WK6 Agenda<br />News, ASEAN MNEs<br />Video clips discovery<br />BBA Strategic audit<br />Homework<br />1<br />MIB, BBA 20...
Video Clips Discovery<br />What are forces of the changes in the first two video clips?<br />What’s the trend? What’s the ...
Video Clips Discovery<br />What are their core competencies?<br />How do these companies make money?<br />Do these compani...
Environmental Scanning<br />In three groups, use the strategic audit sheets(part I-V) to provide a SWOT analysis for BBA p...
Homework<br />Select Thai MNEsand do the internet research using the strategic audit sheet to provide a summary<br />Curre...
WK6.2 Agenda<br />NEWS, ASEAN MNEs<br />Lecture<br />Mind map<br />BBA SWOT<br />Homework<br />MIB, BBA 2010<br />6<br />
Strategy<br />Strategic management:<br />A set of managerial decision and actions that determines the long run performance...
Strategic Decision Making Process<br />See the strategic checklist sheet<br />MIB, BBA 2010<br />8<br />
Strategy and Structure<br />MIB, BBA 2010<br />9<br />
Strategy and Structure<br />MIB, BBA 2010<br />10<br />Strategic Planning<br /><ul><li>International strategy
Corporate level strategy
Business level strategy
Department level strategy</li></li></ul><li>Societal Environment<br />MIB, BBA 2010<br />11<br />
Current Trends<br />US Current Trends<br /><ul><li>Increasing environmental awareness
Growing health consciousness
Expanding seniors market
Impact of the Generation Y boomlet
Declining mass market
Changing pace and location of life
Changing household composition
Increasing diversity of workforce & market</li></ul>Thailand trends<br />Environment<br />Health<br />Politic<br />Society...
Industry Environment<br />How will the societal environment affect the industry environment?<br />MIB, BBA 2010<br />13<br />
I. Porter’s Five Forces<br />Threat of New Entrants<br />Barriers to entry <br /><ul><li>Economies of scale: need larger s...
Product differentiation: if no difference should invest in marketing
Capital requirements: stock market
Switching costs: difficulty in switching the product, Window
Access to distribution channels: existing firms are better
Cost disadvantages for new entrants: existing firms have advantages on patent, learning curve, raw material, and location.
Government policy: limited by licensing in some industries (banking, fisheries)</li></ul>MIB, BBA 2010<br />14<br />
I. Porter’s Five Forces<br />Rivalry Among Existing Firms <br /><ul><li>Number of competitors
Rate of industry growth: bigger pie with higher growth
Product or service characteristics: price war for commodity products
Amount of fixed costs and exit costs: high competition in high fixed and exit costs, pharmaceutical industry
Capacity: excess supply if full capacity, oil, egg
Diversity of rivals</li></ul>MIB, BBA 2010<br />15<br />
I. Porter’s Five Forces<br /><ul><li>Threat of Substitute Products or Services
Bargaining Power of Buyers
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WK6 environmental scanning

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  • Sociocultural: consumer activism, lifestyle changes’Technology: r&amp;d green productLegal: environmental protection
  • Appropriate&gt;3.5Unsure2.5-3.5 ethical decision: do the same to you?Not appropriate &lt;2.5Utility: satisfaction of all stakeholder, Rights: respect the rights of the individual involved?,
  • WK6 environmental scanning

    1. 1. WK6 Agenda<br />News, ASEAN MNEs<br />Video clips discovery<br />BBA Strategic audit<br />Homework<br />1<br />MIB, BBA 2010<br />
    2. 2. Video Clips Discovery<br />What are forces of the changes in the first two video clips?<br />What’s the trend? What’s the industry situation? Thailand?<br />MIB, BBA 2010<br />2<br />
    3. 3. Video Clips Discovery<br />What are their core competencies?<br />How do these companies make money?<br />Do these companies have a complete vertical integration?<br />Do these companies have a sustainable advantage?<br />Durability<br />Imitability(transparency, transferability, replicability)<br />Other meanings for sustainable?<br />MIB, BBA 2010<br />3<br />
