The Overall Current State Analysis
Visions, missions, short, medium or long term strategies, objectives and strategic directions, pompous words and great goals. You can see them everywhere, in any industry, at all levels, from multinational companies to start-ups with 3 employees, from production to services. These impressive phrases, neatly laid out on pages, are more than just buzzwords; they cultivate trust among clients, partners, and employees, laying the groundwork for lasting relationships.
Yet, statistics tell a sobering story: over 90% of these ambitious plans fail!
Despite the grand visions and strategic roadmaps, many organizations struggle to translate words into action. One key factor that can curb the progress of o company is the analysis of the current state. Before charting a course for the future, it’s crucial to understand your starting point. Assessing where you are lays the foundation for informed decision-making and effective strategies moving forward
Without a thorough analysis of the current situation, any vision, direction, or strategic objective risks becoming mere aspirations. As Einstein famously said, 'If I had an hour to solve a problem, I’d spend 55 minutes thinking about the problem and 5 minutes thinking about solutions.' This highlights the critical need to fully understand our current status before embarking on any journey toward change.
From the start, it’s crucial to acknowledge that conducting a thorough analysis of the current situation demands significant effort. To accurately portray today's big picture of a company, we must rely on concrete figures, data, and facts. Gathering this information can require substantial internal and external resources, along with meticulous examination. In my experience, the time needed to compile current data varies based on a company's level of standardization, often ranging from a few weeks to several months. While this may appear excessive, it's essential to recognize that without this investment, any future plans risk becoming obsolete in no time.
"Why should I invest time and resources in something I already know? I founded this company, I've been leading it for decades, I grew it from scratch, I know every detail of my business!", some entrepreneurs would say.
Very well, let's see together if you know your business like the back of your hand!
The External and Internal Context
You have a deep understanding of your industry, including market dynamics, competitive landscape, and the technologies driving it. You’re well-versed in the levels of digitization and automation within your sector, all while keeping a close eye on evolving national, regional, and global regulations. Your commitment to sustainability is evident in both your products and processes, extending throughout your entire supply chain.
You've mapped out clear development pathways and have growth scenarios for your offerings, employing tools like the ABC/XYZ Analysis, Margin Bubble, GE McKinsey Matrix or BCG Matrix for strategic insights. External factors affecting your business (e.g. analyzed through frameworks like PESTEL, PEST or STEP), are well understood and don’t pose significant risks. Moreover, your organization has robust risk management practices integrated into its operations.
You truly excel in managing all internal aspects of your business. You're fully aware of your financial standing, tracking every cent spent and earned, along with your profitability and competitive edge. You have a dashboard that provides daily updates on both financial and non-financial performance indicators. Your employees are motivated and aligned with the company’s goals. They possess the necessary skills for their roles and understand what additional training they need to effectively support the strategy (qualification matrix). Their efforts are guided by leaders and managers who demonstrate clear leadership abilities. The company's operations are centered around customer satisfaction: top quality, competitive pricing, and excellent delivery performance.
Having all this inputs, you can quickly identify Strengths, Weaknesses, Opportunities and Threats (SWOT Analysis).
The Value Stream Analysis
You have a clear understanding of your sales capacity—whether it’s hourly, daily, weekly, or annually—because you’ve thoroughly analyzed your operational capabilities, along with the efficiency and effectiveness of each process. The accuracy of your data collection ensures you can trust the insights you gather. Through value flow analysis (e.g. Value Stream Mapping, Swimlane), you possess a comprehensive knowledge of your operating system, recognizing all types of waste and identifying areas for improvement. Your team is well-equipped with problem-solving techniques know-how, ensuring that any deviations from established standards don’t hinder your objectives. You know your processes inside and out, and you have effective solutions ready for any congestion points. Your analyses are based on a thorough review of the organization’s performance over a defined period, such as a 12-month cycle that incorporates both past achievements and future forecasts. Performance metrics are clearly defined, cascaded down, and consistently monitored across all levels, from Shop Floor to Office Floor Management (SFM, OFM), with a well-understood escalation process for any issues that arise.
Resources
Assessing your team's capabilities is crucial for embarking on a successful journey toward improvement and growth. Here are some specific questions to consider:
Skills Inventory: Do you have a skills matrix in place to identify gaps? For instance, if you're aiming to implement new technology, does your team have the necessary technical expertise to operate and manage it?
Readiness for Change: Are your team members open to adopting new processes? Conducting regular feedback sessions can help gauge their willingness to embrace transformation. For example, a recent training session could reveal whether team members are enthusiastic or resistant to change.
Resource Availability: Do you have a clear budget for investments, along with an understanding of how much time and personal commitment is required from team members? If you're planning to expand, can you allocate funds for new hires or training programs?
Team Commitment: Consider conducting a commitment survey to measure your team's enthusiasm level. Are they engaged and aligned with the company’s vision? High commitment often correlates with higher productivity and innovation.
By answering these questions, you’ll have a clearer picture of whether your organization is equipped to turn aspirations into reality and how to strategize effectively for transformation and growth.
Absolutely! A detailed snapshot of your organization’s current state is essential for making informed strategic decision The more accurate the analysis of the current situation is, the more precise the definition of the development strategy will be.