Strategy and business model
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Strategy and business model
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Strategy and business model
- 1. Strategy, Business Model & Business Plan
- 3. Strategy Funnel Goal: Articulate and execute long-term, defensible offer of unique value to customers Customer & Benefits Competitive Dynamics Competitive Space Segment,Size Channels Strategic Positioning Value Proposition Industry Structure Environmental Trends Industry Market Perceptual Space
- 12. Strategic Situation External Factors Internal Factors Strategic Situation Resources (know-how, people, money, etc) Vision, values & culture Social, political, regulatory, technological & community Industry Attractive-ness, dynamics, & competition Unmet customer needs & desires Competitive position (through customers eyes & in industry)
- 13. Match SW to OT Strengths (S) Internal Factors External Factors Opportunities (O) SO Strategies ------------------------- WO Strategies ------------------------ Threats (T) ST Strategies -------------------------- WT Strategies ------------------------- Use strengths to avoid threats Min. weaknesses to avoid threats Use strengths to take advantage of opportunities Offset weaknesses to take advantage of opportunities Weaknesses (W )
- 35. Ikea’s Activity System Limited Customer Service Modular Designs Low Mfg Cost Self-service Selection Self-transport Limited sales staff Customer loyalty Self -assembly Suburban Location Most items in stock Design focused on low cost Explanatory labeling Easy transport Flat packing kits Wide variety Long-term suppliers Year-round stocking On-site inventory Impulse buying High-traffic store layout Easy to make
Editor's Notes
- 2 We’re in the midst of working on the context of your business -- on the environment, industry, competition -- on what the world gives you to work with. Before this we looked a little at what you bring to the table: your vision, skills, idea, networks. The next step is to combine the two. To take stock of what the world offers and what you bring and to fit them together into a strategy in which you use your strengths to take advantage of opportunities, shore up weaknesses, stave off threats, etc. Your strategy is summarized as a business model -- the gist of your plan to take advantage of an opportunity. This is the heart of your plan. Once you have the model, it’s a matter of working out the details of how you will implement the model. And then reassuring the investors that you’ve thought through the risks.
- 3 By now you should have a pretty good picture of Customers – who are, how organized, what problem product solves for them, what else they see, how to reach ‘em…thus value proposition Industry space – rules and drivers, competitors and how they operate, space that is left…thus a position Goal of strategy is: Goal: Articulate and DELIVER long-term, defensible offer of unique value to customers…
- 4 First, clarification…what is strategy?
- 5 What is strategic management? Disciplined process Fed by scanning – like you just did Anchored by mission Pulled by vision Built on resources Shaped by external and competitive forces REQUIRES constant attention…
- 6 When develop strategy, develop lot of things…here is checklist Vision… Value prop (done…will do more) Position or direction (depending on change) Structure or resource base (always both but which emphasize depends on change) Revenue model – cf Sid and future…gotta see and realize value concretely Timelines or guidelins – timing matters (see later) FIT – most important, pieces have to fit together and reinforce, esp when small
- 7 Company A provides a new-generation process historian that helps pharmaceutical and other batch process firms prevent bad batches by analyzing and adjusting batches in real time. Because each batch can cost between $250,000 and $1 million, the $100,000 cost of A-RS will be paid off within a year. As important, because A-RS is fully compliant with regulation xyz, it provides a cost-effective, painless way to fulfill companies’ reporting requirements. “A-RS is the only product we found that truly fulfills the FDA’s requirement for paperless reporting and record-keeping without any additional programming or work-arounds.” Alan A, GSK.
- 8 Example: Riskforce…Active preparation for risk management…concrete and specific…per company (maybe not wider yet) Two-ten…control dental…
- 10 27 2 kinds of strategy
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- 13 14 Automsoft example… SO-low-end historian WT-weak CEO, threat from size of market + competitors…so remove CEO ST – CEO + tech…reposition to turn size market to opportunity, keep edge on competitors WO – still no money, small staff…so marketing mind share: white papers, industry standards group (with CEOs) Captive insurance example W & T: Loss of 65% of business…owner/managers hurting… big firms 50,000 vs their 200 S: Sales, experience, location (Cayman & Bahama), desperation, IT Min W by saying: No DIS economies of scale…3 vs 12, very focused (one industry – oil and gas) Emphasize S: owners vs peons, fun to do business with (parties), edgy & aggressive + built IT support to deliver Attack T – in very specific way: one vertical, focused product, as good as cheap, better service and attention Opportunity…growth! Suisse Re…
- 14 27 Fill out situation… S by strengths W by weaknesses O by opportunities T by threats Connect up…with arrows and lines (football plays…)
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- 27 Get into this in two weeks as push strategy… Consulting group example… Thought it was thought leader…analysis showed that it was on intimacy/operational effectiveness border…and should focus on operational effectiveness…using intimacy (from main consulting), using others inventions to produce semi-automatic change management consulting tools...
- 28 Get into this in two weeks as push strategy… Consulting group example… Thought it was thought leader…analysis showed that it was on intimacy/operational effectiveness border…and should focus on operational effectiveness…using intimacy (from main consulting), using others inventions to produce semi-automatic change management consulting tools...
- 29 Get into this in two weeks as push strategy… Consulting group example… Thought it was thought leader…analysis showed that it was on intimacy/operational effectiveness border…and should focus on operational effectiveness…using intimacy (from main consulting), using others inventions to produce semi-automatic change management consulting tools...
- 30 Lead with product? Cost? Focus? Value proposition? Thought it was thought leader…analysis showed that it was on intimacy/operational effectiveness border…and should focus on operational effectiveness…using intimacy (from main consulting), using others inventions to produce semi-automatic change management consulting tools...
- 31 27 As value disciplines implied, position requires fit, not just niche. As important as finding a niche is fitting into it…building mountain and/or fortification by becoming special.
- 32 Entrepreneurs have one distinct advantage: the ability to build to suit…The philosophy is that of tai chi – listening so carefully, balanced so well, that 4 ounces of pressure sends an opponent sprawling… Examples: OCS – electrical engineer + electronic music + macintosh subculture. Early warehouse scene and culture. Garage to high-end with marketing clout to Shockwave. Dollar Express – Big format, careful locations, small HQ to control buying and costs, decentralized customer service: Youthbuild. Visionary + nerd + street boy + construction head. Nonprofit + school + charter + HUD. Teacher/ caseworker/foreman teams in 4 pods of 100.
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- 46 The steps to building a business model
- 47 The steps to building a business model
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