This two-day workshop helped participants craft a high-potential business growth strategy that capitalizes on marketplace opportunities while leveraging organizational competencies and
competitive advantages. Day 1 of the workshop consists of four modules: 1) an overview of business growth strategy, 2) conducting a current state assessment to identify business opportunities
consistent with organizational core competencies, 3) articulating a business growth vision to remain competitive in a challenging marketplace environment, and 4) growing the core business to
maximize revenue and profit.
3. 3Proprietary and Confidential UNI Strategic
Agenda—Day 1
Agenda Item Time*
Registration 08:30—09:00
Introduction 09:00—09:15
Session #1—Overview of Business Growth Strategy 09:15—10:40
Refreshments & Networking Break 10:40—11:00
Session #2—Conducting a Current State Assessment 11:00—12:45
Luncheon 12:45—14:00
Session #3—Articulating a Business Growth Vision 14:00—15:30
Refreshments & Networking Break 15:30—15:50
Session #4—Driving Organic Growth 15:50—17:00
*Times are approximate—Sessions may cut across breaks
4. 4Proprietary and Confidential UNI Strategic
Agenda—Day 2
Agenda Item Time
Session #5—Pursuing Inorganic Growth 09:00—10:40
Refreshments & Networking Break 10:40—11:00
Session #6—Developing a Business Growth Strategy 11:00—12:45
Luncheon 12:45—14:00
Session #7—Organizational Readiness & Implement. 14:00—15:30
Refreshments & Networking Break 15:30—15:50
Session #8—Measuring and Tracking 15:50—17:00
*Times are approximate—Sessions may cut across breaks
5. 5Proprietary and Confidential UNI Strategic
Our Topic—Defined
! Business growth is something for which most companies, large or small, strive
• Small firms want to get big, big firms want to get bigger
! The most common measure of growth is financial-based:
• Top line—Increase revenue through greater product sales or service income
• Bottom line—Increase profitability through the operation by minimizing costs
! Other businesses metrics may use additional criteria for assessing their growth:
• Number of employees
• Physical expansion
• Success of a product line
• Increased market share
! Ultimately, success and growth will be gauged by how well a firm does relative to the
goals it has set for itself
6. 6Proprietary and Confidential UNI Strategic
›❯ The topic of business growth—and our agenda,
more specifically—is extremely broad in nature.
This workshop is designed to be “a mile wide and
an inch deep.” Without exaggeration, each of our
eight sessions could easily be a standalone,
two-day workshop
›❯ The content in this workshop will contain a fair
amount of real-world illustrative examples to bring
the theories and concepts to life. Effort was made
to choose examples that represent a range of
different industries, business sizes and
geographies
›❯ The agenda has several “practical exercises”
which will provide participants the opportunity to
apply learning. Rather than using hypothetical
case studies, these exercises will ask participants
to apply concepts to their actual real-world,
business situations
Our Topic—Caveats & Disclaimers
7. 7Proprietary and Confidential UNI Strategic
Content
! Session #1—Overview of Business Growth Strategy
! Session #2—Conducting a Current State Assessment
! Session #3—Articulating a Business Growth Vision
! Session #4—Driving Organic Growth
! Session #5—Pursuing Inorganic Growth
! Session #6—Developing a Business Growth Strategy
! Session #7—Organizational Readiness & Implementation
! Session #8—Measuring and Tracking
8. 8Proprietary and Confidential UNI Strategic
Overview of Business Growth Strategy
#1—Overview of Business Growth Strategy
“You will either step forward into
growth…or you will step back
into safety.”
—Abraham Maslow
9. 9Proprietary and Confidential UNI Strategic
Business Growth—Not Just for the Sake of Growth
#1—Overview of Business Growth Strategy
! Since the ultimate goal of most companies is profitability, most companies will measure their
growth in terms of net profit, revenue, and other financial data
While temporary periods
of unprofitable growth may
be acceptable—and even
necessary—ultimately,
growth without profitability
is a recipe for failure
• Protecting market share
• Supporting a new product launch
• Entering a new market
Growth > Profitability
?
10. 10Proprietary and Confidential UNI Strategic
Types of Business Growth
#1—Overview of Business Growth Strategy
Existing Products to
Existing Customers
Growth Strategies
Organic
Strategies
Entering New
Industries
New Products &
Services
Existing Products to
New Customers
Takeover/
Acquisition Mergers
Joint Venture
Strategic Alliance
Horizontal
Vertical
Conglomerates
New Business
Models
Vertical Horizontal Unrelated
New to
Company
New to
World
New
Geographies
New
Channels
New
Segments
Inorganic
Strategies
11. 11Proprietary and Confidential UNI Strategic
#1—Overview of Business Growth Strategy
Organic Growth
! Organic growth is the internal growth of a company due to more product/service sales and
better saturation of a market
Organic Growth
• When you grow your business through strong
management and effective planning, you know
your business inside and out
• You can move quickly to take advantage of
changes in the marketplace, and you can
experience the satisfaction of seeing your
vision come to fruition
• You also have the choice of growing your
business at a rate that is comfortable for you
• Instead of merging with another company or
buying one, you can sell your business when it
is mature. This can create profit for you
• You may have limited resources for growing your
own business
• You may find the marketplace will not allow you to
grow beyond a certain point. In addition, your plans
for your own growth can be thwarted by
competition, causing you to cut back expectations
and consider the possibility of having to close down
due to limited opportunities
• Growing a business from the start-up stage means
constantly struggling to make sure you have
positive cash flow in order to pay your bills and
payroll, as well as finding ways to grow sales
Pros Cons
12. 12Proprietary and Confidential UNI Strategic
#1—Overview of Business Growth Strategy
Inorganic Growth
! Inorganic growth is achieving growth through means other than internal efforts tied to the
core of the business
Pros Cons
• Growing your business inorganically involves
joining with another business through a merger
or an acquisition. This immediately expands
your assets, your income and your market
presence
• You will have a stronger line of credit because
of the combined value of the two businesses
• You will also benefit from the added expertise
from personnel at the new business.
