Welcome
Agenda
Agenda

SWOT Presentations
Agenda

SWOT Presentations
 Review of class 1I
Agenda

      SWOT Presentations
        Review of class 1I
External analysis (Porter 5 forces)
Agenda

      SWOT Presentations
        Review of class 1I
External analysis (Porter 5 forces)
   Walmart case study / video
Agenda

      SWOT Presentations
        Review of class 1I
External analysis (Porter 5 forces)
   Walmart case study / video
   Exercise: using the 5 forces
Agenda

      SWOT Presentations
        Review of class 1I
External analysis (Porter 5 forces)
   Walmart case study / video
   Exercise: using the 5 forces

        Generic strategies
Agenda

      SWOT Presentations
        Review of class 1I
External analysis (Porter 5 forces)
   Walmart case study / video
   Exercise: using the 5 forces

        Generic strategies
       Balanced scorecards
Agenda

      SWOT Presentations
        Review of class 1I
External analysis (Porter 5 forces)
   Walmart case study / video
   Exercise: using the 5 forces

       Generic strategies
      Balanced scorecards
     Mergers & acquisitions
Agenda

      SWOT Presentations
        Review of class 1I
External analysis (Porter 5 forces)
   Walmart case study / video
   Exercise: using the 5 forces

      Generic strategies
     Balanced scorecards
    Mergers & acquisitions
   Comcast / NBC case study
Agenda

      SWOT Presentations
        Review of class 1I
External analysis (Porter 5 forces)
   Walmart case study / video
   Exercise: using the 5 forces

      Generic strategies
     Balanced scorecards
    Mergers & acquisitions
   Comcast / NBC case study
         Next week
Questions before we begin?
Concept Review
1
Introduction to Strategic Management
2
Internal and External Environment
Internal Analyses
Resource based view of the firm
Firms differ in fundamental ways because each
firm possesses a unique “bundle” of resources –
tangible and intangible assets and organizational
    capabilities to make use of those assets
Tangible Assets          Intangible Assets         Organizational
                                                    Capabilities
Hampton Inn’s            Budweiser’s brand       Dell Computer’s
reservation system       name                    customer service
Ford Motor’s cash        Dell Computer’s         Wal-mart’s purchasing
reserves                 reputation              and inbound logistics
3M’s patents             Nike’s advertising with Sony’s product
                         LeBron James            development process
Georgia Pacific’s land   Katie Couric as NBC’s   Coke’s global
holdings                 “Today” host            distribution
                                                 coordination
Value Chain Analysis
SWOT(T) Analysis
SWOT


       Strengths       Weaknesses




       Opportunities      Threats
SWOT Analysis         Numerous environmental opportunities




                              Cell 3:     Cell 1:
                          Supports a      Supports an
                 turnaround-oriented      aggressive
   Critical                 strategy      strategy
                                                             Substantial Internal
  Internal
                                                                Strengths
Weaknesses                     Cell 4:    Cell 2:
                Supports a defensive      Supports a
                             strategy     diversification
                                          strategy




                            Major environmental threats
External environment
5 Forces framewor k
What are entry barriers?
5 Forces framewor k
                      capital requirements
                      patents & trademarks
                      branding
                      distribution
                      long term contracts
                      switching costs
example: Univer sity of Phoenix

                                  Take 10 minutes
                                  Analyze 5 forces
                                  Select spokesman
Social   Economic   Technology   Ecological   Political
TECHNOLOGICAL OBSOLESCENCE
TECHNOLOGICAL OBSOLESCENCE
RE GU LATORY FORCES
RE GU LATORY FORCES
RE GU LATORY FORCES
Social   Economic   Technology   Ecological   Political
3
Strategy development
Long term objectives
Profitability
Profitability
Productivity
Profitability
    Productivity
Competitive position
Profitability
     Productivity
 Competitive position
Employee development
Profitability
     Productivity
 Competitive position
Employee development
  Employee relations
Profitability
      Productivity
 Competitive position
Employee development
  Employee relations
Technological leadership
Profitability
      Productivity
 Competitive position
Employee development
  Employee relations
Technological leadership
  Public responsibility
Qualities of Long-Term Objectives

