Navigating through the

Corporate DNA
A seminar on Contemporary Strategic Management
for the De la Salle University
Graduate school of Business
THE COURSE
OBJECTIVES
OBJECTIVES
The objective of this discussion is to:
 Equip participants with knowledge on contemporary
issues that are present in the day-to-day operations
of today’s Corporate landscape;
 Provide participants with a macro-perspective
insights in resolving corporate issues through
strategic planning and management;
 Identify key areas vital to Corporate strategies;

 Understand ways of translating strategic plans into

financial model and budget that incorporates key
performance indicators.
 CONTEMPORARY
CORPORATE ISSUES
PEOPLE MANAGEMENT

• High competition for talents

HIRING • Limited talent pool sources
• Ineffective hiring protocols
What it cost organizations?

 Impedes achievement of
• Mismatch of people skills against Corporate goals and
strategies objectives
TALENT • Ineffective or lack of skills management
MANAGEMENT  Hinders organizational
• Ineffective or lack of reward programs; growth
• Conventional HR policies and procedures
 Loss of business
opportunities
• Ineffective or lack of employee retention  Negative impact on
and relationship programs operational productivity
RETENTION • Emergence of aggressive manpower
service businesses  Discourages continuous
• Lack of succession planning improvement
PEOPLE MANAGEMENT
The true cost of losing key talent is
equivalent to 6 to 24 month’s salary.
27% of ‘high potential’ employees
plan to leave their employer in the
next 12 months. What will it cost
your business? *
18% of millenials are planning to
stay with their current employer.
How are you attracting and
retaining younger workers? *
Source: PwC, 16th Annual Global CEO Survey
53% of Global CEOs see lack of
key skills as a key challenge. Only
30% of CEOs are ‘very confident’
that they will have access to the
talent they need over the next 3
years. *
78% of Global CEOs intend to
make a change to their strategies for
managing people. *
FINANCE & ACCOUNTING

• Weak skills in technical accounting and tax

compliance
COMPETENCE • Lack of training and development for finance
personnel
What it cost organizations?

 Millions in tax liabilities

• Inadequate processes and procedures
 Inability to make sound
• Significant back logs on work loads
WORK • Noncompliance to tax laws and regulations
decisions
FUNCTIONS • Ineffective and inefficient use of Enterprise  Inability to analyze and
resource planning (ERP) systems strategize on business
drivers

• Unreliable financial reports  Opens opportunities for

• Inability to support management and governance fraudulent activities
FINANCIAL AND bodies on decision making
MANAGEMENT  High turnover of finance
• Lack of financial risk management oversight
REPORTING personnel
• Changing fiscal policies and tax uncertainties
 Negative or low returns on
ERP investments
FINANCE & ACCOUNTING
Companies spend roughly P100,000
to P15 million pesos in professional
services in keeping track of report
backlogs and the reconstruction of
books of accounts.
61% of Global CEOs are planning to
implement strategic changes in their
companies in 2014. 68% on the other
hand, anticipates changes in the
Company’s organizational structure.
How does your finance function support
these decisions?*
*Source: PwC, 16th Annual Global CEO Survey
Companies face tax assessments
that may go to billions of pesos as a
result of noncompliance to tax laws
and regulations. Some other
companies shut down operations
due to BIR noncompliance.
25% of Global CEOs are concerned
about the increasing tax burdens as
an issue that may potentially slow
activity, turn profits into higher tax
bills and make them less globally
competitive. *
INFORMATION TECHNOLOGY

• Poor information security

INFORMATION • Weak cyber security
SECURITY • Data security breaches
• Inadequate controls on information assets
• Lack of user awareness on information security
What it cost organizations?

 Obsolescence of millions of
investment in IT resources
• Outdated and improper business continuity management
BUSINESS process  Blown up costs in IT
CONTINUITY • Business continuity serves as compliance burden systems implementation
• Rapid changes in technology resources
 Impedes realization of
Corporate objectives and
goals
• Lack of alignment between technology investments with
Corporate strategies  Loss of business
• Lack of people appreciation on how IT benefits business opportunities
TECHNOLOGY • Inadequate scalability of technology infrastructure
INFRASTRUCTURE • Improper IT project management strategies and  Exposure to reputational risk
implementation
INFORMATION TECHNOLOGY
GLOBAL CEOs ASSESSMENT OF THE LIKELIHOOD OF
CYBER ATTACK*

20% LIKELY TO OCCUR

36%
UNLIKELY TO
OCCUR

NOT SURE
44%

68% of US CEOs see that cyber attack would

have negative impact on their businesses.
CEOs of global industries that deal in
regulated data are most concerned about the
negative impact of cyber attacks, such as
banking (77%), power & utilities (73%),
healthcare (71%) and communications (71%)*
Some companies put in multi-million
investments in Information Technology
infrastructure that end up unsuccessful,
blowing up additional millions of
investment in correcting implementation
glitches

*Source: PwC, 16th Annual Global CEO Survey

OPERATIONS & BUSINESS DEVELOPMENT

• Inability to cope with existing and increasing demand

• Lack of growth foresight
• Improper growth driver analysis
GROWTH • Stagnant or deficient innovation strategies
• Wrong focus of business development strategies
• Lack of resilience to significant and unpredictable risks
What it cost organizations?

