Chapter 5

Chapter 5
Leadership and
Strategic
Planning
MANAGING FOR QUALITY AND PERFORMANCE EXCELLENCE, 7e, 2008 Thomson Higher Education Publishing 1
Leadership
The ability to positively influence people

and systems under ones authority to have
a meaningful impact and achieve
important results
institute
Strategic Planning
Theprocess of envisioning an
organizations future and developing the
necessary goals, objectives, and action
plans to achieve that future.
The Baldrige Leadership
Triad
Strategic
Planning
Operations
Leadership
Customer and
Market Focus
Executive Leadership
Defining and communicating business directions
Ensuring that goals and expectations are met
Reviewing business performance and taking
appropriate action
Creating an enjoyable work environment
Soliciting input and feedback from customers
Ensuring that employees are effective contributors
Motivating, inspiring, and energizing employees
Recognizing employee contributions
Providing honest feedback
Key Idea
Six key leadership competencies can be
described as navigator, communicator,
mentor, learner, builder, and motivator.
Dale Crownover, President, Texas Nameplate Co. (a 2-time

Baldrige Award recipient)
Leadership Competencies
Navigatorcreates shared meaning and provides
direction toward a vision,mission, goal, or end-result.
Communicatoreffectively listens and articulates
messages to provide shared meaning.
Mentorprovides others with a role to guide their
actions.
Learnercontinuously develops personal knowledge,
skills, and abilities through formal study, experience,
reflection, and recreation.
Buildershapes processes and structures to allow
for the achievement of goals and outcomes.
Motivatorinfluences others to take action in a
desirable manner.
Leading Practices Leadership
(1 of 2)
Create and deploy a customer-focused

strategic vision and clear quality values
Create a sustainable organization and
environment for performance improvement,
accomplishment of the mission, innovation,
agility, and learning
Demonstrate personal commitment to
organizational values, develop future
leaders, and reinforce high performance
Create a focus on action and communicate
with, empower, and motivate all employees
Leading Practices Leadership
(2 of 2)
Address organizational governance to

include management and fiscal
accountability, protection of stakeholder
interests, and conduct evaluations to improve
the leadership system
Create an environment that fosters legal and
ethical behavior
Integrate public responsibilities, resource-
sustaining processes, and community
support into business practices
Key Idea
The purpose of leadership theories is to

explain differences in leadership styles
and contexts.
Leadership Theories
Classic theories:
Traitapproach
Behavioral approach
Role approach
Contemporary and emerging theories:

Situationalleadership
Transactional leadership theory
Transformational leadership theory
Substitutes for leadership theory
Emotional intelligence theory
Key Idea
Emerging leadership theories build on or

enlarge traditional theory by attempting to
answer questions raised, but not
answered, by earlier approaches.
Leadership System
Leadership system how decisions are
made, communicated, and carried out at
all levels; mechanisms for leadership
development, self-examination, and
improvement
Effectiveness of the leadership system
depends in part on its organizational
structure
Key Idea
An effective leadership system respects

the capabilities and requirements of
employees and other stakeholders, and
sets high expectations for performance
and performance improvements.
Example: Solar Turbines, Inc.
Governance
Governance the system of management
and controls exercised in the stewardship of
an organization.
Approving strategic direction
Monitoring and evaluating CEO performance
Succession planning
Financial auditing
Executive compensation
Disclosure
Shareholder reporting
Leadership and Social
Responsibilities
Ethics
Health,
safety, and environment
Community support
Key Idea
Practicing good citizenship refers to
leadership and support within the limits
of an organizations resources of
publicly important purposes, including
improving education, community health,
environmental excellence, resource
conservation, community service, and
professional practices.
Strategic Planning
A strategy is a pattern or plan that integrates
an organizations major goals, policies, and
action sequences into a cohesive whole.
Formal strategy includes:
Goals to be achieved
Policies to guide or limit action
Action sequences, or programs, that
accomplish the goals
Leading Practices - Strategic
Planning
Systematic planning systems for strategy
development and deployment
Understand the competitive environment and the
factors and strategic challenges that determine
success, and gather and analyze a variety of
external and internal data
Align short-term action plans with long-term
strategic objectives, communicate them, and track
progress
Derive human resource plans from strategic
objectives and action plans
Identify key measures and indicators for tracking
progress, reinforce organizational alignment, and
compare performance with competitors
Strategic Planning Process
Reason for existence Future intent Attitudes and policies
Mission Vision Guiding Principles
Environmental assessment Capabilities and risks
Strategies Broad statements of direction
Things to change or
Strategic Objectives
improve
Action Plans Implementation
Mission
Definition of products and services,
markets, customer needs, and distinctive
competencies
Solectron: to provide worldwide
responsiveness to our customers by
offering the highest quality, lowest total
cost, customized, integrated, design,
supply chain, and manufacturing solutions
through long-term partnerships based on
integrity and ethical business practices.
Vision
Where the organization is headed and what
it intends to be
Brief and memorable - grab attention
Inspiring and challenging - creates excitement
Descriptive of an ideal state - provides guidance
Appealing to all stakeholders - employees can
identify with
Solectron: Be the best and continuously

