BU戰(zhàn)略計(jì)劃基本(1)

1、BU Strategic Plan BasicsJune 2001This presentation contains detailed notes to the slides. If you are viewing the downloaded version, please click on Notes Page in the View menu to see both slides and commentary511246DESCRIPTION OF MATERIALSThis document was developed as a training presentation for t

2、he newly appointed business unit CEOs of an Asian family-owned conglomerateThe purpose of this document is to guide new CEOs through the basic elements of developing a BU-level strategic planThis pack includes a companion document, “BU Strategic Plan Template Book, which provides completeness and co

3、nsistency of BU strategic plan submissions. These templates are not intended to replace or constrain BU strategic thinking and should be adapted to reflect a particular BUs sectoral context as required2WHAT IS A BU STRATEGY?A strong business concept that drives an integrated set of actions that crea

4、tes value by:Creating products/services whose value exceeds the cost of providing themCapturing value from competitors, customers, distributors, suppliers, and producers of substitute products and services3RATIONALE FOR PROPOSED DEFINITIONA strong business concept that drives an integrated set of ac

5、tions that creates value by:Creating products/services whose value exceeds the cost of providing themCapturing value from competitors, customers, distributors, suppliers, and producers of substitute products and services1.Recognizes dual role of creating and capturing value in all elements of busine

6、ss system2.Forces choices6.Competitive7.Externally oriented, customer driven4.Recognizes importance of cost as competitive tool5.Considers trade-offs between benefit provided to customers and costs they incur3.Gives consideration to all elements of the business system4COMMON ELEMENTS OF REAL-LIFE ST

7、RATEGIESVisionWhere?Strong businessconcept comprising:How tocompete?Integrated set of actionsDeveloped high quality standards and excellent operational proceduresFocus on developing critical mass of stores and establishing market dominanceMcDonalds experienced phenomenal success in globalization due

8、 to:Successfully screening franchisees and a dedication to intense initial and ongoing trainingConsistent delivery of high-quality food and service around the worldHuge economies of scale and powerful supplier leverageCapitalization of “American appeal of McDonaldsSuccess in tailoring assortment mix

9、 to meet local needs“We want to be the worlds best quick-service restaurant experience“We will offer consistently excellent quality across the worldTargeting a broad set of the urban population, increasingly offering a bundled product (meals) at a low price in major cities around the worldMcDONALDS

10、EXAMPLE5BU STRATEGY REVIEW INTERACTIONSHighly interactive debate driven by fact-based understanding of environment and internal capabilitiesHow do you expect Competitor A to react?How sustainable is your business model? Can it be easily duplicated?How robust are your contingency plans?How quickly ca

11、n you shift your business emphasis to capture industry opportunities?BU CEO6BU STRATEGIC PLAN DEVELOPMENTIndustry dynamics and implicationsEnvironmental and internal assessmentCompetitive assessmentInternal assessmentWhat are the major changes in industry dynamics and resulting opportunities and ris

12、ks?What are your competitive strengths and weaknesses?How does your current business emphasis fit with industry opportunity and competitive landscape?Strategy articulationStrategic definition and implicationsStrategic initiativesFinancial projectionsWhat strategy will your BU pursue over the next 3

13、years?What will be the impact of major strategic initiatives?What are the expected financial returns of your strategy?+Risk/contingen-cies & strategic alternativesWhat strategic alternatives have you considered?+7INDUSTRY DYNAMICS AND IMPLICATIONSEconomics of demandBy segmentSubstitutes, ability to

14、differentiateVolatility, cyclicalityEconomics of supplyProducer concentration and diversityImport competitionCapacity utilizationEntry/exit barriersCost structure (fixed and variable)Industry chain economicsCustomer and supplier bargaining powerWhat are the major changes in industry dynamics and the

15、 resultingopportunities and risks?How is industry structure changing with respect to demand, supply, and industry chain economics? What are the resulting opportunities and risks?What is the expected competitor conduct? What are the resulting opportunities and risks?What are the present and future ex

16、ternal factors that could present new opportunities and risks?Major industry competitor movesMarketing initiativesIndustry capacity changesM&As, divestituresVertical integration/disaggregationAlliances and partnershipsCost control and efficiency improvementsImpact and likelihood of major industry di

