Firmsconsulting partners thankfully have extensive experience in electricity utility corporate strategy. I personally have done about 20 such studies, serving as partner on about 12 of them.
It is not the only sector where we have experience. We have substantial expertise in financial services, state-owned-entities, transportation and resources.
You may have seen or heard about our Strategy Training Library. It is the world’s most detailed and largest library of strategy training material.
We take enormous pride in the quality of the material we produce and base the material on real studies. The client’s identity is, of course, scrubbed.
Let’s discuss the corporate strategy study where we are helping an electricity company in the US develop their way forward.
The team running this study is jointly based out of Toronto and Atlanta. The initial corporate strategy planning work, phase 1 as such, is now completed and we will release that in the summer of 2014: all 321 videos and 325 power-point slides.
We are now preparing to advise the client on Phase 2.
We are assembling a team to work with us to complete this phase where we take the findings from the corporate strategy and prepare to design the new business model for the company. This is a very expansive phase, which consists of six major areas.
We are looking for MBA interns to help us complete Phase 2, which will take place between June and November of 2014. The ideal applicant should have strong grades, can work full time either in the US or Canada and is permitted by their visa to undertake a paid-internship work.
No prior experience in the sector is needed. We look for exceptional grades, leadership, strong communication and prior experience working in demanding teams. Note, I will be leading this study and you should listen to my podcasts about prior studies I led as a partner to understand how I run these studies: rail privatization, R&D study, financial study, leasing study etc.
I try to make every current study I am leading better than any previous study I have ever led. I am sure I am less than 30% successful but I at least aim for that goal.
Those who know me, will know that I can regularly work through the night without sleeping. That will not be expected of you, thankfully, but explains why you may get emails from me at 3am, 4am or even 5am.
If you are interested in becoming an intern, please leave a comment below. If you are shortlisted, we will contact you through the site messaging system and give you access to more material about the study, which is on the site. We will not email documents which is why we do not want you to email us.
I have provided a basic description of the work we will do. It is tough, complex and will expose you to very challenging strategy and in particular, corporate strategy planning.
Divestments: The first phase of the study recommended the divestment of over 70 businesses. We will undertake the detailed financial analyses to value the businesses slated for divestiture. We will also need to understand the short-term implications of divesting, as parts of the core business may be dependent on the assets being divested.
Business unit strategy: We will have to continue reviewing the asset and registration registers for the business units to find unrelated activity to the new corporate strategy. The business unit level strategy for each division will need to be developed. In particular, we will need to determine the gaps each business unit will have in undertaking the new generations, transmission and smart-grid build projects which will be the focus of the new corporate strategy. We will need to determine a new strategy for the international business and consider the costs of breaking existing contracts with foreign governments.
Divisionalization: The core recommendation of the first phase was the international division would now focus on the domestic US market. This means the international division will now treat the parent company like its main client for construction work. We will need to agree service-level-agreements for new construction work, negotiate long-term contracts, develop a pricing model, agree a procurement model and develop an EPCM operating model.
Business case: Finally, the business case for each of the changes above must be developed from both a top-down and bottom-up level, and signed off with the CFO.
Governance & Business Management Process
Operational Governance: Since the international division has never operated in the US for the last 20 years, a new operational governance model must be created so that updates are presented to the parent company’s Exco, finance committee, risk committee and audit committee.
Long-term Governance: The structures above are short-term measures to manage the construction project in the next 6 to 9 months. A long-term governance structure must be developed for the board, Exco, Opco and Manco as well as the processes to run the governance structure once the new division starts its day 1 which is scheduled for early 2015.
Balanced Scorecard: The parent company uses the balanced-scorecard process and this will need to be rolled out to the new division at the CEO, Exco and Opco levels.
Organization & Process Alignment
Support Services: The international division owns a significant number of businesses related to the construction of transmission towers, power plants, grid lines, grid testing etc. Phase 1 recommended bringing all these businesses, which are unrelated, into one structure and we need to create a detailed organizational design, strategy and macro-structure to house them all. We need to agree their functions and agree the service-level-agreements they will have with the parent company, on behalf of the now divisionalized international division.
Business Processes: Key business processes will have to be identified and designed. Resources will need to be aligned, and, as we are populating the organizational structure, opportunities to reduce costs must be developed, a business case developed and the final process agreed. The same process must be done for internal support functions like HR, finance, procurement, construction etc.
Migration: Each support service like grid testing was originally incorporated in a different state or country. Bringing them into the new division, incorporated in a single state, requires placing everyone on the same legal, tax, brand, payment, insurance, expense, allowance, health and union plan. We will need to complete that process by developing the strategy, which an accounting firm will implement.
Assessment: A complete skills audit and skills assessment must be done of all managers above the senior management level. We will need to develop a strategy to fix any gaps discovered. This requires working with the business unit strategy team to understand the workload in the next 36 months and the skills required to complete the work. For example, the US has never built a nuclear power station in the last 25 years and such skills will need to be developed within the organization.
Pilots: For new roles such as a nuclear plant inspector, pilot facilities must be planned, piloted and incubated to test the strategy we are recommending.
Behavior & Culture: Phase 1 identified numerous cultural and behavioral problems in the international division. A new performance management, incentive, penalty and succession planning system must be developed. In addition, a process to negotiate, agree and implement the staff deployment from outside the US to the US must be completed.
Leadership: Develop a system to screen and fill outstanding senior management roles.
