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© © © Strategic Management Leveraging Individual Strategic Thinking to Produce Superior Organizational Performance by Alan W. Kennedy February 2015 © 2015 Alan W. Kennedy on behalf of Schulich Executive Education Centre (SEEC). All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, recording, photocopying or otherwise, without written permission of the copyright holder.

©© © Strategic Management Leveraging Individual Strategic Thinking to Produce Superior Organizational Performance by Alan W. Kennedy February 2015 © 2015

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Page 1: ©© © Strategic Management Leveraging Individual Strategic Thinking to Produce Superior Organizational Performance by Alan W. Kennedy February 2015 © 2015

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Strategic Management

Leveraging Individual Strategic Thinkingto Produce

Superior Organizational Performance

by Alan W. Kennedy

February 2015

© 2015 Alan W. Kennedy on behalf of Schulich Executive Education Centre (SEEC). All rights reserved.No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means,

electronic, mechanical, recording, photocopying or otherwise, without written permission of the copyright holder.

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Module 1Course Introduction

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About the Presenter

Alan has been teaching Strategic Management for the Schulich Executive Education Centre since 1992. Alan is a member of the faculty for Management I, a one week course for new managers, and the Insurance Industry Leadership Program. Alan is a frequent speaker on matters of strategy, risk, and project management of major capital projects. Alan’s book, The Alpha Strategies – Understanding Strategy, Risk, and Values in Any Organization, listed as a Kirkus Best Books of 2013, is available at online retailers everywhere and at www.thealphastrategies.com

Alan is a Honor Roll CMC member of the Canadian Association of Management Consultants. Alan received his degrees from Dalhousie University and served as Senior Vice President & General Counsel for both Oxford Development Group and Campeau Corporation and as a member of the Board of Directors for both companies.

Alan Kennedy B.A. LLB. CMC

Alan is a founding partner of Gibson Kennedy & Company, a Toronto consulting firm offering Canadian clients strategy counsel and competitive research services since 1990. Gibson Kennedy is the authorized correspondent in Canada for Kaiser Associates Inc., a Washington-based consultancy offering global competitive research services to North American based clients. Alan’s practice focuses exclusively on matters of strategy and capital projects planning and communication. Alan has extensive governance experience developed from attendance at more than 500 board meetings.

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Table of Contents

Day One: Situation Analysis

Module 1: Course Introduction 1 – 1 – 27

Module 2: Getting Ready to Plan 1 – 28 – 39

Module 3: Internal Assessment 1 – 40 – 50

Module 4: External Assessment 1 – 51 – 60

Day Two: Strategic Planning

Module 1: Course Introduction 2 – 1 – 27

Module 2: Getting Ready to Plan 2 – 28 – 39

Module 3: Internal Assessment 2 – 40 – 53

Module 4: External Assessment 2 – 54 – 71

Day Three: Business Planning

Module 1: Strategic Plan Review 3 – 3 – 19

Module 2: Expectations of the Strategic Plan 3 – 20 – 35

Module 3: Impact of the Strategic Plan 3 – 36 – 46

Module 4: Business Plan Strategy Development 3 – 47 – 55

Schedules

English Bay Situation Analysis Schedule “A”

Tarion Strategic Plan Schedule “B”

Goldstone Branch Business Plan Schedule “C”

Bibliography Schedule “D”

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Your Expectations

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Course Objectives

1. How to prepare and to evaluate a situation analysis

2. How to prepare and to evaluate a strategic plan

3. How to prepare and to evaluate a business plan

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Module 1 Course Introduction Topics

1. An overview of the course and content for each dayDeliverablesThe 12 modules

2. The strategy modelThe 8 strategies 3 types of strategy Origins of the strategy system model

3. Overview of strategy development processThe 4 types of expectations driving strategy developmentThe 3 steps in strategy development