17、scontinuitiesChanges in regulation/government policyTechnological breakthroughsKey questionSubquestionsIssues to be considered*May or may not be applicable to all BUsWhat industry are you competing in? What are the various segments in the industry?Industry definitionIndustry segmentationDefinitionSi

18、zing8SEGMENT ANALYSISILLUSTRATIVEIndustryboundariesSegmentsIndustry segmentsRelatively distinct subgroupings within the industryMarket is relatively similar within the segment but different across segmentsDifferent industry dynamics may vary in importance in different segments9ProducersIndustrySTech

19、nology breakthroughsChanges in government policy/regulationsDomesticInternationalEconomics of demandAvailability of substitutesDifferentiability of productsRate of growthVolatility/cyclicalityEconomics of supplyConcentration of producersImport competitionDiversity of producersFixed/variable cost str

20、uctureCapacity utilizationEntry/exit barriersIndustry chain economicsBargaining power of input suppliersBargaining power of customersMarketingPricingVolumeAdvertising/promotionNew products/R&DDistributionCapacity changeExpansion/contractionEntry/exitAcquisition/merger/divestitureVertical integration

21、Forward/backward integrationVertical joint venturesLong-term contractsInternal efficiencyCost controlLogisticsProcess R&DOrganizational effectivenessFinanceProfitabilityValue creationTechnological progressEmployment objectivesExternalshocksFeedbacktructureConductPerformanceSTRUCTURE-CONDUCT-PERFORMA

22、NCE (SCP) MODEL101.Determinants of supplier powerDifferentiation of inputsSwitching costs of suppliers and firms in the industryPresence of substitute inputsSupplier concentrationImportance of volume to supplierCost relative to total purchases in the industryImpact of inputs on cost or differentiati

23、onThreat of forward integration relative to threat of backward integration by firms in the industry2.Determinants of barriers to entryEconomies of scaleProprietary product differencesBrand identitySwitching costsCapital requirementsAccess to distributionAbsolute cost advantagesProprietary learning c

24、urveAccess to necessary inputsProprietary, low-cost product designGovernment policyExpected retaliation5.Determinants of rivalry Industry growthFixed (or storage) cost/value addedIntermittent overcapacityProduct differencesBrand identitySwitching costsConcentration and balanceInformational complexit

25、yDiversity of competitorsCorporate stakesExit barriers3.Determinants of buying powerBargaining leverageBuyer concentration vs. firm concentrationBuyer volumeBuyer switching costs relative to firm switching costsBuyer informationAbility to backward-integrateSubstitute productsPull-through4.Determinan

26、ts of substitution threatRelative price performance of substitutesSwitching costsBuyer propensity to substitute2. New entrants3. Buyers4. SubstitutesIntensity of rivalry1. SuppliersPrice sensitivityPrice/total purchasesProduct differencesBrand identityImpact on quality perceptionBuyer profitsDecisio

27、n-makers incentives5. Industry competitorsFORCES AT WORK FRAMEWORK11Opportunities and threatsHow are demand and supply expected to evolve?How do you expect the industry chain economics to evolve?What are the potential major industry discontinuities?What competitor actions do you expect?Your BUSWOT A

28、NALYSISConvert opportunitiesBuild on strengthsNeutralize threatsAddressweak-nessesStrengths andweaknessesWhat are your BUs assets/competencies that solidify your competitive position?What are your BUs assets/competencies that weaken your competitive position? Can be used as a thought-starter for com

29、petitive analysis and internal assessmentDiscovers potential opportunities/threats arising from factors external to the BU12SCP APPLIED TO LEXMARKRapidly changing technology, e.g., birth of portable, handheld, wireless computersRapidly changing customer preferencesPossibility of a paperless society,

30、 given increasing environmental concern and rise of the InternetEconomics of demandInk-jet printers replacing laser in nonnetwork environmentHigh price sensitivity; minimal opportunity for major product differentiationGrowth of laser and ink-jet printer markets stable but dependent on PC sales and d

31、egree of replacementEconomics of supplyHP holds lions share of printer marketIndustry capacity exceeds market demandPresence of counterfeit and recycled product supply, especially in consumablesHigh exit barriers due to asset intensityIndustry chain economicsBargaining power of suppliers low Bargain

