Strategic Planning and Governance Flashcards

Which term describes the process by which a utility periodically reviews and updates its strategic plan based on performance data and changing conditions?

Answer: Strategy refresh or rolling review

A strategy refresh or rolling review is the periodic process of updating the strategic plan using performance data and environmental changes to keep it relevant and actionable.

What is the key distinction between a utility's strategic plan and its operational plan?

Answer: Strategic plans establish long-term direction and priorities; operational plans detail how those priorities will be executed day-to-day

Strategic plans set the long-term direction and overarching goals, while operational plans translate those goals into specific annual tasks, budgets, and responsibilities.

A utility is establishing key performance indicators (KPIs). Which characteristic is most critical for a KPI to be useful?

Answer: It must be directly measurable, tied to a strategic objective, and have a defined target

Useful KPIs are measurable, aligned to strategic objectives, and have defined targets so progress can be objectively tracked and reported.

In the context of utility governance, what is 'conflict of interest' policy designed to prevent?

Answer: Board members or executives making decisions that personally benefit them at the utility's expense

Conflict of interest policies prevent decision-makers from using their positions to gain personal benefit at the expense of the utility, its ratepayers, or the public interest.

Which planning tool uses a two-by-two matrix to prioritize strategic issues based on importance and urgency?

Answer: Eisenhower Matrix

The Eisenhower Matrix categorizes tasks into four quadrants based on urgency and importance, helping leaders prioritize strategic actions appropriately.

A utility's strategic plan includes a goal to achieve full cost recovery for water services. What financial strategy best supports this goal?

Answer: Implementing a rate structure that recovers all operating, capital, and debt service costs from ratepayers

Full cost recovery requires a rate structure deliberately designed to collect revenues covering operations, maintenance, debt service, and capital reinvestment from the customer base.

Which element distinguishes 'governance' from 'management' in a utility organization?

Answer: Governance establishes policies, accountability structures, and strategic direction; management implements those decisions operationally

Governance is the board-level function of setting policy, direction, and accountability structures, while management is the executive and staff function of implementing those decisions.