council for christian colleges and universities christian colleges and proprietary schools friday,...
TRANSCRIPT
Council for Christian Colleges and Universities
Christian Colleges and Proprietary SchoolsFriday, March 25, 2011
Chief Academic OfficersConference
Dr. David L. AndersonAssociate ProfessorTrinity International University
1 LORD, our Lord, how majestic is your name in all the earth!
You have set your glory in the heavens. 2 Through the praise of children and infants you have established a stronghold against your enemies, to silence the foe and the avenger. 3 When I consider your heavens, the work of your fingers, the moon and the stars, which you have set in place, 4 what is mankind that you are mindful of them, human beings that you care for them?[c]
5 You have made them[d] a little lower than the angels[e] and crowned them[f] with glory and honor. 6 You made them rulers over the works of your hands; you put everything under their[g] feet: 7 all flocks and herds, and the animals of the wild, 8 the birds in the sky, and the fish in the sea, all that swim the paths of the seas.
9 LORD, our Lord, how majestic is your name in all the earth!
Psalm 8
Continued Growth
of a College
1. Marketing
1. To know and understand the consumer so well that the product or service fits the consumer and sells itself.
2. Growth, expansion, change
1. Where is the customer?
2. What does the customer buy?
2. Innovation
1. Task of endowing human and material resources with new an greater wealth-producing capacity.
Three AssumptionsA Theory of the Organization
Applied to Colleges- Peter Drucker
1. Environment of the Organization
1. Society and its Structure
2. Market
3. Customer
4. Technology
2. Specific Mission of the Organization
3. Core Competencies Needed to accomplish the
organization’s mission
Peter Drucker:
Organizational Leadership and Competition
1. Decentralization and simplification.
2. Skepticism of macroeconomic theory.
3. Respect of the Worker.
4. “The Sickness of Government.”
5. The need for "planned abandonment."
6. Taking action without thinking is the cause of every failure.[33]
7. The need for community.
8. The need to manage business by balancing a variety of needs and goals.
9. A company's primary responsibility is to serve its customers.
10.An organization should execute its business processes.
11.Companies could stand among humankind's noblest inventions.[38]
History of Proprietary Colleges
DeVry University/Keller Graduate School
Phoenix University
Bryant and Stratton
ITT Technical Institute
Current RegulationsIn Regard to Proprietary Colleges
Department of Education
Proposed Regulations
Congressional Response
Positioning for Response by the Christian Colleges
Value Chain
A linked set of activities from raw material to end use product for the customer.
Value chain Customer Basis
Procurement R&D Manufact-
uring Marketing Distribution Service
Value Chain
Customer
Drive and Mature Pipeline
Peoplesoft SAP MRP II Quicken Books
Strategic Marketing Tactical Marketing
Choose the value Provide the value
Sales
Promotion Advertising
Sales
Force
Distribution
Servicing
Souring
Marketing Pricing
Service
Develop-
ment
Product
Develop-
ment
Value
Positioning
Market
Selection/
Focus
Customer
Segmentation
Communicate the value
SUPPLIER
VALUE
CHAINS
FIRM
VALUE
CHAIN
BUYER
VALUE
CHAINS
In the “value system,” the supplier, firm, distributor, and buyer value chains overlap.
The supplier’s outbound logistics is the firm’s inbound logistics.
The supplier’s outbound logistics is the firm’s inbound logistics, etc.
Value SystemValue Chain
CHANNEL
VALUE
CHAINS
Sources of Strategic Issues
Most critical external issues * Competition * Industry trends * Market trends * Other trends and threats
Most salient internal issues Strategic * Financial weaknesses Issues * Weaknesses, problems * Labor Costs
Other options worth considering
Alternatives Analysis
Four Specifications of the Organization
- Peter Drucker
1. Assumptions must fit reality.
1. Environment
2. Mission
3. Core competencies
2. Assumptions in all three areas must fit one another.
3. Theory of the business must be known and understood throughout the business.
4. Theory of the business must be tested constantly.
Warning Signs:
Business Can Become Obsolete
- Peter Drucker
1. Organization Can Achieve its Original Objectives
2. Too Rapid Growth
3. Unexpected Success
4. Unexpected Failure
Margin
Margin
Firm Infrastructure
Human Resource Management
Technology Development
Procurement
Inbound Logistics Operations
Outbound Logistics
Marketing
& Sales
Marketing Management
AdvertisingSales Force
Admin.
Sales Force Oper.
