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Growth Strategies

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Growth strategies in era of turbulence.

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Growth Strategies

  1. 1. Event: 21 st Management Accounting Students’ Conference 2009 15 th August 2009 Marriott Hotel, Karachi
  2. 2. Goggle for Growth By: Aamir Ali Reg # 20061233 Stage IV
  3. 3. OUTLINE <ul><li>Business World … </li></ul><ul><li>Why Growth </li></ul><ul><li>Goggle for Growth </li></ul><ul><li>Turbulent Economy </li></ul><ul><li>Strategic Alliances </li></ul><ul><li>Corporate Marriages </li></ul><ul><li>Managing Marriages </li></ul><ul><li>Next … </li></ul>
  4. 4. BUSINESS WORLD….. <ul><li>People </li></ul><ul><li>Material </li></ul><ul><li>Machine </li></ul><ul><li>Information </li></ul>
  5. 5. How to grow? <ul><li>Identify the CORE </li></ul><ul><li>What to become in the future? </li></ul>
  6. 6. Understanding your CORE is the first block of your growth strategy.
  7. 7. Role <ul><li>Communicate information for Decision Making </li></ul><ul><li>Assurance of effective utilization of resources </li></ul>
  8. 8. The Dumbest Moment !! <ul><li>First quarterly loss in 38 years ! </li></ul><ul><li>CEO resigned ! </li></ul>
  9. 9. When you hire a specialist .. <ul><li>Backs your business on track </li></ul><ul><li>& </li></ul><ul><li>Moves it in a forward motion </li></ul>
  10. 10. WHY GROWTH? <ul><li>The path of success </li></ul><ul><li>Pressure from interest holders </li></ul><ul><li>Managers get benefits </li></ul><ul><li>Survival option </li></ul>Top Most Challenge
  11. 11. Growth Agents <ul><ul><li>Create strategies </li></ul></ul><ul><ul><li>improve the leads </li></ul></ul><ul><ul><li>find prospects : turn them in quality leads </li></ul></ul>
  12. 12. GOGGLE FOR GROWTH <ul><ul><li>Internal Growth </li></ul></ul><ul><ul><li>External Growth </li></ul></ul>
  13. 13. Internal Growth Market Share Growth
  14. 14. Internal Growth Market Leverage Growth Market Share Growth Customer Leverage Growth
  15. 15. External Growth <ul><li>Strategic alliance </li></ul><ul><li>Merger and acquisition </li></ul>
  16. 16. Advisors <ul><ul><li>Research new markets </li></ul></ul>
  17. 17. TURBULENT ECONOMY <ul><li>Economic downturn forces businesses to: </li></ul><ul><ul><li>Cut back in all areas </li></ul></ul><ul><ul><ul><li>Making people redundant </li></ul></ul></ul><ul><ul><ul><li>Lowering prices </li></ul></ul></ul><ul><ul><ul><li>Freezing wages </li></ul></ul></ul>
  18. 18. Cost Cutting Options… <ul><li>Lots of businesses are joining hands </li></ul>Not to grow but just to Survive !!!
  19. 19. STRATEGIC ALLIANCE <ul><li>When competitors become partners.. </li></ul>NIFT National Institutional Facilitation Technologies (Pvt.) Limited NIFTeTRUST
  20. 20. Management Consultants <ul><ul><li>Cross-fertilization of Best Practices </li></ul></ul><ul><ul><li>Strategic Development </li></ul></ul>
  21. 21. Analysts Assess True image and potential risks and rewards of the alliance
  22. 22. Corporate Marriages <ul><li>Mergers & Acquisitions </li></ul>
  23. 23. Merger <ul><li>Merger ? </li></ul><ul><li>Combine forces </li></ul><ul><li>Does a merger create : </li></ul><ul><li>new wealth </li></ul><ul><li>new factories </li></ul><ul><li>new technologies </li></ul><ul><li>new products </li></ul>
  24. 24. <ul><ul><li>Rearranging the deck chairs on the Titanic </li></ul></ul>
  25. 26. Acquisition <ul><li>Take over of Control </li></ul>
  26. 27. Marriages in Pakistan <ul><li>Competition (Merger Control) Regulations 2007 </li></ul>Regulated under : <ul><li>Regulated by : </li></ul><ul><ul><li>Competition Commission of Pakistan </li></ul></ul>
  27. 28. Some Recent Marriages
  28. 29. Arif Habib Securities Limited Aisha Steel Mills Limited 30 June 2009
  29. 30. KP Chemical Corporation Pakistan PTA Limited 23 June 2009