    4. 4. Environmental Scanning<br />In three groups, use the strategic audit sheets(part I-V) to provide a SWOT analysis for BBA programs in three different universities.<br />What are the key success factors?<br />How do we make money?<br />MIB, BBA 2010<br />4<br />
    5. 5. Homework<br />Select Thai MNEsand do the internet research using the strategic audit sheet to provide a summary<br />Current Situation(performance, mission, vision, strategy)<br />Board and management<br />External environment scanning<br />Internal environment scanning<br />Core competency<br />Competitive advantage<br />Provide SWOT using EFAS, IFAS<br />MIB, BBA 2010<br />5<br />
    6. 6. WK6.2 Agenda<br />NEWS, ASEAN MNEs<br />Lecture<br />Mind map<br />BBA SWOT<br />Homework<br />MIB, BBA 2010<br />6<br />
    7. 7. Strategy<br />Strategic management:<br />A set of managerial decision and actions that determines the long run performance of a corporation.<br />Strategy:<br />A master plan to achieve your mission and objective.<br />MIB, BBA 2010<br />7<br />
    8. 8. Strategic Decision Making Process<br />See the strategic checklist sheet<br />MIB, BBA 2010<br />8<br />
    9. 9. Strategy and Structure<br />MIB, BBA 2010<br />9<br />
    10. 10. Strategy and Structure<br />MIB, BBA 2010<br />10<br />Strategic Planning<br /><ul><li>International strategy
    11. 11. Corporate level strategy
    12. 12. Business level strategy
    13. 13. Department level strategy</li></li></ul><li>Societal Environment<br />MIB, BBA 2010<br />11<br />
    14. 14. Current Trends<br />US Current Trends<br /><ul><li>Increasing environmental awareness
    15. 15. Growing health consciousness
    16. 16. Expanding seniors market
    17. 17. Impact of the Generation Y boomlet
    18. 18. Declining mass market
    19. 19. Changing pace and location of life
    20. 20. Changing household composition
    21. 21. Increasing diversity of workforce & market</li></ul>Thailand trends<br />Environment<br />Health<br />Politic<br />Society<br />MIB, BBA 2010<br />12<br />
    22. 22. Industry Environment<br />How will the societal environment affect the industry environment?<br />MIB, BBA 2010<br />13<br />
    23. 23. I. Porter’s Five Forces<br />Threat of New Entrants<br />Barriers to entry <br /><ul><li>Economies of scale: need larger scale for new entrants, SCG, TPI
    24. 24. Product differentiation: if no difference should invest in marketing
    25. 25. Capital requirements: stock market
    26. 26. Switching costs: difficulty in switching the product, Window
    27. 27. Access to distribution channels: existing firms are better
    28. 28. Cost disadvantages for new entrants: existing firms have advantages on patent, learning curve, raw material, and location.
    29. 29. Government policy: limited by licensing in some industries (banking, fisheries)</li></ul>MIB, BBA 2010<br />14<br />
    30. 30. I. Porter’s Five Forces<br />Rivalry Among Existing Firms <br /><ul><li>Number of competitors
    31. 31. Rate of industry growth: bigger pie with higher growth
    32. 32. Product or service characteristics: price war for commodity products
    33. 33. Amount of fixed costs and exit costs: high competition in high fixed and exit costs, pharmaceutical industry
    34. 34. Capacity: excess supply if full capacity, oil, egg
    35. 35. Diversity of rivals</li></ul>MIB, BBA 2010<br />15<br />
    36. 36. I. Porter’s Five Forces<br /><ul><li>Threat of Substitute Products or Services
    37. 37. Bargaining Power of Buyers
    38. 38. Bargaining Power of Suppliers
    39. 39. Relative Power of Other Stakeholders</li></ul>MIB, BBA 2010<br />16<br />
    40. 40. I. Porter’s Five Forces<br /><ul><li>Threat of Substitute: different appearance and characteristics but can satisfy the same need
    41. 41. Price ceiling of a product is the switching price to a substitute product.
