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SMMCG1[BS-1] Leading Strategically, image, Competitor, Cons, V.A.R.S.…
SMMC
G1
[BS-1] Leading Strategically
The basic of Strategy and Corporate Governance
Corporate Strategy
Organizational design
Head office
Determining how much autonomy to give business
Deciding whether decisions are made top-down or bottom-up
Influence on the strategy of business units
Organizational structure
Developing centers of excellence
Determining the appropriate delegation of authority
Setting governance structures
Allocation of resources
People
Identifying core competencies and ensuring they are well distributed across the firm
Moving leaders to the places they are needed most and add the most value
Ensuring an appropriate supply of talent is available to all businesses
Capital
Allocating capital across businesses so it earns the highest risk-adjusted return
Analyzing external opportunities
Strategic Tradeoffs
Managing risk
True product differentiation
The degree of autonomy business units have is important in managing this risk
Firm-wide risk is largely depending on the strategies it chooses to pursue
Generating returns
Higher risk strategies create the possibility of higher rates of return
Incentives
Incentive structures will play a big role in how much risk and how much return managers seek
It may be necessary to separate the responsibilities of risk management and return generation so that each can be pursued to the desired level
Portfolio Management
Deciding what business to be in or to be out of
Determining the extent of vertical integration the firm should have
Creating strategic options by seeding new opportunities that could be heavily invested in if appropriate
Business Strategy Key Concept
Mission, Vision, and Values
Vision
future direction
GOOGLE :red_flag:
''organize the world’s information''
"to provide
access to the world’s information in one click"
achieved its original vision :check:
expectation
strategic intent
Value
how we will behave
principles of making decisions
code of conduct
Mission
purpose(goals)
resolve disputes
inspiration
makes it transparent
why we exists
what we achieve
Business Model
A
ctivities, Resources, and Capabilities
(ARCs)
key for enabling or creating that value proposition
(to in crease EVA)
not necessary owned and operated by youself
e.g outsourcing
V
alue proposition
Increase EVA
(value - cost = EVA)
creating more value
reducing cost
Goal
Economic-Value-Added (EVA)
R
ealize value (Revenue model)
razor-blade model
ink cartridges
gaming consoles
freemium model
Linked-In
offer a premium account if you pay a fee
Google
sell targeted keyword advertising to advertisers
eBay
transact and takes a commission from the sale
multi-sided platforms and ecosystems
Facebook
charge in cash for the product or service
durable product
selling services from it
car
leasing and subscription models
periodic payments to use of the product or service
Netflix, Disney
The
s
cope of the enterprise
footprint
width
customer segments the business wants to serve
Example, Netflix
horizontal
products or services which the company be in
vertical
things and activities are outsourced to suppliers or downstream partners
Online competition
Changes in consumer behavior
Technological innovation
The shift from traditional stores to newer businesses
Business Model Transformation
provide value
Business Model Innovation
deliver advice
Coherence, Fit and SWOT
SWOT
Opportunities
Strengths
Threats
Weaknesses
External
Fit
kind of turf and lighting
size of the field and goals
some factors of the entire market or the general environment.
Internal
Coherence
Company's employees have different functional departments, they must work in a consistent way and integrate with each other.
strategic fit
capabilities
:red_flag: Success
systems
values
defenders
They must work together with a common understanding and consistency of approach.
focus on passing and keeping possession of the ball
defense and quick counter attacks
midfielders
goalkeeper
forwards or strikers
Competitor
weaknesses
behavioral patterns
strengths
Cons
unclear definition
abstract and open ended
No clear connection to company's courses of action
V.A.R.S. Framework
⭐️the
conclusion
of VARS framework
4 interconnected elements
Value Proposition
Revenue Model
NEW
A
ctivities/
R
esources/
C
apabilities
a successful business model
dramatically change the
entire
business
results
Scope of the Enterprise
prime example
Netflix🎬
core
new technologies
alter the video rental business
revenue model changed
no additional cost
adds value proposition
Business Model
✏️definiton
theoretical abstraction/ a set of hypotheses
create value and make to work
fail
requiring adjustments
success
content
NO
encompass all strategies
learning and finding more
NO
firm-specific
ex:Blockbuster and Hollywood
NO
detailed description
high-level abstraction
complete
1/4
A
R
CS elements
