What is a Long-Range Plan? How to create it

Are you thinking about improving your business? be the best player in the market?

In the fight to get to market, the companies often forget key elements, for example, stabilize their mission and vision to ensure the business in the right direction. As you guess the company often lost its direction also in this situation remains to be successful in a short time.  Create a Long-Range Plan helps to keep the most profitable status in the market.

What is a Long-Range Plan? to be fast, a Long-Range Plan is a document that acts like a map, where the company stabilizes clearly how they are going to get their goals and how they want to take a position in the market. It allows to accurately prioritize work, and have under control your growth and results. This document frees you from the troubling cycle of day-to-day planning, no need to say that this Long Range Plan doesn’t save you the little problems that you can find on your day today. But you have an important vision of where you want to arrive.

Furthermore, a Long-Range Plan helps you to manage your company at a strategic level and research strategic topics through how the market moves. You have to consider include this plan in your budgeting process and forecasting how the market will be moving.

Let’s try to introduce how to create a Long-Range Plan in your company with some tips to have in consideration.

• Mission and Vision Statements 

One of the first topics that you ought to be clear is your company’s Mission and Vision, they serve to stabilize the business the company policy, creating an approach to the market. It is important that your company is aligned with a good mission and vision statement. At this point, you have to spend time understanding which is your brand identity, what you want to do, through co-working with the company’s stakeholders and shareholders in order to define a clear vision.

This process can take a few weeks owing to you have to schedule a few meetings with the company superintendence, in these meetings you will incubate ideas, including decisions to clarify the right company direction. Once the plan has been created, it can be consulted whenever there is a change in the strategic commercial and should be adjusted.

• Define Goals

To have clear the goals and identify them, you have to ask you, some questions to understand which is the meaning and the purpose. Going furthermore the questions are:

1. What do we do? What do we want to do?
2. what are our weaknesses and strengths? DAFO Matrix
3. What opportunities should we consider in the market?
4. Where do you see your business in one year from now? 5 years? 10 years?
5. Have we resources to go there?
6. Is there a potential customer base?
7. Is any player in the market that does the same? will they do the same?

In base of these questions, you can start to define your goals. Keep in mind that your company must be aligned in this work.

• Write the plan

In this streamwork, you can involve the people that you can think is important, for example, owners, directors, senior executives in writing the plan.  The Longe Range Plan should be a guide for all areas in the company:

• Market approach
• Marketing communications and message
• Measurables Sales and Operational goals
• Customer Oriented

And the last step is to put in march all this information and ideas. Try to assure all the company in the same mission with focus its goals. And Review every quarter if the results are going well or you have to change

Good luck!

Autor: Emilio

What is quality? Lean Thinking

Recently my company has been certified in ISO 9001, that Standard that says that a company is as ineffective in its processes, and it is wonderful in the news of internal communication, in some association of quality and hung on the wall, but the Reflection that I pose myself, is, what is quality? What do we mean by quality? Why does a company work so well?

Quality is not a role, quality is not something that is said, quality is not for a day, if you believe that is really wrong, you are going astray.

Quality is a way of life, a culture of work and a philosophy of understanding the operative.

There have been great quality gurus, thanks to them the quality is where it is, but as it says, whenever it is looking for continuous improvement everything has to evolve. We are at a time where innovation at all levels is the key to new successes, new challenges, new failures and undoubtedly new illusions that will make you bigger and wiser.

The quality, apart from the paper that you can have hanging in the department, is something that is breathed, and that the whole company must breathe and know well. Personally, in this sense, I am constantly striving to show the intrinsic benefits of good quality management, that all people know what we work for, what we work for and give merit to the people who deserve it.

What we have ever seen written Lean Thinking, is the reality that is slowly taking root in companies, many of them do not give as much value to a certification as to the fact of doing things right.

Things to , process improvement, people involvement, project implementation, the set of all activities are what creates the core of quality. The core of the company. Quality is NOT expensive, we have to forget that quality is expensive, implementing the different methodologies we have is a wonderful challenge that makes quality an exciting world to live with.

I encourage everyone to make quality and forget certificates.

Make Lean Thinking!

