DEV ELOP V I S I ON AN D S T R AT E G Y

DEF INIT ION S AN D K E Y M E AS U R E S

Version 7.0.4

THE FRAMEWORK FOR PROCESS IMPROVEMENT

Experience shows that benchmarking’s potential to drive dramatic 1.0 Develop Vision and Strategy
improvement lies squarely in making out-of-the-box comparisons
and searching for insights not typically found within intra-industry
paradigms. To enable this type of beneficial benchmarking, the
APQC Process Classification FrameworkSM (PCF) serves as a high-
OPERATING PROCESSES
level, industry-neutral enterprise model that allows organizations
to see their activities from a cross-industry process viewpoint. 1.0 >>> 2.0 >>> 3.0 >>> 4.0 >>> 5.0 >>> 6.0
Develop Develop and Market Deliver Deliver Manage
Vision Manage Products and Sell Physical Products Services Customer
The PCF enables organizations to understand their inner workings and and Services Products and Service

from a horizontal process perspective, rather than a vertical Strategy Services

functional viewpoint. The PCF does not list all processes within a
specific organization, and every process listed in the framework is
MANAGEMENT AND SUPPORT SERVICES
not present in every organization.
7.0 Develop and Manage Human Capital
Originally created in 1992 by APQC and a group of members, the
framework has experienced more than twenty years of creative use 8.0 Manage Information Technology

by thousands of organizations worldwide. The PCF is supported by

9.0 Manage Financial Resources
APQC’s Open Standards Benchmarking research. It is continuously
enhanced as APQC’s Open Standards Benchmarking team further 10.0 Acquire, Construct, and Manage Assets
develops definitions, processes, and measures. Please visit
APQC’s web site periodically for updates. The PCF is available for 11.0 Manage Enterprise Risk, Compliance, Remediation, and Resiliency

organizations of all industries and sizes at no charge by visiting

12.0 Manage External Relationships
www.apqc.org/pcf.
13.0 Develop and Manage Business Capabilities

HISTORY
The Process Classification Framework was originally envisioned as
a taxonomy of business processes. The initial design involved more
than 80 organizations from the United States and worldwide. Since
its inception, the PCF has been updated several times to reflect
changes in the way organizations do business.

In response to feedback from users of the PCF, APQC regularly

engages practitioners, consultants, and academics to develop
definitions based on real-world experience with the processes.
That collaborative effort resulted in this document: a listing of
processes with definitions and selected key performance indicators
from APQC’s Open Standards Benchmarking repository. This
particular document was developed with assistance from IBM.
The definitions contained in this document are to be considered
in conjunction with the PCF. The content in this document will be
updated according to research performed by APQC and subsequent
updates to the PCF. This document was created using PCF version
7.0.4.

Version 7.0.4  •  August 2016

 1.0 Develop Vision and Strategy Definitions and Key Measures TABLE OF CONTENTS

1.0 Develop vision and strategy______________________3
Key Performance Indicators______________________ 3
1.1 Defining the business concept and long-term vision__ 3
1.1.1 Assess the external environment____________3
1.1.2 Survey market and determine customer
needs and wants_________________________3
1.1.3 Assess the internal environment____________4
1.1.4 Establish strategic vision___________________4
1.1.5 Conduct organization restructuring
opportunities ___________________________4
1.2 Develop business strategy_______________________ 4
1.2.1 Develop overall mission statement__________ 4
1.2.2 Define and evaluate strategic options to
achieve the objectives_____________________ 4
1.2.3 Select long-term business strategy___________5
1.2.4 Coordinate and align functional and
process strategies________________________ 5
1.2.5 Create organizational design_______________5
1.2.6 Develop and set organizational goals_________ 5
1.2.7 Formulate business unit strategies___________ 5
1.2.8 Develop customer experience strategy_______ 5
1.2.9 Communicate strategies internally and
externally_______________________________5
1.3 Execute and measure strategic initiatives___________ 6
1.3.1 Develop strategic initiatives________________ 6
1.3.2 Evaluate strategic initiatives________________ 6
1.3.3 Select strategic initiatives__________________ 6
1.3.4 Establish high-level measures_______________6
1.3.5 Execute strategic initiatives________________ 6

