A Repository-Based Enterprise Strategy Management Process ...

A Repository-Based Enterprise Strategy Management Process Maturity Evaluation Model Fenglin Peng1 and Xuping Jiang2 1

Business School,Jianghan University Wuhan, Hubei Province, China 2 Department of Commanding Communications Commanding Communications Academy Wuhan, Hubei Province, China [email protected] Abstract. Enterprise strategy management can be regarded essentially as a process of strategic planning, implementing, evaluating and controlling. Additionally, there are lots of detailed methods of operation in this process. How to evaluate the process of enterprise strategy management which applies various operating methods with one unified evaluating standard and measurement quantitatively and qualitatively is always the emphasis of the research of enterprise strategy management. Therefore, this paper uses the thought of Capability Maturity Model (CMM), which is applied in the process of software development for reference, and puts forward a Repository-Based Enterprise Strategy Management Process Maturity Evaluation Model. In this model, the enterprise strategy management process is evaluated comprehensively and classified as a whole, according to the knowledge maturity of the methods of strategic planning, implementation, evaluation and control used in the process (i.e. score based on the repository). This model contains a 4-level enterprise strategy management process maturity framework and a maturity evaluating repository. The Repository-Based Enterprise Strategy Management Process Maturity Evaluation Model measures the scientificity and quality of the process of enterprise strategy management. We hope, to the enterprise strategy management, the process maturity should be evaluated firstly, and then the scientific methods and operating techniques which can make enterprise strategy management process ascend in the maturity stairs can be introduced. Keywords: Enterprise strategy management, repository, maturity, evaluation.

1 Introduction Enterprise strategy management [1,2] is a subject about how to design, plan, implement, evaluate and control enterprise strategies, which in nature is to fully use enterprise resource such as human resource, financial resource and property, so as to optimize management and improve economic benefit. From 1990s, with the development of the theoretic research and practices of enterprise strategy management, how to evaluate the process of enterprise strategy management which applies various operating methods with one unified evaluating standard and measurement quantitatively and qualitatively is the emphasis of the research of enterprise strategy management [3,4]. Y. Wu (Ed.): ICCIC 2011, Part III, CCIS 233, pp. 482–487, 2011. © Springer-Verlag Berlin Heidelberg 2011

A Repository-Based Enterprise Strategy Management Process

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This paper uses the thought of Capability Maturity Model (CMM) [5] which is applied in the process of software development for reference, and puts forward a Repository-Based Enterprise Strategy Management Process Maturity Evaluation Model. In this model, the enterprise strategy management process is evaluated comprehensively and classified, according to the knowledge maturity of the planning and the skills of implementation and evaluation used in the process (i.e. score based on the repository). The second section of this paper starts from the definition of enterprise strategy management, then analyzes the process and stages of enterprise strategy management, and introduces the typical operation methods applied in the process and stages. The third section of this paper uses the CMM which is applied in the process of software development for reference, and puts forward the goal and thought of enterprise strategy management process maturity evaluation. On this basis, the fourth section established a 4-level Enterprise Strategy Management Process Maturity Framework. The fifth section gives a repository used in enterprise strategy management process maturity. The sixth section is the conclusion and points out the future work. Enterprise Strategy Management Process Maturity Model measures the scientificity and quality of the process. We hope, to enterprise strategy management, the process maturity should be evaluated firstly, and then the scientific methods and operation techniques which make the enterprise strategy management process ascend in maturity stairs, can be introduced into the process.

2 Analysis of Enterprise Strategy Management Process Essentially, enterprise strategy management can be regarded as a whole process, in which the enterprise resource, such as human resource, financial resource and property can be fully used through the means of planning, implementing, evaluating, controlling and so on in macro-level, in order to realize the enterprise strategy total goal. This process includes 3 stages [1-4,6,7]. 1) Strategic Planning Stage: This stage is a procedure, in which mainly through the analysis of enterprise outer environment and inner conditions, the enterprise strategy is comprehensively judged and formed with combination of the enterprise own development positioning. The typical operation methods and techniques of this stage include Porter’s five forces model, SWOT, SPACE, Nine-cell matrix, and so on. 2) Strategic Implementing Stage: This stage mainly depends on the cooperation and hard work among the organizations of the enterprise’s each level and all the staff members to implement the strategic goal in detail. 3) Strategic Evaluating and Controlling Stage: This stage mainly verifies and evaluates the degree of the implementation of enterprise strategic through all kinds of evaluation methods and index system, and adjusts and controls the design and implementation of next management strategies according to the evaluation of the result of implementation. The typical methods include the Balanced Score Card, Excellence Strategy Evaluation Standard, and so on [6]. The goal of enterprise strategy management is to realize the high-level aims and tasks of enterprise evolution in a period of strategic time [2]. The enterprise strategy management process can make the enterprise’s resource get better use, then the efficiency can be higher and the result can be better. In order to make enterprise managers know, understand and use various operation techniques and methods better, it is very necessary to set up a method to evaluate the process of enterprise strategy