  30. 31. Merck & Co. Inc. & Schering Plough Corp
  31. 32. Marriages in Financial Institution <ul><li>Massive restructuring </li></ul><ul><li>Huge infusion of capital </li></ul><ul><li>Cutting edge technology up-gradation </li></ul>
  32. 33. KASB Bank Limited with Atlas Bank Limited
  33. 34. Factors Forcing Marriages <ul><li>Privatization Policy </li></ul><ul><li>State Bank of Pakistan (SBP) </li></ul><ul><li>Economic Downturn </li></ul>
  34. 36. Dalda Acquired Tullo
  35. 37. Benefits of Marriages <ul><li>Revenue enhancement </li></ul><ul><li>Cost reduction </li></ul><ul><li>Diversification of business activities </li></ul><ul><li>Wider market access </li></ul><ul><li>Transfer of talent and resources </li></ul>
  36. 38. Tax benefits <ul><li>Set off business losses </li></ul><ul><li>unabsorbed depreciation </li></ul><ul><li>an allowable expense </li></ul><ul><li>option to be taxed as one unit </li></ul>Under the Income Tax Ordinance, 2001
  37. 39. Answer to the downturn ! <ul><li>No extra help </li></ul><ul><ul><ul><li>Cash Injection </li></ul></ul></ul><ul><li>Cost Cutting Options </li></ul>
  38. 40. If you fail to plan, you plan to fail <ul><li>Lipton merged with Brooke Bond </li></ul>MCA approved merger on the condition “ the company will develop tea cultivation at 600 hectares by the year 2004” The company failed and MCA can not revise its order !!!
  39. 41. Its <ul><li>More than laying off people </li></ul><ul><li>. . . . . </li></ul><ul><li>Changing Top Management </li></ul><ul><li>Changing Product Quality </li></ul><ul><li>Changing Manufacturing Process </li></ul>
  40. 42. Really make a fundamental change in the efficiency of the companies. Mergers that succeed
  41. 43. Strategy Consultants <ul><ul><ul><li>Improve performance </li></ul></ul></ul><ul><ul><ul><li>Analysis of problems </li></ul></ul></ul><ul><ul><ul><li>Development of future plans </li></ul></ul></ul>
  42. 44. Why a marriage fail after honeymoon ends <ul><li>Two single parents </li></ul><ul><ul><li>Each with their own </li></ul></ul><ul><ul><ul><li>Pets </li></ul></ul></ul><ul><ul><ul><li> & </li></ul></ul></ul><ul><ul><ul><li>Habits </li></ul></ul></ul>Difficulty of creating ideal marriage <ul><ul><ul><ul><li>Decide to marry </li></ul></ul></ul></ul>
  43. 45. Mom & Dad so busy in love .. <ul><li>Fail to see kids don’t get along </li></ul>
  44. 46. Choice ? <ul><ul><li>How to face challenges as unified family? </li></ul></ul><ul><ul><li>Identify the differences </li></ul></ul><ul><ul><li>Recognize what’s the best? </li></ul></ul><ul><ul><li>Select ways that fits the challenges </li></ul></ul>Live happily ever after !  
  45. 47. Managing Marriages <ul><li>Ongoing process </li></ul><ul><li>Develop a clear, logical and replicable approach </li></ul><ul><li>Two way communication </li></ul>GSK a history of managing marriages all the way!!
  46. 48. System Managers <ul><li>Design such system </li></ul><ul><li>Implement system </li></ul>a
  47. 49. NEXT - - - - <ul><li>Capital </li></ul><ul><li>Knowledge </li></ul>The chief strategic resource of the future But the ability to form powerful partnership NO X
  48. 50. <ul><li>But Remember ! </li></ul><ul><li>If not lead by effective leadership efficiently then a complete disaster </li></ul>M&A felt as nutritious a
  49. 51. Leaders <ul><li>Goggle for new strategies for growth </li></ul><ul><li>Lead organization efficiently and effectively </li></ul>a
  50. 52. Growth Specialists <ul><ul><li>Achieve success in a variety of ways </li></ul></ul><ul><ul><li>Help in ways you may never have thought of </li></ul></ul><ul><ul><ul><li>A specialist’s job is to </li></ul></ul></ul><ul><ul><ul><li>maximize </li></ul></ul></ul><ul><ul><ul><li>your potential. </li></ul></ul></ul>
  51. 53. To achieve new levels with your business, may be its time to find a specialist. If you are ready …
  52. 54. Q & A

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