Bt27 mar2012a versluis
- 1. Strategic planning and sustainability Workshop Kuala Lumpur, March 27, 2012 MACD Workshop v5 (AV).ppt 1
- 2. The strategic planning cycle – How it is supposed to work Strategy selection Execution planning External Strategic analysis scanning Execution Learning Monitoring MACD Workshop v5 (AV).ppt 2
- 3. Sound strategies ought to be based on rigorous fact-based analysis and unbiased decision making Process of strategic management Strategic analysis Strategy selection Strategy implementation External Objectives analysis Strategy People, resources, options structures, processes, culture needed Opportunities Threats Converting strategy Evaluation Strategy into operational plans Strengths Weaknesses Making people act in line with strategy Strategy decision: Internal Choose a strategy Monitoring, learning, analysis correcting MACD Workshop v5 (AV).ppt 3
- 4. Going through the strategic planning cycle – How often? • Daily: "normal" external events might require new strategic responses, effecting the whole cycle • Monthly: KPI reports etc. • Annually: budgeting and investment planning and strategic planning must be consistent and aligned • Occasionally: for example when: – Company in trouble – Major external shocks – New owners etc. MACD Workshop v5 (AV).ppt 4
- 5. Winning strategies provide answers to five key questions Strategic key questions What do we Where do we How do we Have we got, Which want? play? win? what it enablers do takes? we need? Corporate Strategy Parenting Advantage Business Strategy Competitive Advantage Targets and Markets USPs Capabilities & Structures ambitions Resources and systems INHERENT POTENTIAL ABILITY TO ACHIEVE POTENTIAL MACD Workshop v5 (AV).ppt 5
- 6. Are we organized strategically = Aimed at long term sustainability? All options found Are planners capable of and considered understanding execution "fairly"? complications? Daily? Angles wide enough? Right managers? If not, what is done about it? Analytical skills good and un- Do KPIs measure the biased enough? right things? And are measurements correct? What are the mechanisms for continuous learning? Are they effective? MACD Workshop v5 (AV).ppt 6
- 7. C. SWOT analysis MACD Workshop v5 (AV).ppt 7
- 8. The SWOT analysis aims to provide a sound analytical basis for identification and selection of strategy options SWOT analysis STRENGTHS WEAKNESSES Build on strengths and Overcome weaknesses and Internal intensify competitive turn them into strengths analysis advantage Closely track environment Early recognize threatening and take advantage of situations/events/factors upcoming events and formulate action plan to External minimize risks analysis OPPORTUNITIES THREATS MACD Workshop v5 (AV).ppt 8
- 9. The analysis of internal strengths and weaknesses looks at all resources and aspects of a company and its success factors • Define current and future potential 1 EXTERNAL ANALYSIS • Evaluate the subjective assessment of the defined Market potential and attempt to make it objective Customers/ Compe- trends titors – Comparing the potential with the industry 3 SWOT ANALYSIS 3. Sales channel development or the development of the most structures • Success factors important competitors • Strengths/weaknesses – Weighing the corporate data against the business 2 INTERNAL ANALYSIS Products/ranges • Opportunities/threats standards Organi- zation/ – Examining the analyzed strengths and weaknesses Core com- petencies framework with respect to the corporate / public goals Sales/profit development • Determine the success factors of the company / institution MACD Workshop v5 (AV).ppt 9
- 10. The external analysis examines the environment of a company and determines opportunities and threats • Monitor and examine trends and developments and determine their relevance 1 EXTERNAL ANALYSIS – Political, economical Market – Markets, consumers Customers/ trends Compe- titors – Competitors (incl. up/down value chain) 3. 3 SWOT ANALYSIS – Social, demographic, cultural Sales channel structures – Technical, technologies • Success factors – Legal, regulatory • Strengths/weaknesses 2 INTERNAL ANALYSIS – Shocks, events, disasters, weather etc. • Opportunities/threats Products/ranges • Analyze / assess their significance for the company Organi- Core com- petencies zation/ framework • Recognize future opportunities and threats as quickly Sales/profit as possible and react to a changing environment by development – Realizing external signals in "real time" – Collecting information continuously and analyzing it immediately drawing the necessary conclusions from it MACD Workshop v5 (AV).ppt 10