• You will have to expand your management
capabilities dramatically when you join forces with
another business
• You will suddenly have many more employees and
more assets to monitor, use and dispose of as your
business needs change
• You may enter areas of the marketplace where you
have no expertise
• You can also grow too fast. Most mergers and
acquisitions require financing, and you will have to
service your debt from the growth you experienced
with the merger or acquisition
Inorganic Growth
13. 13Proprietary and Confidential UNI Strategic
#1—Overview of Business Growth Strategy
Source: The Evolution of Strategic Management/Strategic Planning
! While in the past business strategy has focused on factors such as cost cutting, quality, and
productivity, recent trends have suggested an increasing focus on innovation and growth
Trends in Business Strategy
14. 14Proprietary and Confidential UNI Strategic
CEOs’ Perspectives On Growth
#1—Overview of Business Growth Strategy
! PwC’s Annual Global CEO Survey suggests a decrease in confidence when it comes to
identifying and capturing growth opportunities
Source: PwC
15. 15Proprietary and Confidential UNI Strategic
CEOs Targeting Pockets of Opportunity
! CEOs are pursuing organic
growth in existing markets
#1—Overview of Business Growth Strategy
! Half of CEOs’ top ten
countries are growth markets
! Additionally, PwC’s Annual Global CEO Survey suggests a tendency toward pursuing
organic growth, and in global growth markets
Source: PwC
16. 16Proprietary and Confidential UNI Strategic
Business Growth—Industry Perspectives
#1—Overview of Business Growth Strategy
! In particular, CEOs in Technology, Capital Markets and Oil & Gas view organic growth in
existing markets as integral to their growth plans
Source: PwC
17. 17Proprietary and Confidential UNI Strategic
The Case for Business Growth
#1—Overview of Business Growth Strategy
Why should you care? How will you benefit?
! As with any topic in business, the case needs to be made for why growth is important and
how the company will benefit from it
&
18. 18Proprietary and Confidential UNI Strategic
Why Should You Care?—Universal & Timeless Need
#1—Overview of Business Growth Strategy
! Growth is possible in any industry, any region, any phase of the business cycle
19. 19Proprietary and Confidential UNI Strategic
Why Should You Care?—Long-term Business Viability
#1—Overview of Business Growth Strategy
! Simply put, growth is not an option—it’s an imperative. Businesses that do not grow
consistently eventually risk market irrelevance and extinction
When companies stop growing, they
reach a “stall point” in their revenue
growth and almost never recover it
Only 7% ever recover from a stall.
Most go on to be acquired or to go
into bankruptcy or dwindle at market
growth levels of growth for some
period after that
They never really recover that next
level of true business success and
true business impact
Source: Strategic Planning Failure, The Evolution of Strategic Management/Strategic Planning
20. 20Proprietary and Confidential UNI Strategic
How Will You Benefit?—Improved Financial Condition
#1—Overview of Business Growth Strategy
! Not surprisingly, achieving sustainable growth typically has a direct and profound impact on a
company’s bottom line
Improves
Business
Value
Generates
Additional
Capital
Reduces Fin’l
Market
Vulnerabilities
Can Reduce
Bank Debt
More Quickly
21. 21Proprietary and Confidential UNI Strategic
How Will You Benefit?—Increased Shareholder Value
#1—Overview of Business Growth Strategy
Source: A.T. Kearney 5-, 10-, and 15-year analyses of revenue growth and total shareholder returns for
the entire Australian Securities Exchange, identifying top performers on the ASX200.
! Long-term growth is the decisive driver of stock prices, thus companies are in control of their
own stock price destiny
CEOs stated…
• Growth requires a clearly-
articulated and relevant vision
• Growth is a direct outcome of
strategy
• Growth requires a solid
methodological approach
• Growth success is attributed to to
corporate culture and leadership
22. 22Proprietary and Confidential UNI Strategic
Strategic Business Growth—Best Practices
#1—Overview of Business Growth Strategy
! Through our work helping companies grow, we have identified five best practices that tend to
yield the best results
Follow a ProcessBe a Leader
Find the Next S-Curve Know Thy Customer Embrace Your Inner Innovator
23. 23Proprietary and Confidential UNI Strategic
1) Best Practices—Find the Next S-Curve
#1—Overview of Business Growth Strategy
! If you wait until you need a new growth strategy, it already may be too late to identify and
develop one
24. 24Proprietary and Confidential UNI Strategic
2) Best Practices—Know Thy Customer
#1—Overview of Business Growth Strategy
! Best practice growth companies excel in the area of customer centricity. They make it a
priority to understand their customers better than any of their closest competitors
• Demographics
• Attitudes
• Perceptions
• Beliefs
• Needs
• Wants
• Behaviors
25. 25Proprietary and Confidential UNI Strategic
3) Best Practices—Embrace Your Inner Innovator
#1—Overview of Business Growth Strategy
! There is an inextricable link between innovation and growth. While growth without innovation
is technically possible, it is significantly limited in scope
26. 26Proprietary and Confidential UNI Strategic
4) Best Practices—Be a Leader
#1—Overview of Business Growth Strategy
! It’s no coincidence that some of the most consistent growth-oriented companies have senior-
level leaders who value and reinforce the importance of growth and innovation
27. 27Proprietary and Confidential UNI Strategic
#1—Overview of Business Growth Strategy
! Growth is typically not accidental—it is the result of establishing and following a well-thought
out process and approach
Current
State
Assessment
Articulating a
Business
Growth Vision
Driving
Organic
Growth
Pursuing
Inorganic
Growth
Developing a
Business
Growth Strategy
Organizational
Readiness &
Implementation
Measurement
&
Tracking
5) Best Practices—Follow a Process
28. 28Proprietary and Confidential UNI Strategic
Content
! Session #1—Overview of Business Growth Strategy
! Session #2—Conducting a Current State Assessment
! Session #3—Articulating a Business Growth Vision
! Session #4—Driving Organic Growth
! Session #5—Pursuing Inorganic Growth
! Session #6—Developing a Business Growth Strategy
! Session #7—Organizational Readiness & Implementation
! Session #8—Measuring and Tracking
29. 29Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Conducting a Current State Assessment
“The long run is a misleading
guide to current affairs. In the
long run, we are all dead.”
