Easy 5 steps for strategic decision making.
Step 1: Issue Identification
Businesses have issues that need to properly identified in order to be resolved, but you must also have a purpose and end goal in mind. Think of what will be achieved and what the outcomes will be of this strategic exercise. Establishing goals and measurements will be keys to the whole strategic planning cycle to issue resolution.
A review of 2011 business activities will reveal issues your business encountered. Or maybe you kept a running log of challenges. Either way, an initial step would be to identify the issues, and to be more specific, break them down into micro issues to resolve. Sometimes these issues seem too large, complicated or complex to resolve and by breaking them down, partial solutions in step can be achieved.
A best practice to follow would be to solicit your business team or unit for issues to get more a global perspective. Bouncing ideas and challenges across a wider audience will add value and objectively in identifying issues.
Once broken down, isolated, or prioritized, the appropriate approach would be to tackle that one issue for resolution.
Example: Ineffective manufacturing process (assembly line 1) of Widget A resulted in 10% higher costs in 2011 (over 2010). Goal: effective processes to result in reduction of 12% in costs for 2012.
Step 2: Developing Options for Solutions
The best solutions come from a team approach, providing diverse feedback to an issue. Call for a meeting or conference call to discuss, or solicit the team for their valued input into the solution. Once a full suite and variety of solutions have been developed, call upon the team again. As a manager or executive or your business, your team will help you make the best, informed decision, and in this case, selection of the most fitting option.
Example: Possible solutions included added automated machine A to assembly 1, performance enhancement training for staff on assembly line 1, elimination of Widget A manufacturing. Best option: performance enhancement training.
Step 3: Implementing the Best Option
Implementation is an absolute critical stage. Most astute business people can plan appropriately. Better managers are able to implement the plans to the fullest extend. I have experienced too many good business, marketing and strategy plans that were partially or not implemented on a timely basis. What was the purpose of planning?
Be a strong project manager… follow the steps to implementing the solution to the issue. There are plenty of tools and resources to assist in solution implementation.
Example: Immediately implement performance enhancement training. Use spreadsheets or Gantt charts to track activities, time frames and completion.
Step 4: Measure Results
This is another critical step in the strategic process. As you can see each step is interlinked with the other. If your team is not measuring results, why implement, why conduct planning is you don’t implement, etc. Time to quantify what has been achieved through implementing the best option.
Metrics will reveal how successful the issue was resolved. As stated in the goals of the exercise, there needed to be purpose to the exercise and through quantifying this, results can be illustrated.
Example: Reviewed financial performance quarterly (improvements): 1st quarter – 1 %, 2nd quarter – 6%, 3rd quarter – 5 %, 4th quarter – 2%.
Step 5: Revise and Repeat
Review the reports and respond accordingly. Like business planning, planning and management should be dynamic. You cannot stay stagnant to the ever-changing environment. Good managers are able to pro-actively plan and respond.
If the best option did not produce the results or achieve the goal, the cycle would be repeated consistently to achieve necessary results, and of course this format could be followed to resolve a number of micro or macro challenges in your organization.