 Loss of business
• Inability to cope with market trends opportunities and market
• Stiffer market competition share
• Costing mismatch
MARKET • Inefficient production process resulting to uncompetitive
pricing
 Inability to cope with market
• Improper management of supply chain competition
• Ineffective business models
 Costly supply chain
management practice

• Lack of customer focus  Inability to meet stakeholder

CUSTOMER • Lack of post sales support
• Emergence of social media in the operations and business
expectations

FOCUS development landscape  Lower returns on investment

OPERATIONS & BUSINESS
DEVELOPMENT

Two goals head growth agenda in

2014 for many US CEOs: capturing
more share in existing markets,
whether in the US or internationally
and making greater use of
acquisitions or strategic alliances to
advance that aim.*
63% of CEOs believes that
customer base is where main
opportunities lie. 53% of CEOs
asserted that social media influences
their business strategy
OPERATIONS & BUSINESS DEVELOPMENT
GLOBAL CEOs INNOVATION PRIORITIES KEY INGREDIENTS TO INNOVATION
 How do we manage
these Corporate issues
and business challenges?
THE CORPORATE
PLATFORM OF
STRATEGIC
DEVELOPMENT
PLATFORM OF STRATEGIC
DEVELOPMENT

PEOPLE

GROWTH

PROCESS TECHNOLOGY
 THE STRATEGIC
PLANNING PROCESS
THE STRATEGIC PLANNING PROCESS

Self- Where
Where are
are you
you now?
now?

How did you do?

assessment

Identify
Evaluate
Objectives and
results
goals

Measure Define desired

targets outcomes

How will you measure success? Develop plans, Where do you want to be?
strategies and
targets
STRATEGIC
ROADMAP
MODELLING
 Institutional
FINANCIAL Viability &
Sustainability
REVENUE GROWTH PRODUCTIVITY
STRATEGY Broaden
STRATEGY Improve
Revenue Mix, operational
Market share efficiency

High utilization of
CUSTOMER products & Cost efficient
services, Brand solutions
Strength

Strengthen Expansion to
loyalty through Innovative &
customer untapped
responsive P & S
intimacy markets

INTERNAL PROCESSES

Customer Implement
focused Strategic Leapfrog
structure & Mitigate risk global standards
alliances competition
process & best practices

LEARNING & GROWTH Culture of excellence

through competence
building & sustainability

Strategic people Performance &

competency achievement
building driven people
ENTERPRISE RISK MANAGEMENT
 The Enterprise Risk
Management (ERM) is a
structured, consistent and
continuous process across
the whole organization for
identifying, assessing,
deciding on responses to and
reporting on opportunities
and threats that affect the
achievement of its
objectives.

 The criteria in risk

assessment includes impact
and likelihood.

 The Company should focus

on those areas with the
highest risk ratings.

RISK
RISK RISK RISK
RISK SCOPING IDENTIFICATIO
ASSESSMENT TREATMENT MONITORING
N
PEOPLE STRATEGY

RISK
RISK RISK RISK
RISK SCOPING IDENTIFICATIO
ASSESSMENT TREATMENT MONITORING
N
PROCESS STRATEGY
Periodic revision and Handling
Guidelines Design of Control activities

Periodic review schedule and

approval

Defined Scope Preventive

Adequate Policies
Detective

Streamlined Procedures
Corrective
Standardized Templates and forms

RISK
RISK RISK RISK
RISK SCOPING IDENTIFICATIO
ASSESSMENT TREATMENT MONITORING
N
TECHNOLOGY STRATEGY

RISK
RISK RISK RISK
RISK SCOPING IDENTIFICATIO
ASSESSMENT TREATMENT MONITORING
N
 TRANSLATING
STRATEGIES TO
FINANCIAL PLANS
FINANCIAL PLANNING PROCESS

Develop
Strategic plan  Financial plans should
clearly reflect the
Identify Company’s strategies and
responsibility activities.
Periodic
centers and
Performance
Develop  Financial plans should
review
program function both as a planning
activities and control tool.

 Financial plans should be

MANAGEMENT flexible, and may be
SIGN OFF adjusted based on changing
business operations in a
given period.
Define Summarize
Performance cost
 Significant deviations should
Indicators – requirements of
Financial and program be investigated to
Nonfinancial activities understand changing
conditions and their
Develop budget implications to the
based on cost organization
requirements
per center
GUIDELINES IN BUDGET
DEVELOPMENT

 Choose appropriate budget period

- Annual budget
- Continuous/ perpetual budget
 Identify appropriate personnel participation
- Top-down Budgeting
- Bottom-up Budgeting
 Set profit objectives
- Posteriori method
- Priori method
 Determine appropriate costing approach
- Zero based budgeting
- Trend budgeting
MANAGEMENT BY
OBJECTIVE: THE
BALANCE
SCORESCARD
THE BALANCED SCORECARD

 The Balanced scorecard is a

performance management
tool that encompasses the
financial measures of an
organization and key non-
financial measures relating
to customers or clients,
internal processes, and
organizational learning and
growth needs.

 The balanced scorecard

provides a means to clarify,
articulate and communicate
strategy.
THANK YOU