Questionaire

Unit 1 Lecture

Overview

Students have been taking courses in the Master of Administrative Science (MAS) Program to meet the requirements for the degree. Some of these have been somewhat discrete, which means that there was little relationship between the course and other courses taken in the program. As the Capstone course in the program, this seminar utilizes much of the information gathered in the classes taken and demonstrates how the courses help with either strategic planning or planning strategically. Each class taken can provide some part of a strategic or operational plan. This course will demonstrate the importance of the different components and how they work together to form the direction for the organization.

There is some confusion over the use of terminology when discussing strategic planning. Sometimes, there is short term planning that is done is a strategic manner where the complete process is thought out in a logical and proactive manner. This is not generally classified as a strategic plan but is planning strategically. It is important for everyone to be on the same page when discussing the topic; so it is important to review basic terminology used in the process.

This unit will explore the basic terms used and components of plans and the planning efforts.

Definitions:

Different authors and planners use some of the words in the planning process in different manners. Therefore, it is necessary to define these terms to ensure consistency of use for all participants.

Organization - The term organization will be used to classify public and not-for-profit organizations and agencies, as well as private companies. Individuals can also utilize these concepts when planning, but for ease of writing, the term organization will be used to represent all, including the individual.

Strategic Plan – a plan that includes the major goals, objectives, and action steps of the organization into a comprehensive document. This plan is a long term plan that may be for a period of three to five years. There are different parts of a strategic plan, which includes vision, mission, goals, objectives, and strategies, which may be referred to as action steps.

Strategic Planning – a process that identifies goals, objectives, and strategies used to move the organization toward it vision. The planning process also reviews resource allocation to meet the specific objectives. This process is a continuous one that assesses where the organization is and where it expects to be in the future.

John M. Bryson, writing in “Strategic Planning for Public and Nonprofit Organizations: A Guide to Strengthening and Sustaining Organizational Achievement,” defines strategic planning as “a disciplined effort to produce fundamental decisions and actions that shape and guide what an organization (or other entity) is, what it does, and why it does it” (2004, p. 6). In planning terms, strategic planning provides the roadmap for the organization’s activities. It provides direction for the organization by defining specific aspects needed for success. The basic components include a vision, mission, goals, objectives, and strategies. Each of these components plays an essential role in organizational success.

Vision – describes what the organization will be when it is successful. This is a future view of the organization or what the organization will look like when it successfully completes its strategic plan.

Mission – describes what the organization does. The mission articulates the fundamental purpose of the organization. It also provides a clear statement of the organization’s values. The mission answers the question, “What is our business?”

Goals – what the organization wishes to accomplish. Goals are open-ended and general in nature.

Objectives – what will the organization accomplish, by what means, and by what date. Objectives are specific, measurable, attainable, realistic, and time bound (SMART). They tell what the organization will be accomplished and by what date. They are much shorter range than goals.

Strategy – how the organization will accomplish its objectives. In China during the reign of the first Emperor of China (220-206 B.C.E.), Qin Shi Huang had the first wall built to protect China from the nomadic groups that existed north of China. The wall became the first in a number of such structures that are referred to as the Great Wall of China, and the strategy was one that was designed to keep the invaders out of China. Mohandas Ghandi used non-cooperation and non-violence as well as peaceful resistance as strategies to oppose the British rule in India, which led to the independence of India. The military use strategies to plan campaigns and how those campaigns will be undertaken. The private sector uses strategies to out maneuver the competition. There should be at least one strategy for each objective.

Environmental Assessment - Strategic planning involves an environmental assessment that provides the organization with some basic information. The strengths, weaknesses, opportunities, and threats (SWOT) analysis is the basic assessment mode, however there are other assessments that need to be considered. Are there trends that are impacting the organization in either a negative or positive way? Do these trends require the organization to change what they do or how they do it? Are there new competitors entering the market? Are there changes in how products are made or services delivered? These are some initial questions raised by those in the organization when asked to engage in such a planning effort.

