Professional Documents
Culture Documents
Whats Happening?!
Knight-Ridder advertising revenue for 2004 was $648
million. Newspaper revenue was $747 million. Online media
revenue was $31 million.
Chapter 6 Summary
Business Vision
Chapter Objectives
What is a Vision?
Concrete and easily understood ideas about the longrange future of the business
Implementation
(Action)
Agreement &
Commitment
Tactics and
Business Plan
Strategy
Feedback
Vision
Sensing
Opportunity
Vision Uncertainty
Customer Service
Automation
Lower employee attrition
Improve job training
Decentralize decision making by empowering
employees
USAA
Role and significance of IT?
An executive partnership
Technology experimentation and assimilation
Leveraging of information systems
Strategic architecture
Horizontal integration of applications.
Whirlpool
Decided that it would become the global leader in
the large appliance industry.
Initially identified product technology and
procurement as key factors to realize this goal.
Added information systems as an essential third
factor to achieve this goal.
Conclusions
Successful companies are the result of good
leadership.
Talented leadership is demonstrated in the following
forms:
Determining the direction of the business.
Promoting the need for action.
Fostering an environment for well directed
information systems.
2.
Chapter 7 Introduction
Implementing a Vision:
Chapter Objectives
1.
2.
3.
External
Analysis
Company
Vision
Operating Environment
Competitive Positioning
s
tie
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tu ts
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po rea
p
O Th
Company
Strategic
History
Current
Strategy
Stakeholder
Analysis
Vision &
Strategy
Chosen
Strategy
Realized
Strategy
Company Analysis
Structure
Internal
Analysis
Figure 7-2
Values/Culture
Skills
Resources
s
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s
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n
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S
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Strategy Implementation
Senior Management
Vision
and Macro
Strategies
Business Uncertainties
Empowered Implementers
Company Culture
Risks to be Avoided
Critical Performance
Factors
Micro
Strategies
and
Tactics
Key Enterprise
Business Processes
Figure 7-3
Business Plan
The most straight-forward part of the entire process.
Deals with allocation of funds, people and other
resources.
IT Based Strategies
MARKET PLACE
OPERATIONS
SIGNIFICANT
STRUCTURAL
CHANGE
Federal Express
USA Today
Charles Schwab
Whirlpool
Xerox
TRADITIONAL
PRODUCTS
AND PROCESSES
USAA
L.L. Bean
McKesson
BancOne
Boeing
Frito-Lay
Wal-Mart
Figure 7-6
Simple Strategy
Aggressive Implementation
Conclusions
Chapter 7
Implementing a Vision:
Strategy, Tactics and
Business Plan
Be Careful
Global Management
Managers must be prepared to engage in heightened
international competition and have the ability to:
1.
2.
3.
4.
5.
When in Doubt
Whether dealing with vision, strategies or tactic
think customer!
Remember that a major difference between
companies is how they treat their customers.
Also the importance of doing necessary
homework on competitors.
Supporting Strategies:
1. Innovation
2. Growth
3. Alliances
Focus Challenges
product areas.
Southwest Airlines
Wal-Mart Stores
Dell
Strategic clarity.
World-class processes.
Strategy Clarity
Clearly communicated understanding of this is based on the
vision for the company.
Here are the core business strategies and this is how you
should carry out your job.
Superb execution is more about values and commitments.
Successful execution comes from belief and conviction and
not from procedures.
Business Strategies!?
How important are they, really?
Strategy Consistency?
1. Internal Factors
2. Resource Factors
3. Environment Factors
4. Communication and Implementation
Considerations
Strategy Consistency?
Internal Factors:
Strategy Consistency?
Environment Factors:
Do the goals and policies exploit industry opportunities?
Do the goals and policies deal with industry threats that are
possible with available resources?
Does the timing of the goals and policies reflect the ability of
the environment to absorb the planned impact.
Are the goals and policies consistent with societal concerns?
Strategy Consistency?
Communication and Implementation Considerations:
Are the goals understood by the implementers?
Is there congruence between the goals and policies and the
values of the implementers to insure commitment?
Is there sufficient management capability and availability to
assure effective implementation?
Current strategy?
Assumptions about the companys relative
position, strengths and weaknesses, competitors
and industry trends.
IEA
Internal
External
Action
Progressive Corporation
1988 Performance
Record Revenue
Record Earnings
Outstanding Company Culture
Highly Respected Business Leader
Well Regarded Company
Could Things Possibly Be Better?
Progressive Corporation
1989 Impact
Voters Passed Proposition 103 in
California Resulting in $52 Million
Being Put into an Escrow Account.
Allstate Gained a Larger Market
Share in Progressives Niche
Market for the First Time.
Progressive
Customer Value Proposition:
Progressive
Core Values:
Peter Lewis
Currently Chairman of the Board
We sell speed, not insurance.