4. Definition of major terms to be used in the course

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Course Deliverables

Day 1

Day 2

Day 3

Produce a Situation Analysis

Produce a Strategic Plan

Produce a Business Plan

1. Course Overview

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Definitions

The knowledge base to support strategy decisionsSituationAnalysis

A review of the 8 strategies common to all organizations

StrategicPlan

An alignment of functional activities with expectations created by the strategic plan

BusinessPlan

1. Course Overview

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Strategy Planning in 12 Steps

2. Scoping Expectations: Have we assessed the expectations for strategic planning?

3. Internal Assessment: Do we truly understand the what’s, how’s and why’s of our current strategy?

4. External Assessment: What factors in the external environment must we truly understand?

1. Choice of Planning Process: Should we be doing strategic planning or business planning?

SituationAnalysis

StrategicPlanning

BusinessPlanning

5. The Situation Analysis Review: Do we have enough understanding to support informed decisions?

7. Strategic Issue Identification: Are we able to develop scenarios to identify possible strategic issues?

6. Issue Development: Are we able to connect external factors to the strategy framework?

8. Strategic Plan Communication: Have we described the likely “what” and “when” impact of change?

9. Strategic Plan Review: Do we understand the strategic plan and how it is likely to impact us?

10. Expectations Impact: Can we identify the impact of strategic plan expectations on functional activities?

11. Expectations Testing: Are the strategic plan expectations consistent with competitive reality ?

12. Strategy Implementation: How are new expectations (if any) to be integrated with ongoing responsibilities?

1. Course Overview

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The 4 Steps of Situation Analysis

Identify What Management Knows

Separate Need to Knowfrom Nice to Know

Study Factors for Actionable Information

Convert 8 Strategiesto Org Design

Evaluate ActivityStrengths/Weaknesses

Use Evaluation toIdentify External Factors

Confirm Responsibilityfor all 8 Strategies

Identify Type ofPlanning Required

Identify CEO / BoardExpectations

Conduct InternalAssessment

Conduct ExternalAssessment

IdentifyAuthority Group

AssessAppetite for Change

Prepare Scopefor Planning Project

If less than 8,Go to Business Planning

Step 1 Step 2 Step 3 Step 4

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Step Objective

Confirm Authorityfor all 8 Strategies

Identify Type ofPlanning Required

Identify CEO / BoardExpectations

Conduct InternalAssessment

Conduct ExternalAssessment

IdentifyAuthority Group

AssessAppetite for Change

Prepare Scopefor Planning Project

1. Choice of Planning Process: Should we be doing strategic planning or business planning?

1. Course Overview

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8 Strategies are Common to all Organizations

2. The Strategy Model

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The starting point for all strategy

The 8 Strategy Model

Strategy General Description

Business Definition /

MandateFocus on positioning the business / interpreting mandate parameters

Risk Focus on the unacceptable and ways to manage it

Growth Focus on type and rate of growth

Financial Management Focus on sourcing, allocation, and management of capital & revenues

R&D / Technology Focus on the creation and/or use of intellectual capital / technology

Organization Mgmt Focus on sourcing, allocation, and management of human resources

Marketing & Sales / Communications

Focus on identifying and capturing customers / clients

Service Delivery / Production / Manufacturing

Focus on fulfilling the marketing / communication promise of value / relevance

2: The StrategyModel

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The Generic Sub-Strategies

Business Definition /

Mandate

Business Positioning: Niche, Specialty, Commodity

Mandate: Narrow Interpretation; Middle-of-the-Road; Broad Interpretation

RiskFocus: Internal; External; Both

Management: Accept, Avoid, Transfer, Reduce

GrowthType: Internal, External (acquisitions, partnerships, alliances, joint ventures)

Rate: Bigger, Smaller, No Change

Financial Management

Sourcing: Debt, equity, self-funding

Allocation: Stars, Cash Cows, Question Marks, Dogs

Management: Performance; Control, Both

R&D / TechnologyPurpose: To enable productivity; to create competitive advantage

Type: Follower, Leader, Adapter

Organization Mgmt

Sourcing: Internal; External

Allocation: (Org Design) Centralized, Decentralized, Functional, Lines of Business, Geographical