Mandates – Mandates are requirements that are placed on an organization. These mandates take on different forms. For the public sector, it might be a new law that is enacted that requires the organization to change what it does or to modify how it conducts its activities. The public budget process pushes organizations into different modes at different times. For many organizations, this type of pushing is seen as a reason not to engage in strategic planning. Public policy also impacts what the organization does and how it does it. In private organizations, the head of the organization, the Chief Executive Officer (CEO), may have specific preferences that need to be met. There could also be specific operating procedures that need to be followed. There are some external mandates placed on private companies by government, such as specific regulatory actions, for example.

Policies – the rules within which strategies can be developed and taken. These policies establish the parameters for actions that are taken to meet the objectives.

Stakeholders – any individual who can place a claim on the resources of the organization. Stakeholders may be external or internal customers who need the organization to fulfill their own goals.

Strategic Management

The history of strategic management as an academic discipline is long. From early times, there have been military and diplomatic strategies. Some of the most well know strategists include, among others: Sun Tzu, Machiavelli, Napoleon, Lenin, Montgomery, and Mao Tse-Tung. One of the most cited, however, is Alexander, son of Phillip of Macedonia.

Alexander had a clear goal – eliminate control of Macedonia by the Greeks and expand the empire. Alexander assessed his strengths and weaknesses. His strength included things such as being young, having a father who was the king, possessing courage and ambition, being educated by Aristotle, having loyalty of his soldiers, and having the ability to think strategically. His primary weakness was the fact that he was only half Macedonian since his mother was from Epirus, a Greek state.

He was able to utilize his relative advantage in each battle to overcome his opponents. This was demonstrated early in his career as a soldier as he met the Athenians near Chaeronea. His assessment was that the enemy was not well tested in battle, and by pulling back his soldiers in one area, he was able to entice the enemy to advance and break the line that prevented his soldiers to advance. The result was that Alexander and his father’s troops were able to rout the enemy.

The soldiers under his command were well trained and highly motivated. Alexander was ruthless with his enemies; he had them executed. When groups revolted against his rule, he took swift action, although he was strategic in his efforts. For example, when Greece revolted, he took over 3,000 troops south towards Thessaly. The Thessalian army held the pass between two mountains (mount Olympus and Mount Ossa), and Alexander had his men ascend Mount Ossa and get behind the opposing army. The Thessalians surrendered and joined Alexander’s forces.

At the time, Alexander’s army was the best fighting force in the world. Alexander was able to maneuver his troops around the battlefields to take advantage of the terrain. Throughout his campaigns, Alexander displayed extraordinary strategic planning to meet his goals. An example was the Battle of Gaugamela, where Alexander met Darius’ troops. The two sides were unevenly matched, with Darius having numbers estimated to be between 200,000 and one million. Alexander’s force numbered much less, although it may have been nearly 40,000 in strength. Darius expected Alexander to attach during the night, and he kept his soldiers awake waiting for an attack that did not come.

Alexander and his troops slept well the night before the battle. Alexander took advantage of the terrain and understood how his opponent generally carried out his battles (the use of the scythe chariots and elephants, for example). He lined up his troops in the most advantageous manner, to combat the chariots used by Darius. As they angled their shields and pikes toward the battlefield, the horses pulled inward away from the wall developed by the troops, and the chariots cut into each other, thus eliminating the chariots as a strength. By assessing the environment and planning out appropriate strategies, he was able to defeat Darius’ troops and send Darius running away.

Various strategies can be found in wars that have been fought from Alexander’s time to the present. In the Revolutionary War, the British marched in a row toward the revolutionary soldiers. This was the acceptable way of waging war. The Continental Army used the strategy of guerrilla warfare – hiding behind trees and fences and then firing at the enemy as they marched forward. Where the British army wore red uniforms, the colonial troops wore different uniforms based on their location, and in many cases, there were no standard uniforms available. The soldiers who wore their own clothing were able to blend into the scenery easier than the British red coats. (It should be noted that the current U.S. Army uniforms, the battle dress uniform, can be for desert, night, or temperate weather, among others. There is a manual in excess of 350 pages that defines what uniforms will be worn, what accessories can be worn, and so forth. This is a significant change from the Revolutionary and Civil Wars when whoever enlisted might end up supplying their own clothing, supplies, and equipment.)

