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IIT K Maverick Regional Round
- 1. Name Phone Number LinkedIn profile Shruti Dadhwal (Captain) +919999878060 Shruti R Vishnuraj +919446949900 Vishnu Swaraj Krishna +919078341902 Swaraj Submitted by, TEAM SYZYGY 1
- 2. EXECUTIVE SUMMARY : Client should focus on markets 1, 4 and 5 STRATEGIC OBJECTIVES ANALYSIS INSIGHTS RECOMMENDATIONS BUSINESS SITUATION STRATEGIC ASSESSMENT GROWTH To assess current situation of the company in 8 metropolitan market segments. Analysed market conditions for declining revenues and subscriber base • Markets 1, 3, 5 and 8 are operating under profitable margins while markets 2, 4, 6 and 7 are incurring losses. • Market 4 is having low market share even though there is low competition and good network quality. • Focus on Markets 1,4 and 5. Holistic assessment of all the markets on various parameters like network quality and level of competition Market segmentation based on competition, network quality and market share To increase client’s profitability and subscriber base. Identifying 3 key market segments to focus on based on their profitability, market share and growth opportunity. • Improving network quality and market share in market 1, 4 and 5 • Redefining marketing strategies for the same • Identifying options for market diversification. • Growth is directly related to network quality. • Despite of profitability we have declining subscribers. • Lack of innovative marketing plans and attractive services for customers. Declining revenue and profit due to less productive marketing strategy and competition from large players Client should deploy evaluation strategies to identify the source of lagging performance
- 3. Existing Competitors • 5 out of 8 market have strong/Moderate level of competition Less productive Marketing strategy • 250 M spend for national level initiatives Unsatisfied Customers • 6 out of 8 markets ranked 5 or below on network quality • 175000 customers left in 3 years High operation cost • 735 stores across all the markets • 1000M G& A expenditures DECLINING REVENUE AND PROFIT -200 -100 0 100 1 2 3 4 5 6 7 8 Profit by market(MUSD) 0 100 200 300 400 500 600 700 1 2 3 4 5 6 7 8 Revenue Vs Marketing and GA exp.(MUSD) Revenue Marketing and GA Expenditures 0 500 1000 1500 2000 2500 3000 2010 2011 2012 2013 Revenue(MUSD) -300 -200 -100 0 100 200 300 1 2 3 4 5 6 7 8 Marketwise change in Subscribers 2010-2013 Client Insights Market insights Business diagnosis Segmentation Growth strategy Risk assessment
- 4. Market 2 • Loss making • Lowest number of subscribers • Smallest market Market 1 • Highest profitable market • Opportunity for improvement in network quality • High cost for new subscribers Market 3 • Highest market share • Excellent network quality Market 4 • Low level of competition still market share is low • Loss making Market 5 • Lowest Network quality • Profit making Market 6 • Close to breakeven • Network quality low Market 7 • Average network quality • Less number of stores Market 8 • Highest client base • Excellent network quality and highest number of stores *Note : green signifies profit, red signifies loss 0 20 40 60 80 1 2 3 4 5 6 7 8 Smart phone penetration 0 50 100 150 200 1 2 3 4 5 6 7 8 Number of stores Client Insights Market insights Business diagnosis Segmentation Growth strategy Risk assessment 0 200 400 600 1 2 3 4 5 6 7 8 Marketing and GA Expenditures(MUSD)
- 5. BUSINESS DIAGNOSIS CUSTOMER FINANCIALS EXTERNAL ENVIRONMENT INTERNAL BUSINESS Marketing Program assessment • Continuous evaluation of marketing programs through metrics measurement Capturing VOC • Surveys • Interviews • Focus groups • Suggestions • Observations Financial statement analysis • Horizontal analysis • Trend analysis • Regression analysis • Graphical analysis • Ratio analysis Review of Internal business policies Competition • Assessing general market conditions • Identifying how competitors differentiate from client’s offerings • Select which competitor to attack or avoid -1000 -500 0 500 1 2 3 4 5 6 7 8 Profit Margin Ratio 2013 Appraisal of operational costs Client Insights Market insights Business diagnosis Segmentation Growth strategy Risk assessment