Glenn Renwick, President and Chief Executive
Officer
Raymond Voelker, Chief Information Officer
People
Work
Organization
Information
Technology
Information
10 day
information
float
People
Route Salesman
Increased
complexity for
route
salesman and
plants
Work
Organization
Regional
Competitors
Information
Technology
Information
Reduced
information
float to 24
hours
People
Route Salesman
Account Specialist
Merchandiser
Increased
complexity for
route
salesman and
plants
Work
Organization
Decentralized Marketing
Organization
Yum! Brands
KFC
Pizza Hut
Taco Bell
Long John Silver
All American Food
(A&W)
Created as Tricon Global Restaurants on October 6,
1997 as a spin off from Pepsi.
Yum! Brands
The worlds largest quick service restaurant
company with more than 33,000 units in more
than 100 countries involving 840,000
employees.
36% are outside the US
Business Strategies
1. Drive International Growth
2. Multi-brand Great Brands
International Growth
In 1992 McDonalds had 4,000 international restaurants.
Today it has over 16,000 with a $1 billion profit from
these operations.
Yum! has 11,800 (6,800 KRC and 4,400 Pizza Hut) with
nearly $400 million in international profit.
Burger King is third with a profit of $50 million.
International Sales
Great China
Americas
Europe, South Africa
Asia-Pacific
0%
10%
20%
30%
40%
50%
International Challenges
1. Customer food preference and taste.
2. Standard of livingproduct cost.
3. Currency fluctuations.
Multi-branding
McDonalds has been the envy of this industry since its
units average $1.6 million a year (almost twice that of
Yum!)
Multi-branding gives customers more choices and variety.
20%
40%
60%
80%
Restaurant Units
Licensees
Franchisees
Affliates
Company
0
2,000
4,000
6,000
8,000
Internal
Assessment
External
Assessment
A New Strategy
Figure 7-1
Strategy Considerations
Competitive Environment
Market Target
Basis for Perceived Competitive Advantage
Strategy-to-Tactics
Implementation
Objectives
Authority
Responsibility
Training
Motivation
Performance
Results
Reward
Control
Figure 7-4
Strategy Implementation
Senior Management
Vision
and Macro
Strategies
Business Uncertainties
Empowered Implementers
Company Culture
Risks to be Avoided
Critical Performance
Factors
Micro
Strategies
and
Tactics
Key Enterprise
Business Processes
Figure 7-3
Information Needs
Senior Management
Emerging Opportunities and Threats
External Impact of Strategies and Tactics
Internal Impact of Strategies and Tactics
Performance Measurements
Empowered
Implementers
Figure 7-5
Environmental Analysis
General Environment
Operating Environment
Competitive Positioning
s
ti ie
n
t u ts
r
po rea
p
O Th
Company
Strategic
History
Company
Vision
Current
Strategy
Stakeholder
Analysis
Vision &
Strategy
Chosen
Strategy
Realized
Strategy
Company Analysis
Structure
Values/Culture
Skills
Figure 7-2
Resources
h
gt
n
tre
ss
e
kn
a
e
es
SWOT Analysis
Strength: A collective organizational competency, asset
or capability that enables it to achieve a high level of
success.
Weakness: A collective organizational competence,
asset or capability that is competitively inferior and
provides a vulnerability that can be exploited.
Opportunity: A trend or event that could lead to a
positive change in position if addressed by a strategic
response.
Threat: A trend or event that could lead to a negative
change in position if not addressed by a strategic
response.
Source: The Art of Strategic Planning
for Information Technologies
SWOT Analysis
Strengths
Weaknesses
Opportunities
Threats
Suggest
strategies that
should be
tested against
Vision
Goals
Company Values
Financial Status
Cash Position
ROI Position
Societal Demands
Competition
Core Competencies
People Skills
Overall Resources
A Logical Approach
Find a tactic that will work.
Build it into a strategy.
Smart Sizing
Consistent with the vision and strategies of
the organization.
Help build future strengths of the company
while streamlining or eliminating
unnecessary processes and functions.
A big of a price to pay for anything less
than this.
Company Infrastructure
Data Management
User Applications
Voice Management
Network Management
Plan Process
Financial Strategy
Organization
Figure 7-7
IT Based Strategies
MARKET PLACE
OPERATIONS
SIGNIFICANT
STRUCTURAL
CHANGE
Federal Express
USA Today
Charles Schwab
Whirlpool
Xerox
TRADITIONAL
PRODUCTS
AND PROCESSES
USAA
L.L. Bean
McKesson
BancOne
Boeing
Frito-Lay
Wal-Mart
Figure 7-6
Business Vision
and Strategies
Right Sizing
Re-engineering
Total Quality
Management
Conclusions