The use of chemicals in warfare was a major concern at the end of the 1900s. At one of the Hague Conventions, there was a general agreement that no type of chemicals would be used if its intent was to asphyxiate or cause severe harm to others. All nations involved in the World War I agreed to this except for the U.S., Italy, and Turkey. In 1914, the French used gas grenades in battle and broke the agreement. Germany did not want to be the first one to violate the agreement, but once this was done, Germany engaged in gas warfare which was designed to inflict injury and also fear into the enemy.

Misinformation was a strategy used during World War II and the Normandy landing. In the months prior to the invasion, there was a campaign of deception where information was leaked to the Germans. The information was that Normandy was a diversionary attack. There were a number of incidents where relative information was leaked to the Germans, but the misinformation was too believable. The Allied attack was a success because the Germans had committed substantial forces to another potential landing site.

Agent Orange was used in the Viet Nam War as a strategy. This chemical was a defoliant, which cleared the forest and land areas thus preventing the guerillas the opportunity to hide. There was little acknowledgement of the long-range impact this would have on the soldiers. Strategies are so important for the military that they teach such in all of the different branches of the service. They even focus on them in the War College.

The American private sector integrated strategic planning into its operations during the late 1950s and early 1960s. Robert McNamara was the president of Ford Motor Company when President John Fitzgerald Kennedy asked him to be Secretary of Defense. When he assumed his new role in the public sector, he brought with him the multi-year planning process he had used at Ford. This planning process allowed him to develop the necessary perspective for key decisions and strategically important decisions. Because of the success of his long-range planning philosophy at Ford and with the Department of Defense, other large corporations started to adopt the process. Such long range planning may have been instrumental in the period of steady economic growth that the United States experienced in the 1960s. There also was a high level of prosperity in the United States, which provided organizations with many different growth opportunities. Strategic planning offered the public and private sector guidance for the difficult task of decision making.

Strategic planning in organizations was very popular and widespread between mid-1960s to mid-1970s. People believed it was the answer for all problems, and corporate America was "obsessed" with strategic planning. (See Mintzberg, H. [1994]. “The Rise and Fall of Strategic Planning.” New York, NY: The Free Press.) There were a number of different models in use by companies and organizations, and a number of issues with the plans and the planning process arose. Many failed to include the financial and operational aspects into the strategic planning process. In many instances, the strategic planning process was considered an upper-management task where few middle managers or front line workers even had seen the plan. The issue became one of organizations failing to completely align the vision/mission with the operational function.

Strategic Planning Advantages

Are there advantages of strategic planning and the process itself? Many of us know of organizations that have engaged in planning efforts but have not completed such a plan. Sometimes, organizations engage in this process because it appears to be the thing to do, such as the flavor of the day. If there is a valid reason for the organization to engage in the process, some decision should be made as to the most appropriate way to complete the process as well as ensuring the availability of sufficient and appropriate resources to complete the process. Public and not-for-profit organizations have increasingly been using a collaborative approach, one that involves stakeholders of the organization in the planning process. When this type of planning is used, organizations become more attuned to the needs and wants of their customers, which is a definite benefit to the organizations.

Businesses have been using strategic planning to grow their businesses for some time. In most instances, businesses use a top down approach with the planning done at the upper levels of the organization. Analyzing their competitive advantage and defining their core competencies have benefited companies around the world, but although strategies have been around for centuries, the inclusion of strategies and strategic planning in government is relatively recent occurrence. The strategic planning effort in the public sector began in the late 1960s and early 1970s. During this period, some organizations looked at a different budgeting system, the Planning, Programming, Budgeting System (PPBS). This top down planning process parallels the private sector’s corporate strategic planning model. Arguably, few public sector organizations have engaged in strategic planning and even fewer have utilized a collaborative approach that involves the stakeholders in the process.