- 6. 4 1.9Million Level of competition NetworkQuality 1 3.3Million 14 % 2 .35Millio n 5 3 2.9Million 32 % 8 4.9Million 24% 7 1.3Million 12 % 6 1.2Million 18 % 5 4Million LOW MODERATE HIGH 10 % 7% INSIGHTS • Market 8 will be having threat of competition in future • Maintain network quality in markets3 and 8 • Focus on market share growth in markets 4 • Improve network quality in markets 5 and 1 IMPLICATIONS • When the market moves towards right ,market share might reduces • When the market moves up , market share can increase • Top left corner is the ideal location Client Insights Market insights Business diagnosis Segmentation Growth strategy Risk assessment
- 7. PROMOTION CHANNELS • Use of Social media for customer feedbacks • Promotion of new services and schemes through online advertisement Network Quality Improvement - a 4Q approach Measure • Collection of data from customers like number of call drops, average data speed, signal quality etc. • Conduct surveys among the customers for network experience Voice of the customer : Poor network quality Analyse • List down all the causes for poor network quality • Find the most probable root cause and most affected market • Identifying key areas of improvement • Use pareto’s principle Implement • Execute action plans for identified pilot markets • Horizontal deployment of action plan among all the markets Sustain • Continuous monitoring • Feedback and control GROWTH STRATEGY Market 1 • Find ways to reduce new subscription cost, then concentrate on increasing market share Market 4 • Network cost is high compared to market share, we should work on improving number of subscribers for profitability • Increase number of stores Market 5 • Even with highest revenue per subscriber , the network quality is very poor MARKETING PEOPLE • Identify the target audience in different markets • Providing innovative schemes and offers to increase subscription DIVERSIFICATION • Diversification into other services like DTH , IOT • Partnerships , Mergers and Acquisitions • Vertical integration Client Insights Market insights Business diagnosis Segmentation Growth strategy Risk assessment
- 8. RISK ASSESSMENT AND MITIGATION FINANCIAL RISKS • Improper value utilisation of network assets • Lack of confidence among investors • Difficulty in repaying debts (If any ) • Fluctuations in US economy STRATEGIC RISKS • Difficult customer retention in high competition • Failure of Marketing strategies • Ineffective management of new policies • Unpredictable consumer behaviour OPERATIONAL RISKS • Lack of organizational flexibility • Lack of skilled employees during diversification COMPLIANCE RISKS • Uncertainty of legal or regulatory compliance in new services • Utilisation analysis before allocating assets • Clearly state associated risks to the investors • Predictive analysis of financial growth • Detailed forecasting of economy • Build a growth strategy around the notion of competitive differences. • Hiring right people for the right job. • Focus on deeply understanding the customer values. • Plan to build a skilled workforce(in- house/external hiring) • Proper research on legal or regulatory policies before diversifications. Client Insights Market insights Business diagnosis Segmentation Growth strategy Risk assessment
- 11. Business situation Strategic assessment Recommendations Existing Competitors • 5 out of 8 market have strong/Moderate level of competition Less productive Marketing strategy • 250 M spend for national level initiatives Unsatisfied Customers • 6 out of 8 markets ranked 5 or below on network quality • 175000 customers left in 3 years High operation cost • 735 stores across all the markets • 1000M G& A expenditures DECLINING REVENUE AND PROFIT -200 -100 0 100 1 2 3 4 5 6 7 8 Profit by market(MUSD) 0 100 200 300 400 500 600 700 1 2 3 4 5 6 7 8 Revenue Vs Marketing and GA exp.(MUSD) Revenue Marketing and GA Expenditures 0 500 1000 1500 2000 2500 3000 2010 2011 2012 2013 Revenue(MUSD) -300 -200 -100 0 100 200 300 1 2 3 4 5 6 7 8 Marketwise change in Subscribers 2010-2013
