A bioprocess equipment supplier transforms its annual strategy review into an agile process fostering creative thinking and giving strategic planning a more valuable role in the development and execution of the business strategies.
After becoming the majority stakeholder of a bioprocess equipment supplier, an investment fund asked Larka to help the top management design and implement an effective strategic planning process to leverage their full potential and reach a higher valuation after 5 years.
Larka started its mission by interviewing the executive team to assess their satisfaction degree with regards to their current strategic planning process. They all perceived Strategic Planning as a waste of their time and were frustrated by its lack of impact on the strategic direction of the company.
Our team was therefore not surprised to discover an overly bureaucratic, uncreative, insufficiently insightful and financially oriented strategic-planning process during the first assessment of their organization.
This situation is far from being uncommon as most of the biopharma industry's executives we have interviewed during surveys and projects agreed that they were getting little-value from their annual strategic planning process.
However, the rapidly evolving biopharma market, its perpetual innovation, increasing complexity and rising competition require bold vision, creative strategies, quick adaptation and world class execution. More than ever, companies need to take a fresh look at their annual strategic planning processes.
In a 8-month mission, Larka's experts worked with our client's team to design and implement best practices for an effective strategic-planning process.
The first thing we told to our client is how important it is to separate strategy reviews from budget and financial target discussions. Management should focus on conceiving ambitious strategic ideas before discussing the practical implications of the strategy in terms of budgets and revenue goals. Budget is extremely important but should not restrain creative thinking. To that end, we have segmented our client's strategic planning process in two phases : one phase to dream big and develop bold vision and another to talk about numbers.
Another best practice is to stimulate the strategic dialogue with insights and market intelligence. Indeed, in order to make real-time strategic decisions about the business orientation, executives must be aware of their markets' dynamics, coming opportunities and threats, current and future priorities of their targeted customers segments and their strengths and weaknesses relatively to their competitors. Thanks to our proprietary business intelligence platform and our unrivaled experience of the biopharma industry, we provided our client with the right level of intelligence to stimulate question-driven valuable dialogue and identify strategic priorities. Analyzing those up-to-date insights, our client's management uncovered a list of strategic questions for each business unit, selected some of them and focused creative thinking on answering those issues.
In order to increase our client's agility and responsivity towards market changes and offer more time for strategic debates, we established regular strategy review meetings throughout the year. We also brought more flexibility to the process, giving the possibility to each business unit to define its own strategy review cadence and adapt its strategic-planning time horizons to its needs.
We also made sure to engage people from multiple levels of the organization in the strategic planning. Indeed people carrying out a strategy must also develop it. That's why, in addition to C-level executives, business units heads for example need to personally invest their time in developing strategy and preparing for the strategic reviews. Companies can also engage outsiders in the process, like customers and suppliers to bring alternative ideas and perspective to the thinking. In today's competitive environment, a well-chosen extended strategy team can be a great advantage to have an exhaustive view of opportunities and threats and make better strategic decisions.
Creating a great strategic-planning is only half of the challenge. To support and implement the strategies formulated, we helped our client's management set a budget with capital and resources allocation map, timelines as well as financial and operating targets. The challenge lies in determining where the resources would bring the most value, how much money and talent to distribute and how to put those decisions effectively into action. Indeed, dealing with a limited budget, companies often have difficulties defining priorities among the strategies developed during the creative thinking phase. We have therefore advised our client on the best strategies to follow, what should be the associated resources and timeframes and what are the expected benefits to reap.
For the strategies to be effective, execution had to be monitored through a robust performance management system. Our experts designed and implemented a customized system to monitor progress with quantitative metrics and goals and ultimately translate strategy into strong results. Our system relied on both financial and non-financial metrics in order to give managers with an early warning of problems with strategic initiatives and not only financial lagging alerts. An effective system enables management to step in and correct, adjust or abandon an initiative that is failing to provide the expected benefits.
Throughout this strategic-planning mission, we helped our client address the strategic uncertainties ahead, initiate creative thinking about the company's vision and orientation while delivering strong results in day-to-day operations. Our client's executives are no longer reluctant to enter strategic planning process and see it as a real possibility for the company to define ambitious goals and drive towards them relentlessly.