Management: Rigid Expectations, Flexible, Laissez-faire

Marketing / Sales

Communications

Identifying: (Marketing 4Ps): Product / Service; Price; Place; Promotion

Capturing: (Sales): Targeting; Approaching; Pitching; Converting; Closing; Follow-Up

Service Delivery / Production / Manufacturing

Needs / Requirements;

Inputs

Production

Delivery

Follow-up

2. The Strategy Model

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Source of The 8 Strategies2. The Strategy

Model

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3 Types of Strategy are Common to all Organizations

2. The Strategy Model

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Source of the 3 Types of Strategy2. The Strategy

Model

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Acquisitions

Internal Growth

Avoid

Transfer

Specialty

Equity

Debt

Control

Services

Place

Use

Production

Centralized

Lines of Business

2. The Strategy Model

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The Dynamic Strategy System2. The Strategy

Model

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4 Types of Expectations Driving Strategy Development

2. The Strategy Model

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Strategy Development in 3 Steps

Name

Focus

on

Process

Focus

on

Results

Comments

1

2

3

4

5

6

Scoring 1 = Not Very Important 4 = Neutral 7 = Very Important

1. Getting the Facts / Becoming Informed

3. StrategyDevelopment

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2. Conducting Analysis

Results (Metrics) Very Important

Results (Metrics) Not Important

Process (Strategy) Very Important

Process (Strategy) Not Important

1 2 3 5 6 7

7

6

5

3

2

1

3. StrategyDevelopment

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Step 3: Strategy Selection

Results (Metrics) Very Important

Results (Metrics) Not Important

Process (Strategy) Very Important

Process (Strategy) Not Important

3. StrategyDevelopment

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Strategy Development Characteristics

1. Strategy development is driven by imposed expectations

2. Strategy development is fueled by timely & relevant facts

3. The time required to become informed is usually underestimated

4. The strategy development process should provide insight - possible choices of action- on current chosen strategy- on what is required to move from current strategy

5. “Selling” a recommended strategy for approval is a different process

3. StrategyDevelopment

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Definitions of Major Terms

Strategy

A description of chosen action

Strategic Planning

A review of the 8 strategies common to all for-profit and nonprofit organizations

Business Planning

Any subsequent strategy planning to implement the expectations of the organization’s Strategic Plan

Strategic Issue

A Strategic Issue is a question whether to replace or to improve existing strategy

Strategic Management

Strategic management is the leveraging of strategic thinking of individuals

Strategic Thinking

Strategic thinking is thinking about how imposed expectations and the realities of the external environment should impact the management of assigned responsibilities

Expectations: Guidance on the hoped-for outcome

Metrics: Anything expressed as a number

Vision: A description of the successful outcome from long term pursuit of dominant strategy

4. Definitions

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Module 1 Course Introduction Topics

1. An overview of the course and content for each dayDeliverablesThe 12 modules

2. The strategy modelThe 8 strategies 3 types of strategy Origins of the strategy system model

3. Overview of strategy development processThe 4 types of expectations driving strategy developmentThe 3 steps in strategy development

4. Definition of major terms to be used in the course

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Module 2 Getting Ready for Planning

It isn’t the unkown that gives us trouble. It what we know that ain’t so.

Will Rogers

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Module 2: Getting Ready for Planning

1. Overview of output and process for situation analysis

2. SWOT Analysis and how to make it more powerful

3. Stakeholder Analysis- Identification of Stakeholders- Appetite / Expectations / Strategy Understanding Analysis

4. Planning as a project

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Day One Output: Situation Analysis Report

-The Planning ScopeThe Scope ofAcceptable

Change

InternalAssessment

ExternalAssessment

- Stakeholder Analysis & Appetite for Change

- Current Strategy Analysis and Configuration

- Customers & Markets- Industry Analysis- Competitors- Trends- Best Practices

- A listing of factors most likely to impact the Firm- Preliminary insights on questions of strategyConclusions