                                                  Acceptable
      Achievable
                          Profitability
                          Productivity
                      Competitive position
                    Employee development               Flexible
Understandable
                       Employee relations
                    Technological leadership
                      Public responsibility
                                               Measurable
        Suitable

                           Motivating
The Balanced Scorecard
The Balanced Scorecard
Tangible goals linked to long term objectives
The Balanced Scorecard
Tangible goals linked to long term objectives
Generic Strategies
michael porter
michael porter
Source of Competitive Advantage

                       Cost              Differentiation




        Broad
                 Cost Leadership       Differentiation
Scope


        Narrow




                                       Differentiation
                   Cost Focus
                                            Focus
Source of Competitive Advantage

                       Cost              Differentiation




        Broad
                 Cost Leadership       Differentiation
Scope


        Narrow




                                       Differentiation
                   Cost Focus
                                            Focus
Source of Competitive Advantage

                       Cost              Differentiation




        Broad
                 Cost Leadership       Differentiation
Scope


        Narrow




                                       Differentiation
                   Cost Focus
                                            Focus
Source of Competitive Advantage

                       Cost              Differentiation




        Broad
                 Cost Leadership       Differentiation
Scope


        Narrow




                                       Differentiation
                   Cost Focus
                                            Focus



                      FOOD
Source of Competitive Advantage

                       Cost              Differentiation




        Broad
                 Cost Leadership       Differentiation
Scope


        Narrow




                                       Differentiation
                   Cost Focus
                                            Focus



                      FOOD
So how do we decide?

Differentiation
                      Cost Advantage     Overall ROI
  Advantage


    High                  High              35%

    Low                   High              26%

    High                  Low               22%

    Low                   Low              9.5%
michael treacy
michael treacy
michael treacy
Another view: value disciplines



Operational
                     Customer intimacy     Product leadership
excellence
Another view: value disciplines



Operational
                     Customer intimacy     Product leadership
excellence
Another view: value disciplines



Operational
                     Customer intimacy     Product leadership
excellence
Another view: value disciplines



Operational
                     Customer intimacy     Product leadership
excellence
Source of Competitive Advantage

                      Cost               Differentiation




                 Operational intimacy
        Broad
                 Cost Customer
                      Leadership  Product leadership
                                   Differentiation
                 excellence
Scope


        Narrow




                                       Differentiation
                   Cost Focus
                                            Focus
“Our mission is to develop the most innovative
   products at the lowest cost through operational
excellence and intimate knowledge of our customers”
“Our mission is to develop the most innovative
   products at the lowest cost through operational
excellence and intimate knowledge of our customers”



                      You can’t
                       do it all
Walmart, Part I
Questions




• How   could rubbermaid have reacted faster?

• Could   they survive in the U.S.?

• Which   stakeholders love Walmart, which hate it?
Grand strategies
A
                                                B
Concentrated growth
                                            Liquidation
Market development
                                            Bankruptcy
Product development
                                          Joint ventures
     Innovation
                                        Strategic alliances
Horizontal integration
                                            Consortia
 Vertical integration


                             C
                  Concentric diversification
                 Conglomerate diversification
                        Turnaround
                        Divestiture
Core competencies, mergers &
      the synergy myth
Why do companies merge?
Control Costs   Increase Revenue
What is synergy?
What is synergy?
Costs savings work, revenue synergy doesn’t
+
5 Forces framewor k
5 Forces framewor k
Business school 101:




If you don’t know the answer, guess
Business school 101:




If you don’t know the answer, guess
Walmart, Part II - Globalization
Questions




• What   drove Walmart’s globalization?