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management which applies various implementing methods with unified evaluating standards and means quantitatively and qualitatively.

3 Goal and Thought of Enterprise Strategy Management Process Maturity Evaluation The thought of Process Maturity was born in the Software Engineering Institute of the Department of Defense (DOD) of USA, in which the staffs invent a method of evaluating software development process, called Capability Maturity Model (CMM) [5] . The higher the grade of CMM is, the more mature the corresponding software development process is, and the better the developed software system is. The emphasis of CMM is the development of software, which is not suitable for enterprise management process in general. This paper uses the same thought as reference, combining the tendency and features of enterprise strategy management development, and provides an enterprise strategy management oriented Process Maturity Evaluation Model. The Enterprise Strategy Management Process Maturity Evaluation Model can be used in measuring the scientificity of the enterprise strategy management process and the final management quality. Also, the Enterprise Strategy Management Process Maturity Evaluation Model shows the direction of enterprise strategy management development. We hope that, to the enterprise strategy management, its process maturity should be evaluated firstly, and then the scientific methods and operating techniques which can make enterprise strategy management process upgrade in the maturity stairs can be introduced. Thus, the enterprise strategy management can avoid most decision-making problems.

4 Framework of Enterprise Strategy Management Process Maturity Model The framework of Enterprise Strategy Management Process Maturity Model which is shown in Fig. 1, is classified into 4 levels. 1) First Stair: Initial Level The enterprise strategy management process has not been defined. In this level, the enterprise strategy management totally depends on enterprise manager own skills and experience. However, in an enterprise, especially a big enterprise, the strategy management and decision-making are so complex that none of these managers can be competent for the work only depending on one’s personal skills and experience. 2) Second Stair: Basic Level The enterprise strategy management process has been defined, but there are no repeatable operation methods and means adopted, and the standards of management process have not been defined. In this level, what kind of detailed operation methods should be adopted in each stage of enterprise strategy management process lies on the individual. This often results in unnecessary misunderstanding and risks. For instance, directors of the department of manufacture, marketing or financial management make and implement their own management methods separately. This may causes the resource confliction, goal collision or other problems among the departments.


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O p ti m iz ed L e ve l: The higher the grade is

T h e e n t e rp rise s tr a te g y m a na g e m e n t p ro c e ss a nd c on t e nt h a ve be e n d e f in e d , an d r e p e a ta b l e o pe r a tio n m e th o ds a nd m e a n s ha v e b e e n a d op te d in e a c h st a ge of the p ro c e ss, o n th e b a sis of g o od p r a c tic e , a n d c a n b e v e rif ie d , im p ro v e d, a n d o pt im iz e d.

D efi nition L ev el : T h e e n t er p rise s tr a te g y m a na g e m e n t p ro c e ss a nd co n t e nt h a ve be e n d e f in e d , a n d r e p e ata b l e o pe r a tio n m e th o ds a nd m e a n s h a v e b e e n a d op t e d in e ac h stag e of the pr o c e ss, b ut m a y n ot b e b a se d o n g o od p r a c tic e a n d v e rific a tio n .

B as ic L ev el : T he e nte rp r is e stra te g y m a n a ge m e nt p r oc e s s a n d c o n te n t h a ve be e n d e f in e d , b u t re p e a ta ble o p e ra t ion m e th o d s a n d m e a n s ha v e n ’t b ee n a d o p te d in e a c h st a g e o f th e p ro c e ss.

Ini tia l L e ve l: T h e e n te r pr ise st r ate g y m a n a ge m e nt p r oc e s s an d c o n ten t h a v e n’ t be e n d e f in e d .

