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BS4:Strategic Positioning and Strategic Renewal, G6 (Rora, Deniel, Jason,…
BS4:Strategic Positioning and Strategic Renewal
Executive Expertise: Strategic Renewal
Kurt Bock - CEO, Country Financial
Cognitive dissonance
See something happening, it doesn't fit your frame of reference, so you ignore it.
Have rich costumer data
Need to know their customers very well :!:
Al Goldstein - CEO & Founder, Avant
Strategic position
Need to change it over time :!:
Sunk cost fallacy
Spent much time working on something that doesn't quite make sense
Startup always try to find the right path, the market either
It's too broad to make decisions
How to do it quickly?
Trust! :check:
Bureaucracy
Sean Chao - CEO & Founder, Catalytic
Strategic renewal
Constantly pivoting to find that right product bargain
How to make sure to remain a market leader?
Adding
Case Introduction – Lego Group
Center of this business
Versatile component that can interconnect with any other
Can be assembled in many ways
1980s &1990s early
Diversifying
Lego Mindstorm
Robotic bricks
Legoland
1999y
Licensing with Star Wars
Proliferation
Cost increasing :warning:
1990s late
Increased price competition
Outsourcing by China
Diversification not going well
Large number of Lego shapes and colors inflating costs
Stagnate :red_cross:
Kjeld Christiansen
Strategy
Refocus
Constrained & focused model of innovation
Lego friends
Appeals to girls
Popular and successful movie
Generic Business Strategy
Differentiation advantage
Unique and different from competitors, so can command a price premium
emphasis on value creation
Nordstrom, Bloomingdales, Harrods and Bonmarche
Using product features to entice customers
Smartphone
Customer service
Hotels
Customization
Starbucks
Cost leadership
what is cost leadership
similar to its competitors but at a lower price
emphasis on controlling costs and generate economic value added and profits
Walmart, Carrefour and Metro
what does affect costs
Production techniques
Product design
Capacity utilization
Organizational or managerial inefficiency
Input costs
scale economies
How Walmart reduce input costs
Network of warehouses
IT system for managing the logistics
Fleet of trucks
Procurement capability
detailed supplier cost data
consumer buying behavior
price sensitivity data
hardball negotiation tactics with suppliers
How to know a company can produce a cost or differentiation advantage over its competitors?
Understand what drives cost or customer value
Understand the firm's internal capabilities, resources or activity systems
broad scope
Broad differentiation
Focused differentiation
Broad cost leadership
Narrow or focused low cost
Drive-thru
Lose eat-in customers segment and reduce real estate cost
Ikea
No pre-assembled furnitures
Geico
Sell insurance through phone and internet
Luxury products
Narror market segment and limited distribution channels
Making more valuable to customers
Strategic Renewal
US electronics retailer Circuit City
performed exceptionally well from 1982-2000.
stock price even appreciated six times faster
in-store customer service and Leading logistics
2008
bankrupt
Amazon
used up a lot of its cash and bought back shares to boost up its stock price.
fire employees
Examples
Nokia and Blackberry v.s Apple and Samsung
Kodak
film, and paper
harsh light of digital imaging
transformed and thrived
positions
resources
deep knowledge
strong intellectual property
photochemical business
Fujifilm
environmental change that diminishes the value of the company's internal strengths
a deterioration of the company's internal fundamentals which then undermines its competitive advantage with respect to it's environment.
3P
Processes
are activities and routines that are well encoded within the firm and can be deployed effectively in pursuit of a new strategy.
Positions
are activities and routines that are well encoded within the firm and can be deployed effectively in pursuit of a new strategy.
Paths
refer to opportunity, essentially to the strategic options that lie before the firm which can be exploited by using the firm's processes and positions.
example： soccer
key points
1.strategically position themselves
2.done with strategic clarity and discipline
3.strategic renewal may become necessary
Executive Expertise: Strategic Positioning
Fieldglass
Position
:red_cross:a low price basis
:red_cross:just a product sale
Make sure of overall products
Sell on an overall commitment
Value proposition
Get an VMS
Join this ecosystem of your peers
Target market
Middle-income households
Assets to protect
Income that they need to secure for the future
Geico
Efficient way
Something to be in all of the cost structure
Product innovation
JD Powers
In the very top with Fieldglass on claims, auto, home, etc.
Personalized service
Commitment
Conclusion
Overall value proposition of Fieldglass
Compliance
Quality
Cost savings
Cycle time
The most important thing of financial services firms
Being first to market
Being able to get something done faster
Being willing to pay a premium
What the mining industry cares about
Safety
Compliance
Every industry had its own nuance
Dual Strategies
Conclusion
Manage trade-offs
Clear communication
Dogged discipline
Significant managerial innovation
Different business model
You can't have your cake and eat it :red_cross:
Story 1: Saab :warning:
1960s
Distinctive cars
Instantly recognizable
Highly educated owners
1940s
Ursaab
The most aerodynamic car design
1990s
General Motors
stepped in and
acquired a 50% stake in the company
Build multiple car models with common platform
Un-Saab
Unable to retain the position of differentiation
Story 2: Dell :red_flag:
Story 3:Honda & Toyota :red_flag:
Total Quality Management(TQM)
Management approach to long-term success through customer satisfaction.
Customize user's computer orders
Differentiation advantage
Solve inventory problems
Integrated Strategies
Integrate some elements of cost reduction
with some elements of differentiation
The Manager’s Journey: Advice from Our Experts
What advice would they give aspiring manager such as yourself?
Differentiate between Failure and Sucess
critical decision in the right time
tactical plan
figure out which decision is critical
make 5-10 strategic decision
How you can be an effective strategic leader?
Be a great listener to your employee and customer
Find your philosophy
passionate to lead people
contentiously thirst to be acquisitive
know everyone strengthen and weakness
close to your firm
encourage people and have open discussion
understand yourself,knowing your strengthen and weakness
Taboo (Don't do):red_cross:
hoist yourself up by your own bootstrap
directly do the product development (the highest cost in the all process)
stop learning
G6
Rora
Deniel
Jason
Lucy
Cindy
Peggy
Also Known As