Here are her ten insights and how they relate to the Baldrige model:

1. You gain a competitive advantage by creating unique value for customers. Customer-driven excellence is a Baldrige core value, defined as an organization’s performance and quality being judged by its customers. If customers rate your performance and quality high, you will gain a competitive advantage.
2. Your strategy must also clarify what the organization will not do. The Baldrige model asks several questions about how you develop strategies that will help you prioritize your strategies.
3. “Competition is about profits, not market share,” writes Magretta. You grow a company by increasing profits, not market share.
4. Brilliant strategies will not lead to performance excellence unless you execute them. The Baldrige Criteria devote an entire section to strategy implementation.
5. Good strategies are interconnected and build on core competencies. The Baldrige Criteria ask how your strategic objectives capitalize on your core competencies and balance short- and longer-term challenges and opportunities.
6. While it’s important to be flexible, your organization must stand for and excel at something. You must have the resources and capabilities to execute the plan
7. You need not predict the future to commit to a strategy.
8. “Vying to be the best is an intuitive but self-destructive approach to competition,” Magretta writes.
9. You need both a distinctive value proposition and a value chain tailored to deliver it. The Baldrige model promotes the development of a work system that capitalizes on your core competencies, delivers customer value, and achieves success and sustainability.
10. Your strategy should delight your most important customers while deliberately making your least important customers unhappy. The Baldrige Criteria ask which customers you intend to pursue, and why.

To read more about effective strategic planning, click on these articles:

• Revolutionary Thinking
• What Path Is Your Organization Taking?
• Effective Strategic Initiatives
• 10 Tests to Assess Your Strategies
• The Vital Few

Here’s what management guru Peter Drucker wrote on the topic: “Executives who make effective decisions know that one does not start with facts. One starts with opinions.”

I disagree.

According to Drucker, which Stephen Wunker addresses in his post on the HBR Blog Network here, if leaders do not make their opinions clear, they will simply find the facts that confirm what they believe. The problem is that the opinions and the confirmatory facts push the organization in one direction without considering other courses of action. Wunker writes, “Decision makers may have a general sense of stakeholders’ opinions, but in their eagerness to act and to avoid controversy they do not probe to understand these perspectives fully. Rather, they quickly make a decision and then marshal facts to support it.”

In the Baldrige model, the process of understanding opinions and perspectives fully would be part of the strategy development process, which encourages collecting and analyzing data and information to create an effective plan. As a result, decision makers can generate informed opinions based on their interpretation of fact-based knowledge about markets, customers, competitors, internal capabilities, and long-term needs. Rather than basing their opinions on assumptions and best guesses, they rely on data and information. The process starts with the facts.

However, I agree with Drucker that decision makers can be quick to choose a course of action without exploring their different opinions about what the facts are telling them. “Disagreement is a safeguard against being a prisoner of the organization and seeing an issue just as underlings want,” Wunker writes. He suggests soliciting opinions through anonymous questionnaires or interviews by a neutral party, pushing executives to think about the criteria for future success, and linking opinions to fact-based tests that would validate or disprove the opinion.

By integrating Baldrige, decision makers can develop a fact-based strategy development process that encourages dissent and values different perspectives.

To read more about strategy development, click on these articles:

• The First Critical Phase of Strategic Planning
• Challenge Your Assumptions
• The Most Important Question in Strategy
• Identifying Potential Blind Spots
• What Path Is Your Organization Taking?
• Identifying Game Changers
• 10 Tests to Assess Your Strategies

The question leaders of organizations, business units, divisions, departments, and teams need to continually ask is: What is truly important? Baldrige can help you answer that.

One way to summarize the answer is with a Strategy Tree. In “Strategy on One Page,” Anthony Tjan presents an alignment tool that starts with the purpose of your organization’s existence and links to your results and how you will measure progress. The questions summarize the big picture by identifying and linking:

1. Mission and vision: What is your organization trying to achieve?
2. Value proposition: What do you have this is different and appealing to your target customers?
3. Customers: What are your key customer and market segments—and why?
4. Results: What are your key customer and financial metrics?

“Start with the purpose and objective of the ‘why’ and the ‘what,’ and move through the ‘who’ your business will target and ‘how’ to measure progress, and you will get better alignment, faster—which hopefully translates into better results,” writes Tjan. “Common sense, not commonly done.”

To read more about the four areas on this Strategy Tree, click on these articles:

• An Achievable Mission and Vision
• Know Your Value Proposition
• Who Are Our Customers and What Do They Require?
• How Do We Know That?

Strengths and weaknesses are internal factors; opportunities and threats are external factors. A post on RapidBI describes the characteristics of each:

• Strengths are positive tangible and intangible attributes, internal to your organization, that are within its control.
• Weaknesses are factors within your control that detract from your ability to attain your goal, but that you could improve performance on.
• Opportunities represent the reason for your organization to exist and develop; identify them by time frames.
• Threats are beyond your organization’s control, which could place your mission or operation at risk. Classify them by their seriousness and probability of occurrence and develop contingency plans to address them if they occur.

RapidBI describes two acronyms for identifying the factors to address in your SWOT analysis:

• PRIMO-F for strengths and weaknesses: People, Resources, Innovation/Ideas, Marketing, Operations, and Finance
• PESTLE for opportunities and threats: Political, Economic, Social, Technological, Legal, and Environmental

The post offers simple rules for a successful SWOT analysis:

1. Be realistic about the strengths and weaknesses of your organization
2. Distinguish between where your organization is today and where it could be in the future
3. Be specific. Avoid gray areas.
4. Always analyze in relation to your competition and whether you are better or worse
5. Keep your SWOT short and simple; avoid unnecessary complexity and over analysis
6. Don’t list an opportunity if the same opportunity is available to competitors
7. Don’t list a strength if your competitors also has it.

