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Growth Strategies – Beat
                                                     the Unbeatable

      ―There, there it is ag...
ITS NOT STRATEGY THAT MATTERS – IT’S EXECUTION THAT COUNTS




                                                           ...
Business is somewhat like
                    Driving…


                    Open Roads, Fast Traffic

                   ...
Unfortunately most of us drive
                    with the traffic …


                    Congested Roads, Slow Traffic
...
In congested roads, how will you
                    reach your destination quickly?
                    •   Be an aggress...
The best business strategy is to be in
                         a fast growing industry!
                              Jus...
What is your understanding of the growth strategy?

1.562.860.8637
                     ITS NOT STRATEGY THAT MATTERS – IT...
We believe Growth Strategies is about:


                                     •   Increase Sales or Revenue
              ...
Size of the market pie is fixed
                    We have to snatch competitor‘s share to increase our market?

1.562.86...
How to capture the market share?




                                    or

                                             ...
Low Cost Strategy




                    There could be only one price leader !



1.562.860.8637
                       ...
Low Cost Strategy


                    You might be able to capture the market share but it will
                        ...
Differentiation Strategy




                    Differentiation means higher cost!




1.562.860.8637
                   ...
Differentiation Strategy




                                and/or

                    Customers                        ...
Differentiation Strategy – Customer

                                                    •   Original Market
             ...
Differentiation Strategy – Product
               • Quality
                                          In today‗s world, th...
Both Low Cost and Differentiation Strategies have their
                    pro and cons but they don‘t completely fit the...
Where each strategy fits . . .
                                                                     Low Price OR
         ...
We Believe:

                      ―Any business with less than
                      1%of the market share is in
        ...
Pursuing Differentiation & Low Cost Strategy
                                       Reduce Cost
                          ...
Differentiation & Low Cost Strategy is about
   Value Innovation
                           Cost


                       ...
How ?

              • Conduct a detailed marketing research, highlighting
                 • Industry Conditions
        ...
Strategy Canvas – A Diagnostic and
   Communication Tool
          How much industry invests in




                      ...
Strategy Canvas – Grocery Stores
          How much industry invests in
                                         High
    ...
Strategy Canvas – What it Shows
   Company Caught In Fierce Competition
          How much industry invests in
           ...
Strategy Canvas – What it Shows
   Over Delivering Without Payback
          How much industry invests in
                ...
Strategy Canvas – What it Shows
   Incoherent Strategy
          How much industry invests in
                            ...
Strategy Canvas – What it Shows
   Strategic Contradiction
          How much industry invests in
                        ...
How the Strategy Canvas Looks
                    for a Company that is pursuing
                     Differentiation and ...
Strategy Canvas – Trader‘s Joe
          How much industry invests in
                                         High
      ...
Trader Joe‘s Strategy Canvas
                                                        • Focus
                             ...
We know how to create
                       Strategy Canvas.

                                But

                    Ho...
Four Action Framework
   Answer Four Simple Questions

                    1   Identify factors that you can eliminate


 ...
Strategy Canvas – Trader‘s Joe

                                                                                          ...
Example:
   Our Client – An Interior Design Firm
   •     Industry Annual Revenue: $7.0b             •   Gross Profit Marg...
Strategy Canvas – Interior Design Firm
          High




                            High-end Industry
          Medium

...
Traditional Approach

     • Segment Market
           Let‘s define the market segment e.g. Home owners, Builders, Other
 ...
Strategy Canvas – Interior Design Firm
          High
          Medium




                                               ...
Recommended Growth Strategy

                                    • Focus
                                          – Clear...
Value Curve Validation

     • The litmus test i.e.
             – Focus
             – Divergence, and
             – Com...
What to Reduce, what to Add

              Think About:


              • Non-Customers, and
              • Alternatives
...
Three Tier of Non-Customers

                                            Tier 1: ―Soon to be‖ non-customers
              ...
How to Fulfill the needs of Non-Customers

     Look Across
     • Alternative Industries
     • Strategic Group Within In...
Next Step


            Identify                   Strategic Pricing           Align                      Adoption
       ...
Credits:




                         International Best Seller …




1.562.860.8637
                    ITS NOT STRATEGY ...
CPSPHERE – HELP YOU FOCUS & GROW




                                      Results




1.562.860.8637
                    ...
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Growth Strategies

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You know how to market your products and services. But do you know how to beat your competitors without going into the proce war or compromising quality?

Growing your business is a challenging task. This presentation shows how growing companies are accomplishing it and how you can adopt these tactics for your business growth.