—John Maynard Keynes
30. 30Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Win:Win:
Economic
Technological
Societal
Impact of
Globalization
Balance
of Trade
Access to
Capital
Tech.
Infrastructure
Tech
StandardsIP
Reg.
IT
Product
Develop
R&D
Tax &
Regulatory
Sustain-
ability
Future
Markets
Human
Rights
Demographic
Shifts
Workforce
Talent
Corp
Resp.
Mkt.
Res
Sales/
Mktg
Human
Rscs
Macro Environment
Industry/Sector
Organization
Current State Assessment—Framework
31. 31Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Economic Trends
Political impasse in the
U.S. will leave the
government without the
borrowing capacity to fund
normal operations
Significant risk stems
from uncertainty about bold
policy action and
coordination within and
among advanced countries
With weak financial
institutions and its
infrastructure-led growth
model under attack, China
may not have all the tools to
achieve its goals
Worldwide, we may witness a
widening gap between the
preferences of savers and
the needs of borrowers
The new trend to look for in
the euro area will be in the
financial markets rather
than in the political realm
1 2
3 4
5
Source: Brookings Institution
32. 32Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Impact of
GlobalizationEconomic
Development
Balance
of TradeProduct
Markets
Financial
Assets
Access to
Capital
Macro Environment
Industry/Sector
Organization
Economic Factors
• Which countries are gaining most in
terms of consumer wealth and
disposable income?
• Which countries are showing the
greatest improvements in economic
development and GDP?
• How favorable (or unfavorable) are
the current financial markets?
• What is the optimal means for
raising capital (e.g., debt, equity)?
• Which regions of the world have the
most favorable trade balances?
• What are the implications of your
company’s ownership structure
(e.g., shareholder expectations)?
• Does you company have adequate
access to capital?
• Is your current financial situation
conducive to growth? If so, which
means of investment are optimal?
1) Economic Factors & Considerations
Questions/Considerations
33. 33Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
2) Technological Trends
Source: PwC
34. 34Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Technological
InfrastructureTechnological
Ingenuity
Tech
StandardsPatent
Norms
New Product
Development
R&D
Macro Environment
Industry/Sector
Organization
Technological Factors
2) Technological Factors & Considerations
• Which regions/countries represent
the current “hot bed” of innovation?
• Do certain countries or geographies
have a more favorable technology
infrastructure? What is the basis for
this advantage?
• What are the current innovation
trends in your industry (e.g. product,
service, process, solution)?
• What is your industry’s stance
relative to patents (e.g., granting,
enforcing)?
• Does your industry aggressively
protect proprietary IP, or is it more
“open source?”
• What is your company’s track
record in new product/service
development?
• How strong is your company’s R&D
capabilities relative to those of key
competitors?
Questions/Considerations
35. 35Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
3) Political Trends
Risks to Conducting Business Internationally:
• Confiscation, Expropriation and Domestication
• Economic risks associated with the political
environment (exchange controls, local-content
laws, import restrictions, etc.)
• Political Sanctions (e.g., boycotting trade)
• Political and Social Activist and NGOs
• Violence, Terrorism and War
• Cyber-terrorism and Cybercrime
Global Political Trends/Factors:
• Inherently unstable governments
• Changes in ruling political parties
• Extreme nationalism
• Animosity toward specific countries
• Trade disputes
36. 36Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Balance of
PowerTax &
Regulatory
Regulatory
EnvironmentIncentives
& Support
Public
Affairs
Corp.
Gov.
Macro Environment
Industry/Sector
Organization
Political Factors
3) Political Factors & Considerations
• How is the political environment
(domestic and international)
affecting your business?
• Which countries seem to be the
most “business friendly” and
receptive to foreign investment?
• Do tax laws make certain countries
more or less attractive from an
investment/growth perspective?
• Are there trade barriers in current or
prospective countries that make
partnership and/or investment less
feasible?
• Which countries seem to be offering
the greatest incentives to
encourage foreign investment?
• What is your company’s risk
tolerance relative to doing business
in foreign countries?
• How strong is your company’s
corporate governance function?
Questions/Considerations
37. 37Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
4) Environmental Trends
1. A deeper understanding of what sustainability means
2. Your employees are your secret weapon
3. Speaking with rather than to your customers
4. Your impact goes well beyond what happens in your office
5. Really get to know your suppliers
6. The gap is getting bigger, which is both good and bad
7. A more open environment to explore sustainability
8. The ‘business case’ is wider than most realize
9. Your new recruits will take you there
10. Having fun with it
How Sustainability is Impacting Business:
Source: The Sustainable MBA
38. 38Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Natural
DisastersClimate/
Weather
Raw
MaterialsSupply
Stability
Public
Affairs
Environ.
Affairs
Macro Environment
Industry/Sector
Organization
Environmental Factors
4) Environmental Factors & Considerations
• To what extent (if any) is your
industry affected by climate/
weather?
• Does your company have critical
infrastructure in countries
susceptible to natural disasters
(e.g., hurricanes, earthquakes)?
