Successful development group which operates in Moscow and Moscow region and holding construction material, logistics, construction, and real estate business units. Despite the existing portfolio, the stagnation on the development market concerned the shareholders. The developed by the management of the group business strategy was divisive and for some questions the management had not provided acceptable answers. Besides the current strategic management in the group not fully satisfied the shareholders.
What did the client want:
All in all the shareholders “wants” boiled down to the two points:
- Make an assessment of the developed business strategy with specific recommendation for its improvement
- Conduct a audit of the strategic management in the group with improvements plan
For the strategy assessment a proprietary methodology aka “express-strategy”. In its framework a earlier developed strategy is being verified for integrity, entirety, consistency, and accuracy of conclusions and decisions. In the case of presenting serious issues, strategy development tools may be applied selectively in order to remedy the situation.
For the strategic management assessment were applied the method I developed for international rating agency as well as the approach of the Harvard’s professors Dr. Norton and Dr. Kaplan “The Strategy-Focused Organization”. In the course of my practice this approach was enhanced, adapted for national nuances and proved by several projects in various industries.
The project challenges:
Despite the overall fair quality of the earlier developed strategy in the course of the assessment a following serious issues were found:
- The core competences were not defined, thus were not taken into account for the decisions
- There were no scenario defined, despite turbulence on the market
- Weak industry and competition analysis
- There were no segment breakdown for streams despite the diverse customer base
- No risks were identified, thus no were taken into account for decisions and modelling
(bold is the matched with the shareholders’ questions)
The group management meet such assessment with an ungracious reception
Based on the assessment the action item list was drafted for the in-depth development and correction of the earlier developed strategy the in order to support the shareholders’ goals.
Based on the strategic management assessment (strategic audit) the processed information and conclusions about strategic process, decision tree and decision making procedures, etc. the action plan was drafted in order to improve overall strategic management in the group.
The close work with management team allowed to specify and to correct the strategy within one and half month: to work out the assumptions and hypothesises in-depth, to draft and to evaluate scenarios and to specify final conclusions and decisions. Updated strategy was approved at the shareholders meeting and was accepted as a base for five years group development.
The action plan to improve the strategic management was accomplished in 6 months, which supported the strategy execution and allowed the shareholders to manage the group strategically.