Organizational Decision Making

Organizations constantly make decisions. What is decision making? Decision making can be the process used to identify and selecting an appropriate course of action to deal with a problem. In some instances, decision making involves determining how to take advantage of an opportunity. Sometimes, the decision process defines the problem, generates alternatives, selects the “best” alternative, and then implements the chosen alternative. This process links the organization’s present circumstances with specific actions that will move the organization into the future. Throughout much of the process, the past experiences of the decision makers and the organization are used as a framework for the process.

Managers make decisions every day. At times, decisions made are rational, and at other times, they may be classified as irrational. Often, the manager or executive responsible for the decision process lacks the required information to make important decisions. Managers may use personal biases in the process since they may be more likely to give greater attention or validity to information that parallels their own beliefs. The managers may not be in touch with the reality of the organization. They may not know of the real issues confronting the organization. Technology has increased the amount of information and changed information flows. This has resulted in much more information that is available to managers, but many managers may not be able to interpret and process the information due to the volume of data.

What does the decision process really require? Organizational decisions must work toward and support the goals of the organization. This requires that decision-makers know what the goals of the organization are. There are a number of decision models that lead individuals through the process. Nearly all such models require alternatives that need to be evaluated. In the evaluation stage, the decision-makers must be aware of the vision and the mission of the organization. This awareness will assist the individual in making the appropriate decisions, which will lead the organization toward its vision while maintaining its mandates and current values. The vision and mission provide the road map for the organization’s development and decision-making.

Strategic and Operational Planning

Strategic planning and operational planning are two different concepts, although there are some similarities. Strategic planning is future-oriented with a time line three to five years into the future. Due to this time frame, it is done in an environment that is uncertain. Operational planning involves planning for day-to-day functions, and the environment is more certain. Strategic decisions are long-term in nature, whereas operational decisions solve short-term or current issues.

It may be a strategic plan for a high school freshman trying to determine which college to attend, what program to follow, and what the long term career goals may be. This student could then craft a curriculum to get to the end goal – admission into College A. For a junior who is about ready to look for colleges, the decisions may be more immediate and shorter term. This student has already committed to a course of study and gotten a number of grades that may impact his or her ability to be accepted in a given college. This individual may need to alter his or her plans as to which schools to apply to and which course of study to pursue. Very few high school students plan for the long term, so as a parent, you are responsible for assisting the student in getting to the long range goal – College A, for example. A parent with a young child may be engaged in strategic planning when trying to determine how to pay for college, although the environment may change a great deal between the time the parent decides to set aside money and the time when the child actually needs to pay for college.

When organizations make decisions for the future, those decisions are not made in a vacuum. Current conditions, both internal and external to the organization, influence the process. In a stable environment, the short-term future can be predicted. In turbulent times, the future is less clear. Therefore, organizations must be aware of the environment in which they are planning. Strategic planning, emphasizing the longer term, has to exist in an environment that is dynamic and, most probably, harder to predict. Strategic decisions are directional as opposed to the implementation orientation of the operational decisions.

Many organizations that engage in long-range planning consider the future predictable based on past experience. As the organization asks itself “what business are we in,” that organization also considers the future that is most likely to occur and then moves backward year by year to determine what needs to be done to achieve that future. This is a type of reverse planning – where are we going to be in five years and what will we look like, and then for each year, what do we need to do to get to that point.

Organizations that utilize strategic planning consider the future unpredictable. Planning is viewed as a continuous process. Instead of asking, “what business are we in,” strategic planners ask “what business should we be in?” The organization must also consider if it is doing the right thing. The strategic planning process looks at the array of possible futures and proposes a number of strategies to reach those alternatives. These strategies must consider the internal and external environment and the assessment of those environments.