    42. 42. Bargaining Power of Buyers: large buyers, many alternative suppliers, backward integration capability, low switching cost, low profit margin, unimportance to final product
    43. 43. Bargaining Power of Suppliers: Oligopoly, high switching cost, no substitute, forward integration capability
    44. 44. Relative Power of Other Stakeholders</li></ul>MIB, BBA 2010<br />17<br />
    45. 45. II. Industry Life Cycle<br />What would happen in each phase?<br />Number of the companies<br />Size of the companies<br />Strategy<br />Price<br />MIB, BBA 2010<br />18<br />Fragmented<br />Consolidated<br />
    46. 46. III. Strategic Groups and Types<br />A strategic groups<br />Similar strategies<br />Similar resources<br />Strategic types<br />Defender: limited product lines and cost, focus on improving efficiency<br />Prospectors: broad product lines, focus on product innovation and market opportunities<br />Analyzers: operate in many market areas (stable: efficiency and variable: innovation) <br />Reactors: inconsistent in strategy-structure-culture relationship<br />Who’s the direct competitor?<br />MIB, BBA 2010<br />19<br />
    47. 47. Strategic Factors<br />Apply to BBA<br />MIB, BBA 2010<br />20<br />
    48. 48. EFAS and Industry Matrix<br />Your external analysis and position in the industry. How your competitors respond to each factor.<br />MIB, BBA 2010<br />21<br />
    49. 49. Mind map and BBA Exercise<br />Prepare the mind map for this lecture.<br />Continue BBA Exercise<br />Strategic factors<br />Use the word “BECAUSE” to provide your supporting reasons. <br />Example: BBA students are…because…<br />MIB, BBA 2010<br />22<br />
    50. 50. Homework<br />What industry that you choose?<br />MNEs?<br />EFAS and Industry Matrix<br />Continue lecture for internal factor<br />MIB, BBA 2010<br />23<br />
    51. 51. WK6.3 Agenda<br />News: World Cup(Spain), 3G, new director for BOT, ladies’ journey, Carrefour, Princess speech<br />ASEAN MNEs<br />Competitive Intelligence exercise<br />Lecture<br />Mind map, BBA exercise, Homework update<br />MIB, BBA 2010<br />24<br />
    52. 52. Competitive Intelligence Exercise<br />Careful study of trade journals. <br />Wiretapping the telephones of competitors. <br />Posing as a potential customer to competitors. <br />Getting loyal customers to put out a phony "request for proposal” soliciting competitors' bids. <br />Buying competitors' products and taking them apart. <br />Hiring management consultants who have worked for competitors.<br />Rewarding competitors' employees for useful "tips." <br />Questioning competitors' customers and/or suppliers. <br />Buying and analyzing competitors' garbage. <br />Advertising and interviewing for non-existent jobs. <br />Taking public tours of competitors' facilities. <br />Releasing false information about the company in order to confuse competitors.<br />Questioning competitors' technical people at trade shows and conferences. <br />Hiring key people away from competitors. <br />Analyzing competitors' labor union contracts. <br />Having employees date persons who work for competitors. <br />Studying aerial photographs of competitors' facilities. <br />MIB, BBA 2010<br />25<br />
    53. 53. Internal Scanning<br />MIB, BBA 2010<br />26<br />
    54. 54. I.Resource Based Approach<br />Resources+capability+competencycompetitive advantage<br />Resources: <br />Tangible: <br />Physical assets: plant, equipment, and location<br />Capital: credit rating, capital management<br />Technology: patent, R&D<br />Intangible: employees and skills, culture, reputation, brand <br />Capabilities: ability to use its resources, ability to turn input into output<br />Competency: cross functional integration and coordination of capabilities, use VRIO framework to evaluate its competency<br />Avon: door to door selling<br />Wal-Mart: logistic <br />Oriental Hotel: customer service<br />MIB, BBA 2010<br />27<br />
