Download - Raj Aphale Strategy Presentation
![Page 1: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/1.jpg)
Business Strategy
Webinar
CMA Rajendra D AphaleB. Tech., MMS, ACMA, LL.B.
Cost Accountant
![Page 2: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/2.jpg)
[email protected], +91-77385 91521
2/58
Introduction
Raj is a practicing cost accountant, consultant and trainer and helps his clients in--Strategy planning and implementation,
balanced score cards, business analytics-Interim Management-Lean management, kaizen etc-Human resource management- OD,
compensation, competency, performance management-Costing systems, cost management, cost audit,
compliances, performance management
Raj has done work in 16 countries other than India, including US, UK, Germany, Singapore
![Page 3: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/3.jpg)
[email protected], +91-77385 91521
3/58
Introduction
Raj is a practicing cost accountant, consultant and trainer and helps his clients in--Strategy planning and implementation,
balanced score cards, business analytics-Interim Management-Lean management, kaizen etc-Human resource management- OD,
compensation, competency, performance management-Costing systems, cost management, cost audit,
compliances, performance management
Raj has done work in 16 countries other than India, including US, UK, Germany, Singapore
![Page 4: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/4.jpg)
[email protected], +91-77385 91521
4/58
Agenda
What is Strategy? Why Strategy? Mission Values Vision Competitive advantage Core competency
![Page 5: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/5.jpg)
[email protected], +91-77385 91521
5/58
Agenda
Levels of Strategy Forms of Strategy
Defining your business Stages in Strategy Management Focus Strategy tools – environment scanning SWOT, PESTEL, Porter's 5 forces
![Page 6: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/6.jpg)
[email protected], +91-77385 91521
6/58
Agenda...
Strategy tools – others Strategy execution Organising for strategy
![Page 7: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/7.jpg)
[email protected], +91-77385 91521
7/58
What is Strategy
Many experts have defined strategy in many ways-* Plan of action to achieve goals* Plan of action with some patterns* Path to reach milestones* Pattern or common thread related to organisation's activity* Optimum allocation or resources*....
![Page 8: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/8.jpg)
[email protected], +91-77385 91521
8/58
What is Strategy....
Michael Porter defines it as
“Strategy is the creation of a unique and valuable position, involving a different set of activities”
![Page 9: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/9.jpg)
[email protected], +91-77385 91521
9/58
Why Strategy?
Strategy is expected to provide direction to an organisation
Strategy creates predictability Strategy helps aligning different functions in an
organisation Strategy helps achieve vision
![Page 10: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/10.jpg)
[email protected], +91-77385 91521
10/58
Why Strategy?
Strategy involves creating a fit among different activities of a business
Strategy helps achieving better return on investment than industry average consistently
“A company can outperform its rivals only if it can establish a difference it can preserve” - Michael Porter
![Page 11: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/11.jpg)
[email protected], +91-77385 91521
11/58
Mission
Purpose of existence of an organisation What is your company's mission? What is your mission?
![Page 12: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/12.jpg)
[email protected], +91-77385 91521
12/58
Mission...
Mission should indicate -– Who our customers are– What needs of our customers are we serving– What are the unique ways we are serving the
needs
![Page 13: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/13.jpg)
[email protected], +91-77385 91521
13/58
Values
What the organisations live by Created by leaders' behaviour, Demonstrated
by employees' behaviour Will decide how a company will do business,
what businesses it may or may not do; whether it will focus long term or short term
May limit an organisation's growth
![Page 14: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/14.jpg)
[email protected], +91-77385 91521
14/58
Vision
How do we see our future? (Where do you see yourself in 5 years?)
Word picture of what the organisation will be in the next few years
Vision needs to be SMARTS What is your company's vision? What is your vision?
![Page 15: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/15.jpg)
[email protected], +91-77385 91521
15/58
Competitive Advantage
What an organisation can do better than its competitors, based on KSFs for the industry
Quantify, as far as you can
![Page 16: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/16.jpg)
[email protected], +91-77385 91521
16/58
Core Competency
A harmonised combination of multiple resources and and skills that distinguish a firm in the marketplace
Core competencies must -– Provide potential access to several markets– Should make significant contributions to
perceived customer benefits of the end product – Should be difficult to copy
![Page 17: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/17.jpg)
[email protected], +91-77385 91521
17/58
Levels of Strategy
Corporate level - business portfolio management, allocation of corporate resources, broad policies
Business unit level (SPU level) – Business growth, product / service portfolio, competitive advantage
Functional level – how different functions will support business strategy
![Page 18: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/18.jpg)
[email protected], +91-77385 91521
18/58
Forms of Strategy
Emergent strategy – Mintzberg Deliberate strategy – Porter
![Page 19: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/19.jpg)
[email protected], +91-77385 91521
19/58
Mintzberg
Forms of strategy- Entrepreneurial Adoptive Planned (unconnected, imposed, consensus, confused!)
![Page 20: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/20.jpg)
[email protected], +91-77385 91521
20/58
Mintzberg
5Ps of strategy Plan Plot Pattern Position Perspective
![Page 21: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/21.jpg)
[email protected], +91-77385 91521
21/58
Porter
Deliberate strategy Generic strategies
Cost leadership Differentiation Choice of the market
![Page 23: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/23.jpg)
[email protected], +91-77385 91521
23/58
Focus
“Strategy is defining what to do and what not to do” - Michael Porter
What has your business decided to do? What has your business decided not to do?
