2006 3rd Place Peking University


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2006 3rd Place Peking University

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2006 3rd Place Peking University

  1. 1. Save Forest Smart 4H Consulting Cathy Huang Cynthia Zhang Gloria Luo Le Guan March 26 th , 2006 Consulting Group Consulting Group
  2. 2. Executive Summary Business Summary Challenge Identification Options Recommended Strategy Action Plan Implementation Timeline Financial Projection 4H Consulting March, 2006 1 Consulting Group
  3. 3. Approach 2 RAN’s business model: Campaigns to pressure leading players and then to the industry Mission : To protect the Earth`s rainforests and support the rights of their inhabitants Campaigns : Old Growth Campaign, Global Finance Campaign, Jumpstart Ford Campaign Force company to file agreement Leverage to whole industry Consulting Group Monitoring and enforcing Launch campaign
  4. 4. 3 Consulting Group Changing environment presses RAN to review its practices and search for new opportunities Large NGOs squeezing out smaller ones Practice Area’s Changing Environment RAN Growing concern on security and pressure on radical practices New campaign targets harder to find and achieve Broaden trend from environmental movement to sustainability
  5. 5. RAN 4 Consulting Group RAN has to adapt itself by changing its strategy, business model, organization structure, and improving funding Lacking enough funding to support Loose management and high turnover Focus on campaigning: a penetrated and conventional practice area A closer problem detect: RAN’s perspective Radical practice: potential damage to its image Maintain RAN’s influence and strengthen support from related industry
  6. 6. To improve its influence and support base for campaign, areas below can be implemented 4 Consulting Group 5 <ul><li>Strategy: Come up with a more friendly attitude to target companies, reduce the amount of radical act in its campaign </li></ul><ul><li>Marketing: (1) Rely more on internet advertising to arouse awareness from the mass; (2) Maintain a close relationship and influence on local student groups </li></ul><ul><li>Fundraising: Revenue source mainly from foundations and public support, therefore RAN should focus more on contacting foundations with similar mission </li></ul><ul><li>Existing Campaign: Try to collaborate with other NGOs in pushing Ford; Also target other Ford`s competitors and arouse competition for environment standard improvements </li></ul>
  7. 7. 6 Consulting Group “ Red Ocean” Enhancements in conventional practice result in merely incremental growth; Blue ocean is available for exploration “ Blue Ocean” “ Rainforest Friendly” labeling and ranking Transformation <ul><li>Knowledge & Research-based </li></ul><ul><li>Label certificate granting/promoting </li></ul><ul><li>Standard Setting </li></ul>Conventional campaign Competition Limited available resource & market power Operation Model Not enough “bad guys”- Declining niche Marketing Fundraising Stronger alliance campaign Only incremental improvements and growth “ Red Ocean”
  8. 8. - 7 <ul><li>Enhance cooperation with large companies, student groups, other NGOs </li></ul><ul><li>Increase interactions with financial service institutions </li></ul><ul><li>Decrease radical actions </li></ul><ul><li>Organization restructuring </li></ul><ul><li>Create Labeling and Ranking system </li></ul><ul><li>Traditional radical actions training </li></ul>Creating the Blue Ocean + × ÷ Consulting Group
  9. 9. Launching Rainforest-Friendly label and ranking system within timber product leading distributors Year 2012 2011 2010 2009 2008 2007 2006 2005 2004 Through supply chain, promote Rainforest-Friendly label and ranking system to upstream suppliers Promote the system to the whole timber industry and thus build strong recognition Expand the system to other rainforest-related industries: automobile engine, etc. Complete an integrated rainforest-friendly label and ranking system across several industries RAN’s expertise and authority in rainforest protection System adopter and support base By transforming itself to promote rainforest protection label and ranking system, RAN will become the leading institute for creating and governing the standards 8 Consulting Group
  10. 10. Ranking and labeling System Consulting Group Phase #0: utilize the voluntary industry talents and seek for opportunities to cooperate with relevant NGOs to establish the research and evaluation system <ul><li>Leverage on RAN’s </li></ul><ul><li>Advisor pool </li></ul><ul><li>Utilize expert volunteers </li></ul><ul><li>in research and assessment </li></ul>Co-operate with complementary NGOs with similar size and mission statements ( e.g. Technology, network) Research oriented, knowledge based 9
  11. 11. 10 Consulting Group Ranking system based on the firm’s commitment to forest-friendly activities.Different green colors represent different levels Light green: Enterprises and companies that meet the minimum forest friendly requirements Medium green : Enterprises and companies that not only meet the forest friendly requirements but also involve in protecting the rights of the local inhabitants Dark green: Enterprises and companies that take the leading positions in implementing the standards, and as well help to promote the standards across industry
  12. 12. Consulting Group <ul><li>Student associations: </li></ul><ul><ul><li>internet, workshops, campus promotion </li></ul></ul><ul><li>Promotion and media coverage </li></ul><ul><li>Home Depot:``We only sell products with `` </li></ul><ul><li>Timber Producer: ` Our product is recommended by ` </li></ul>Launch effective marketing strategies utilizing students` talents and partners in the supply chain 11
