BUSINESS STRATEGY

[Pages:42]BUSINESS STRATEGY

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THE FUNDAMENTAL ELEMENTS OF THE DEFINITION OF A BUSINESS STRATEGY

The Mission of the Business

? Definition of business scope: products, markets, and geographies

? Identification of unique competencies

Internal Scrutiny at the Business Level

(Past performance and future projections)

? Identification of internal critical factors to achieve competitive advantage ? Overall assessment of competitive position

Definition of Strengths and Weaknesses

Environmental Scan at the Business Level

(Past performance and future projections)

? Identification of external factors contributing to industry attractiveness

? Overall assessment of industry attractiveness

Identification of Opportunities and Threats

Formulation of the Business Strategy

A set of multiyear broad action programs

Strategic Programming

Definition and evaluation of specific action programs

(covering 6- to 18- months)

Budgeting

Strategic funds programming and operational budgets

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THE DELTA MODEL ? AN INTEGRATIVE STRATEGIC FRAMEWORK

The Triangle SLI

TCS

BP

Customer Segmentation and Customer Value Proposition

Mission of the Business ? Business Scope

? Core Competencies

Competitive Positioning ? Activities that drive profitability

Industry Structure ? External factors determining

industry attractiveness

Business The Strategic Agenda

I

OE

CT

Adaptive Processes Strategic Agenda

Aggregate and Granular Metrics

Experimentation and Feedback

The changes introduced by the Delta Model ? Add the Triangle to decide on the strategic positioning ? Add the Adaptive Processes to expand the implementation tasks

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The primary outputs of the Business Strategy process are: ? Managerial Consensus ? Customer Segmentation and Customer Value

Proposition ? The Mission of the Business (supported by

Industry Structure and Competitive Positioning Analyses) ? The Strategic Agenda of the Business ? The Strategic Agenda of the Adaptive Processes (Operational Effectiveness, Customer Targeting, and Innovation) ? The Budget and Metrics

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MANAGERIAL CONSENSUS

Saturn definition:

70% Agreement/ 100% Buy-In

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CUSTOMER SEGMENTATION AND

CUSTOMER VALUE PROPOSITION

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CUSTOMER SEGMENTATION

Customer Tier

Description

BUSINESS DIMENSION OF THE CUSTOMER TIER

Customer Dimension

Products

Customer Tier: ________________________

Services

Customers

Channels

End Users

Complementors

Unique Competencies

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