• “Walmart   and China are a joint venture”

 • good, bad   or indifferent?
Walmart, Part III
Assignments
Discuss scorecard ideas with learning team (5
      threads, 5 responses, 5 summaries)

  Develop balanced scorecard and 300-word
       discussion of what you learned

Start work on week 5 strategic plan presentation
Week 4
Individual Assignment: Balanced Scorecard                        10




                 Discuss scorecard ideas with learning team (5
                      threads, 5 responses, 5 summaries)

                   Develop balanced scorecard and 300-word
                        discussion of what you learned

              Start work on week 5 strategic plan presentation
Week 4
Individual Assignment: Balanced Scorecard                        10
Learning Team Assignment: Strategic Direction Evaluation         2




                 Discuss scorecard ideas with learning team (5
                      threads, 5 responses, 5 summaries)

                   Develop balanced scorecard and 300-word
                        discussion of what you learned

              Start work on week 5 strategic plan presentation
Next Week
Implementation strategies

       Exam prep

Bus475.Nov09.3

  • 1.
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  • 5.
  • 6.
    Agenda SWOT Presentations Review of class 1I External analysis (Porter 5 forces)
  • 7.
    Agenda SWOT Presentations Review of class 1I External analysis (Porter 5 forces) Walmart case study / video
  • 8.
    Agenda SWOT Presentations Review of class 1I External analysis (Porter 5 forces) Walmart case study / video Exercise: using the 5 forces
  • 9.
    Agenda SWOT Presentations Review of class 1I External analysis (Porter 5 forces) Walmart case study / video Exercise: using the 5 forces Generic strategies
  • 10.
    Agenda SWOT Presentations Review of class 1I External analysis (Porter 5 forces) Walmart case study / video Exercise: using the 5 forces Generic strategies Balanced scorecards
  • 11.
    Agenda SWOT Presentations Review of class 1I External analysis (Porter 5 forces) Walmart case study / video Exercise: using the 5 forces Generic strategies Balanced scorecards Mergers & acquisitions
  • 12.
    Agenda SWOT Presentations Review of class 1I External analysis (Porter 5 forces) Walmart case study / video Exercise: using the 5 forces Generic strategies Balanced scorecards Mergers & acquisitions Comcast / NBC case study
  • 13.
    Agenda SWOT Presentations Review of class 1I External analysis (Porter 5 forces) Walmart case study / video Exercise: using the 5 forces Generic strategies Balanced scorecards Mergers & acquisitions Comcast / NBC case study Next week
  • 14.
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  • 16.
  • 17.
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    Resource based viewof the firm
  • 20.
    Firms differ infundamental ways because each firm possesses a unique “bundle” of resources – tangible and intangible assets and organizational capabilities to make use of those assets
  • 21.
    Tangible Assets Intangible Assets Organizational Capabilities Hampton Inn’s Budweiser’s brand Dell Computer’s reservation system name customer service Ford Motor’s cash Dell Computer’s Wal-mart’s purchasing reserves reputation and inbound logistics 3M’s patents Nike’s advertising with Sony’s product LeBron James development process Georgia Pacific’s land Katie Couric as NBC’s Coke’s global holdings “Today” host distribution coordination
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    SWOT Strengths Weaknesses Opportunities Threats
  • 26.
    SWOT Analysis Numerous environmental opportunities Cell 3: Cell 1: Supports a Supports an turnaround-oriented aggressive Critical strategy strategy Substantial Internal Internal Strengths Weaknesses Cell 4: Cell 2: Supports a defensive Supports a strategy diversification strategy Major environmental threats
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    What are entrybarriers?
  • 31.
    5 Forces framework capital requirements patents & trademarks branding distribution long term contracts switching costs
  • 32.
    example: Univer sityof Phoenix Take 10 minutes Analyze 5 forces Select spokesman
  • 34.
    Social Economic Technology Ecological Political
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  • 40.
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    Social Economic Technology Ecological Political
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    Profitability Productivity Competitive position
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    Profitability Productivity Competitive position Employee development
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    Profitability Productivity Competitive position Employee development Employee relations
  • 51.
    Profitability Productivity Competitive position Employee development Employee relations Technological leadership