Promotion
Service
Technical Literature
Customer Supply Chain (Michael Porter)
Business Objectives:What Should our Business Be?
Business Objectives are the foundation for designing both the structureof the business and the work of individual units and individual managers.
- Peter Drucker
1. Fundamental strategies of business.
2. Must be operational.
3. Must make possible concentration of resources and efforts.
4. Must be multiple rather than singlular.
5. Needed in all areas in which business survival depends.
Environmental Changes toGenerate the Future Systematic Search
- Peter Drucker
1. Has anything happened that might establish a pattern for our industry, our country, our market?
2. Is anything happening in the structure of an industry that indicates a major change?
3. What do generally approved forecasts assert will likely happen in 10, 20, or 30 years?
4. Has change already taken place?
Increased Accuracy of Measurement
Cost, Revenue, Profit, Investment Center Strategic Business Unit Critical Success Factors Core Competencies
An Idea must have:
- Peter Drucker
1. Operational validity
2. Economic validity
3. Aim at Social Reform
4. Test of personal commitment
Potential Entrants
Suppliers
Industry Competitors
Rivalry Among Existing Firms
Buyers
Substitutes
Bargaining power of suppliers
Threat of new
entrants
Bargaining power of buyers
Threat of substitute products or services
Five Forces Model (Michael Porter)
What is Strategic Planning?
- Peter Drucker
1. The continuous process of making present risk-taking decisions systematically with the greatest knowledge of their futurity.
2. Organizing systematically the efforts needed to carry out these decisions.
3. Measuring the results of these decisions against the expectations through organized, systematic feedback.
Critical in Strategic Planning?
- Peter Drucker
1. It is more than a bundle of techniques.
2. It is more than forecasting.
3. It deals with the futurity of present decisions, not with future decisions.
4. It is an attempt to understand risk, not eliminate it.
1. The systematic and purposeful work on attaining objectives
2. New and different ways to obtain objectives
Market Segmentation
Environmental SnapshotSeverity of Impact on Company
Positive Negative
Category H M L Neutral L M H
EconomicThe market is expanding with more baby boomers entering retirement. There seems to be more disposable income for the country as a whole
and more time for golf
Regulatory/Legislative
Regulatory restrictions are based upon the US Golf Association rules
DemographicThe country is getting older with more people in retirement. These folks
have greater disposable income and more free time. Also people are living longer.
Attitude/ Lifestyle
Lifestyles are changing in that people have more money to spend and more time to spend after retirement
Socio-Cultural
People are becoming more active and playing more sorts like golf
Political/ Legal
No changes
TechnologicalTechnology is making the game more enjoyable by allowing less
experienced golfer achieve better scores
Statement of Trend
FirmFirm
EnvironmentEnvironment
PerformancePerformance
• Size
• Geographical scope
• Product scope
• Organization structure
• Technological resources
• Knowledge resources
• Establishing switching costs
• Exploiting knowledge
• Developing response strategies
• Managing risks
Key Factors for Strategic Success
Generic Competitive Strategies
Cost Leadership
Differen-tiation
Cost FocusFocused Differen-
tiation
Competitive Advantage
Competitive
Scope
Broad Target
Narrow Target
Lower Cost Differentiation
Strategic Analysis Model
Alternatives Analysis
Strategic Issues
Identifying Strategic Alternatives
Arguing For and Choosing a
Preferred Strategy
Recommendations
Short-Term Plans Goals & Objectives
Strategic IntentPrograms
Contingencies
Long-Term Plans Goals & Objectives
Strategic Intent Programs
Contingencies
Situation AnalysisExternal Review
Industry Analysis Competitive
Analysis Market Analysis
Environmental Analysis
Internal Review Financial Analysis
Strengths & Weaknesses
Opportunities & Threats
1. What is thecurrent
situation?
2. Where do wewant to go?
3. How can weget there?
Strategic AlternativesStaying in the same business:Concentration – Product or market developmentVertical Integration – Forward or backwardAcquisition of or merger with a competitorHarvest or be acquiredRetrenchment and Turnaround (including Bankruptcy Chapters 11, 13)Low-cost leadership, differentiation, or focusStrategic alliances, including joint ventures
Exiting the business:Liquidation
Entering another business:Diversification through acquisition – related or unrelated businessInternal diversification
Council for Christian Colleges and Universities
Christian Colleges and Proprietary SchoolsFriday, March 25, 2011
Chief Academic OfficersConference
Dr. David L. AndersonAssociate ProfessorTrinity International University