- 12. 4 1.9Million Level of competition NetworkQuality 1 3.3Million 14 % 2 .35Millio n 5 3 2.9Million 32 % 8 4.9Million 24% 7 1.3Million 12 % 6 1.2Million 18 % 5 4Million LOW MODERATE HIGH 10 % 7% INSIGHTS • Market 8 will be having threat of competition in future • Maintain network quality in market s3 and 8 • Focus on market share growth in market 4 • Improve network quality in markets 5 and 1 IMPLICATIONS • When the market moves towards right ,market share might reduce • When the market moves up , market share can increase • Top left corner is the ideal location Business situation Strategic assessment Recommendations
- 13. PROMOTION CHANNELS • Use of Social media for customer feedbacks • Promotion of new services and schemes through online advertisement Network Quality Improvement - a 4Q approach Measure • Collection of data from customers like number of call drops, average data speed, signal quality etc. • Conduct surveys among the customers for network experience Voice of the customer : Poor network quality Analyse • List down all the causes for poor network quality • Find the most probable root cause and most affected market • Identifying key areas of improvement • Use pareto’s principle Implement • Execute action plans for identified pilot markets • Horizontal deployment of action plan among all the markets Sustain • Continuous monitoring • Feedback and control GROWTH STRATEGY Market 1 • Find ways to reduce new subscription cost, then concentrate on increasing market share Market 4 • Network cost is high compared to market share, we should work on improving number of subscribers for profitability • Increase number of stores Market 5 • Even with highest revenue per subscriber , the network quality is very poor MARKETING PEOPLE • Identify the target audience in different markets • Providing innovative schemes and offers to increase subscription DIVERSIFICATION • Diversification into other services like DTH , IOT • Partnerships , Mergers and Acquisitions • Vertical integration Business situation Strategic assessment Recommendations
- 14. MARKET PROGRAM ASSESSMENT Identifying the key goals Relate the goals to KPI’s Continuous evaluation Goal KPI Brand awareness Website traffic. page views , social links Engagement Blog comments, like shares, inbound links Lead generation Email and blog subscriptions, Form completion Sales Online sales, Offline sales, Customer retention/loyalty Percentage of content consumed by existing customers CAPTURING VOC Customer identification Voices from customers Translating voices to needs Verbatim Need Requirement “I don’t want call drops” No call drops Network quality “I want high data speed” High speed internet More bandwidth “I want cheaper rates for my call” Price should be equal or less than competitors Price APPENDIX
- 15. FINANCIAL CALCULATIONS REVENUE Annual revenue = No of subscribers * Average revenue per subscriber per month * 12 EXPENDITURES • Marketing and GA costs • Annual network cost • New subscription costs • Average annual Personnel costs Profit Margin ratio = Profit /Revenue ASSUMPTIONS • New subscribers by market for 2013 only • New subscribers to the client calculated by considering market share • Other costs and revenue are considered negligible • Personnel cost is not included in G&A Expenses APPENDIX The excel file with calculation is attached Market Subscibers in 2010 Subscibers in 2013 Increase in subscribers 1 450 400 -50 2 20 20 0 3 800 1000 200 4 75 150 75 5 600 400 -200 6 400 200 -200 7 200 100 -100 8 1100 1200 100 TOTAL 3645 3470 -175 Market Subscribers -250 -200 -150 -100 -50 0 50 100 150 200 250 1 2 3 4 5 6 7 8 Chart Title
- 16. TEAM NAME : SYZYGY* * In astronomy, is a straight-line configuration of three celestial bodies in a gravitational system TEAM CAPTAIN : Shruti Dadhwal I am an avid fiction reader and try to continuously hone my culinary skills. I am driven by curiosity to learn new things. My mantra for life is – ‘I never lose, either I win or I learn’. MEMBER : R Vishnuraj MEMBER : Swaraj Krishna I am energetic and loves to have fun. I listen to music and watch movies in my free time. I am a fast learner and always think about new ways of doing things I am a calm, passionate and fun-loving guy. I believe in hard-work to stay focused and keep going. I love Table tennis and Volleyball.