Blueprinting method: Analyze your services and optimize them

Blueprinting is a methodology that is based on analyzing, visualizing and presenting a map of services. It serves to see the evolution of a process or the provision of services through a flow chart.

As a final result we will obtain a diagram where the activities of the process are chronologically represented on a horizontal axis. Depending on the proximity to the client these processes or activities will be at one level or another level within a vertical axis.

 

What do we get with Blueprinting?

We achieve two points of view, within the company (processes) and outside the company (customer experience). Blueprinting focuses on detailing the configuration of a service-based process to achieve an optimal result both inside and outside the company. The philosophy of work is to dismantle the conceptual map of services to achieve continuous improvement through customer satisfaction, as well as increasing the effectiveness and efficiency of processes (associated cost reduction, process waste, etc.).

To achieve success within companies, it is necessary to work under three pillars: developing alternative strategies, focusing on clear objectives and making decisions based on concise data.

From the analysis of the results we develop options to mark a strategy and a posterior evaluation. Always setting some guidelines for action in the face of problems and new challenges, applying competently improvement actions and focusing / sizing efforts.

 

How do you start working with Blueprinting?

1- First, we have to establish the limits of the system, in this case, we are talking about our services and products. In this way we will be able to visualize a dimension of our study, we refer to the E2E (End to End) of the system. Therefore it is important to reflect the essence of the system in sight, then we have to identify what are the key points of this system, these points are our activities or processes.

This first step will unfold all those processes that have an impact both on the operations of our organization and, on the face of the customer, to know what factors are those aspects that will influence the decision of our brand for another one of the competition.

2- All this we have to take it to a graphic representation, for the representation of this process, we will work on a diagram that marks the interactions with the client, with the company, zones of perception, etc. All this we are going to carry out Through the use of a symbology by all recognizable.

In this representation it is necessary to begin to identify in a clear way that internal processes are intimately related to client experience. We must identify how these two routes, one internal and one external, mark the roadmap to generate the start-up of a service with the maximum possible potential.

Obviously to develop this mapping diagram of both processes and client is necessary to set time guidelines, it seems totally obvious but has a non-trivial character that will define the vision of the E2E process and analyze how they impact the processes inside and outside the Organization through the Customer Journey you achieve to reach how much of good or bad is the customer experience. Mides KPIs on both sides and paramétrizas how to improve internally so that it impacts on customer and vice versa.

This methodology may be accompanied by others such as the Servqual Technique or a DMAIC. With this we will uncover “moments of truth“.

3- When deploying our Process diagram and Customer Journey, we have a general life cycle of our system that makes it easier to identify faults. A widely used practice is to identify faults as potential risk areas for customers, these areas must also have a special attention on our part. The areas where failures occur is where we have to start working, it is very important to define in our protocol of action that is important and critical, we should not direct our actions to something that can “wait” to start with actions that have greater priority.

With this we will avoid the occurrence of these failures and even anticipate future failures that may be blocking our services.

4- Once we have identified the failures and we have set a priority or criticality in front of each of them, whether with affection to our clients or in the internal operative, we have to establish a battery of actions in front of these problems. To the extent possible we will work to minimize current errors and prevent futures to reduce impact.

Let’s see them on a real case, to analyze all the steps we have seen. And pursue those aspects that can generate more impact within the organization.

Of course, from this mapping we can integrate KPIs and customer satisfaction indicators that delimit improvement actions on a specific focus to optimize processes and generate value actions towards our final client.

To gain the trust of the client is to offer a service that meets the needs of this and do not have any fuss, we do not like to be surprised with unwanted bills, services or products that do not meet our needs because we feel cheated and will be very difficult That the customer re-believe in us, that is why he marks the end of the process with a face of ambiguity. Since we must remain alert and give a successful service. In the complicated moments we must get our arsenal and get the customer to move as far as possible from that yellow face to pass to a green of satisfaction.

How to implement a Map of the Value Chain or Value Stream Mapping in our organizations

Today we will try to give a small guide to the development of Value Chain Mapping, Value Stream Mapping or VSM within our organizations. The philosophy of this technique is to analyze the process in detail to reach the maximum knowledge of it and to see where our process is failing or can simply improve, with this we will achieve that the performance and efficiency of our processes also help save costs .