RIGHTS AND PERMISSIONS ABOUT APQC

©2016 APQC. ALL RIGHTS RESERVED. APQC is a member-based nonprofit and one of the world’s
leading proponents of knowledge management, benchmarking,
APQC encourages the wide distribution, discussion, and use of
and best practices business research. Working with more than
the PCF and PCF definition documents for classifying and defining
750 organizations worldwide in all industries, APQC provides
processes. APQC grants permission for use and adaptation of the
organizations with the information they need to work smarter,
PCF for internal use. For external use, APQC grants permission for
faster, and with confidence. Visit www.apqc.org or
publication, distribution, and use, provided that proper copyright
call +1-713-681-4020 and learn how to Make Best Practices Your
acknowledgment is made to APQC. No modifications to the look or
PracticesSM.
content should be made in external venues.

Please use the following text when reusing the PCF in

external print or electronic content.

The PCF was developed by APQC and member companies as

an open standard to facilitate improvement through process
management and benchmarking regardless of industry, size,
or geography. The PCF organizes operating and management
processes into a number of enterprise-level categories, including
categories, process groups, and over 1,000 processes and
associated activities. The PCF and its associated measures and
benchmarking surveys are available for download and completion
at no charge at www.apqc.org.

2 Permission granted to photocopy for personal use. ©2016 APQC. ALL RIGHTS RESERVED.
 1.0 Develop vision and strategy (10002)

Establishing a direction and vision for an organization. This involves defining the business concept and long-term vision, as well as
developing the business strategy and managing strategic initiatives. Processes in this category focus on creating a vision, a mission,
and strategic objectives, and culminate in creating measures to ensure that the organization is moving in the desired direction.

Key Performance Indicators:

• Gross revenue
• Net income

Process Insight:
These key performance indicators can be viewed per full-time equivalent employee (FTE), in year-over-year growth, or in a way that
makes sense given the needs of the individual organization.

1.1 Define the business concept and long-term vision (17040)

Creating a conceptual framework of the organization’s business activity and strategic vision with long-term applicability. Scout
the organization’s internal capabilities, as well as the customer’s needs and desires, to identify a fit that can be used to advance a
conceptual structure of the organization’s business activity. Conduct analysis in light of relevant externalities and large-scale shifts
in the market landscape.

1.1.1 Assess the external environment (10017)

Assessing all forces, entities, and systems that are external to an organization but can affect its operation. Analyze far-
reaching currents in the macroeconomic situation, assess the competition, evaluate technological changes, and identify
societal as well as ecological issues of concern. Create a big-picture understanding of externalities, with sufficient depth
across individual aspects.

1.1.2 Survey market and determine customer needs and wants (10018)

Examining the market to identify customer required solutions. Assess the relevant market(s) to determine the products/
services that are needed or wanted by customers. Carry out quantitative and qualitative analyses to capture and investigate
products/services. Employ creative techniques that allow for a closer appreciation of the customer, and design relevant
solutions.

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 ( 1.1 Develop business concept and long term vision continued )

1.1.3 Assess the internal environment (10019)

Undertaking a review of the organization’s in-house skills and resources in order to create a big-picture understanding of
internal capacities. Assess the organization’s capabilities in order to advance the advantageous and weed out the detrimental
aspects. Identify synergic associations within the backdrop of the forces and players active in the market, and take into
account all externalities.

1.1.4 Establish strategic vision (10020)

Establishing the organization’s long-term vision as a strategic positioning and engagement of stakeholders. Institute the vision
by creating strategic orientations of all stakeholders. Understand the strategy development frameworks in this context.

1.1.5 Conduct organization restructuring opportunities (16792)

Examining the scope and contingencies for restructuring based on market situation and internal realities. Map the market
forces over which any and all probabilities can be probed for utility and viability. Once the restructuring options have been
analyzed and the due-diligence performed, execute the deal. Consider seeking professional services for assistance in
formalizing these opportunities.

1.2 Develop business strategy (10015)

Developing an organization’s mission statement, strategy, and business design. Create a concise statement that clearly articulates
the mission of the organization, outlining practicable targets to Establish a strategic vision [10020]. Delineate strategic options by
matching these alternatives with the organization’s internal capabilities. Create an organizational design, and identify goals by
developing strategies at the functional and process levels.