32、ing power of distributors highLittle integration (forward or backward)MarketingManufacturers competing mainly on priceRetail dominant distribution channelAggressive development and release of new productsMoves to increase brand awareness via marketing campaignsCreative financing packagesInternal eff

33、iciency Relentless drive to low-cost manufacturingContinuous efforts to create more specialized features and/or functionsOthersEntry of PC and peripherals playersClamp down on counterfeit and recycled consumables suppliersFinancePrice competition on printer hardware drives margins down and forces pl

34、ayers to rely on profits from consumable products (good margins) and high volume capture on hardwareSExternalshocksFeedbacktructureConductPerformanceSource: Lexmark Case Presentation associate training materials13RESULTING OPPORTUNITIES AND RISKS FOR LEXMARKOpportunitiesRisksBecome the first mover i

35、n printers for portable, handheld, wireless computer marketGrow demand base via use of creative, nontraditional channels and alternative financing/payment methodsGrow demand for consumables via programs to increase printing usage Be the supplier of printers for PC/peripheral players hoping to the ex

36、pand into printer marketExpand leadership in corporate institutional accountsIncreasing demand for customization may increase costs and erode marginsAny decline in PC sales may significantly decrease revenuesMarket share may be eroded as competition intensifies Branding/marketing push from establish

37、ed players Pricing push from low-cost manufacturersMargins at risk if printing usage declines with push for paperless societyNOT EXHAUSTIVESource: Team analysis14COMPETITIVE ASSESSMENTPrivileged assets that create competitive advantage, e.g., physical assets, location/space, distribution/sales netwo

38、rkDistinctive skills and competencies that create competitive advantage, e.g., innovation, talent developmentWhat are yourcompetitivestrengths andweaknesses?What are the capabilities required to succeed in this industry?How do you compare against these necessary capabilities?Strengths and weaknesses

39、 of your competitive position vs. necessary capabilitiesBenchmark performance against the industrys relevant key performance indicators (KPIs),* with margin and market share as the required minimumKey questionSubquestionsIssues to be considered*KPIs are a handful of levers that drive the value of th

40、e industry or business15CAPABILITY PLATFORM: ASSESSING SOURCES OF COMPETITIVE ADVANTAGE Physical assetLocation/spaceDistribution/sales networkBrand/reputationPatentRelationship with license allocatorBHPs low-cost minesTelecom/media company with rights to radio spectrumAvons representativesCoca-ColaP

41、harmaceutical company with a wonder drugFavored nation status with a key minister in liberalizing economyInnovationCross-functional coordinationMarket positioningCost/efficiency managementTalent development3M with new productsMcDonalds with QSC&VJ&J branded consumer health productsEmerson Electrics

42、Best Cost Producer programP&G brand management programPrivileged assetsDistinctive competenciesCapabilities needed to succeed in industryExample16Step 1: Ensure that these are the capabilities required to succeed in the industry. Use this list as a thought starter, and add and delete as you see appr

43、opriateBU OverallSegmentsABCStep 2: Assess your overall position relative to the capabilities required to succeed in the industry. Also, determine whether these capabilities are relevant to the segments you servePhysical assetLocation/spaceDistribution/sales networkBrand/reputationPatentRelationship

44、 with license allocatorInnovationCross-functional coordinationMarket positioningCost/efficiency managementTalent developmentPrivileged assetsDistinctive competenciesCapabilities needed to succeed in industryCAPABILITY PLATFORM: ASSESSING SOURCES OF COMPETITIVE ADVANTAGE (CONT.)ILLUSTRATIVE Extremely

45、 relevantSomewhat relevantIrrelevant17RANKING YOURSELF AGAINST THE COMPETITIONKey midmarket buying factorsExplanationConvenient locationOfferPrice*Customer serviceShopping environment*Competitive positioning of Department Store 2 (DS2) vs. DS1MuchworseWorseRDSpositionBetterMuchbetter-2-1012DS2 is lo

46、cated in major thoroughfares and is accessible via public transport, resulting in higher trafficDS2 is considered a destinationDS2 and DS1 have the same categories except for snacks and appliancesDS2 has historically been viewed as the low-price player. This is reinforced by continuous customer expe

47、rience as well as the continuous reminder of the low prices via store signs and the strategic placement of loss leaders all around the storesBoth provide the standard offeringRangeDS2 has it allX*Best/lowest price, promotions*Cleanliness, ambience, signageSource:Team analysisXXXXX18BENCHMARK PERFORM

