Inputs to the Business Operating System

[Post by Chuck Krugh, November 18, 2022]

Two weeks ago I introduced the Business Operating System (BOS). I covered the basics on how it works as we move through one Plan-Do-Check-Act cycle. This week, I want to talk about the primary input into the BOS: Strategy.

Strategy means a lot of things to different people. It’s important that we at BIW understand what we consider strategy for our BOS. So, what is strategy? According to the dictionary, it’s a careful plan or method.

Everything we do in business starts with a plan. I would even argue that many of the things you do outside of work start with a plan as well. You probably don’t spend time writing out the plan on your project, your errands or your fun, but you do spend time thinking about them. That time is really the informal planning process you’re using to ensure that when you do your project, it will be successful.

In business, we have to be more deliberate at planning because the projects are usually much bigger, can affect many people, may require extra steps for safety, are likely to be expensive and could affect the company’s health. A successful company makes plans far out into the future to be ready for getting the work done.

For our business’s operating system, we are also thinking about our strategy over time. We will generally start with a five-year outlook made up of yearly increments. Year 1 is the most developed and Year 5 is laid out at a high level with a lot less detail.

The Year 1 strategy will become the input into the PLAN quadrant of the BOS. This is represented by the blue arrow in the figure. Our strategy needs to be broken down into an Annual Operating Plan (AOP) and Action Plans that support the AOP. This all happens in the PLAN quadrant.

This process starts at the Senior Leadership Team level or SLT, our company’s vice presidents, who work with me to translate the Year 1 strategy into the Annual Operating Plan. The AOP turns into that year’s company goals.

To ensure we reach our company goals each year, we develop action plans under each goal. Each action plan might require work by different parts of the company. Detail for the action plan is added as it moves to the Director and Manager levels in the company. As more detail is added to the plan, the steps and tasks required to reach each goal are laid out. When complete, we have a comprehensive plan laying out how we as a team are going to achieve our company goals.

What I like about this process is that it is organized and structured. This input side of the BOS gives us a starting place, or strategy, to begin the Plan-Do-Check-Act cycle. We will continue to discuss our overall strategy, our AOP and our BOS in the coming weeks.

Safely Execute High-Quality Work

President, General Dynamics Bath Iron Works

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