• Is sustainability a big issue in your
industry, and if so, how is it
impacting your company?
• How stable is the supply of raw
materials in your industry? Are
supply levels sufficient to meet
current and future projected
demand?
• Can the futures market help offset
risk related to certain critical raw
materials?
• How strong is your company in
terms of public and environmental
affairs?
Questions/Considerations
39. 39Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
5) Societal Trends
1. Value creation shifting from workers to outside the enterprise
2. Business processes as opt-in community-powered activities
3. Mobile experiences as the primary social channel
4. Business engagement driven by social analytics
5. Engagement strategies that scale across all important social channels
6. Anticipating and designing for loss of control
Six Social Trends Impacting Business:
Source: Dachis Group
40. 40Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Demographic
Shifts
Human Rights
Workforce
Talent
Social
Respons-
ibility
Sales &
Mktg.
Market
Res.
Macro Environment
Industry/Sector
Organization
Societal Factors
5) Societal Factors & Considerations
• How are recent shifts in global
demographic trends affecting your
industry and business?
• Are certain countries more or less
attractive to your company because
of their stance on human rights?
• Is your company able to understand
and be sensitive to differences in
social norms across the world?
• Which countries and markets are
most attractive from a workforce
talent perspective (in terms of skill
set, wages, etc.)?
• How strong are your sales and
marketing functions at identifying
societal nuances and leveraging
them for competitive advantage?
• Is your company adept at
conducting market research, and
understanding how attitudes,
perceptions and behaviors are
changing?
Questions/Considerations
41. 41Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Current State Audit—Template
Economic + -
Macro Environment
• Economic Development
• Impact of Globalization
• Distribution of Wealth
Industry/Sector
• Product Markets
• Balance of Trade
• Financial Markets
Organization
• Financial Assets
• Ownership Structure
• Access to Capital
Environmental + -
Macro Environment
• Climate/Weather
• Natural Disasters
• Sustainability
Industry/Sector
• Supply Stability
• Raw Materials
• Futures Markets
Organization
• Public Affairs
• Investor Relations
• Environmental Affairs
Technological + -
Macro Environment
• Tech. Ingenuity
• Tech. Infrastructure
• Level of Innovation
Industry/Sector
• Patent Norms
• Tech. Standards
• IP Regulations
Organization
• New Product Dev.
• Information Tech.
• R&D
Societal + -
Macro Environment
• Human Rights
• Demographic Shifts
• Social Norms
Industry/Sector
• Social Responsibility
• Workforce Talent
• Training & Dev.
Organization
• Sales & Marketing
• Human Resources
• Market Research
Political + -
Macro Environment
• Tax & Regulatory
• Balance of Power
• Business Posture
Industry/Sector
• Incentives & Support
• Regulatory Environ.
• Trade Barriers
Organization
• Public Affairs
• Legal Affairs
• Corporate Governance
42. 42Proprietary and Confidential UNI Strategic
#2—Conducting a Current State Assessment
Practical Exercise #1—Current State Assessment
With YOUR organization/business unit in mind, think about the key factors impacting your
potential for growth…both internal and external; favorable and unfavorable
! Which of the five factors on the previous page have the most significant impact on your
potential for business growth?
! Within each of the five factors, what specific criteria warrant the most consideration as you
plan for growth?
! What company resources do you have at your disposal to help you conduct a Current
State Assessment?
! What new/additional information, resources, or activities could you leverage to supplement
your Current State Assessment?
! How could you potentially modify the framework from this session to make it even more
relevant for your organization?
43. 43Proprietary and Confidential UNI Strategic
Content
! Session #1—Overview of Business Growth Strategy
! Session #2—Conducting a Current State Assessment
! Session #3—Articulating a Business Growth Vision
! Session #4—Driving Organic Growth
! Session #5—Pursuing Inorganic Growth
! Session #6—Developing a Business Growth Strategy
! Session #7—Organizational Readiness & Implementation
! Session #8—Measuring and Tracking
44. 44Proprietary and Confidential UNI Strategic
#3—Articulating a Business Growth Vision
Business Growth Vision
“A leader has the vision and
conviction that a dream can be
achieved. He inspires the power
and energy to get it done.”
—Ralph Lauren
45. 45Proprietary and Confidential UNI Strategic
#3—Articulating a Business Growth Vision
! Business Growth Vision is a bridge between the Current State Assessment and the Business
Growth Strategy. It essentially articulates the objectives business expansion needs to deliver
Strategic Roles
Business Growth Vision
Growth Gap Decision Filters Growth Charter
Business Growth Vision—Key Components
46. 46Proprietary and Confidential UNI Strategic
#3—Articulating a Business Growth Vision
! The Financial Growth Gap is a central part of the Growth Vision. It defines how much revenue
is required—over and above base business—to achieve financial goals
Activities:
! Gain input through management interviews and analyses
! Collect and understand financial data and division financial/growth trend data
! Determine the growth gap based upon realistic, yet aggressive analysis and planning
Tools:
! Historical growth rate
! Management cited goals
! Financial summary for official growth plans
! Past product launches
Definition:
Growth Gap—The difference between total expected business unit revenues from
existing products and the revenue goal. This identifies revenues to be generated
through growth modes such as new product development and acquisitions.