improve
Values (Guiding Principles)
Define attitudes and policies for all
employees, which are reinforced
through conscious and subconscious
behavior at all levels of the organization.
Alcoa: integrity, environmental health
and safety, customer, excellence,
people, profitability, accountability
Environmental Assessment
Customer and market requirements,
expectations, and opportunities
Technological and other innovations
Organizational strengths and
weaknesses
Financial, societal, ethical, regulatory
and other potential risks
Changes in global or national economy
Factors unique to the organization, such
as partner and supply chain needs
Key Idea
Strategies are broad statements that set the
direction for the organization to take in
realizing its mission and vision.
Strategic objectives are what an organization
must change or improve to remain or
become competitive.
Action plans are things that an organization
must do to achieve its strategic objectives.
Strategy Deployment
Developing detailed action plans, defining
resource requirements and performance
measures, and aligning work unit, supplier,
or partner plans with overall strategic
objectives.
Policy Deployment
(Hoshin Kanri)
Top management vision leading to long-
term objectives
Deployment through annual objectives
and action plans
Negotiation for short-term objectives and
resources (catchball)
Periodic reviews
See Figure 5.5!

Key Idea
Strategic objectives and action plans often

require significant changes in human resource
requirements, such as redesigning the work
organization or jobs to increase employee
empowerment and decision making,
promoting greater labor/management
cooperation, modifying compensation and
recognition systems, or developing new
education and training initiatives.
Link Human Resource Plans
and Business Strategy
Examples
Redesign work organization to increase
empowerment
Promote greater labor/management
cooperation
Foster knowledge sharing and
organizational learning
Establish partnerships with education to
better prepare future employees
The Seven Management and
Planning Tools
Affinitydiagrams
Interrelationship digraphs
Tree diagrams
Matrix diagrams
Matrix data analysis
Process decision program charts
Arrow diagrams
Leadership and
Organizational Structure
Basic types of organizational structures
Line organization
Line and staff organization
Matrix organization
Key Idea
As more and more companies accept the

process view of organizations, they are
structuring the quality organization around
functional or cross-functional teams.
Team-Based Organization
Chart
Leadership in the Baldrige
Criteria
The Leadership Category examines how an organizations
senior leaders address values, directions, and performance
expectations, as well as a focus on customers and other
stakeholders, empowerment, innovation, and learning. Also
examined is the organizations governance and how the
organization addresses its public and community
responsibilities.
1.1 Senior Leadership
a. Vision and Values
b. Communication and Organizational Performance
1.2 Governance and Social Responsibilities
a. Organizational Governance
b. Legal and Ethical Behavior
c. Support of Key Communities
Strategic Planning in the
Baldrige Criteria
The Strategic Planning Category examines how an
organization develops strategic objectives and action
plans. Also examined are how chosen strategic objectives
and action plans are deployed and how progress is
measured.
2.1 Strategy Development
a. Strategy Development Process
b. Strategic Objectives
2.2 Strategy Deployment
a. Action Plan Development and Deployment
b. Performance Projection

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Chapter 5

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Chapter 5

The ability to positively influence people

Dale Crownover, President, Texas Nameplate Co. (a 2-time

Create and deploy a customer-focused

Address organizational governance to

The purpose of leadership theories is to

Contemporary and emerging theories:

Emerging leadership theories build on or

An effective leadership system respects

Mission Vision Guiding Principles

Environmental assessment Capabilities and risks

Strategies Broad statements of direction

Solectron: Be the best and continuously

See Figure 5.5!

Strategic objectives and action plans often

Line and staff organization

As more and more companies accept the

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