To start with this type of techniques you have to start by making clear some concepts such as:

– Production lead time: is the time from the time the order is received until it is ready for packaging and shipping to the customer.

– Processing Time: is the time required to perform the tasks of manufacturing a product.

– Time of configuration, or change of tools: is the time it takes to move from one process to another.

– Number of Reprocessed: is the number of units that need to be reprocessed because of faults or defects.

– Batch Size: is the number of units of product that are realized in a determined time.

– Available Time of Equipment (Working Time Available or Uptime): it is the time that we dedicate, or the time of activity, in a determined period (h / day, h / week, h / month …), here we have to despise meetings, Breaks … everything that can disturb the working time, this data can be given in%.

– Waste (Scrap): are the unnecessary costs that are generated in each process. We can differentiate the following:

– Overproduction resulting in excess inventory (stocks of end products and products in progress),

– Unnecessary movements and transport.

– Waiting points and bottlenecks that slow down the process.

– Nonconforming products (manufacture defective products which must then be reprocessed to repair their faults).

– Other activities that generate inefficiencies or unnecessary costs.

– Demand: it is the number of product that we need to manufacture to cover the orders, or the needs of the market.

– Warehouse process: is the stock of products in progress, both in the process and in warehouses and transport.

Then the data to collect and mark in each of the processes are the following, I contribute the encoding of signs for each one.

Next I present a theoretical model of VSM of how the structure of a global map would be after performing the initial study of how we work within our organization, in this step it is important to devote time to it, because any details that can escape repercussion at the time Of the final results. It is necessary to give detail in the flow of the product, information flow, processes and re-processes that are realized, to control the quantity of all the materials with which it is working, times described above, etc.

When we have represented our process, and we have a global vision the next step is to move to the data. Here as well as before you have to carry out an exhaustive study of what data you have to put in each case and most importantly the type of metrics with which we are going to work, for this we must help from different supports in other areas.

In each process, we highlight as basic data to take into account: cycle time, task time,% activity in that process and Batch size or lot size. With the obtaining of all the data we will be able to complete the map and have a vision of how each of the processes and steps are being carried out within the process. With the next step we can carry out a separate study of each process, discovering in this way its capacity and seeing where there are bottlenecks that block the overall process.

Assembling all the mapping of our process, we can begin to analyze it and use the Lean philosophy, one of the first problems that we can encounter is the production in Batch push, each process produces at a different pace in such a way that there will be in areas that are Accumulate material and in others where there is not, therefore, it is sought that a process produces the necessary and fair amount for the next process, or move to a pull production where the next process demand is worked. Trying to perform a JIT process (just in time) from the client to the resources will help the overall process have shorter delivery times with better quality and lower cost. Techniques like FIFO, 5S, Ishikawa, AMFE, Poka Yoke … help to achieve the efficiency of the process, ultimately Kaizen and Kanban philosophy.

So you have to design a plan to reach an optimal performance model from the VSM. Once each technique is implanted in the process it is important to mark them on the map in such a way that we know about each one being executed. Without disregarding the maintenance work performed by the operator, this maintenance can be: corrective, preventive, predictive or total productive on this pillar is based on the philosophy Jidoka, where the operator takes a vital role in fault detection.

Asset management model

All the companies are of the sector that is, count on commercial, productive, economic objectives, etc., according to the demand of the needs these are covered with internal or external resources. Having said this, and based on the logic of financial profitability, all companies are betting on subcontracting rather than on own resources, as well as on the purchase of services or products, and at this point we see how the supplier market is becoming more specialized.

Made this introduction, by all known, to have a proper asset management is necessary to manage a multitude of suppliers, with their specialties, details, covering the needs but integrating it into a whole.

Goals.

The biggest objective is to sell as much product as possible, with the best quality, satisfying the customer and with the lowest possible cost, thus achieving the highest profitability and possible benefits. From here it branches into production sub-objectives, availability, reliability, maintenance, safety with the least impact on the customer.

Weighting of objectives.

Each of these objectives is measured differently in each of the companies, and mainly they will have a very different weighting in each one of the companies, since it influences the sector to which they dedicate themselves.

Structure of the service.

