For Strategic Planning, Value Management can

• Test and validate planning assumptions
• Identify and confirm stakeholder values
• Create a shared vision or agreed direction
• Develop alignment to corporate directions
• Establish Master Planning principles and objectives, and
• Define key challenges and strategies

Preserving Process Value by

• Eliminating or reducing deviations in performance
• Maintaining operation effectiveness and efficiency
• Reducing hidden costs (e.g. high transaction costs incurred when changes are made to services, service levels, or demand levels in a trial-and-error manner)
• Publicizing and substantiating hidden benefits (e.g. reduced lock-in through leasing assets rather than buying them)
• Uses of automation, web-based functionality, cloud, support tools, etc. to reduce the cost of providing service, and better allow scalability without commensurate cost increases.

Use Value Analysis to:

·         Test and validate planning assumptions

·         Identify and confirm stakeholder values

·         Create a shared vision or agreed direction

·         Develop alignment to Corporate directions

·         Establish Master Planning principles and objectives, and

·         Define key challenges and strategies

Data Quality Factors

INTRINSIC

· Accuracy

· Lineage

· Semantic

· Structure

CONTEXT

· Completeness

· Consistency

· Currency

· Timeliness

· Reasonableness

· Identification

Data Consistency

Presentation:  Common presentation formats for each data element are defined.  Data elements that are presented in a screen or a form will conform to the defined presentation format.

Presentation completeness:  Each data presentation format can convey all information within the attributes.  Every defined presentation format will be verified to ensure that it can present all values the displayed attribute can take.

Null presentation:  Standards for the presentation of missing information for each data type are defined.  Any data element that may be null must have a defined representation for the absent value. If there are multiple reasons for absent values that can be captured in the data (e.g., "unavailable" vs. "not applicable") there will be multiple null representations.

Capture and collection:  Data entry edits and data importation rules should be defined for each data element.  Participants must apply the defined data edit and collection rules.

Data Timeliness

Accessibility:  Newly posted records should be available to enterprise applications within a specified time period. Policies specifying acceptable time delays must be provided.  Time delays must be measured and recorded.

Response time:  Ensure that requested data is provided within the acceptable time period.  Expectations for response time must be specified.  Requested data must be received by the requestor within the specified time period.

Strategic Alignment Components: Business & IT

BUSINESS STRATEGY

·    Scope – Includes the markets, products, services, groups of customers/clients, and locations where an enterprise competes as well as the buyers, competitors, suppliers and potential competitors that affect the competitive business environment.

·    Competencies – The critical success factors and core competencies that provide a firm with a potential competitive edge. This includes brand, research, manufacturing and product development, cost and pricing structure, and sales and distribution channels.

·    Governance – How companies set the relationship between management stockholders and the board of directors. Also included are how the company is affected by government regulations, and how the firm manages their relationships and alliances with strategic partners.

ORGANIZATION INFRASTRUCTURE & PROCESSES

·    Administrative Structure – The way the firm organizes its businesses. Examples include central, decentralize, matrix, horizontal, vertical, geographic, and functional.

·    Processes - How the firm's business activities (the work performed by employees) operate or flow. Major issues include value-added activities and process improvement.

·    Skills – H/R considerations such as how to hire/fire, motivate, train/educate, and culture.

IT STRATEGY

·     Technology Scope - The important information applications and technologies

·     Systemic Competencies - Those capabilities (e.g., access to information that is important to the creation/achievement of a company's strategies) that distinguishes the IT services.

·     IT Governance - How the authority for resources, risk, and responsibility for IT is shared between business partners, IT management and service providers. Project selection and prioritization issues are included here.

IT INFRASTRUCTURE AND PROCESSES

·         Architecture - The technology priorities, policies, and choices that allow applications, software, networks, hardware, and data management to be integrated into a cohesive platform.

·         Processes - Those practices and activities carried out to develop and maintain applications and manage IT infrastructure.

·         Skills - IT human resource considerations such as how to hire/fire, motivate, train/educate, and culture.