2. Overview

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Step 2 Objectives

Confirm Responsibilityfor all 8 Strategies

Identify Type ofPlanning Required

Identify CEO / BoardExpectations

Conduct InternalAssessment

Conduct ExternalAssessment

IdentifyAuthority Group

AssessAppetite for Change

Prepare Scopefor Planning Project

2. Scoping Expectations: Have we assessed the expectations for strategic planning?

2. Overview

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Traditional SWOT

The TOWS Matrix, A Tool for Situational Analysis Heinz Weihrich, 1982 .http://www.usfca.edu/fac_staff/weihrichh/docs/tows.pdf

2. SWOT

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8 Strategy SWOT Analysis on English Bay

Under Norcross Control – Strategy Strengths & Weaknesses

Not Under Norcross Control – External Factors (Opportunities / Threats)

2. SWOT

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The Alpha Strategies

Strengths Weaknesses Opportunities Threats

Business Def / Mandate

Risk

Growth

Financial Management

R&D /Technology

Organization Mgmt

Marketing/Sales /Comm

Service Delivery / Production / Manufacturing

A Framework for SWOT 2. SWOT

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Stakeholder IdentificationWho are the major stakeholders?

Stakeholder Categories Actual Stakeholders

The Authority GroupThose Stakeholders who approve the plan and authorize implementation

The Involve GroupStakeholders who should be involved because of the role they will play in implementation

The Inform GroupStakeholders who need to be told what to do so that their actions are consistent with implementation

The Consider GroupAny Stakeholders not falling in any of the above categories and who could have a response to implementation

2. Stakeholders

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Stakeholder ExpectationsNow we know “Who” they are,

what do they want?

Stakeholder Categories

Actual Stakeholders

Expectations

The Authority Group

The Involve Group

The Inform Group

The Consider Group

2. Stakeholders

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Scoping Appetite / Expectations / Understanding

Business Definition Risk Growth

Organization

Management

Financial Management

Marketing / SalesStore Operations

R&D/ Technology

Manufacturing (Outsourced)

X X X

X

XXX

X ● ●

● ● ●

● ● ●

Circle the symbol that is Norcross’ likely answerX means change is acceptable ● means change is not acceptable

Question: What does it mean if not all 8 strategies can be candidates for change?

2. Stakeholders

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Strategic Planning as a Project

Project Element Description

Objective

Scope

Methodology

Schedule

Major Mile Stones

Deliverables

2. Stakeholders

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Module 2: Getting Ready to Plan

1. Overview of output and process for situation analysis

2. SWOT Analysis and how to make it more powerful

3. Stakeholder Analysis- Identification of Stakeholders- Appetite / Expectations / Strategy Understanding Analysis

4. Planning as a project

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Module 3 Internal Assessment

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Module 3: Internal Assessment

1. Overview of process

2. Configuring the strategy system

2. Moving from strategy to organization design

4. Current Strategy Performance Assessment- Strengths & Weakness Identification- External Factors Impacting Strategy

5. Initial English Bay Strategy Conclusions

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Step 3 Objectives

Convert 8 Strategiesto Org Design

Evaluate ActivityStrengths/Weaknesses

Use Evaluation toIdentify External Factors

Confirm Responsibilityfor all 8 Strategies

Identify Type ofPlanning Required

Identify CEO / BoardExpectations

Conduct InternalAssessment

Conduct ExternalAssessment

IdentifyAuthority Group

AssessAppetite for Change

Prepare Scopefor Planning Project

3. Internal Assessment: Do we truly understand the how’s and why’s of our current strategy?

3. Overview

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Configuring the Strategy System

Source: Seeingstrategy.com

3. Strategy System

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From 8 Strategy Model to Organization Design

3. Org Design

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From 8 Strategies to Organization Design

EB Organization DesignEB Organization

Service Delivery / Productivity

Marketing

Growth

Risk

8 Strategy Framework

Financial Management

Technology

Organization Management

Norcross- Oversight

Lyons

- Financial Mgmt

- I.T.