    55. 55. I.ResourceBased Approach<br />VRIO Framework<br />MIB, BBA 2010<br />28<br />
    56. 56. Resource Based Approach to Strategy Analysis<br />Resources+capability+competencycompetitive advantage<br />Match capability with resourceor resource with capability<br />Which way is easier? <br />MIB, BBA 2010<br />29<br />
    57. 57. Sustainable Competitive Advantage<br />Durability: depreciation rate of the firm’s resources, capabilities, or core competencies<br />Examples: Intel, cassette tapecdmp3mp4<br />Imitability: duplication rate by others<br />Transparency:understanding speed of other firms to the relationship of resources and capabilities supporting a successful firm’s strategy<br />Transferability:competitors ability to get the resources and capabilities necessary for the competitive challenge<br />Replicability: competitors duplication ability, the use of resources and capabilities to imitate the firm’s success<br />Explicit knowledge vs. Implicit knowledge Which one is easier to copy?<br />MIB, BBA 2010<br />30<br />
    58. 58. II. Business Models<br />6. Time Model: SONY R&D 1st mover<br />7. Efficiency Model: Wal-Mart, Dell <br />8. Blockbuster Model: movies, pharmaceutical companies<br />9. Profit Multiplier Model: Walt Disney<br />10. Entrepreneurial Model: niche market<br />11. De Facto Standard Model: free for basic product<br />How can we use business model for our internal scanning?<br />Do your competitors use the same business model?<br />How do these companies make money in each business model?<br />Customer Solutions Model: IBM, consulting firms<br />Profit Pyramid Model: GM<br />Multi-Component System/Installed Base Model: HP printer and ink cartridge, Gillette razor and blade<br />Advertising Model: news paper, dot.com<br />Switchboard Model: ebay, NY material museum<br />MIB, BBA 2010<br />31<br />
    59. 59. III. Value Chain Analysis<br />Value chain: <br />Linked set of value-creating activities beginning with basic raw material and ending with distributors getting final goods into hands of customers<br />MIB, BBA 2010<br />32<br />
    60. 60. III. Value Chain Analysis<br />The importance or weight of each activity(strength and weakness) depends on the type of business.<br />Retail business: logistic, Pharmaceutical or electronic: R&D<br />How can we use value chain for our internal scanning?<br />Compare your value chain to the industry key success factors as well as your competitors value chain.<br />Examine the company product lines for strength& weakness (divisional structure). Synergies among product lines (economies of scope)?<br />MIB, BBA 2010<br />33<br />
    61. 61. Organizational Structure<br />Examine the organizational structure before the value chain to see the availability of resources and capabilities (reverse, 2nd school of thought).<br />How will the organizational structures be your strengths or weakness? <br />Specialization, control, command, decision, communication flow<br />MIB, BBA 2010<br />34<br />
    62. 62. Other Internal Issues<br />Corporate culture: identity, commitment, stability, and employee behavior<br />Marketing: positioning, segmentation, product life cycle, marketing mix, brand<br />Financial: financial leverage, capital budgeting<br />R&D: R&D intensity(% R&D spending),patent, publication, new product, technology transfer, technology discontinuity<br />HR: teams, temporary workers, quality of life and diversity<br />MIB, BBA 2010<br />35<br />
    63. 63. Mind Map & BBA Exercise<br />How to do the internal scanning?<br />How can we apply sufficiency economy philosophy with internal scanning?<br />IFAS textbook example<br />MIB, BBA 2010<br />36<br />
    64. 64. Homework<br />Industry? Annual Reports? News? <br />SWOT analysis on Wednesday July 14, 2010<br />Each team will have to evaluate other teams’ results.<br />MIB, BBA 2010<br />37<br />

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