In order to meet customer needs, the activities within the company must be clearly differentiated. So let’s see what we have:

• Audit: Measurement and valuation activities of what you are doing.
• Consulting: strategy to follow in the present and future.
• Training: if necessary training in the preparation of new services.
• Engineering: design and calculation of the needs and resources needed to achieve objectives.
• Implementation of models and plans designed in the engineering phase.
• Control: measurement and assessment of what is being done at any time.
• Decisions: actions that must be carried out in the model to adjust in the deviation of the defined objectives.

Business contractors.

Within the pool of contractors that can meet our needs, we must carry out a market study to ascertain the degree of adaptation of the service offered by the companies, negotiate with each one the service that is willing to cover with the greatest balance between necessity Of the process industry company and the service offered by the contractor company.

Economic calculation of the service according to the intensity of the service.

The unit cost of the contractor’s service is calculated by the intensity of the objective to be covered, for example, the intensity of the environmental impact of the nuclear industry will be higher than the intensity of the objective for the wind industry. Thus, for one case it will be more costly economically than for the other, respectively.

Calculation of the cost of investment of implantation of the model.

Until the stationary phase is reached, investment costs are calculated to start the model, which are amortized over the periods of return on investment.

Once the start phase of the Implementation Project of the Asset Management Model is exceeded annually, a number of resources are consumed by contractors and suppliers. These costs are similar each year, adjusted for changes in CPI and changes in special prices.

Study of return on investment and profitability.

The model itself, in its initial phase, measures and assesses the cost of direct and indirect money from the current asset management. The reduction of costs of direct and opportunity costs, increased availability, reliability, safety and reduced impact on the environment has a positive economic impact on the company, which increases its profitability and its benefits.

Speed of implantation of the model.

Due to the economic cycles of companies and the environment, changes in products and services may be difficult or easier to implement the model.

To do this, once the investment and annual costs have been established, different implementation speeds of the model are proposed, ranging from six months to ten years; Depending on the needs and policies of the company.

Conclusion.

Thanks to this model, you can prioritize what services are needed to meet business objectives. Sometimes it is difficult to establish how much of the supplier’s resources will be needed in each situation, but thanks to the structure of the model in phases, the exercise is performed defining, analyzing and assessing the needs at each moment, as well as calculating its Economic cost.

Canvas: project management framework

It emerges as a project management methodology, helping guide these and focusing on a creative design by creating a canvas project to work on. In this way Canvas allows us to draw as our project would be in a series of steps that define in an agile way through the intervention of all stakeholders involved, reducing the TTM and improving the penetration of our products.
We can simplify the realization of Canvas in 3 main blocks which in turn are subdivided:
The first of the blocks located in the center defines what would be the pillars of the project, in this case the final product, on the other hand the activities needed to get that product.

On the right side we will develop market components, product value proposition, broadcast channels, customer relationship and sources of revenue.
Finally the left block defines this methodology would be to identify what resources are going to be needed, use of technological platforms (ICT), relationship between them and what is needed by each in the different steps of the project and of course establish A cost structure.

What benefits does Canvas offer?

– The Canvas model allows rapid modifications on the progress of the project based on data analysis and testing the hypotheses that mark the guidelines of the success of the project, marking the viability of the business.
– Canvas allows the interaction of the different affected areas in a friendly and flexible way, in a very intuitive way and encouraging the interaction between people.
– Undoubtedly encourages teamwork, the way in which different workshops are held to work on the evolution of the product launch. Working with a canvas model allows to establish a better relationship between the people who are going to intervene. You can use methodologies like Scamper or brainstorming.
– Improves the overall visualization of the holistic of the project. Once the Canvas is made, it will be shown to all the people who have taken part in this activity and that will be part of the achievement of the launch of the product.
Now we will develop and define other aspects that we have seen that are necessary to successfully achieve the development of Canvas.