Growth Gap—Defined
47. 47Proprietary and Confidential UNI Strategic
#3—Articulating a Business Growth Vision
14.3%
CAGR
4.5%
CAGR
$200MM
$400MM
$600MM
$800MM
$1B
FY13
$604
$688
FY18
$1 B
18.4%
CAGR
Base Business
Growth Gap Expectation
$900
Growth Gap—Disguised Example
! The example below shows how a company projected a growth for its base business (CAGR),
and subtracted the resulting amount from its revenue goal to derive its Growth Gap
48. 48Proprietary and Confidential UNI Strategic
Growth Gap—Assumptions & Scenarios
#3—Articulating a Business Growth Vision
! It is important to develop several assumption-based scenarios when planning for growth
Estimated NP Costs ($MM):
Development Costs
Acquisition Costs
Marketing Launch Costs
TOTAL
Assumptions
Annual Gross $ Sales (MM)
Gross Retail
• Existing Expertise $35 $50
• NTC $65 $100
• NTW $167 $250
In-House Development Costs ($MM)
• Existing Expertise = $1.0
• NTC/NTW = $1.5 - 2.0
Acquisition Costs ($MM)
• Medium = $80
• High = $150
Year 1
2.5
--
25.0
27.5
Year 2
1.0
80.0
25.0
106.0
Year 3
2.5
--
25.0
27.5
TOTALS
6.0
80.0
75.0
161.0
1 – EE
1 – NTC
$100
1 – EE
1 – NTC
Year 1
Intros
$200
Year 1
Intros
Year 2
Intros
1 – EE
1 – NTC
$300
Scenario 1
($200MM
when
potential
failure rate is
applied)
49. 49Proprietary and Confidential UNI Strategic
Growth Gap—Rollout/Timing
#3—Articulating a Business Growth Vision
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
0 Introductions in
FY ‘13
1 year of product
development,
testing and
revisions
3 “events” in FY ‘14 3 “events” in FY ‘15 2 “events” in FY ‘16
B2
C2
A4
A3
C1
B1
A2
$260MM in FY ‘16
(after success rate)
A
Low Risk
($25MM Yr 1)
Medium Risk
($60MM Yr 1)
High Risk
($90MM Yr 1)
A1
$156MM in FY ‘15
(after success rate)
$61MM in FY ‘15
(after success rate)
B C
! Additionally, to the extent possible, it is often useful to sequence and time how growth events
will play out over the term of the plan
50. 50Proprietary and Confidential UNI Strategic
Strategic Objectives—Definition & Disguised Example
#3—Articulating a Business Growth Vision
• Increase share of stomach within existing consumer base
• Create new occasions and/or categories for the brand
• Improve current margins
• Grow topline sales while being highly incremental to the parent brand
• Identify consumer problems, opportunities and ideas beyond frozen
• Enhance consumers’ perceptions of Company X
• Leverage internal capabilities, competencies, and capacities
- R&D
- Manufacturing
Individual new products/platforms will achieve at least one or more of the
following strategic roles in order to build a portfolio of new products/platforms
that achieve all the strategic roles:
! Strategic Objectives are very specific goals or expectations that potential growth opportunities
should satisfy
51. 51Proprietary and Confidential UNI Strategic
Decision Filters—Categories/Types
#3—Articulating a Business Growth Vision
! While the categories/types of filters can vary by company, there are several that seem to be
commonly used by most organizations. As with Strategic Objectives, they can be either
“categorical” or go/no-go
Filter Description
Strategic Fit
The extent to which a growth opportunity is a fit with the
overall corporate (or BU) business strategy and objectives
Customer/Consumer Fit
The extent to which a growth opportunity satisfies a high-
potential customer need (especially an unmet need)
Technical Feasibility
The extent to which a company is able to achieve a growth
opportunity with minimal incremental technological upgrades
Operational Feasibility
The extent to which a company is able to achieve a growth
opportunity with minimal disruption to ongoing operations
Financial Returns
The extent to which a growth opportunity meets the required
financial hurdles as determined by the Growth Gap
52. 52Proprietary and Confidential UNI Strategic
Strategic Fit Hurdle
• Does the concept fit with the New Product Vision? Yes / No
• Is the concept consistent with Brand Extendibility? Yes / No
• Does the concept satisfy one or more Strategic Roles? Yes / No
➔ If yes, which Strategic Role(s) are satisfied? A, B, C, D, E, F
• Is there an enthusiastic champion for this concept on the Core Team? Yes/No
➔ Which OC would implement this concept? FRZ ASE GPD OTHER
Consumer Fit
• Does the concept offer consumers a very attractive solution to an intense need? Yes / No
• Does the concept offer a unique nutritional point of difference? Yes / No
• Does the concept have a strong purchase intent? <19.7 19.7-21.6 >23.5
• Does the concept have a strong purchase frequency? L M H
Attractiveness of the Market
• What is the potential size of the market (in $MM)? <$500 $500-2,000 >$2,000
• What is the market growth trend? 1 2 3 4 5
(1 = Declining; 3 = Static; 5 = Growing)
• How attractive is the competitive environment? 1 2 3 4 5
(1 = Not at all; 3 = Somewhat; 5 = Very)
• Relative to current competitive offerings, how unique is this idea? 1 2 3 4 5
(1 = Not at all; 3 = Somewhat; 5 = Very)
Decision Filters—Disguised Example
#3—Articulating a Business Growth Vision
• = Screen è = Sort/Portfolio Management
53. 53Proprietary and Confidential UNI Strategic
Growth Charter—Disguised Example
#3—Articulating a Business Growth Vision
Consumers actively looking to improve their overall health and well-being will turn to
Company X as their trusted source on healthy foods. Company X will earn their trust by
understanding consumer needs and wants and introducing new products that provide
nutritionally superior, great tasting “real” foods that make healthier eating easy every day.
• Nutritionally Superior: Every Company X innovation will have a distinctive, relevant
and motivating nutritional benefit.
• Great Tasting: Company X foods will be a positive taste experience that consumers
enjoy eating.
• Healthier Eating Easy (Convenient): Consumers will find Company X new product
introductions as easy, if not easier, to buy and use as the food choices presently in
their lives.