The international arm used to be a separate company. No financial, reporting, audit etc., system existed to reconcile the parent company’s finances to the international division on a daily and weekly basis.
We will need to understand the new division’s reporting systems and develop a strategy to link the parent company’s and divisions reporting system. This may require consolidation of SAP systems, changes in the existing IT infrastructure and even changes to the tax and audit requirements.
We will work alongside an audit firm to complete this process. This is a substantial stream where we only have responsibility for the strategy planning.
Help develop CEO’s talking points and strategy for engaging the investment community, parent company, investors, clients and employees. In many ways, this is a very sophisticated communication stream, where we will need to think about how to communicate the strategy changes to the community.
If you like the idea of us opening our studies to interns, please comment below. This is a trial we are running and if it works well, we will consider opening the financial services strategy study to interns in July 2014. If you have suggestions to improve this, also let us know in the comments section.
This is a very unique opportunity that is exclusively available to Firmsconsulting members, clients and readers.
Where else can you learn strategy under the guidance of former partners without actually working at consulting firm?
At the end of December 2014 we published a post recapping our year at Firmsconsulting and providing a brief overview of our plans for 2015. We want to provide an update on our plans for 2015 so you know what to expect and how we are keeping to that schedule.
More importantly, if you want us to change the schedule or our priorities, you can comment and let us know. We are going to focus this update on just one area where we need some guidance from readers.
Implementation Executive Program
We are planning to work on 4 studies this year.
- The market entry study is done and will be released shortly.
- The power sector corporate strategy transformation study has started and will be released shortly.
- In all likelihood, the power sector study will lead to a major implementation phase so that will be the next study.
- Finally, we are debating whether or not to do the BTO strategy study, operations or another study as the 4th study of the year.
Do you want an implementation study and toolkit?
We need to know which should be the next two studies. If you look at our header and footer, under executive programs, we have listed all the studies we have negotiated with clients. The start dates for some of those studies have not been set and we can move them based on reader popularity.
Every time someone subscribes for updates on a study, we view that as a vote for the study.
We try to do the studies with the most votes first.
We need you to vote.
As it stands, this is the top 4 studies based on your votes:
- Market entry strategy study
- Power Sector strategy study
- Operations study
- CPG pricing, marketing and strategy study.
Based on this voting, the operations study is the next study we will release. That outcome was a little surprising. We suspect it is the most popular because most readers have not taken the time to vote.
So, by default operations moved to the top of the list. We also think many readers are confusing operations with implementation. This post will provide some details on implementation studies so you can understand the differences better and decide if you really do prefer the operations study over the implementation study.
We feel implementation skills are more important than operations skills. Every executive in every organization needs implementations skills. This involves setting goals, change management, embedding new cultures, overhauling systems and processes. In essence, it means helping your company/client generate the $xM benefits that was promised.
Every single executive client we have will understand their biggest obstacle is implementing recommendations. In a corporate environment, you get promoted for getting results. You do not get promoted for strategy analyses and recommendations which you fail to implement.
We are working on creating the most comprehensive implementation toolkit in the world, which we will roll out for the power sector implementation study.
We are working with Bain and McKinsey Implementation Group coaching clients to ensure the toolkit exceeds the quality of the material available in those firms. Therefore, we remain excited about this study and toolkit.
The implementation study will contain over 350 videos and power point guides. The accompanying toolkit will contain well over 100 videos and power point guides. That is >450 videos in total. That is a deeply comprehensive program. To give you a sense of some of the differences between implementation and operations, we have attached some screenshots from the videos.
Once you review these implementation slides and believe it will be useful, please vote by subscribing to this study and comment below. We use the comments to help us think of missing elements in the studies and tool kits.
In this exhibit we explain the fundamental difference between operations and implementation. They are frequently confused but are not the same in any way.
This exhibit explains the overall, high-level implementation approach. There is a lot of details that sit behind each block. In fact, the block on “Design Implementation” contains well over 100 power point slides since there are so many different implementation techniques and tools to overcome resistance from employees.
This exhibit pretty much sums up the main chart the client is interested in. At the start of an implementation, the client tracks adherence to the activities. The client does this since it is too early to track the banked benefits. However, as the study progresses the implementation will focus more on the banked benefits versus the activities initially outlined for the implementation.
This is because things always change throughout the implementation and sticking to initial activities makes little sense when the situation on the ground is fluid. Sticking to the financial targets, however, is the primary goal of the client.
The exhibit below is a simplified version of a more detailed map. We list every single type of resistance a client could display over the course of the study, along with the toolkit to overcome that resistance. This is probably the most important part of the toolkit. There is a significant amount of material walking subscribers through use of the tools.
This final exhibit highlights just one of the five possible roll out options for implementation. The “Big Bang” approach works very well during crises where there is no choice but to execute the roll-out across the entire country at one time.
As you can see, this is a very comprehensive study and toolkit.
However, if we release the studies based on the votes alone, it would seem the implementation study is not as popular and will not be released anytime this year. So please vote to help us know which studies to release.
So, to recap: 4 studies are planned for 2015 but we need you to tell us which one’s should be released first by registering for the implementation study or any other study you prefer.
If the implementation study and toolkit is not what our readers find useful, we will likely decline the opportunity to run the power sector implementation study. This would be a pity because we believe implementation is a core skill to learn and is a priority of every major consulting firm today.