1- Customer Segmentation: The most important thing you have to ask is who is going to be directed to your product, what penetration is going to have and if you are going to have the buying power that you have planned on that niche market.
2- Proposal of value: that is, what you need to cover, the key is to know what problem you will be able to solve your group of customers.
3- Channels of diffusion: to generate a good market penetration it is very important to define through which channels you are going to spread your product on your target audience. At this point you have to be able to discern the audience to which the product is directed and it is based on this you have the possibility to choose the best channel. If it is a group of young customers, it encourages the digital channel while in other sectors, traditional channels may be more successful.
4- Customer Journey: In this process of launching products you have to stop and think about how the relationship with your customers will be. Set touchpoints within the customer and product lifecycle. Ways of contact and feelings that can lift these touchpoints.
5 – Obtaining income: always have to justify a department’s budget to start working on a project, then, let’s see what points are sensitive to the client: how much is the customer willing to pay, how does the payment, sale Direct, online sales … then you have to evaluate all the possibilities of earning money.

When we are clear in what environment the company will move on these new products or services, we will work the internal alliances. We will evaluate the internal part of the project that we need and what expenses we will support, the points to see at this time of project development are:

1- Internal resources: we must identify what people are going to need to achieve our goal, which departments are going to be involved and of those who are going to wear the “monkey” job.
2- Actions to be carried out: it is very important to define the concept of product as market, so, we must establish some lines of action in front of this new horizon. It is very important to know that you want to not waste your time in development.
3- Internal alliances: within this canvas our actors must maintain a good communication and clear lines of action. Based on these values, we must promote the accessibility and transparency of information. It is necessary to make a foment of companionship and to eliminate it with the resources of departments involved.
4- Cost structure: we have seen that we need to identify where our benefits come from, but we also have to have identified where our costs come from. It identifies these outbreaks and establishes a prioritization to reduce these costs.

Once we have all this identified, how do we move forward?
We have marked a starting point in the execution of our project, we must update our Canvas, we must continue to update the changes that happen in our product development and when we finally launch the product to the market we are able to analyze what strengths and weaknesses have influenced our. That helps us to mark a better route at the time of the execution of new projects Canvas or of the nature that is.

Once we have finalized the project we have to take the appropriate metrics to know how good the product we have launched to the market, in these cases it is very interesting to work with Analysis AB, where through the execution of drivers you have a sample of how they affect your products to your customers and can make comparisons between groups of customers without the need to launch the product to your entire portfolio. They are agile methodologies that help to obtain quick results on impact to clients.

The McKinsey 7S: Seven basic factors to improve the strategy of any organization

The McKinsey 7S is a model that identifies the seven basic factors which have to be present in any organization.

This methodology is used to check if the implementation of the company strategy is consistent with the reality of the business. If not, you will have to make changes to align strategy with reality.

 

How works 7S?

The McKinsey 7S defines multiple factors to consider, which are divided into two groups:

– Soft skills: Shared Values, Members Skills, Style and Staff.

– Hard skills: Strategy, Structure and Systems.

The model seeks to highlight that the goal is to obtain the perfect combination between the seven factors. Thus, taking into account all factors, we will improve the results of our company.

 

The seven factors to study

The 7S method is composed by 7 factors, connected between them with a central element that is called “shared values”.

The factors are:

1. Style: The style is the culture of the organization. Normally is the direction who establishes the basis of the behaviors and the best practices that will shape the style and the way of being of the company. They should be the leaders and they have to behave correctly to set an example to the other employees of the company.

2. Staff: Employees are one of the most important parts of any organization. That is why the way to behave the human resources may be aligned with the company strategy.

3. Systems: It includes the internal processes and the information systems that enable the operation of the company.

4. Strategy: That is how we manage the company resources to achieve the objectives, considering a long term period. It could be compared with the brain of an organization.

5. Structure: This is the way the company is organized. The structure can be departmental or otherwise, with a linear, matrix, divisional hierarchy or other. It also can be separated geographically (local, state or multinational), centralized or decentralized management, etc.

Structure also may depend on the legal form that has the entity (corporation, limited cooperative, joint venture …) and the expansion model (franchises, organic, mergers…).

6. Members Skills: It refers to the skills and capabilities required by the organization’s members. It can also refer to the know-how of the company.

7. Shared values: The shared values ​​are the heart of the company. It’s what unites its members and aligns them all in the same direction.

 

The best of the 7S model is that it is a diagnostic tool to understand why some organizations are inefficient. Having analyzed the weaknesses and making changes, it will lead to an organizational change that can significantly improve the way of working and the results.

 

Original post:  https://pdcahome.blogspot.com/p/las-7s-de-mckinsey-7-factores-basicos.html