• Real Foods/Everyday: Consumers will consider Company X innovations mainstream
– not just for special diets, not medicinal, not faddish and not strange. They can relate
to and understand the nutrition provided and eat these foods every day with
confidence.
54. 54Proprietary and Confidential UNI Strategic
#3—Articulating a Business Growth Vision
Practical Exercise #2—Articulating a Growth Vision
For YOUR organization/business unit, think about the following components of a Business
Growth Vision…
! Growth Gap
• What is the assumed growth rate for your base business (CAGR)?
• What is the size of your Growth Gap?
• Approximately what percentage of future growth needs to be organic?
! Strategic Objectives
• What are some specific objectives that come to mind as you think about identifying
growth opportunities for your organization?
– Financial? Strategic? Organizational? Operational? Competitive? Other?
! Decision Filters
• What are some examples of “Go/No-go” filters that might make sense for your
organization?
• What are some examples of “Categorical” filters that can sure business growth is
evenly distributed across different considerations?
55. 55Proprietary and Confidential UNI Strategic
Content
! Session #1—Overview of Business Growth Strategy
! Session #2—Conducting a Current State Assessment
! Session #3—Articulating a Business Growth Vision
! Session #4—Driving Organic Growth
! Session #5—Pursuing Inorganic Growth
! Session #6—Developing a Business Growth Strategy
! Session #7—Organizational Readiness & Implementation
! Session #8—Measuring and Tracking
56. 56Proprietary and Confidential UNI Strategic
Driving Organic Growth
#4—Driving Organic Growth
“There are no great limits to
growth because there are no
limits of human intelligence,
imagination, and wonder.”
—Ronald Reagan
57. 57Proprietary and Confidential UNI Strategic
A.T. Kearney—Strategy for Organic Growth
#4—Driving Organic Growth
! An A.T. Kearney study prescribes a three-pronged strategy for Organic growth that any
company can deploy to achieve aggressive growth rates
Source: A.T. Kearney, The Inside Story on Organic Growth
58. 58Proprietary and Confidential UNI Strategic
1) Capture Short-term Growth Opportunities
#4—Driving Organic Growth
! Nothing ensures success faster than a few quick wins. Once in growth mode you can build
momentum across the organization
Low-hanging Fruit Business Growth Momentum
59. 59Proprietary and Confidential UNI Strategic
2) Eliminate Barriers to Growth
#4—Driving Organic Growth
! Eliminating growth barriers can open up internal and external avenues to growth that many
companies do not even realize are blocked
• Large size of company leading to lack
of communication
• Lack of salespeople’s knowledge
about the product/service/market
• Unproductive work environment
• Too much focus on cost cutting or on
improving EBIT creative a disincentive
for investment in growth
60. 60Proprietary and Confidential UNI Strategic
3) Continually Manage for Sales & Marketing Excellence
#4—Driving Organic Growth
! Companies that substantially improved several marketing and sales capabilities at once
increased total sales by more than 25% per year
61. 61Proprietary and Confidential UNI Strategic
Organic Growth—Starbucks
#4—Driving Organic Growth
! Organic growth is the single-minded focus for Starbucks and CEO,
Howard Schultz
! Starbucks believes the franchising business presents a clear
opportunity, as it allows the chain to open up stores in small towns
where a franchisee can contribute their local knowledge and share
the cost and risk
! The strategy is about sustaining a revenue growth rate, so the firm
is looking to squeeze even more locations into available space
! In January 2013 Starbucks opened its first franchise store in the
UK, in Liphook, Hampshire and the franchise has since opened
three additional sites
! Starbucks is actively expanding the new U.K. franchise program
with a number of experienced and well capitalized regional and
national franchise operators as well as growing captive licensed
store footprint into important customer segments such as rail
stations, airports, universities and hospitals
62. 62Proprietary and Confidential UNI Strategic
Organic Growth—Lego
#4—Driving Organic Growth
! Lego has never made an acquisition. It focuses on using new
product development and innovation as the driver of revenues and
profits - to great success
! Since 2007, Lego has tripled its revenues globally and achieves an
operating profit margin of almost 25%!
! Its share of the total U.S. toy market has quadrupled in five years.
