maintenance of planning processes does not elicit flexibility and does not enable a dynamic work environment. With a creation process that doesn’t necessarily consider the realities of foreign markets. Also, it doesn’t typically involve a process to alter and change strategies following the implementation. With such significant potential differences between cultures, ideally, an organization would want to match the cultural energy that is experienced and to continually mold their strategies to the cultures that they are participating in. This can create organizational misalignment and a misuse of resources that results in missed opportunities.

Focusing on a positive example, recall the Louis Vuitton expansion into Asia. China was in the beginnings of its economic growth and had an appetite for luxury. While Louis Vuitton’s brand name was a consistent strong point. Their ability to apply and adjust their expansion strategy made the move successful. Louis Vuitton took agile steps as they realized that the cultural and language nuances were stunting their success. Adjusting quickly to hire local experts to help them understand the locale. How the local search engine optimization (SEO) and social media worked in China. As a result, its e-commerce platform was able to dominate the luxury industry.

Competitive Opportunities

While many issues are identified with expanding globally, the potential for a successful growth opportunity presents itself in the planning processes. Beginning with the opportunity for co-created strategic plans with global locations being partnered with the headquartered office to create strategies with a greater global perspective. This application would also address issues identified as being aligned between the two partners as they both have a vested interest. Two linked enhancements to this approach are incorporating a professional facilitator to guide this process to ensure a balance of strategy and idea generation. The associated enhancement is creating an open-source mechanism within the organization to openly share feedback and ideas across boundaries with rapid speed.

Agile Project Management

The second prime opportunity for enhancing global operations is applying the agile project methodology. The iterative nature of the methodology can create an environment of repeatable, open communication that ensures alignment of priorities and accountability of accomplishments. This leads to real-time self-assessment of progress, issues, and opportunities that could position an organization with the flexibility to successfully adapt to emerging markets.

Continued Development

Lastly, is the opportunity for the continued development of organizational global leaders. With expanding influence into foreign markets, the need presents itself for savvy leaders to conform to the cultures they are in and to learn how to capitalize on that gained knowledge. This can also be a cross-learning experience by developing foreign leaders into organizational global leaders further expanding the cultural depth of the organization. This greater organizational perspective potentially increases the organization’s competitive advantage not only in its foreign environments but in domestic markets as well.

Strategic Planning In An Agile Framework

Try something different. Try applying strategic planning in an agile framework. Start with a workshop in which the organization defines its future vision and strategy to achieve that vision. Subsequently, each strategy is then broken down into the tactics that will achieve each strategy. Plot the tactics across a timeline at its projected completion date. This creates a milestone map of what goal will be accomplished during each month.

The monthly planning session follows. This event identifies the goals for that month-long period. This mirrors the weekly planning session of what actions will take place during that week. Interlaced into this process reside periodic checkpoints throughout the year. These checkpoints manage progress in the form of quarterly self-assessments. In addition, it monitors monthly, weekly, and daily accountability progress checks while resolving issues.

1. Kick it off

First, the kickoff event of establishes a vision.  Best practices include employing an external facilitator to guide the process. Incorporating a breadth of organizational members in the event. Lastly, applying the affinity diagram process to help stretch ideas. Yet, still able to define the actions to accomplish those ideas.

2. The strategic planning process

The strategic planning process takes place during two key points in the model. First during the initial planning session when identifying how to achieve the vision. Secondly during the quarterly self-assessment process. This ensures that the actions still aligned with the strategies and that the strategies will achieve the vision. The defined and actionable goals complement a loosely defined vision. Strategic goals also represent the major organizational milestones that garner the attention of the entire organization. They represent major shifts of focus and allocation of significant resources to achieve the goals.

3. The tactical planning process

The tactical planning process occurs during key points in the model. The first during the initial planning session and the creation of actionable goals. This goal accomplishment represents achieving the overall strategy. Reviewing these tactics during the quarterly self-assessment and monthly planning sessions ensures progress. Additionally, the review examines the goals for relevancy in achieving the overall vision. This step systematically breaks down each goal into a modular piece that makes it easier to comprehend and communicate. It additionally provides the capability for changing portions of the goal with greater ease when market conditions dictate needed changes.

4. Monthly sessions

Each monthly operational planning session identifies which tactical goals to be accomplished over the course of the month. While the tactical planning session identified which goals to accomplish each month, the monthly planning session then establishes what actions and goals for each week. This ensures completion of the tactical goals by the close of the month. Following, the weekly planning and daily planning sessions identity down to the level of goal owners.

Created above represents a streamlined cascade of aligned goals from a vision to daily activities. While a standard planning process, the need exists for agility to adjust to normative changes is required. An agile model ensures flexibility in the process. The infusion of quarterly, monthly, weekly, and daily checkpoints ensures progressive movement. It intertwines goals and accountability into the process. This also elicits a continuous discussion on the relevancy of the goals.  Debating if the goals link to the desired effect on achieving the vision or if the future holds alteration.

Conclusion

These sessions are not intended to be extensively planned and formal presentations that hide perspective and context but more simply of what was accomplished, what will be done during the next iteration, what are the roadblocks, issues, and risks that will be faced, and what higher level of help is needed. The intent during these planning sessions elicits each team and member to close out each day, week, and month with a visible sense of accomplishment making clear the accomplishments. Lastly, these sessions have the intent to open the dialogue about continuous improvement amongst the participants where issues are raised with the expectation that participants and observers are available for consultation and assistance to ensure that progress does not stall.

Implementing A Global Planning Model

A global planning model aims to achieve global and virtual alignment factoring in three specific elements to enable that alignment. The creation of a vision using the insights of all of those impacted by the vision. This joint participation leads to a higher level of self-efficacy. This planning model adheres to a consistent alignment of priorities. Priorities that consist of transparency, continual validation, and resource distribution. Lastly, the model enables a stream of communication vertically and horizontally across the organization. This brings a tighter forming of physically separate team members into the group.

Team Dynamics

Team dynamics have the possibility to evolve in this model to different levels. Beginning with the team to determine their work and the accountability that naturally occurs in that process. In checkpoints of the process, individuals and teams will be unable to hide a lack of progress. Nor will roadblocks to progress hide as it will be explicitly transparent what is holding back progress. Due to the open nature of this planning methodology, there will also be greater possibilities for integrating projects across historic functional work boundaries that are not typically crossed as well as creating unique partnerships and capitalizing on economies of scale. Additionally, there is an ability for team members and organizations to share workloads and to be able to provide immediate assistance due to the resonant nature of identifying constraints in an open forum.

Living Organism

This planning model most importantly creates the ability to act as a living organism that grows, alters, and evolves during the same intended time period. As markets change, as people leave and enter, so do visions, strategies, and goals. This iterative process enables the construct and foundation to make slight, medium, or significant adjustments in a short period of time while being able to communicate and elicit support across the organization. Lastly, significant to the team is the validation process that monitors goals and if they are having the desired effect or not.

References

Reynolds, A. a. (2018). Hence The Two Traits of the Best Problem-Solving Teams. Harvard Business Review.

Watson, M. (2018). Another Common Strategies and Practices Among Facilitators of Innovative Thinking in Organizations. Ann Arbor, MI: ProQuest.

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