Editor's Notes
- Hello Everyone , A very good …….. to all of you We team SYZYGY is here to present in front of you the analysis and recommendations for the case study Proposal_US I have along with me…….. And……… and I am …… To begin with I will be giving a brief overview of the problem at hand The client is a regional wireless service provider operating in 8 US metropolitan areas ,They have been facing stiff competition from the larger operators in the industry, resulting in declining revenues and profitability in the last few years The clients previous efforts to improve performance focussed on national level initiatives in marketing and customer experiences, but did not see meaningful improvements in their financial metrics We will here discuss different avenues for the client to improve profitability and financial performance
- To start with , we will first analysis the business situation The objective is to assess the current situation of the company in the 8 market sectors Here we analyse the market conditions for declining revenues and subscriber base The key insights we found were that the declining revenue and customer base are due to less productive marketing strategy , Excessive competition and low network quality We thus recommend the clients to deploy the business evaluation strategy to identify the source of lagging performanceb We next discuss the holistic assessment of all markets on various parameters like network quality and level of competition Here to understand the situation better, we segmented the markets based on competition , network quality and market share After segmentation , we found that the markets 1,3,5 and 8 are operating under profitable margins , while markets 2,4, 6 and 7 are incurring losses Market 4 is having less market share even though there is low competition and good network quality in that area After the strategic assessment we recommend the client to focus on profits 1,4 and 5 to improve its financial metrics customer base Moving towards the end of the presentation we will be discussing the growth strategy to increase client’s profitability and subscriber base. As a part of which we focus markets 1,4 and 5 as discussed earlier The major insights we found during analysis is that growth is directly related to network quality Despite of profitability in some markets , we have declined subscriber There is a lack of innovative marketing strategy and attractive services for the customer. We recommend the client to improve network quality and enhance its market share in segments 4 and 5. Client should redefine the market strategies and idenitify the options for market diversification.
- Moving on to the presentation now We will discuss some current business trends of the client. As we can see that the company is suffering from declining revenue from ________in 2010 to ____________ in 2013. The four factors we identified for this declining revenue were Firstly Existing Competitors. % out of 8 markets have strong or moderate level of competition. Secondly we have a reducing customer base. 175000 customers left in 3years. Graph here shows that markets 1,5,6 and 7show negative change in subscribers from 2010-2013. Then we have a High Operation Cost. The client has 735 stores across US adding upto ____________M USD. The client spent 1000M USD expenditure on General and Aministrative costs. Last but not the least , the growth of the company suffered because of less productive marketing strategy. The company spent 250M USD for its national initiatives in 2013. The graph here shows markets revenue and total marketing and G&A expenditure of the company. From which we can see that these Marketing and GA expenditures are more than 50 % of the revenue.