- 11. The number of external factors driving long term business success are many Increased barriers to entry from growing societal and environmental standards Threat of new entrants Ecological Socio-demographic environment environment Greater strategic Growing partnerships Suppliers’ Customers’ loyalty with suppliers to bargaining power Business bargaining power towards ‘responsible’ address S&E suppliers risks Political and legal Technological environment environment Rivalry among Threats of competitors substitutions Power of reputation as Greater differentiation a business asset. in S&E performance of Comparative advantage product/services Source: Porter, 1980 MACD Workshop v5 (AV).ppt 11
- 12. The SWOT matrix should group and categorize key internal strengths and weaknesses as well as external opportunities and threats Internal Strengths Weaknesses Opportunities Threats External Sales and •… •… marketing •… •… Social, demographic Operations •… •… •… •… Technological Human •… •… resources •… •… Economic R&D and •… •… technology ?? •… •… Market, customers Financial and •… •… accounting Purchasing, •… •… Political/legal/regulatory •… •… suppliers Coordination Industry and •… •… •… •… mechanisms competition Links and interactions between internal and external factors will have to be further investigated in order to develop strategic options Source: Roland Berger MACD Workshop v5 (AV).ppt 12
- 13. E. Strategy planning and sustainability MACD Workshop v5 (AV).ppt 13
- 14. … but, there is consensus that sustainability requires conciliation of environmental, social and economic demands Society Bearable Equitable Sustainable Environment Economy Viable Source: World Summit 2005, Roland Berger MACD Workshop v5 (AV).ppt 14
- 15. But, sustainability must be linked to the corporate strategy Any sustainability strategy that is not closely linked to the core of the organization – the business – will fail Source: Roland Berger MACD Workshop v5 (AV).ppt 15
- 16. Generally, sustainability initiatives support one of three strategic goals 1 MANAGING RISK • Many already address some ecological or social risks by establishing environmental management or whistle blower protection • Companies should integrate sustainability issues more actively into risk management to indentify gaps and act to become less vulnerable 2 ENHANCING BUSINESS • Companies that want to grow profitably need to develop and nurture a solid reputation and a healthy internal culture around sustainability • Reputation is becoming an increasingly important differentiation factor on both customer and employment markets • Creating a healthy internal culture is critical to attracting and retaining the right people to provide continuous value creation and cost savings 3 GENERATING BUSINESS • With forward-thinking, business opportunities can be generated through activities that better society and preserve our planet • Social and environmental needs are emerging in B2B and B2C markets, demographic profiles are changing, creating new customer segments • Companies can profit through innovations to fulfill these new needs and values by actively targeting these segments Source: Roland Berger MACD Workshop v5 (AV).ppt 16
- 17. 3 GENERATING BUSINESS The product offering should be tailored to the segment needs SUSTAINABILITY-NEEDS PROFILE PRODUCT DIFFERENTIATION National • Environmentally friendly Pride Regional Products • Healthy – "Good for me" Independence Work-Life Balance • Sustainable corporate values Nutrition Helping Health conscious Neighbors • "Green image" Resource Sport Family Efficient • Helps a special cause (Product RED) Social Culture Engagement Science & Protect Research • Promotes fair trade Ethical Nature Standards Education Human rights Protect Climate Development Aid Source: Roland Berger MACD Workshop v5 (AV).ppt 17
- 18. 3 GENERATING BUSINESS Different types of industry focus on different sustainability aspects Examples for sustainability-segments (Illustrative) 1 SUSTAINABLE PROCESSES 2 SUSTAINABLE PRODUCTION 3 SUSTAINABLE PRODUCT USE AND RECYCLING 4 SUSTAINABLE RESOURCE SOLUTIONS AND SUPPLY CHAIN 5 SUSTAINABLE PRODUCT INNOVATIONS 6 SUSTAINABLE VALUE CHAIN Source: Roland Berger MACD Workshop v5 (AV).ppt 18
- 19. So what do we do? Actions to ensure the success of sustainability initiatives 1 LINK YOUR SUSTAINABILITY INITIATIVES TO THE CORPORATE STRATEGY 2 CLEARLY ARTICULATE HOW SUSTAINABILITY HELPS TO MANAGE RISKS 3 DEFINE HOW SUSTAINABILITY REDUCES COSTS (DIRECT AND INDIRECT) 4 DEVELOP INITIATIVES THAT FURTHER ENHANCE THE BUSINESS 5 CREATE A DIRECT LINK BETWEEN CUSTOMER EXPECTATIONS AND SUSTAINABILITY Source: Roland Berger MACD Workshop v5 (AV).ppt 19
- 20. Contact us Anthonie Versluis Managing Partner Malaysia Roland Berger Strategy Consultants Sdn Bhd (949134-W) Level 39, Menara Standard Chartered 30 Jalan Sultan Ismail 50250 Kuala Lumpur Tel: +603-22038600 Email: anthonie_versluis@my.rolandberger.com Mobile: +6019-6290073 www.rolandberger.com