Th e m o r e m a tu re a nd sc ie ntifi c th e e n ter p rise st ra ta gem m an ag e m en t pro c e ss i s

Fig. 1. The framework of enterprise strategy management process maturity evaluation model

3) Third Stair: Definition Level The enterprise strategy management process has been defined, the repeatable operation methods and means are adopted, and the standards of management process have been defined, but which may not be based on good practices and can not be verified. Problems of this level include that the operation methods adopted and standards made in the enterprise strategy management process might not be the optimized and most suitable ones for the real situation in directing enterprise strategy management. For example, the Strategy Controlling Report (SCR) proposed by Andrew Flitman [6,7], is suitable for directing labor-intensive manufacturing industry. However, because it mainly reflects the past capability, can not deal with great changes and is not suitable for the over-diversified organizations as well as the enterprises which are lack of the support of techniques, the SCR is not suitable for directing the enterprise strategy management of technique-intensive manufacturing industry obviously. 4) Fourth Stair: Optimized Level Enterprise strategy management process has been defined, repeatable scientific means and operation methods have been adopted. The standards of management process have been defined and are based on good practices, additionally can be verified, improved and optimized. This level can provide us practical methods and tools in enterprise strategy management process, and provide operable technique steps, standards, means and supporting platform for establishing the enterprise strategy management process which meets the requirements.

5 Repository of Enterprise Strategy Management Process Maturity Evaluation Model Looking from the framework, the facts that affect enterprise strategy management process maturity are mainly the rationality of the process and the practicability of the

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standards, methods, techniques and tools used in each stage of the process. Since the evaluation of the above facts can only be based on practice, a repository based on practice and used in enterprise strategy management process maturity evaluation can be set up. The repository of enterprise strategy management process maturity evaluation includes: the score of enterprise strategy management process model and its practices; and the score of the practice of each kind of enterprise strategy management standards, methods, techniques and tools. The maturity evaluation of enterprise strategy management is to give the relative score based on the repository and analyze comprehensively, and then provide the maturity grade of a given project process according to the maturity model framework. We classify the rationality of enterprise strategy management process into the following 5-grade scores: 0 grade: the enterprise strategy management process is not defined; 1 grade: the enterprise strategy management process is irrational; 2 grade: the enterprise strategy management process is rational in logic, but hasn’t been verified by practice; 3 grade: the enterprise strategy management process is rational according to the practical verification; 4 grade: the enterprise strategy management process is rational according to the practical verification, and has been optimized. We classify the practicability of the standards, methods, techniques and tools used in enterprise strategy management process into 5-grade scores: 0 grade: no standard, method, technique or tool used in the enterprise strategy management process; 1 grade: can not be repeated; 2 grade: can be used basically, but imperfect; 3 grade: usable; 4 grade: optimized. The corresponding relationship between enterprise strategy management process maturity levels and score grades has been shown as Table 1. Table 1. The Corresponding Relationship between Process Maturity Levels and Score Grades Maturity Levels

Score of Process

Initial level

0 grade

Basic level

1-2 grade

Definition level

2-3 grade

Optimized level

4 grade

Score of Standards, Methods, Techniques and Tools used in the Process (or) existing at least one item of 0-1grade (or) all the items are in 2-4 grade and existing at least one item of 2-3 grade (and) all the items are 4 grade


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6 Conclusion In nature, enterprise strategy management can be regarded as a process of strategic planning, implementing, evaluating and controlling. Also each of the stage in the process involves lots of detailed operation methods. This paper uses the thought of Capability Maturity Model (CMM)[5] in the process of software development as reference, providing a Repository-Based Enterprise Strategy Management Process Maturity Evaluation Model. This model includes an enterprise strategy management process maturity framework and a maturity evaluation repository, and comprehensively evaluates and grades the whole process according to the knowledge maturity of strategic planning, implementing, evaluating and controlling methods used in enterprise strategy management process (i.e. score based on the repository) in detail. Enterprise Strategy Management Process Maturity Evaluation Model firstly measures the scientificity and quality of the enterprise strategy management process. We hope, to the enterprise strategy management, its process maturity should be evaluated at first, and then the scientific means and operation methods which can make the enterprise strategy management process ascend in the maturity stairs should be introduced. The future research work includes: the development of the Repository-Based Enterprise Strategy Management Process Maturity Evaluation System and its typical applications.

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