Mayweather

- Buying

- Operations

- Marketing

- Store Operations

Taglietalla

- H.R.

Business Definition

3. Org Design

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From 8 Strategies to Org Design

EB Organization English Bay Organization Design Specific Activities

Norcross- business definition- risk- growth

- Oversight

- Borrowing- Sale of EB / Joint Ventures- New Store Openings- Expenditures approval

Lyons- financial management- technology

- Financial Mgmt

- Payroll- Receivables- Internal Accting

- I.T. - Systems Admin

Taglietalla

- organizational management- H.R.

- Compensation

- Policy Admin

Mayweather- marketing- service delivery / production

- Buying- Competitor surveys- Hindsight analysis

- Operations

- Receiving- Sorting- Reshipping

- Marketing

-Product: Private Label-Pricing: Value-Promotion: In-store promos and direct mail

- Store Operations

- Hiring-Training- Sales

3. Org Design

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What are the EB functional strategies?

EB Org Design Specific Activities Functional Strategy

-Oversight

- Borrowing- Sale / J.V.- New store openings- Expenditure approval

- Financial Mgmt- Payroll- Receivables- Internal Accounting

- I.T. - Systems Admin

- H.R.- Compensation

- Policy Admin

- Buying- Competitor surveys- Prior Year Sales analysis

- Operations- Receiving- Sorting- Reshipping

- Marketing

- Product: Private Label- Pricing: Value- Promotion: In-store promos

/ direct mail campaigns

- Store Operations- Hiring-Training- Customer Sales

1. Within each function, which specific activity has become the functional strategy over time?2. What makes functional strategy so hard to identify?

3. Strategy Performance

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Internal Assessment

Strengths WeaknessesLikely External Factors

Impacting Performance

Oversight - new store openings capability - micro-management style - markets, customers, competitors

Financial - real estate equity

- budgeting process - discounts

- dividends - financing terms

- financial ratios

- performance measures

- landlords -bankers – real estate markets - tax law - corporate law- market for selling business

I.T. - no use of technology -Technology

H.R. - Good people

- no policies - communications

- customer/product training

- turnover – org mgmt

- industry turnover rates-competitive compensation-competitor employment practices

Buying - private label- 3 month cycle

- quality issues

-Industry Change / Evolution-fashion trends - customers- supplier performance

Operations - warehouse real estate value

- shrinkage

- inventory control

- winter delivery

- real estate market

- Industry practices (e.g. EDI)

Marketing

- brand / image

- private label success

- customer lists

- community focus

- research - advertising

- customer data - competitor data

- product selections

- customers

- competitors- market trends- local markets

Store Operations

- below market rent

- 22 stores upgraded

- varying performance- low leases turning over- store hours set by HO- HO communications

- lack of store mgr autonomy- parking

- customers- competitors- local store markets

Step 33. Strategy

Performance

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Eight Strategies Strategy

Business

DefinitionHigh-end casual and related accessories in B.C. and Alberta

Risk Owner-centric. Norcross involvement in all significant decisions

Growth Internal growth through store openings

Financial Mgmt debt

Technology / R&D To support and enable productivity

Organization Mgmt Head Office / Owner control

Marketing / Store Operations

If you build a store, they will come…

Manufacturing Outsourced

Initial English Bay Strategy Summary

3. Strategy Conclusions

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Module 3: Internal Assessment

1. Overview of process

2. Configuring the strategy system

2. Moving from strategy to organization design

4. Current Strategy Performance Assessment- Strengths & Weakness Identification- External Factors Impacting Strategy

5. Initial English Bay Strategy Conclusions

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Module 4 External Assessment

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Module 4: External Factors Assessment