Effective Strategy

Can we define the criteria for an effective strategy? Is it possible that a strategy employed at one time will not yield the same results the next time it is used? Aren’t there people who are excellent at devising strategies but are not as successful at the implementation stage? Consider Generals Grant and Lee - was Grant superior in his strategies to Lee? Napoleon appeared to be good at strategy, but what were the issues with his attack on Russia? It appears that there were other factors that adversely impacted that strategy. Lack of resources, errors in judgment, unpredictability of the environment, and a host of other factors determined whether Napoleon’s strategy worked well or not. When developing a strategy, it is impossible to determine the specific success factors for the strategy since we do not know if it will result in the desired end. It is also not possible to solely evaluate the strategy based on its success. There could be strategies that would be outstanding given another time or specific environment.

As we undertake the process of determining effective strategies, there are some things that we need to consider. It is important to have some criteria that can be used for evaluating strategies. These may include:

Clear and concise objectives

Internal consistency

Degree of risk

Appropriateness in view of the resources available

Consistency with core values of the leaders of the organization

Goodness of fit with the environment

Motivational impact

Flexibility

Time factor

Committed leadership

Based on this list, it can be determined that the selection of an appropriate strategy is dependent on the organization and its leadership. There must be leadership that supports the process. Any strategy must fit with the leaders’ values, and resource availability must be sufficient to carry out the process.

Policy and Policy Making

When individuals think of public policy, they frequently think of an action by presidents, governors, prime ministers, bureaucrats, and others of that stature. In reality, public policy has a larger group of diverse individuals who influence and set that policy.

In the private sector, there are a limited number of individuals who influence the policies, plans, and decisions of the organization. In most situations, these influencers include the chief executive officer (CEO), the board of directors, the stakeholders (more commonly known as the shareholders), and the customers. In some situations, the government regulators might be involved in oversight. The Federal Communications Commission (FCC), the Securities and Exchange Commission (SEC), and a myriad of other acronymed agencies establish rules for operations of specific types of industries. Because of the magnitude of the responsibilities they have, these groups usually get involved with a particular organization only when some complaint arises. Environmental groups might be involved if a company’s product might damage the environment. The courts might also be involved when complaints are filed. Some employees in private sector companies are represented by unions that might also impact certain implementation decisions. From the list above, few of these interest groups impact long range planning processes or the strategic plan.

The public sector, on the other hand, frequently has a number of groups who impact the decision process including strategic planning and long-range planning. In addition to the CEO (the president, governor, mayor, department or agency head), the interest groups include, but are not limited to, the following:

The legislative branch – In many cases, activities undertaken by public agencies are mandated through laws. The legislative process is complex and, at times, there is oversight built into the legislation at the time it is passed. This oversight allows the legislature to investigate what the organizations are doing and requires justification of the organization’s funding. The effectiveness and efficiency issues are reviewed, and program impact is assessed.

The courts – The courts sometimes determine the legality of the programs or activities. Although many organizations have administrative processes, once the administrative processes are exhausted, there are some remedies in the court system.

Regulatory agencies – There are a number of agencies with oversight in specific operations. The agencies frequently look at what government does and how it does it.

Career employees – In government, employees can influence what the organization plans to do. The ability to vote for the CEO through a regular election is a significant difference between the public and the private sector. In addition, there is the ability to influence long-term actions because the career employees basically stay on the job even with a change in administration.

Unions – The public workforce is more highly unionized than the private workforce. The unions can exert influence on long-range activities through contract negotiations. Contracts are usually more than a year in length. These multi-year contracts include parameters for wage increases and conditions of work. When completing strategic and operational plans, these changes in the contracts must be considered for their long-range implications.

The media – Nearly every day, the media covers some story about the public sector and what is wrong with it. Until the Enron problem, little regular media attention was given to how large companies did business. If there was a profit, that was noted as part of the business news. Since the public sector is so open, it is subject to public scrutiny. It may seem as if the public sector exists in a fishbowl with every one watching to see where and when a mistake is made. When problems occur, those problems always end up on the evening news.