1.2.1 Develop overall mission statement (10037)

Establishing an overarching, compact statement that concisely underscores the mission of the organization. Define and
communicate a clear and succinct mission statement, which encapsulates how the organization aims to proceed in order to
Establish a strategic vision [10020]. Solicit critical inputs from senior management and strategy executives, and collaborate
with marketing or personnel from allied functions.

1.2.2 Define and evaluate strategic options to achieve the objectives (10038)

Assessing sets of strategic decisions designed to drive the organization’s long-term objectives. Identify various strategies
concerning core functional areas. Appraise strategic options in light of auxiliary decision frameworks that ensure smooth
functioning, the advancement of functional efficiencies, and vitality. Involve senior management executives, especially
strategy and/or business unit personnel, with need-based consultative assistance from professional services providers.

4 Permission granted to photocopy for personal use. ©2016 APQC. ALL RIGHTS RESERVED.
 ( 1.2 Develop business strategy continued )

1.2.3 Select long-term business strategy (10039)

Embracing a strategy for the achievement of business goals over the distant future. Espouse one of the strategic options
for realizing its mission over the long term. Enlist senior management executives, comprising strategy and/or business unit
personnel.

1.2.4 Coordinate and align functional and process strategies (10040)

Aligning the approach and method of individual units, departments, systems, and operations within the organization, in
accordance with the larger strategic course adopted. Employ the organization’s strategic path to guide the functions, divisions,
and operations. Calibrate the plan and method of each functional area, as well as the processes therein, to Select the long-
term business strategy [10039].

1.2.5 Create organizational design (10041)

Formulating a design for the organization’s resources that allow it to meet its objectives. Develop a new framework for
molding the organization’s various processes into a coherent and seamless whole.

1.2.6 Develop and set organizational goals (10042)

Developing overall goals for the organization that help in accomplishing its mission. Formulate organization-wide targets in
the near to middle term, which will accumulate and propel the organization to realize its long-term objectives, as outlined in
Develop an overall mission statement [10037]. Enlist business unit heads or equivalent personnel, in close collaboration with
senior management executives.

1.2.7 Formulate business unit strategies (10043)

Charting a strategic course for business units in order to leverage opportunities, sidestep hurdles, and create synergies among
each other. Create strategic road maps for the organization’s units--in light of their individual resources and requirements, as
well as their relationships with other business units--to achieve organizational goals.

1.2.8 Develop customer experience strategy (19959)

Defining a roadmap to meet customer expectations while considering how it will affect the business.

1.2.9 Communicate strategies internally and externally (18916)

Conveying planned procedures and methods to both internal departments and external stakeholders like customers, suppliers,
etc., in an effective manner based on organizational objective.

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 1.3 Execute and measure strategic initiatives (10016)

Managing strategic initiatives, from development through selection, execution, and evaluation. Conduct and oversee strategic
projects supporting long-term objectives. Administer programs of strategic significance by developing such initiatives, select the
most appropriate projects, and formulate measures to assess their impact.

1.3.1 Develop strategic initiatives (10057)

Developing strategic projects that help fulfill long-term goals. Develop time-bound projects that are discretionary in nature and
lie beyond the scope of the organization’s routine operations.

1.3.2 Evaluate strategic initiatives (10058)

Examining projects of strategic significance that lie outside the purview of the organization’s routine operations. Closely
analyze strategic initiatives for their applicability and feasibility, given the organization’s vision.

1.3.3 Select strategic initiatives (10059)

Selecting relevant projects of strategic significance that create opportunities for the organization to realize its long-term
objectives, on the basis of their suitability to the organization’s constraints and reality. Select from the process Evaluate
strategic initiatives [10058], based on their applicability and feasibility for the organization. Enlist senior management,
especially strategy personnel.

1.3.4 Establish high-level measures (10060)

Devising measures to examine strategic projects. Formulate evaluation criteria to assess the strategic initiatives for the level
of impact.

1.3.5 Execute strategic initiatives (19507)

Sucessfully implement strategic initiatives. Execution of strategy is also defined as the process of implementing logical set of
connected activities by an organization to make a strategy work.

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