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Performance Management and Strategic Planning: Overview

Definition and Purposes of Strategic Planning Linking Performance Management to the Strategic Plan
Strategic Planning Developing Strategic Plans at the Unit Level Job Descriptions Individual and Team Performance

Building Support
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Strategic Planning: Definition


Process Describe organizations destination Assess barriers Select approaches for moving forward

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Strategic Planning: Goal


Allocate resources to provide organization with competitive advantage

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Strategic Planning: Purposes


Help define the organizations identity Help organization prepare for the future Enhance ability to adapt to environmental change Provide focus and allow for better allocation of resources
(continued on next slide)
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Herman Aguinis, University of Colorado at Denver

Strategic Planning: Purposes


Produce an organizational culture of cooperation Allow for the consideration of new options and opportunities Provide employees with information to direct daily activities

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Strategic Planning : Overview


1. 2. 3. 4. 5. Environmental Analysis Mission Vision Goals Strategies

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Environmental Analysis
Identifies external and internal trends
To understand broad industry issues To make decisions using big picture context

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External trends
Opportunities:
environmental characteristics that can help the organization succeed

Threats:
environmental characteristics that can prevent the organization from being successful
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External trends Factors to Consider


Economic Political/legal Social Technological Competitors Customers Suppliers

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Internal trends
Strengths:
internal characteristics that the organization can use for its advantage

Weaknesses:
internal characteristics that can hinder the success of the organization

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Internal trends Factors to Consider


Organizational structure Organizational culture Politics Processes Size

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Gap Analysis
Analyzes:
External environment
(opportunities and threats)

vis--vis

Internal environment
(strengths and weaknesses)

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Gap analysis determines:


Opportunity + Strength = Leverage Opportunity + Weakness = Constraint Threat + Strength = Vulnerability Threat + Weakness = Problem
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Strategic Planning for the Organization


Environmental and Gap Analyses provide information for organizations to decide:
Who they are What they do

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Mission
A good mission statement answers: Why does the organization exist? What is the scope of the organizations activities? Who are the customers served? What are the products or services offered?

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Mission Statement contains:


A. Information on organizations Basic product/service to be offered Primary market/customer groups Unique benefits and advantages of product/services Technology to be used Concern for survival through growth and profitability
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Mission Statement may contain:


B. Information on organizations values and beliefs Managerial philosophy Public image sought by organization Self-concept of business adopted by
Employees Stockholders

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Vision
Statement of future aspirations Focuses attention on what is important Provides context for evaluating
Opportunities Threats

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A Good Vision Statement is:


Brief Verifiable Bound by a Timeline Current Focused Understandable Inspiring A stretch

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Purposes for Setting Goals


Formalize expected achievements Provide motivation Provide tangible targets Provide basis for good decisions Provide basis for performance measurement

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Strategies
Create strategies or Game Plans or How to procedures to address issues of:
Growth Survival Turnaround Stability Innovation Leadership

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How the HR Function contributes:


Communicate knowledge of strategic plan Provide knowledge of KSAs needed for strategy implementation Propose reward systems

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Strategic Plans at the Unit Level


Organization Mission statement, Vision statement, Goals, and Strategies
Must clearly align with And be congruent with

Every Unit Mission statement, Vision statement, Goals, and Strategies

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Alignment of Strategic Plan with Performance


Organizations Strategic Plan
Mission, Vision, Goals, Strategies

Units Strategic Plan


Mission, Vision, Goals, Strategies
Critical to involve all employees

Critical to involve all levels of management

Job Description
Tasks, KSAs

Individual and Team Performance


Results, Behaviors, Developmental Plan
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Job Descriptions
Tasks and KSAs are congruent with Organization and Unit strategic plans Activities described support mission and vision of Organization and Unit

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Individual and Team Performance


Organization and Unit mission, vision, goals lead to Performance management system, which
Motivates employees Aligns development plans with organization priorities

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Strategic Plan Choices in PM System Design


Criteria (Behavior vs. Results) Participation (Low vs. High) Temporal Dimension (Short Term vs. Long Term) Level of Criteria (Individual vs. Team/Group) System Orientation (Developmental vs. Administrative) Rewards (Pay for Performance vs. Tenure/Position)

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Building Support
Answering Whats In It for Me?
Top Management:
Help carry out vision

All levels:
Involvement Participation Understanding

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