The top five mistakes are:

• An unclear goal
• Maintaining too narrow a focus
• Neglecting input from others
• Performing an analysis only once
• Relying on SWOT as a holistic diagnostic strategy

To read more about SWOT and strategy development, click on these articles:

• The First Critical Phase of Strategic Planning
• Challenge Your Assumptions
• Identifying Potential Blind Spots
• Revolutionary Thinking
• Where to Play and How to Win

According to MEDRAD’s application summary, available here, “each business and function champion uses common planning templates and workbooks designed to ensure that blind spots are addressed, SWOT’s are analyzed, core competencies are defined, and early indications of major shifts are addressed.”

The diagram at the left shows how MEDRAD “waterfalls” its strategic plan, scorecard, and objectives throughout the company. Top 12 and Strategic Action Team objectives flow to managers, who create group objectives and plans. These objectives are refined and aligned through team meetings and discussions and used by employees to create individual objectives in the Performance Management (PM) process.

For hourly employees, objectives are team-based to help drive performance in manufacturing. In addition, all employees create written development plans that address areas to improve and the knowledge and skills they need to move into other roles.

Progress on objectives is reviewed by senior leaders, department and team leaders, and employees and their managers.

To strengthen alignment with corporate goals and objectives and promote a “we are all in this together” attitude, MEDRAD provides a gainsharing payout each year based on achieving the corporate objectives except for the employee satisfaction objective, which ensures accurate responses to the employee survey. All employees worldwide receive the same payout amount.

The best measures of the effectiveness of this approach are the results MEDRAD has achieved:

• Revenues grew from $120 million in 1997 to approximately $625 million in 2009.
• Repeat sales and referrals have consistently been 60% or higher compared to 50% for other organizations.
• The value delivered by employee improvement ideas was $45,000 per employee in 2009.

To read more about strategy and MEDRAD, click on these articles:

• FREE REPORT: Strategy Development
• The Vital Few
• Effective Strategic Initiatives
• How to Deploy Your Strategic Plan
• MEDRAD: Win with Your People

• The strategic planning processes of four organizations: Heartland Health, Premier, the VACSP Center, and MidwayUSA
• Ideas on how to prepare to plan, including where to look for relevant data and information and how to analyze what you collect (Iredell-Statesville Schools is a example)
• The key questions Cargill Corn Milling asks to determine how it should act within a strategic space
• How these organizations determine and review their core competencies and strategic challenges and advantages
• Four key elements to consider while developing your strategic plan
• How to identify effective strategic objectives

As the report concludes, strategy development at these six Award winners shares common elements that your organization can use to create an effective approach:

• Strategic planning must be a well-defined and refined process that involves key stakeholders in developing strategies. As the diagrams in this report illustrate, a systematic strategic planning process shows who does what, when, with an emphasis on involving key stakeholders in the process.
• Strategy development is an ongoing process. The front end of the process, collecting data and information, occurs daily throughout the year, a responsibility of key people in the organization to find, collect, and communicate what is happening—or may happen—that could affect your organization’s future. The back end of the process, reviewing performance to plan, must be flexible to allow changes to the plan as conditions change.
• The foundation of a strategic plan must be solid. Challenge your assumptions about your organization’s core competencies, strategic challenges and advantages, stakeholder needs, and market conditions.
• An actionable strategic plan builds on your strengths, addresses your weaknesses, and adapts to changing conditions.

Find out how six Baldrige Award winners develop strategies that support ongoing performance excellence. Subscribe to our free report today!

The Baldrige Criteria ask how your strategic planning process identifies potential blind spots and how you address early indications of major shifts in technology. One of the favorite examples of why this is important is the market leader in horse-drawn carriages when the first Model T’s appeared: If you don’t have processes in place to detect disruptive technologies or recognize your blind spots, you expose your organization to irrelevance.

The article in CNNMoney.com, available here, has the potential to change how cell phone service is delivered. The explosion of smartphones has stretched wireless networks to the limit, forcing companies like AT&T, Verizon, and Sprint Nextel to cap data, charge for overages, and raise prices on phones and tablet plans. And mobile data usage is expected to grow 30 times in the next four to five years. The cell towers and antennas that create the networks are large, inefficient, and expensive to maintain, costing the industry $210 billion a year to operate and another $50 billion to upgrade.

It’s a perfect climate for innovation, and that innovation may be the lightRadio by Alcatel-Lucent. About the size of a Rubik’s cube, the lightRadio “takes all of the components of a cell phone tower and compresses them down into a 2.3-inch block.” It can be deployed almost anywhere: on bus station awnings, the sides of buildings, lamp posts, etc. It can be pivoted to meet the greatest need—for example, pointed in one direction when people go to work in the morning and in the other direction when they return home in the afternoon—making it 30% more efficient than cell towers. It has antennas that can relay 2G, 3G, and 4G network signals from the same cube, unlike cell towers that have separate antennas for each network, which can cause interference problems.

Sprint Nextel plans to try out the cubes later this year, and if everything goes as expected, the lightRadio could be mass produced and installed in 2012. Each 1.5-Watt cube powers about a two-block radius, so they are ideal for urban areas as a complimentary technology to existing cell towers.

How might this affect your organization? Is cell phone service an issue where you live or work? Would this have an impact on customers and customer service or your supply chain?

More importantly, do you have a process in place to detect changes in technology that could affect your organization? And do you have process for analyzing and acting on what you discover?

To read more about strategy development, click on these articles:

• Where to Play and How to Win
• The First Critical Phase of Strategic Planning
• Challenge Your Assumptions
• Identifying Potential Blind Spots
• Revolutionary Thinking
• Planning for 2035
• 10 Tests to Assess Your Strategies