As of the end of 2012 it was 7.9%, up 1.6 percentage points from
the previous year
! The strategy of Lego is best summed up by the quote: "We want to
be the best, not the biggest”
! On Dec. 26 in the U.K. and Jan. 1 in the U.S., Lego rolled out Lego
Friends, aimed at girls 5 and up. It sold better than expected - to the
extent that production units were unable to keep pace with demand
! In the U.S., Lego Friends surpassed early projections, with its sales
eventually increasing three times more than expected
63. 63Proprietary and Confidential UNI Strategic
Organic Growth—Framework
#4—Driving Organic Growth
Existing Products to
Existing Customers
Growth Strategies
Organic
Strategies
Entering New
Industries
New Products &
Services
Existing Products to
New Customers
Takeover/
Acquisition Mergers
Joint Venture
Strategic Alliance
Horizontal
Vertical
Conglomerates
New Business
Models
Vertical Horizontal Unrelated
New to
Company
New to
World
New
Geographies
New
Channels
New
Segments
Inorganic
Strategies
64. 64Proprietary and Confidential UNI Strategic
#4—Driving Organic Growth
1) New Geographies
! There are three distinct phases of globalization. Companies and industries do not move
smoothly through these phases. Progression is disruptive, and, when one company changes
the game, an entire industry can be forced to respond
Export Regionalize Originate
Source: Guiding Global Growth, PwC
65. 65Proprietary and Confidential UNI Strategic
1) New Geographies—Applied
#4—Driving Organic Growth
! The three phases of globalization can be applied to a number of important dimensions for
most global businesses
Source: Guiding Global Growth, PwC
66. 66Proprietary and Confidential UNI Strategic
1) New Geographies—IKEA
#4—Driving Organic Growth
! Ikea Group, the world’s biggest home-furnishings retailer,
plans to increase the number of outlets fourfold in China as
the world’s most populous nation is set to become the
company’s second-largest market
! China will be Ikea’s number two market relatively soon, and
number one maybe in the long run - the furniture retailer
plans to add five stores to the 11 it currently has in the
country and boost the total to 40 by about 2020
! Its low-price strategy created confusion among aspirational
Chinese consumers while local competitors copied its
designs. IKEA adapted its strategies and became profitable in
China
! The company plans to open its first store in India by 2014 and
25 stores in 10 to 15 years
! The retailer, which is also looking to open more stores in
Russia this year, is testing an Internet- based e-commerce
business in 10 countries to complement its physical stores
67. 67Proprietary and Confidential UNI Strategic
2) New Channels
#4—Driving Organic Growth
! To grow profitably, it is critical to understand in which channels to play and to prioritize
investments accordingly. The challenge for many companies is to identify through which
channels to address which market segments
• Successful players develop channel strategies that provide clear direction on which
channels to exploit to target specific segments in specific markets, how to win in new
and existing markets and how to be competitive at a local level
• The ability to identify, enact, manage and support local or regional resources with quality
channel strategies and execution can mean the difference between profitable growth
and floundering business performance
• Simply duplicating channel strategies from core markets can lead to disappointing
results
• A well developed and executed channel strategy focuses on understanding the
opportunities, drivers and structures of different markets to ensure local firm resources
are focused on ensuring goods are in the right place, at the right price, when consumers
make a decision to buy
68. 68Proprietary and Confidential UNI Strategic
2) New Channels—Gap
• Gap Inc. is strategically gaining market share in North America and
around the world through its portfolio of six brands -- Gap, Banana
Republic, Old Navy, Athleta, Piperlime and newly-acquired Intermix
- while investing further in its leading digital and online capabilities
• Company executives have confidence about the long-term growth
potential of the brands and reaffirm intentions to expand through
geographies and channels including specialty, online, outlet and
franchise
• "Over the next five years, key to our continued success will be
pushing the envelope further to make shopping seamless to
customers through our digital strategy, while seizing the opportunity
for Old Navy in many untapped international markets”
• In addition to Gap Inc.'s competitive advantage with its multiple
brands, channel and geography model, the company plans to build
upon its online success by delivering an omni-channel platform for
consumers as the retail landscape continues to merge online and
brick-and-mortar shopping experiences
#4—Driving Organic Growth
69. 69Proprietary and Confidential UNI Strategic
3) New Segments
#4—Driving Organic Growth
! While customers may look alike, their needs, attitudes and purchase drivers may differ
significantly
!!!!!
!!!
!!!
!!!!
!! !!!!!!
!!!
!!!
!!! !!!
!!!
!!!
Customers are all the same Customers have unique needs
• Looking for lowest price
• Want maximum fuel efficiency
Example (Automobiles):
• Safety
• Fuel efficiency
!!!
!!!
!!!
• Luxury
• Image conscious
• Performance
• Style
70. 70Proprietary and Confidential UNI Strategic
3) New Segments—Segmentation Types
#4—Driving Organic Growth
! In general, segmentations based on needs and/or attitudes tend to be more insightful and
informative than ones based on channel or firmographics
Key
Question:
Variables:
Type: Channel Firmographics Behavior Needs Attitudes
How are they
doing it?
Who are
they?
What are
customers
doing?
What do
customers
desire?
Why are they
doing it?
§ Purchase
§ Key
influencers
§ Sector
§ Geography
§ Spend Level
§ Company size
§ Product usage
§ Brand
awareness,
usage & loyalty
§ Price paid,
share of wallet,
and purchase
frequency
§ Required/
Have to have
§ Preferred/ Like
to have
§ Not needed
§ Category
attitudes,
desires and
beliefs
71. 71Proprietary and Confidential UNI Strategic
3) New Segments—Characteristics of a Good Segmentation
#4—Driving Organic Growth
! Although may different evaluation systems exist, the following criteria are widely accepted as
guiding principles for a good segmentation
• Identifiable—Individual segments should be able to be identified through
measurable attributes
• Prioritized—The value of each segment to the business is known and the relative
importance to the business can be determined
• Differentiated Needs—Segments need to explain underlying motivations (the
“whys”) and the conditions under which they exist (e.g., different usage/purchase
occasions)
• Predictive—Segments are predictive of or align with consistent patterns of behavior
• Durable—Segments are relatively stable over time, relieving the need to refresh
frequently
• Accessible—Marketing programs can be delivered profitably to the segments
through channels they desire
72. 72Proprietary and Confidential UNI Strategic
3) New Segments—Porsche
• Porsche has extended its product line beyond the flagship 911, and
they’ve usually done well with product line extensions
• The key in Porsche’s approach is using the brand to add value in the
new category, in this case SUV (sports utility vehicles)
• With the Cayenne Porsche brought luxury and sports car performance
into the SUV category. The engine and body shape of the Cayenne
was authentically Porsche, creating a distinctive and premium priced
value proposition
• It was a conscious decision to attract new buyers who couldn’t
ordinarily buy a sports car either because of the price or because
they needed greater space for their family
• The Cayenne, launched in 2003, fueled growth of 60% over 3 years.