 

Strategic Value

1.      Cost focus: Drawing on the value discipline of operational excellence

a)      Price products and services at lowest cost

b)      Drive economies of scale through shared best practices

2.      Value differentiation as perceived by customers: Drawing on the value discipline of customer intimacy

a)      Meet client expectations for quality at reasonable cost

b)      Make the customers' product selection as easy as possible

c)      Provide all information needed to service any client from any service point

3.      Flexibility and agility: Drawing on the value discipline of product and service innovation

a)      Grow in cross-selling capabilities

b)      Develop new products and services rapidly

c)      Create capacity to manufacture in any location for a particular order

4.      Growth: How the base of the business will expand

a)      Expand aggressively into underdeveloped and emerging markets

b)      Carefully grow internationally to meet the needs of customers that are expanding their business

c)      Target growth through specific product and customer niches

5.      Human resources: Where people policies fit in

a)      Create an environment that maximizes intellectual productivity

b)      Maintain a high level of professional and technical expertise

c)      Identify and facilitate the movement of talented people

6.      Management orientation: Different aspects of business governance and decision making

a)      Maximize independence in local operations with a minimum of mandates

b)      Make management decisions close to the line

c)      Create a management culture of information sharing (to maintain or generate new business)

The Business Value of IT: Managing Risks, Optimizing Performance and Measuring Results by  Michael D. Harris, David E. Herron and Stasia Iwanicki, Auerbach Publications © 2008 (294 pages)

Attributes of Good Metric

• Relevant
• Practical
• Actionable
• Reported or communicated
• Owned

IT Value Formula

Benefits
     + Product capability
     + Time to market
     + Timeliness
     + Product evolution

Costs
     - Development
     - Rework
     - Knowledge recovery
     - Legacy
-----------------------------------
                  VALUE
===================

Build SIPOC

1. State process name. Use a Verb + Noun format (e.g. recruit Staff).

2. Detail Outputs. These are the deliverables that the process produces (e.g. a report, or letter).

3. Identify Customers. These are the people who receive the Outputs. Every Output should have a Customer.

4. Detail Inputs, or process triggers. They will often be tangible (e.g. a customer request)

5. List Suppliers. They supply the inputs. Every input should have a Supplier.

6. Add the sub-processes that make up the process. These are the activities that are carried out to convert the inputs into outputs. They will form the basis of a process map.

LEAN Sins

• Defects and deviations
• Excessive motion / activities / procedures / processes 
• Excessive resources due to sub-optimized resource leveling and redundant activities
• Over production
• Unnecessary processing time due to fragmented workflow or not needed processing steps
• Unnecessary/ ineffective handoffs resulting from verification loops and excessive approvals
• Waiting time for response / approvals / documents

LEAN Improvement Steps

1. Specify value from the perspective of the end customer.
2. Identify all the steps in the value stream, eliminating those activities, processes, and policies that do not create value.
3. Flow products and service smoothly toward the customer.
4. Let the customer demand pull value from the next upstream activity.
5. Pursue perfection through continuous improvement.

Demings 14 TQM Principles (know them)

1. Create a constancy of purpose.
2. Adopt the new philosophy (a new way of thinking about running your business).
3. Cease dependence on mass inspection.
4. End lowest tender contracts (do not award business based on price alone).
5. Improve every process.
6. Institute training on the job.
7. Institute leadership.
8. Drive out fear.
9. Break down barriers.
10. Eliminate exhortations (slogans).
11. Eliminate arbitrary numerical targets (quotas).
12. Support pride of workmanship.
13. Encourage education.
14. Develop top management commitment and action.

LEAN at all IT Levels

EXECUTIVES:

• Set and communicate direction (strategy)
• Guide direction (strategy deployment catch ball, system kaizen to drive breakthrough change)
• Enable value stream flow: reducing unevenness and variation and overburden
• Lead (as if they have no authority) and inspire others to lead with them
• Go see and ask why
• Actively engage in continuous improvement through the practice of leader standard work supported by a regular monthly cadence of PDCA
• Improve the work and improve themselves

MANAGERS:

• Establish basic stability: level demand matched with capacity across value streams
• Communicate strategic direction, align with daily work and process improvement (strategy deployment catch ball)
• Go see and ask why
• Actively engage in continuous improvement through the practice of leader standard work supported by a regular weekly/daily cadence of PDCA with their associates
• Make time for workers to regularly practice continuous improvement
• Coach change, improvement, and innovation; support cross-functional process kaizen activity; inspire others to lead with them
• Keep problem-solving at the right level, drive decision-making closer to the individuals and teams that interact with the customer
• Improve the work and improve themselves

TEAMS AND INDIVIDUALS:

• Focus on waste reduction, sustain the gains
• Stop the process when an error appears, identify root cause, and take corrective and preventative action (quality at the source)
• Improve the work and improve them

Strategy Development System

STRATEGIC

Long-term strategy

Mid-term strategy

Breakthrough improvements

Annual improvement plan

TACTICAL

Value streams

Divisions

Business units

Departments

OPERATIONAL

Supporting processes

Projects

Continual Service Improvement