1. Overview of process

2. The Major Categories of External Factors

2. Issues in Customer Identification

4. Overview of Market, Industry, & Competitor and Trends and Best Practices

5. Initial English Bay Strategy Conclusions & Situation Analysis Report

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Step 4 Objectives

4. External Assessment: What factors in the external environment must we truly understand?

Identify What Management Knows

Separate Need to Knowfrom Nice to Know

Study Factors for Actionable Information

Convert 8 Strategiesto Org Design

Evaluate ActivityStrengths/Weaknesses

Use Evaluation toIdentify External Factors

Confirm Responsibilityfor all 8 Strategies

Identify Type ofPlanning Required

Identify CEO / BoardExpectations

Conduct InternalAssessment

Conduct ExternalAssessment

IdentifyAuthority Group

AssessAppetite for Change

Prepare Scopefor Planning Project

If less than 8,Go to Business Planning

4. Overview

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The Major Categories of External Factors

Customers & Markets Industry Dynamics

Competitors Trends

Best Practices

Stakeholder Expectations

4. Major Factors

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Customer Analysis

1. Who are our most important customers?

2. What criteria drive the customer’s purchase decision?

3. How do we compare, in the customer’s view, to the competition?

4. Which of our products and services are truly valuable to them?

5. What are the steps and who influences the purchase decision?

6. How are customer criteria and behavior likely to change?

7. What products and services are our customers going to need?

4. CustomerIdentification

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Need / Risk Segmentation Analysis

1. Who represents the greatest need / greatest risk that our services are intended to address?

2. What drives them to use / come into contact with us?

3. How do we compare to alternatives to address the need / risk?

4. Which of our programs / services are truly valuable to them / address the problem effectively?

5. What are the steps and who influences their decision to use us / encourages their behaviour?

6. How is user need / risk behavior likely to change?

7. What services are users going to need / will be required to manage evolving risk?

Customer Analysis Restated for Public Sector Organizations

See also: Banishing Bureaucracy 1998, David Osborne

4. CustomerIdentification

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Markets – Clusters of Customers

Market Scoring Dan Erica Martin Oprah

Vancouver DowntownGrowth 4 4 4 4

Profitability 5 5 5 5Competition 1 1 1 1

Total 10 10 10 10Vancouver Suburbs

Growth 5 4 5 5Profitability 5 5 5 5Competition 1 1 1 1

Total 11 10 11 11Victoria

Growth 4 5 3 5Profitability 5 5 5 5Competition 1 1 1 1

Total 10 11 9 11Kamloops

Growth 4 4 4 4Profitability 5 5 5 5Competition 1 1 1 1

Total 10 10 10 10Other Greater BC

Growth 5 7 6 5Profitability 7 7 7 7Competition 2 2 2 2

Total 14 16 15 14Calgary

Growth 4 4 4 4Profitability 3 3 3 3Competition 1 1 1 1

Total 8 8 8 8Edmonton

Growth 4 4 4 4Profitability 3 3 3 3Competition 1 1 1 1

Total 8 8 8 8Other Alberta

Growth 5 7 5 5Profitability 5 5 5 5Competition 1 1 1 1

Total 11 13 11 11

Growth

1 – shrinking market and/or market share

4 – only able to maintain existing business

7 – significant growth in market and/or

market share

Profitable

1 – not profitable

4 – break-even

7 – very profitable

Competition

1 – significant competition

4 – competition is manageable

7 – no competition

4. ExternalFactors

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Demand Analysis MethodologyMarket Analysis Restated for Public Sector

Purpose To identify specific opportunities for priorities over the planning period

Grid DesignHorizontal Axis – specific products or services

Vertical Axis – specific clusters for those services

Scores For each cell, assign a score from 1 to 7 for each of the following variables.