Interest groups – The Federalist Papers were part of the Founding Fathers ways of floating “trial balloons.” When they had an idea that they thought would be good, they printed it and sent it throughout the colonies. One concept was that of “factions,” (i.e., a number of different groups). If a specific issue arose, there might be a coalition of different groups for or against the idea. However, with so many groups, it would probably be difficult to find some issue that would galvanize all of the groups. This concept was regarded as a way of ensuring the union would not be overthrown. The thought is as applicable today as it was then. With so many groups supporting their own unique views, there are forces that continuously pull and push an agency or organization. A good example is the state budget process. During the budget development and review, many interest groups approach the legislature stating why their programs should be funded or why their budget should not be cut. Consequently, when public organizations are thinking long-term about what the organization should be in the future, there is significant concern about the various interest groups since those groups can help make the process successful.

Policy Analysis

Policies impact the current organization and what it plans to be. Organizations need to analyze policies to determine mandated changes in their products, services, or potential opportunities. For this reason, a summary of the policy analysis process is included below. The process involves the following steps:

1. Verifying and defining the problem – What is the real issue? At times, organizations perform this task by a back-of-the-envelope calculation. Other methods for this are a quick decision analysis; a detained issue paper that provides basis assessment of the issue; in-depth policy analysis; and the creation of valid operational definitions.

2. Developing evaluation criteria – There must be some criteria by which the analyst will know the issue is solved or that an acceptable policy is established. Basic issues that usually are involved include cost, effectiveness, and benefit. Policy makers want to assess things such as the cost-benefits or efficiencies. Additional aspects include the legality and the political acceptability of the policy. Additionally, social responsibility may be considered as well as ecological or economic impact.

3. Identifying alternatives – When determining alternatives, there must be an understanding of the values, goals, and objectives of the stakeholders that the policy will impact. This stage may require research, surveys, brainstorming, or modifying current solutions. Appropriate alternatives should be included, but sometimes, policy makers fail to recognize or acknowledge the various possible alternatives that limit the possible choices.

4. Evaluating alternative policies – Evaluating the policies can involve various techniques. There are mathematical models where data are extrapolated from existing data. Theoretical forecasting or scenario writing can be other methods used in the evaluating process. The political implications also need to be considered at this point.

5. Display the alternatives and distinguish among them – When looking at alternatives, there are different considerations. Does the organization want to have the optimal solution or are they willing to satisfice? Satisficing is selecting an alternative that meets the criteria; it may not be the best solution, but it is a solution. When looking at the alternatives, it may be that the criteria must be changed because the alternatives are not providing what is desirable. Various methods can be used to compare the alternatives, i.e. matrix display systems, paired comparison, standard alternative method, etc.

6. Monitoring implementation policies - When policy is implemented, perhaps there are issues in whether the problem originally identified is solved by these alternatives. This step requires comparing before and after results or the actual versus the planned performance.

A number of questions are raised when looking at the policy analysis process. Can the policy be implemented? Concerns include whether the technical aspects are feasible or can this actually be implemented? The economic and financial aspects are major concerns. If the policy is too costly for the benefits to be attained, should the policy be implemented? At times, because of the political viability of the policy, the issue of costs and benefits raise some real concerns because many public programs are not cost effective. In times of budgetary constraints, how these programs are funded, and at what levels, becomes a major debate. Will implementing the policy result in higher popularity ratings for the elected officials and thus for their re-election. Can the current bureaucracy administer the policy? If not, what would be required to properly administer this policy? This has fiscal implications as well as political ones.

Once policies are determine and implemented, the impact on the organization needs to be assessed. How the organization includes these policies into its normal functioning is part of the operational planning process. Once these policies become part of ongoing operations, those functions need to be included in future strategic planning efforts. It is important to note that during the first year of operation of a program, the new program may not be part of the long-range plans or the strategic plans. It takes at least one planning cycle to include these new programs in the future planning process.