Strategy + Implementation: Telling them what to do: Strategy + Implementation: Telling them what to do


Today: Today Review of Auckland model Purpose of Analaysis The link between analysis and strategy The compelling evidence behind the strategy How strategy links to implementation


Where do you start?: Where do you start? The Question of the case The nature of the industry The nature of the business The motivation for change Stakeholder Drivers Key Issues Big Question


What is the purpose?: What is the purpose? Strategy: give them a recommendation… Implementation: when, where, who, what, how… …to address issues (and problems) …to put the strategy in action


Where does this fit in?: Where does this fit in? Case Reading and Analysis Strategy and Implementation 0 hours 1.5 hours 3 hours Strategy For the MCC Case Competition… Implementation


Generic strategies: Generic strategies Exit now/future New-Old Products Markets Cost Control Greenfield What is a strategy?


Generic strategies: Generic strategies New-Old Products Markets Old products new markets: Marvel Comics New products old markets Porsche Cayenne Old products new markets Sell more Charge More New Products New Markets Fletchers Electrical in US


Generic strategies: Generic strategies Greenfield New area of business Not built on current protfolio Shimano into fishing equipment Caterpillar into Shoes Jaguar into aftershave


Generic strategies: Generic strategies Cost control Air New Zealand $100 million Fletcher Building $120 million Fonterra $160 million Cost control is a short term growth strategy. You have to increase the revenue line for continued growth


Generic strategies: Generic strategies Exit What do the stakeholders want? What are the management capabilities? Who could we sell to? What value?


Strategy is driven by analysis: Strategy is driven by analysis The analysis will deliver key issues Statement-evidence-impact The key issues are called constraints and drivers The key issues frame, guide, drive your strategy


Strategy may consider: Strategy may consider Market size – growth Competitiveness Margins Core competencies Competive advantage


What is the Financal Impact: What is the Financal Impact NPV Share Price Cash Cost of Strategy Funding Size of Gain


What is Implementation?: What is Implementation? Marketing HR General Market Size Growth Customers Advertising Market Change Distribution Positioning Culture Competencies Organisation Chart Mergers Succession Plans Training Plans Hiring Criteria Risks, Mitigations, Contingencies Impact of Strategy (non-financial) Competitor Reaction


A word about creativity…: A word about creativity… An “out of the box” strategy can set you apart… …so feel free to be creative about strategies… …but keep the strategy criteria in mind… …always check if the strategy “fits” the organisation… …keep it simple, realistic, and achievable… …remember: a radical strategy can win and lose!


What is Implementation : What is Implementation show how you will implement the strategy Hit the main milestones Indicate timing Appropriate detail


STREAMLINE: Divestment: STREAMLINE: Divestment  Identify potential buyers  Negotiate selling price Australian $US2m  Hand-over period  Contract agreement


STREAMLINE: Consolidation: STREAMLINE: Consolidation Consumer Needs Structured feedback process Introduce innovations Distribution Networks Exclusive dealerships Strong trade relationship HR System Management compensation Skilled local management Globalise Material Sourcing Agglomerate regional orders Global economies of scale


EXPAND: Acquisition: EXPAND: Acquisition  Negotiate terms of partnership ownership stake > 50% staff retention buy-ins from both parties  Contract agreement  Integrate organisations culture management Berger product branding


Implementing the Strategy: Implementing the Strategy June June June Now Acquire Huading Parallel Task GLOBALISE Sourcing Streamline Expand 2005 2006 2007 Acquire Luwan Divest Portfolio Evaluation


Handling Risk: Handling Risk