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    Profitability Productivity Competitive position Employee development Employee relations Technological leadership Public responsibility
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    Qualities of Long-TermObjectives Acceptable Achievable Profitability Productivity Competitive position Employee development Flexible Understandable Employee relations Technological leadership Public responsibility Measurable Suitable Motivating
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    The Balanced Scorecard Tangiblegoals linked to long term objectives
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    The Balanced Scorecard Tangiblegoals linked to long term objectives
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    Source of CompetitiveAdvantage Cost Differentiation Broad Cost Leadership Differentiation Scope Narrow Differentiation Cost Focus Focus
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    Source of CompetitiveAdvantage Cost Differentiation Broad Cost Leadership Differentiation Scope Narrow Differentiation Cost Focus Focus
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    Source of CompetitiveAdvantage Cost Differentiation Broad Cost Leadership Differentiation Scope Narrow Differentiation Cost Focus Focus
  • 63.
    Source of CompetitiveAdvantage Cost Differentiation Broad Cost Leadership Differentiation Scope Narrow Differentiation Cost Focus Focus FOOD
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    Source of CompetitiveAdvantage Cost Differentiation Broad Cost Leadership Differentiation Scope Narrow Differentiation Cost Focus Focus FOOD
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    So how dowe decide? Differentiation Cost Advantage Overall ROI Advantage High High 35% Low High 26% High Low 22% Low Low 9.5%
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    Another view: valuedisciplines Operational Customer intimacy Product leadership excellence
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    Another view: valuedisciplines Operational Customer intimacy Product leadership excellence
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    Another view: valuedisciplines Operational Customer intimacy Product leadership excellence
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    Another view: valuedisciplines Operational Customer intimacy Product leadership excellence
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    Source of CompetitiveAdvantage Cost Differentiation Operational intimacy Broad Cost Customer Leadership Product leadership Differentiation excellence Scope Narrow Differentiation Cost Focus Focus
  • 74.
    “Our mission isto develop the most innovative products at the lowest cost through operational excellence and intimate knowledge of our customers”
  • 75.
    “Our mission isto develop the most innovative products at the lowest cost through operational excellence and intimate knowledge of our customers” You can’t do it all
  • 76.
  • 77.
    Questions • How could rubbermaid have reacted faster? • Could they survive in the U.S.? • Which stakeholders love Walmart, which hate it?
  • 78.
  • 79.
    A B Concentrated growth Liquidation Market development Bankruptcy Product development Joint ventures Innovation Strategic alliances Horizontal integration Consortia Vertical integration C Concentric diversification Conglomerate diversification Turnaround Divestiture
  • 80.
    Core competencies, mergers& the synergy myth
  • 83.
  • 84.
    Control Costs Increase Revenue
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    Costs savings work,revenue synergy doesn’t
  • 88.
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    Business school 101: Ifyou don’t know the answer, guess
  • 93.
    Business school 101: Ifyou don’t know the answer, guess
  • 94.
    Walmart, Part II- Globalization
  • 95.
    Questions • What drove Walmart’s globalization? • “Walmart and China are a joint venture” • good, bad or indifferent?
  • 96.
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  • 98.
    Discuss scorecard ideaswith learning team (5 threads, 5 responses, 5 summaries) Develop balanced scorecard and 300-word discussion of what you learned Start work on week 5 strategic plan presentation
  • 99.
    Week 4 Individual Assignment:Balanced Scorecard 10 Discuss scorecard ideas with learning team (5 threads, 5 responses, 5 summaries) Develop balanced scorecard and 300-word discussion of what you learned Start work on week 5 strategic plan presentation
  • 100.
    Week 4 Individual Assignment:Balanced Scorecard 10 Learning Team Assignment: Strategic Direction Evaluation 2 Discuss scorecard ideas with learning team (5 threads, 5 responses, 5 summaries) Develop balanced scorecard and 300-word discussion of what you learned Start work on week 5 strategic plan presentation
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