11/18/2013

Strategic Analysis and Action Review slides (and suggestions for BCG)

The Strategy Process

STRATEGIC ANALYSIS Identify current strategy Assess current performance / Analyze sources of strategic tension Options DIRECTION SETTING & STRATEGY CREATION Strategic Choice IMPLEMENTATION

Action Plan

(Recommendation)

Support strategy: Finance Accounting Operations Marketing

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Issue
Start by recognizing the decision-makers role in

the case. CEO? Division manager? VP? Clearly identify the issue/ problem this company is facing as part of our assessment Avoid options or plans or potential solutions here Keep the identified issue front and centre as you move through the analysis, recommendation, and action plan.
During the analysis, ask yourself: am I looking at all

aspects of the issue? At the end, ask yourself: does my recommendation and my suggested action plan truly address the issue?

Analysis: External
What is going on in the industry? What trends are happening in the industry? Political, Economic, Social, Technical Key Success Factors (KSFs) What do firms need to do to win in this industry?

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Analysis: Internal
Current company/ strategy size up: Diamond-E framework How is the firm performing? What do quantitative and

qualitative metrics show (performance matrix?) Is there good alignment between the elements or are there gaps? What is the companys competitive advantage? Is it sustainable?

Assessing current performance

Operating performance Hard, quantitative measures: Financial, market performance (Ex?) Reflective of past Organizational health Soft, qualitative measures: organizational measures (Ex?) Often early indicator of operational performance

Metrics vary by company and industry. Decide which measures make most sense. Do not fall victim to wishful thinking Differentiate past from present and future

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The Performance Matrix

Where is the business currently? Where has it been recently? Where is it headed? Are changes to strategy needed? What is the extent of these changes? What will performance be like if no changes are made to the strategy, i.e. the base case?

Components of Strategy
GOALS

VALUE PROPOSITION PRODUCT MARKET FOCUS CORE ACTIVITIES

What are the components of the strategy? Are they aligned?

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Options
Develop and analyze alternatives that are.. Viable Distinct Listed in case and/ or developed by you Assess pros and cons thinking through all the aspects

(strategic, financial, organizational) Be careful that you are not already supporting a foregone conclusion!

Recommendation
Pick one of the options that you have previously

developed
Your process is off if you recommend something that did not appear

as an option before

Do not just reiterate the pros listed under your option to

support your choice, but explain why you think that the pros for your choice outweigh those of the other options Be upfront about the cons and discuss if and how you think that you can deal with them effectively

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Action Plan
Who will do what? What is the timeline for implementation? What needs to be done in each of the different functional areas

of the firm?