Globally, the Cayenne made up 50% of Porsche’s volume
• The Cayenne is the lowest price point for a Porsche at $122,000 and
is now the company’s biggest selling vehicle in Australia
#4—Driving Organic Growth
73. 73Proprietary and Confidential UNI Strategic
4) New Products/Services—An Holistic Framework
#4—Driving Organic Growth
Innova&on
Strategy
Innova&on
Process
Por1olio
Management
Process
Management
Project
Metrics
Templates
Tools
Document
Organiza&on
Execu&ve
Sponsorship
Resource
Alloca&on
Team
Composi&on
Resources
&
Organiza&on
Metrics
Process
Strategy
Defini&on
of
innova&on
and
its
role
in
an
organiza&on
Process
that
is
followed
to
create
and
develop
new
products
and
services
Approach
to
managing
mul&ple
innova&on
efforts
across
the
por1olio
Oversight
of
NPD
ac&vi&es
and
how
the
process
is
followed
Measurements
and
hurdles
for
individual
projects
and
the
holis&c
por1olio
Set
of
documents
which
define
and
enable
NPD
ac&vi&es
Mechanisms
and
resources
that
aid
comple&on
of
NPD
tasks
A
space
where
NPD
knowledge
is
accessed
and
stored
Degree
to
which
leadership
visibly
supports
and
endorses
NPD
Decision-‐making
process
for
resources
to
support
NPD
Appropriate
human
resources
that
drive
and
support
the
NPD
process
Lens
Dimension
Descrip&on
Materials
and
programs
required
to
educate
all
NPD
stakeholders
Training
Templates
&
Tools
Metrics
74. 74Proprietary and Confidential UNI Strategic
4) New Products/Services—Six Sources of Inspiration
#4—Driving Organic Growth
! The following Six Sources of Inspiration enable the gathering and developing of a unique set
of insights related to the customer, their experiences, the brand, the organization and the
industry
Customer Insights
Customer attitudes, behaviors and
unmet needs
Experiential Analogs
Customer behavior outside the
category
Brand DNACore Competencies
Brand perceptions and key
associations
Strengths of the organization (e.g.,
partners, assets, resources)
Market & Trend Analysis
Expansive set of trends that are not
bounded by the business issue or
immediate relevance
Archives & Hidden Strengths
Looking into the past, beyond
conventional wisdom and/or well
below the surface
75. 75Proprietary and Confidential UNI Strategic
4) New Products/Services—Best Practices
#4—Driving Organic Growth
1) Encourage a culture that fosters risk taking
2) Develop a new products strategy
3) Use multi-functional teams with dedicated members
4) Follow a systematic and flexible stage gate approach
5) Apply compensation and incentives that stimulate an entrepreneurial environment
6) Foster and demonstrate top management commitment to innovation
7) Establish measurement criteria and track the results of innovation efforts
8) Develop new product types to fulfill the strategy and a balanced portfolio
9) Identify customer problems and needs before generating new product ideas
10) Appoint dedicated leaders and develop new product champions
! Below are a handful of “tried and true” guiding principles to maximize the likelihood of
successful new product/service launches
76. 76Proprietary and Confidential UNI Strategic
4) New Products/Services—Johnson & Johnson
#4—Driving Organic Growth
• Johnson & Johnson Pharmaceuticals segment is poised to continue
driving growth with more than 10 potential new product filings by 2017
• The Pharmaceuticals segment of J&J has built an industry-leading pipeline
that has yielded 11 new product launches since 2009, more than doubling
its productivity over the past four years
• The Company's approach to innovation has resulted in a revitalized
product portfolio for the Janssen Pharmaceutical Companies in the areas
of Immunology, Neuroscience, Infectious Diseases and Vaccines,
Cardiovascular and Metabolism, and Oncology
• These new products, coupled with core growth brands, have fueled 12
consecutive quarters of operational sales growth in the segment and
contributed significantly to the Company's recent earnings growth
• The Pharmaceuticals business of Johnson & Johnson was the fastest
growing in the U.S., Europe and Japan in 2012, with sales of $25.4 billion,
an operational increase of nearly 7% versus 2011
• “The innovative new therapies in our pipeline will drive our next wave of
growth” --Paul Stoffels, M.D., Chief Scientific Officer, Johnson & Johnson, and Worldwide
Chairman, Pharmaceuticals Group
Source: www.marketwatch.com
77. 77Proprietary and Confidential UNI Strategic
5) New Business Models
#4—Driving Organic Growth
! The emergence of new technologies in recent years has vastly expanded the ability for
companies to grow through developing new business models
Value
Proposition
Resources
Processes
Profit
Formula
A product/service that
provides a meaningful end
benefit to customers
People, technology,
facilities, equipment
and cash required
to deliver the VP
Assets and fixed
cost structure, and
the margin and
velocity required to
deliver them
Ways of working together
to address recurrent tasks
in a consistent manner
78. 78Proprietary and Confidential UNI Strategic
5) New Business Models—Types
#4—Driving Organic Growth
! Although there seems to be new business models emerging every day, there are three basic
types that many subscribe to
Solution
Shops
Value-Adding Process
Businesses
Facilitated
Networks
79. 79Proprietary and Confidential UNI Strategic
5) New Business Models—Zara
#4—Driving Organic Growth
• Fashions change at breakneck speed, which means retailers have to keep
pace with changing needs yet affordable production of large volumes of
clothing has traditionally involved long delivery times
• Zara makes it possible for everyone (in the world) to buy the latest
fashions at a price they can afford
• Zara delivers on its brand promise by outperforming everyone else when it
comes to precision, speed and small production volumes
• Zara’s success is achieved by one of the most ingenious design,
development, production and supply chains in the world. All Zara stores
are supplied with a new batch of clothing twice a week
• Delivery time is 24 hours within Europe and 36 hours to all other countries
• A design idea has to be translated into a garment displayed in the store in
a matter of just three weeks. This process takes other clothing
manufacturers an average of six months
• Whereas three months ago competitors were trying to work out what
customers will want three months from now, Zara listens to what the
customer wants now and supplies it in three weeks
Source: www.wikibusinessmodels.com