![Page 24: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/24.jpg)
[email protected], +91-77385 91521
24/58
Stages in Strategy Management
Strategic analysis Strategic choices Strategy execution
![Page 27: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/27.jpg)
[email protected], +91-77385 91521
27/58
Strategy tools
Environment scanning tools PESTEL SWOT Michael Porter's Industry Analysis
![Page 28: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/28.jpg)
[email protected], +91-77385 91521
28/58
PESTEL
P-political factor e.g. changes in international trade, taxation policy
E-economic factor e.g. interest rates, exchange rates, national income, inflation, unemployment, Stock Market
S-social factor e.g. ageing population, attitudes to work, income distribution
![Page 29: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/29.jpg)
[email protected], +91-77385 91521
29/58
PESTEL
T-technological factor e.g. innovation, new product development, rate of technological obsolescence
E-environment factor e.g. global warming, environmental issues
L-legal factor e.g. competition law, health and safety, employment law
![Page 30: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/30.jpg)
[email protected], +91-77385 91521
30/58
SWOT
Internal and external scan Strengths is what we can do better than
competition, based on KSFs Quantify all four elements Take opinions out, facts only please
![Page 32: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/32.jpg)
[email protected], +91-77385 91521
32/58
Industry Analysis
5 forces in any industry- Internal Rivalry Entry barriers Substitutes Buyers Sellers (Collaborators or complementors)
![Page 33: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/33.jpg)
[email protected], +91-77385 91521
Degree of RivalryExit barriersIndustry concentrationFixed costsIndustry growthIntermittent overcapacitySwitching costsBrand identityDiversity of rivalsCorporate stakes
33/58
![Page 34: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/34.jpg)
[email protected], +91-77385 91521
New Entrants and Entry BarriersAbsolute cost advantagesAccess to inputsGovernment policyEconomies of scaleCapital requirementsBrand identitySwitching costsAccess to distributionProprietary products
34/58
![Page 35: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/35.jpg)
[email protected], +91-77385 91521
SubstitutesSwitching costsBuyer inclination to substituteVariety of substitutesPrice-performance tradeoff of substitutesNecessity for product or service
35/58
![Page 36: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/36.jpg)
[email protected], +91-77385 91521
Buyer Power
Buyer volume and informationBrand identityPrice sensitivityThreat of backward integrationProduct differentiationSubstitutes
36/58
![Page 37: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/37.jpg)
[email protected], +91-77385 91521
Supplier PowerSupplier concentrationDifferentiation of inputsSwitching costsThreat of forward integrationCost relative to total purchases in industry
37/58
![Page 38: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/38.jpg)
[email protected], +91-77385 91521
Role of ComplementorsNumber of complementsRelative value addedDifficulty of engaging complementsBuyer perception of complementsComplement exclusivityTend to increase profits by increasing demand for an industry’s products
38/58
![Page 39: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/39.jpg)
[email protected], +91-77385 91521
39/58
Strategy tools
Portfolio analysis BCG Matrix GE McKinsey matrix
![Page 41: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/41.jpg)
[email protected], +91-77385 91521
41/58
GE McKinsey Matrix
Industry attractiveness v/s firm competitiveness 3x3 matrix
![Page 43: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/43.jpg)
[email protected], +91-77385 91521
43/58
Strategy tools
Other tools Value Discipline Ansoff Matrix McKinsey 7S framework (organisational
effectiveness) Game Theory Ohme framework
![Page 44: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/44.jpg)
[email protected], +91-77385 91521
44/58
Value Discipline
3 possible value disciplinesProduct LeadershipCustomer IntimacyOperational Excellence
![Page 46: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/46.jpg)
[email protected], +91-77385 91521
46/58
Ansoff Matrix
Product Market matrix Penetration Market Development Product Development Diversification
![Page 49: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/49.jpg)
[email protected], +91-77385 91521
49/58
Game Theory
Anticipate competitors' response to your strategic actions, and its impact on overall industry and your business
Anticipate competitors' actions and possible impact on your business
Tackle uncertainty situations Appropriate and needed in today's uncertain
world as we know solutions for future which is vaguely predictable
![Page 50: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/50.jpg)
[email protected], +91-77385 91521
50/58
Ohme framework
Integrate 3Cs to create competitive advantage Corporation – Selective and sequencing, trade
off of make buy Competition – people, money, and things
(assets)- allocation; cost structure Customers – segmentation by objectives,
market coverage trade off, further segmentation
![Page 53: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/53.jpg)
[email protected], +91-77385 91521
53/58
Strategy Execution
Isn't it obviously easy after the hard work in creating the plan
Over 90% of well crafted plans fail in execution Need proper organisation and focus Need alignment of business objectives to
strategy, of different departments to each other and of different employees to each other
Balanced scorecard as a tool
![Page 55: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/55.jpg)
[email protected], +91-77385 91521
55/58
Organising for Strategy
Strategy office Top Management driven Cross functional Rotating team
![Page 56: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/56.jpg)
[email protected], +91-77385 91521
56/58
Role of CMAs
Understand business Unbiased assessment of business, not to please
the management Continuous exercise Forecasting, reassessing assumptions Evaluating alternatives Sensitivity analysis Shareholders' perspective, customer perspective
![Page 57: Raj Aphale Strategy Presentation](https://reader036.vdocuments.pub/reader036/viewer/2022062820/589c69a61a28abe96c8b4fbd/html5/thumbnails/57.jpg)
[email protected], +91-77385 91521
57/58
Why managers don't think strategy
Short term vs long term thinking Fear of failure Overconfidence Prior bad experience Self-interest Fear of the unknown Honest difference of opinion Suspicion