Published in: Economy & Finance, Education
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  1. 1. Growth Strategies – Beat the Unbeatable ―There, there it is again—the invisible hand of the marketplace giving us the finger.‖ 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  2. 2. ITS NOT STRATEGY THAT MATTERS – IT’S EXECUTION THAT COUNTS  cpSphere  Delivering Next Generation of Solutions 17215 Studebaker Rd. Suite 390 Cerritos, CA 90703 1.562.860.8637 1.562.860.8611 growth@cpSphere.com 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS www.cpSphere.com info@cpsphere.com www.cpSphere.com
  3. 3. Business is somewhat like Driving… Open Roads, Fast Traffic does it matter if you are driving a new fast or an old modest car? Just like driving, best business strategy is to be in an industry that is growing fast 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  4. 4. Unfortunately most of us drive with the traffic … Congested Roads, Slow Traffic does it matter if you are driving a new fast or an old modest car Just like congested roads, we are in slow growing industries with many competitors. 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  5. 5. In congested roads, how will you reach your destination quickly? • Be an aggressive driver and maneuver through the traffic • Drive in the car pool • Drive on the shoulder • Drive in an ambulance or a police car • Use a different route OR • Use helicopter For our businesses we also need an helicopter strategy that make our competition irrelevant. 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  6. 6. The best business strategy is to be in a fast growing industry! Just like driving against the traffic. Unfortunately, most of us are driving our business with the traffic. To beat the traffic and grow our businesses we need a ―Helicopter Strategy‖ 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  7. 7. What is your understanding of the growth strategy? 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  8. 8. We believe Growth Strategies is about: • Increase Sales or Revenue • Capture Market share • Beat the competition • Exploit the existing demand Find the new Pot of Gold! 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  9. 9. Size of the market pie is fixed We have to snatch competitor‘s share to increase our market? 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  10. 10. How to capture the market share? or Differentiation Low Price 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  11. 11. Low Cost Strategy There could be only one price leader ! 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  12. 12. Low Cost Strategy You might be able to capture the market share but it will erode your profit margins Only way to make money with the Low Cost Strategy is by doing volume! 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  13. 13. Differentiation Strategy Differentiation means higher cost! 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  14. 14. Differentiation Strategy and/or Customers Products 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  15. 15. Differentiation Strategy – Customer • Original Market • By Region • By Ethnicity My Region The World Spanish Female 20 - 35 • By Gender California Speaking MARKET • By Age • Etc. etc. Higher the segmentation, smaller the market size 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  16. 16. Differentiation Strategy – Product • Quality In today‗s world, there is no way to • Features stop imitators. • Technology Does your product innovation create buyer value? 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  17. 17. Both Low Cost and Differentiation Strategies have their pro and cons but they don‘t completely fit the bill of the growth strategy because they are about war. ―The real purpose of any growth strategy should be to create an uncontested market place and growth opportunities.” 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  18. 18. Where each strategy fits . . . Low Price OR Differentiation Strategy Low Price Strategy Differentiation AND Low Price Strategy Differentiation Strategy Introduction Growth Maturity Decline Product Life Cycle 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  19. 19. We Believe: ―Any business with less than 1%of the market share is in Introduction state of life-cycle.” The best growth strategy for such businesses is Differentiation & Low cost 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  20. 20. Pursuing Differentiation & Low Cost Strategy Reduce Cost Cost • Production • Material • Marketing • Layoffs, etc. Differentiate by • Introducing new Product Features • Customer Service, etc. Product Features Product Innovation is offsetting Cost Reduction Do you really know where to cut cost and where to improve buyer value? 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  21. 21. Differentiation & Low Cost Strategy is about Value Innovation Cost Strategically reduce cost that results in more value for customers This is the corner stone of ―Helicopter Strategy‖ Buyer Value 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  22. 22. How ? • Conduct a detailed marketing research, highlighting • Industry Conditions • Competitive Situations • Benchmark your operations • Identify New Market Segments • Define Detailed Budgets Focus on the big picture, Not Numbers. . . 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  23. 23. Strategy Canvas – A Diagnostic and Communication Tool How much industry invests in Industry High Medium Strategy Canvas is a structured way to define your Low Value Proposition Price Factor 1 Factor 2 Factor 3 Factor 4 Factor 5 Factors the industry competes on 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  24. 24. Strategy Canvas – Grocery Stores How much industry invests in High Medium Low Industry Sales & Price National Choice of Store Friendly Advertisement Proximity of Coupons Brands Package Size Space Staff Stores Factors the industry competes on 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  25. 25. Strategy Canvas – What it Shows Company Caught In Fierce Competition How much industry invests in High Medium Industry Value curve converges with competitor. Low Company‘s strategy is to outdo the You competitors Sales & Price National Choice of Store Friendly Advertisement Proximity of Coupons Brands Package Size Space Staff Stores Factors the industry competes on 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  26. 26. Strategy Canvas – What it Shows Over Delivering Without Payback How much industry invests in High Medium You Industry Delivering high level across all factors. Do Low you have highest market share? If not, profitability will be extremely low Sales & Price National Choice of Store Friendly Advertisement Proximity of Coupons Brands Package Size Space Staff Stores Factors the industry competes on 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  27. 