  13. 13. Consulting Group Organization restructuring to adapt to L&R system launching 1 2 4 3 Senior Management Level: more involvement, including BDs and Advisory Board Students pool: Maintain frequent interactions; increase training and fostering programs Establish Research Department: based on original voluntary scientists teams ( knowledge-based) Staff Incentive Stimulation: Enhance staff’s welfare from more comprehensive levels 12
  14. 14. Sponsorship may become another financial source for the L&R launching, in the long term, L&R itself will generate income via service fee 13 Consulting Group <ul><li>Short Term: </li></ul><ul><li>Sponsorship from </li></ul><ul><li>Financial institutions </li></ul><ul><li>Partially from advisory </li></ul><ul><li>services </li></ul><ul><li>(relevant to CSR projects) </li></ul><ul><li>Long Term: </li></ul><ul><li>Drawing benefits </li></ul><ul><li>from label </li></ul><ul><li>and ranking </li></ul><ul><li>services </li></ul><ul><li>Prospective 3-5 years </li></ul><ul><li>until the standard is </li></ul><ul><li>accepted by </li></ul><ul><li>certain industries. </li></ul>
  15. 15. RAN’s costly expense for training and holding radical acts can be utilized instead to launch the label and ranking program 14 Consulting Group 2,337,299 $ Total Support and Revenue 7,027 $ Interest Income 23,899 $ Other Income 113,469 $ Special Events 700 $ Gain from Asset Disposal 46% 1,083,254 $ Grants 47% 1,108,950 $ Public Support and Membership Percentage Support and Revenue RAN's 2002 Financial Statement 1,159,273 $ Net Assets at End of Year 1,048,009 $ Net Assets at Beginning of Year 111,264 $ Increase in Net Assets 2,226,035 $ Total Expenses 22% 486,726 $ Fundraising 14% 311,194 $ Management and General Supporting Services: 64% 1,428,115 $ Public Education and Membership Program Services: Expenses
  16. 16. Service Fee from label issuing and ranking assessment: 50% of its total support and revenue; Membership cost cut by 30% from its 2002 standard due to termination of radical act organizing and training; Increased expense on marketing the label and ranking system via student network, media and system participating companies. <ul><li>Total Support and Revenue: $4,529,503 </li></ul><ul><li>Net Asset in 2004:$1,162,555 </li></ul><ul><li>Net Asset in 2008:$3,751,646 </li></ul><ul><li>Average increase in net asset: 40% </li></ul><ul><li>Projected Service Fee growth afterwards: 15% </li></ul>**For detail, refer to projected income statement in the end 15 Consulting Group By 2008 when RAN completes its timber industry Forest-Friendly label and ranking system, it’s expected to generate revenue from label issuing and ranking assessment
  17. 17. = Label and Ranking System: Blue Ocean for RAN Consulting Group 16 Problem identification Strategy: Redirect RAN into a professional labeling and ranking NGO Feasibility Success factors : Corporate Participant Base Influence to mobilize public support Independence
  18. 18. Consulting Group Thank You 4H Consulting Group
  19. 19. Back-Up Information 4H Consulting Group Consulting Group
  20. 20. While FSC’s certificate scheme exists, RAN’s labeling and ranking compasses a wider range and leverages on retail customer’s recognition products i Consulting Group FSC’s certificate granting “ Rainforest-Friendly” Labeling and Ranking Logging industry only No explicitly label to evoke consumer support and recognition Focus on raw products that are not accessible to retail customers Related to ALL rainforest-related business Use standardized label and ranking to popularize and winning customer recognition on the retail side No such positioned label and ranking existed
  21. 21. Other Smaller NGOs Small Expertise Groups RAN Network Expertise A stronger allied NGO Large NGOs’ squeezing of resources provides smaller NGOs the incentive to ally more closely ii Consulting Group Large NGOs Large NGOs
  22. 22. Adapt to a more friendly and constructive approach Given the changing practice dynamics, radical acts have become potential threat to the group’s development and may weaken its support base iii Consulting Group Radical practices Less suitable targets Government and society’s security concern Harder to achieve goals and attract support Damage to the group’s image and support base; Tax-status attacked >> Funding crisis
  23. 23. iv Consulting Group <ul><li>Plan B : instead of focusing on US markets, expand to developing countries such as China, whose government and grassroots base providing a stronger advantage. </li></ul><ul><li>Extend to developing countries: </li></ul><ul><li>Potential needs to improve </li></ul><ul><li>its natural and economic environment </li></ul><ul><li>Local government support </li></ul><ul><li>Grassroots formats with </li></ul><ul><li>strong base </li></ul><ul><li>Execution Plan: </li></ul><ul><li>Negotiate with local governments (providing services on project advisory) </li></ul><ul><li>--Forest conservation and development program in the northeast China </li></ul><ul><li>--Panda protection Scheme in SiChuan Province </li></ul><ul><li>Cooperate with local grassroots and local education instituions </li></ul><ul><ul><li>--notion dissemination </li></ul></ul><ul><ul><li>--image building on campus base </li></ul></ul>
  24. 24. Consulting Group Play a role as a environmental project advisor RAN Project Intermediary <ul><li>Targets: </li></ul><ul><li>Rainforest or ecosystem conservation- related </li></ul><ul><li>Industries. </li></ul><ul><li>Small size </li></ul><ul><li>Fast developing </li></ul>sponsor cooperate <ul><li>Brand Establishing </li></ul><ul><li>Indirect contribution </li></ul><ul><li>to environment </li></ul><ul><li>Increase </li></ul><ul><li>growing potency </li></ul>v