Growth of Need / Risk

Assess the potential for growth of the need / risk programs / services

1 – shrinking overall need / risk

4 – no change from today

7 – significant growth in need / risk

Sustainability

Assess the likely financial sustainability of delivering services to meet the need / risk

1 – sustainability is a great risk

4 – no change from today

7 – sustainability not a risk

Alternatives

Assess the attractiveness of emerging alternatives to address the need / risk

1 – significant attractive alternatives are becoming apparent

4 – no change in alternatives apparent

7 – no attractive alternatives emerging or apparent

Cell ScoringEach cell score is the total of the variables scoring for that cell

Highest score: 21, representing a need / risk on which we should focus

Lowest score: 3, representing limited perceived value to addressing need / risk

4. ExternalFactors

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Demand Analysis in the Public Sector

Services

Need

/ Risk

Seg

men

ts

G= G= G= G= G=

S= S= S= S= S=

A= A= A= A= A=

Total

G= G= G= G= G=

S= S= S= S= S=

A= A= A= A= A=

Total

G= G= G= G= G=

S= S= S= S= S=

A= A= A= A= A=

Total

G=Growth S=Sustainability A = Alternatives

4. ExternalFactors

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Industry Dynamics

Segment

What is my chosen market called?

Segment Size / Growth

How big is it and is it growing?

Segment Dynamics

What dynamics are most shaping the segment? (e.g. competitive rivalry, customers, suppliers, entry barriers, alternatives)

Critical Success Factors

What must a competitor do to succeed given the dominant industry dynamics?

Segment Evolution

How is this segment likely to change over time?

4. ExternalFactors

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Competitor Analysis

IndustryPositioning

CriticalSuccess Factors

IndustryEvolution

- Who are my future competitors?- What functional areas are likely to become the most important in the future?

- What must I truly understand about my competitors? (e.g. strategies, strengths, weaknesses and areas of relative performance)

- Who do I compete with in my market segments?- What segments are my competitors focusing on?- What segments should I focus on?

4. ExternalFactors

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Competitor / Alternatives Analysis

Restated for Public Sector

ServiceSustainability

CriticalSuccessFactors

ServiceEvolution

- Who / What are the future competitors / alternatives?- What functional strengths are likely to become the most important in the future?

- What must we understand about alternatives / competitors? (e.g. strategies, strengths, weaknesses and areas of relative performance)

- Who is offering / can offer alternatives to our services?- What segments are they focusing on?- What segments should we focus on?

4. ExternalFactors

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Trend Analysis in 3 Steps

1. Source of Trends - The Family

2. What is the Emerging Trend? - “Kids” not moving out

3. What’s the impact on us?- “Kids” influencing parents’ buying decisions?

4. ExternalFactors

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Benchmarking Analysis

Benchmarking

Is a process for comparing organizational performance and processes to “Best-in-Class” performance and using insight from the comparison to improve ways and improve performance

Determine what to Benchmark

Identify Key Performance Variables / Measures

Identify the “Best-in-Class” Organizations

Research Performance of “Best-in-Class” Organizations

Make Performance Comparisons

Recommend Improvements

Obtain Commitment to Implement

4. ExternalFactors

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External Factors Conclusions 4. Conclusions

Research Overall Conclusions

Customer Analysis EB customer needs research

Market Analysis Markets don’t support seem to support most EB stores.

Industry AnalysisEntry of more and more well-financed competitors using technology and multi, cross, and omni-channels

Competitor Analysis EB is a very small specialty retailer

Trend Analysis Technology is changing the nature of retailing

Benchmarking Analysis

EB is not competitive when benchmarked against the lowest of benchmarks: the industry average.

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Which one strategy is being most impacted?

Customers & Markets

Industry Dynamics

Competitors

Trends

Best Practices

4. Conclusions

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Module 4: External Factors

1. Overview of process

2. The Major Categories of External Factors

2. Issues in Customer Identification

4. Overview of Market, Industry, & Competitor and Trends and Best Practices

5. Initial English Bay Strategy Conclusions & Situation Analysis Report

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Day One Deliverable: The Situation Analysis

Day 1

Day 2

Day 3

Produce a Situation Analysis

Produce a Strategic Plan

Produce a Business Plan

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Day Two – Preparation

- Read the Tarion Case

- Review the Day 2 Binder Materials

- Identify the top 3 external factors you believe Tarion must

address because those factors will significantly impact Tarion

over the next 3 to 5 years