david sm13 ppt_08
TRANSCRIPT
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall
Ch 8 -1
Chapter 8Implementing Strategies: Marketing, Finance/Accounting, R&D, and MIS Issues
Strategic Management: Concepts & Cases
13th EditionFred David
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Ch 8 -2
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Ch 8 -3
“The greatest strategy is doomed if it’s implemented badly.” – Bernard Reimann
Implementing Strategies
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Ch 8 -4
Less than 10% of strategies formulated are successfully implemented!
The Nature of Strategy Implementation
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Ch 8 -5
Exclusive dealerships or multiple channels of distribution
Heavy, light, or no TV advertising To limit or not the share of business with a single
customer Price leader or price follower Offer complete or limited warranty Reward salespeople with commission or salary Advertise online or not
Marketing IssuesMarketing decisions requiring policies
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Ch 8 -6
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Ch 8 -7
Current Marketing Issues
Advertising media
Purpose-based marketing
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Ch 8 -8
Market segmentation
Product positioning
Marketing Issues
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Ch 8 -9
Subdividing of a market into distinct subsets of customers according to needs and buying habits
Marketing Issues
Market Segmentation
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Ch 8 -10
Market Segmentation
Market SegmentBasis Psychographic
Behavioral
Geographic
Demographic
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Ch 8 -11
Market-development, product-development, market-penetration, and diversification strategies require market segmentation
Market segmentation allows operating with limited resources; enables small firms to compete successfully
Market segmentation decisions affect marketing mix variables
Market Segmentation
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Ch 8 -12
Product Place Promotion Price
Marketing Mix Variables
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Ch 8 -13
Marketing Issues
Schematic representations that reflect how products/services compare to competitors’ on dimensions most important to success in the industry
Product Positioning
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Ch 8 -14
Product Positioning Steps
1. Select key criteria2. Diagram map3. Plot competitors’ products4. Look for niches5. Develop marketing plan
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Ch 8 -15
Product-Positioning Map for Banks
Personal
Impersonal
Aggressive Conservative
Bank A
Bank B
Bank C
Bank D
Bank E
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Ch 8 -16
Product-Positioning Map for Personal Computers
High Capability
Low Capability
Good Customer Service
Bad Customer Service
Firm 1
Firm 2
Firm 3
Firm 4
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Ch 8 -17
Product-Positioning Map for Menswear Retail Stores
Very latest, fashionable menswear
Conservative, everyday menswear
Low Price High Price
Average department store
Average specialty chain
Average mass merchandiser or discounter
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Ch 8 -18
Product-Positioning Map for the Rental Car Market
High Convenience
Low Convenience
High Customer Loyalty
Low Customer Loyalty
Firm 1Firm 2
Firm 3
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Ch 8 -19
Look for a vacant niche Don’t serve two segments with
the same strategy Don’t position yourself in the
middle of the map
Product Positioning
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Ch 8 -20
Finance/Accounting Issues
Acquiring needed capital Developing projected financial
statements Preparing financial budgets Evaluating the worth of a business
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Ch 8 -21
Raise capital – short-term debt, long-term debt, preferred, or common stock
Lease or buy fixed assets Determine appropriate dividend payout
ratio LIFO, FIFO, or market-value accounting Timeframe of accounts receivable Discounts on accounts Amount of cash to be kept on hand
Finance/Accounting Issues
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Ch 8 -22
EPS/EBIT analysis Earnings per share/earnings before interest
and taxes
Finance/Accounting IssuesDebt vs. Equity Decisions
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Ch 8 -23
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Ch 8 -24
Allows an organization to examine the expected results of various actions and approaches
Finance/Accounting Issues
Projected Financial Statement Analysis
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Ch 8 -25
1. Prepare income statement before balance sheet (forecast sales)
2. Use percentage of sales method to project CGS & expenses
3. Calculate projected net income
Finance/Accounting Issues
Steps in Preparing Projected Financial Statements
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Ch 8 -26
4. Subtract dividends to be paid from net income and add remaining to retained earnings
5. Project balance sheet items beginning with retained earnings
6. List comments (remarks) on projected statements
Finance/Accounting IssuesSteps in Preparing Projected Financial Statements (cont’d)
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Ch 8 -27
Projected Income Statement
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Ch 8 -28
Projected Balance Sheet
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Ch 8 -29
Details how funds will be obtained and spent for a specified period of time
Finance/Accounting Issues
Financial Budget
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Ch 8 -30
Types of Budgets
Cash budgets Operating budgets Sales budgets Profit budgets Factory budgets Capital budgets
Expense budgets Divisional budgets Variable budgets Flexible budgets Fixed budgets
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Ch 8 -31
Central to strategy implementation – integrative, intensive, and diversification strategies often implemented through acquisitions of other firms
Finance/Accounting Issues
Evaluating Worth of a Business
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Ch 8 -32
1. What a firm owns
2. What a firm earns
3. What a firm will bring in the market
Evaluating Worth of a Business
Three Basic Approaches
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Ch 8 -33
Evaluating Worth of a Business
Net worth or stockholder’s equity Net profit – conservative value
would be five times the firm’s current annual profits
Price-earnings ratio method Outstanding shares method
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Ch 8 -34
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Ch 8 -35
Research & Development Issues
New products and improvement of existing products that allow for effective strategy implementation
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Ch 8 -36
Level of support constrained by resource availability
Technological improvements shorten product life cycles
Research & Development Issues
Constraints
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Ch 8 -37
1. First firm to market new technological products
2. Innovative imitator of successful products
3. Low-cost producer of similar but less expensive products
Research & Development IssuesThree Major R&D Approaches to Implementing Strategies
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Ch 8 -38
Management Information Systems (MIS) Issues
Having an effective management information system (MIS) may be the most important factor in differentiating successful from unsuccessful firms.
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Ch 8 -39
Information collection, retrieval, and storage
Keeping managers informed Coordination of activities among divisions Allows firm to reduce costs
MIS Issues
Functions of MIS
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Ch 8 -40
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