48、ANCE AGAINST RELEVANT INDUSTRY KPIsKPIs (examples)Financial indicatorsMarginNet incomeROCE Operating indicatorsAdvertising effectivenessUtilization rate Strategic indicatorsMarket sharePercent of revenue from new productsWorking capital trend External indicatorsMarket prices of raw materials BUCompe

49、titor ACompetitor BCompetitor C19KPIsFinancial indicators*Operating incomeMarginsROCE*Operating indicatorsDistribution reachCycle timeStrategic indicatorsMarket shareBrand awarenessLexmarkHPEpsonBENCHMARKING APPLIED TO LEXMARKStrongMediumWeak * Includes other information equipment (e.g., scanners, p

50、rojectors)* Return on capital employed$457 million12%29%$1,573 million 9%11%$583 million6%N/A12%47%17%Source: Lexmark Case Presentation associate training materials20INTERNAL ASSESSMENTRelevant BU segments (based on customer, product, geography, distribution channel)Operating contribution estimates

51、for each segmentHow does your current business emphasis fit with the industry opportunities and the competitive landscape?Which segments of the business are providing the highest returns?*What have been the performance trends along major BU KPIs?KPI performance trends over the last 3-5 years, e.g.,

52、return on capital employed (ROCE),* operating income, margins, capital employedAssessment of underlying trend driversExpected evolutionKey questionSubquestionsIssues to be consideredWhich intangible assets could be near-term sources of value?Identification of in-house intellectual property, talent,

53、networks, brand/imageConversion into sources of value*Based on latest available, 1- to 2-year historical financial statements*ROCE = Operating income x (1 - tax rate) All interest-bearing debt (short and long) + minority interest + stockholders equity21SEGMENT ANALYSISRevenueGross profitOperating pr

54、ofitAssets employedPeople employedOperatingprofit marginGross profitmarginROCEStep 1: Identify the relevant segmentsStep 2: Provide a segment analysis based on the following minimum financial metrics: revenue, gross profit and margin, operating profit and marginStep 3: To the extent assets and peopl

55、e can be disaggregated by segment, analyze deployment of assets against returns% of totalSegment 1% of totalSegment 2% of totalSegment 3% of totalSegment 4% of totalTotal%Segment 1Segment 2Segment 3Segment 4Total22SEGMENT ANALYSIS APPLIED TO LEXMARKPrinters and suppliersOther office imagingKeyboards

56、 and otherRest of worldEuropeU.S.Product%Geography% of total revenues, 1995100% = $3,807 million100% =$2,494 m100% = $895 m11414864846100% =$3,021 m100% =$1,024 m14355184646100% =$3,452 m100% =$1,031 m1428584060100% =$3,807 m100% =$1,164 m9236832671Gross profitRev1992Gross profitRev1993Gross profitR

57、ev1994Gross profitRev19950Source: Lexmark Case Presentation associate training materials; McKinsey database23TREND ANALYSIS: RETURN ON CAPITAL EMPLOYED (ROCE)The ROCE tree can be disaggregated to show the other relevant KPIs of a BUROCE%Operating income x (1 - tax rate)PHP millionCapital employedPHP

58、 millionRevenuePHP millionOperating margin%x(1 - tax rate)%xMarket share%Industry salesPHP millionxILLUSTRATIVE 24TREND ANALYSIS: CASHThe cash flow tree can be disaggregated to show the other relevant KPIs of a BUCash flow generatedPHP millionOperating cash flowPHP millionInvesting cash flowPHP mill

59、ion+Net incomePHP millionNoncash expensesPHP million+Change in working capitalPHP million+Financing cash flowPHP million+NOT EXHAUSTIVE25ROCE%Operating income x (1 - tax rate)$ millionCapital employed$ millionRevenue$ millionOperating margin%x(1 - tax rate)%xMarket share%Industry sales$ millionxNOT

60、EXHAUSTIVE Source: Lexmark Case Presentation associate training materials; McKinsey databaseTREND ANALYSIS APPLIED TO LEXMARK26INTANGIBLE-ASSET CHECKLISTIntangible assetsWays to extract near-term valueTalentHighly motivated and competent workforce leveraging specific skill sets toGenerate growthImpr