27. Strategy Canvas – What it Shows Incoherent Strategy How much industry invests in High Medium There is no strategy, things are done on ad-hoc basis which individually make Industry sense and keep everyone busy, but do Low not help company to standout against You competitors Sales & Price National Choice of Store Friendly Advertisement Proximity of Coupons Brands Package Size Space Staff Stores Factors the industry competes on 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  28. 28. Strategy Canvas – What it Shows Strategic Contradiction How much industry invests in High Medium Industry Company is asking high price and offer Low bigger area, but offer few national You brands, and low package sizes Sales & Price National Choice of Store Friendly Advertisement Proximity of Coupons Brands Package Size Space Staff Stores Factors the industry competes on 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  29. 29. How the Strategy Canvas Looks for a Company that is pursuing Differentiation and Low Cost Strategy ? 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  30. 30. Strategy Canvas – Trader‘s Joe How much industry invests in High Medium Low Industry Trader Joe‘s Price National Choice of Store Sales & Advertisement Adventure Fun/ Proximity of Int. Food Exclusive Staff Friendly Brands Package Size Space Coupons Stores Factors the industry competes on 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  31. 31. Trader Joe‘s Strategy Canvas • Focus – Friendly Staff – Exclusive International Food – Fun place to shop • Divergence – Value Curve diverge from industry Standards • Compelling Tag Line – Fun Place to get Exotic Food! This curve clearly shows where to cut cost that will deliver higher value for customers 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  32. 32. We know how to create Strategy Canvas. But How to define a New Value Curve? 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  33. 33. Four Action Framework Answer Four Simple Questions 1 Identify factors that you can eliminate 2 Identify factors that you can reduce, well below the industry standard Strategically Reduce Cost 3 Identify factors that you can increase well above industry standard 4 Identify new factors that do not exist in industry Strategically Invest in 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  34. 34. Strategy Canvas – Trader‘s Joe Invest How much industry invests in High Medium Cut Cost Low Industry Trader Joe‘s Price National Choice of Store Sales & Advertisement Adventure Fun/ Proximity of Int. Food Exclusive Staff Friendly Brands Package Size Space Coupons Stores Factors the industry competes on 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  35. 35. Example: Our Client – An Interior Design Firm • Industry Annual Revenue: $7.0b • Gross Profit Margin is 35 – 40% • 11,000+ Interior Design firms, major • Account Receivables are about 15% of Companies are units of big architectural gross assets firms • Collection Period is 15 – 20 days • Industry is extremely fragmented. Big • Inventory is 5 – 10% of gross assets, and 50 companies account for only 10% of • Inventory turn is about 10 times a year the revenue. • Product Sales contribute to 60% of Revenue, Design Fee 35% and Sub- contracting 5% Industry Landscape: Extremely Competitive and Fragmented Market with low barriers to entry 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  36. 36. Strategy Canvas – Interior Design Firm High High-end Industry Medium Low-end Industry Low Design Ideas Price Showroom Workroom Portfolio Design Appeal Emotional Delivery On Time Workman ship 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  37. 37. Traditional Approach • Segment Market Let‘s define the market segment e.g. Home owners, Builders, Other Architect firms • Cost-Payback tradeoff Since we have limited resources, let‘s see where we can get best bank for the buck • Customize Offering to selected Market 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  38. 38. Strategy Canvas – Interior Design Firm High Medium Our Client Low High-end Industry Low-end Industry Design Ideas Price Portfolio Design Appeal Emotional Delivery On Time Brand Media Workman ship Workroom Showroom 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  39. 39. Recommended Growth Strategy • Focus – Clear focus to create a nationwide brand that signifies their Style • Divergence • Compelling Tagline – Leading Brand for celebrities that reach mass audience through retailers 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  40. 40. Value Curve Validation • The litmus test i.e. – Focus – Divergence, and – Compelling Tagline 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  41. 41. What to Reduce, what to Add Think About: • Non-Customers, and • Alternatives Reconstruct Industry Boundaries 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  42. 42. Three Tier of Non-Customers Tier 1: ―Soon to be‖ non-customers They are on the edge of market, waiting to jump ship e.g. Individual Home Owners Tier 2: ―Refusing‖ non-customers Market They have consciously chosen Market against your market Market e.g. corporate housing and hospitality industry Customers Tier 3: ―Unexplored‖ non-customers who are in the market distant from yours e.g. Retail Stores What are the common needs among largest cross-section of customers 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  43. 43. How to Fulfill the needs of Non-Customers Look Across • Alternative Industries • Strategic Group Within Industries • Chain of Buyers • Complementary Service Offering • Functional and/or Emotional Appeal • Time 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  44. 44. Next Step Identify Strategic Pricing Align Adoption Initiative Operations • Set the price which • Create a consensus is easily accessible • Address adoption • Does your product • Set Target Profit to mass of buyers hurdles in offer exceptional • Come up with • Use Pricing actualizing the Buyer utility? Target Cost Corridor Tool strategy • Use Buyer Utility • Streamline Cost • Balance Scorecard Map Innovation Measuring Business Success Operation Excellence November 1st , 2007 October 4th , 2007 It is a given fact; whatever you Name of the game is ―Profit‖. Learn techniques for streamlining your operations measure, it improves. Learn how to that results in positive bottom line for your growing business. define an operating plan for your business and what to measure 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  45. 45. Credits: International Best Seller … 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
  46. 46. CPSPHERE – HELP YOU FOCUS & GROW Results 1.562.860.8637 ITS NOT STRATEGY THAT MATTERS – ITS EXECUTION THAT COUNTS info@cpsphere.com www.cpSphere.com
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