- Now moving on to the next slide, here discuss all the markets in details. We have shown the markets in colors based on their profitability. Green signifying most profitable which is market 1 and red signifying maximum loss incurring which is market 4. Discussing the markets in the decreasing order of the profitability We have market 1____________________ Then we have Market 5_____________________ Followed by Market 8________________________ And then Market 3______________________________ Discussing the markets in the decreasing level of loss incurring rate We have market 4_______________________ Followed by Market 2_________________________ Then we have Market 7_________________ And at the end we have market 6
- For the continued growth of business it is important to understand what factors and conditions does your current success depends on? Which of them might change over time (or are changing already), thus putting current success at risk? How can we prepare for these possible changes in order to cushion or even exploit their impact? We here propose the Client to deploy a business diagnosis strategy to evaluate all the changing factors and sources behind the lagging financial performance. Here we describe the strategy under four sections. Customer Evaluation Customers are critical to any service providing business. It is important to identify you customers and capture the Voice of Customer. We require customer feedback and know what are the new customer demands. And then change these needs to understand where the Company is lagging in providing customer satisfaction. This can be done through various means like surveys, interviews, focus groups, observations and suggestions , feedbacks. Marketing program assessment The telecoms industry has always been ultra competitive. In this a competent marketing strategy can boost the revenues of the Client. For assessing the marketing strategy the Client can Identifying the key goals and relate these goals to Key Performance Indicators and then doing the continuous evaluation. For example we take Brand awareness to be one of the key goals then we evaluate the goal on KPI’s like Website traffic. page views , social links. The second major section where a company needs to keep a continuous watch is the Financials of the company. This can be done through all or some suitable combinations of the analysis techniques Horizontal analysis is the comparison of historical financial information over a series of reporting periods, or of the ratios derived from this financial information. The intent is to see if any numbers are unusually high or low in comparison to the information for bracketing periods, which may then trigger a detailed investigation of the reason for the difference. (A common problem with horizontal analysis is that the aggregation of information in the financial statements may have changed over time, due to ongoing changes in the chart of accounts, so that revenues, expenses, assets, or liabilities may shift between different accounts and therefore appear to cause variances when comparing account balances from one period to the next.) A trend analysis is an aspect of technical analysis that tries to predict the future movement of a stock based on past data. Trend analysis is based on the idea that what has happened in the past gives traders an idea of what will happen in the future. There are three main types of trends: short-, intermediate- and long-term. In statistical modeling, regression analysis is a statistical process for estimating the relationships among variables. It includes many techniques for modeling and analyzing several variables, when the focus is on the relationship between a dependent variable and one or more independent variables (or 'predictors'). Ratio Analysis is a form of Financial Statement Analysis that is used to obtain a quick indication of a firm's financial performance in several key areas. The ratios are categorized as Short-term Solvency Ratios, Debt Management Ratios, Asset Management Ratios, Profitability Ratios, and Market Value Ratios. Finding the problems inside the business is very critical. To evaluate the business internally the company can do periodic review of its business policies. The appraisal of operational costs and other fixed costs is also equally important. To increase profit we need to keep innovating and improvising operational expertise. Assessing External Environment is as important as internal business evaluation. Though we can not control much when the issues are external but surely we can prepare well in advance if we evaluate the external threats to the company. We need to identify what and how is the competitor different. What all services and better features are they providing to the customer which our company is not. We need to analyze the current market conditions and trends. The most critical aspect of analyzing competitors is to evaluate which competitor we need to attack and which are the ones we need to avoid.
- The markets are segmented based on network quality , level of competition and market share. The top left corner is ideally preferred for growth in market share. The main focus should be in shifting the markets to a top zone ,where network quality is high Market 1 and 5 are considerably large market with less market share for the client. This is primarily due to low network quality and high level of competition. Market share of 1 and 5 can be improved by working on network quality in these markets. If we take the case of market 4, market share is low even though there is a good network quality and very low competition,
- it’s critical to invest in infrastructure, and core products and services. But it’s also important to make sure customers have an excellent brand experience at each and every touch point. It’s this ongoing relationship and audience engagement that will differentiate operators and determine how effectively they grow their market share, minimize churn and increase usage. Tell a Compelling Brand Narrative Make Customers Your Best Marketers Promote, Convert, Educate Make Customers Loyal Keep It All Legal Show Your Partners Some Love Connect Consumers with Big Events Optimize Your Content Strategy Base Your Decisions on Insight
- Risk mitigation planning is the process of developing options and actions to enhance opportunities and reduce threats to project objectives . Risk mitigation implementation is the process of executing risk mitigation actions. Risk mitigation progress monitoring includes tracking identified risks, identifying new risks, and evaluating risk process effectiveness throughout the project.