【正文】 CONFIDENTIAL BU Strategic Plan Basics Training materials This report is solely for the use of client personnel. No part of it may be circulated, quoted, or reproduced for distribution outside the client anization without prior written approval from McKinsey Company. This material was used by McKinsey Company during an oral presentation。 it is not a plete record of the discussion. Jim Ayala – PHO Melissa Gil – PHO Regina Manzano – PHO Suresh Mustapha – PHO Steve Shaw – HKO Shelly Yeh – PHO ChoonGin Tan – SIO ? DESCRIPTION OF MATERIALS ? This document was developed as a training presentation for the newly appointed Business Unit CEOs of an Asian Familyowned conglomerate. ? The purpose of this document is to guide new CEOs through the basic elements of developing a BUlevel strategic plan. ? This presentation is plemented by a panion document the “BU Strategic Plan Template Book” which provides pleteness and consistency of BU strategic plan submissions. These templates are not intended to replace or constrain BU strategic thinking and should be adapted to reflect a particular BU’s sectoral context as required 2 ? WHAT IS A BU STRATEGY? A strong business concept that drives an integrated set of actions that creates value by: ?Creating products/services whose value exceeds the cost of providing them ?Capturing value from petitors, customers, distributors, suppliers, and producers of substitute products and services 3 ? RATIONALE FOR PROPOSED DEFINITION A strong business concept that drives an integrated set of actions that creates value by: ?Creating products/services whose value exceeds the cost of providing them ?Capturing value from petitors, customers, distributors, suppliers, and producers of substitute products and services 1. Recognize dual role of creating and capturing value in all elements of business system 2. Forces choices 6. Competitive 7. Externally oriented, customer driven 4. Recognizes importance of cost as petitive tool 5. Considers tradeoffs between benefit provided to customers and costs they incur 3. Gives consideration to all elements of the business system 4 ? COMMON ELEMENTS OF REALLIFE STRATEGIES Vision Where? Strong business concept consisting of How to pete? Integrated set of actions ? Developed high quality standards and excellent operational procedures ? Focus on developing critical mass of stores and establishing market dominance ? McDonald’s experienced phenomenal success in globalization due to: – Successfully screening franchisees and a dedication to intense initial and ongoing training – Consistent delivery of highquality food and service around the world – Huge economies of scale and powerful supplier leverage –Capitalized on “American” appeal of McDonald’s – Success in tailoring assortment mix to meet local needs ? “We want to be the world’s best quickservice restaurant experience” ? We will offer identical excellent quality across the world ? Targeting a broad set of the urban population, increasingly offering a bundled product (., meals) at a low price in major cities around the world McDONALD’S EXAMPLE 5 ? BU STRATEGY REVIEW INTERACTIONS Highly interactive debate driven by factbased understanding of environment and internal capabilities How do you expect Competitor A to react? How sustainable is your business model? Can it be easily duplicated? How robust are your contingency plans? How quickly can you shift your business emphasis to capture industry opportunities? BUCEO 6 ? BU STRATEGIC PLAN DEVELOPMENT Industry dynamics and implications Environmental and internal assessment Competitive assessment Internal assessment ? What are the major changes in industry dynamics and resulting opportunities and risks? ? What are your petitive strengths and weaknesses? ? How does your current business emphasis fit with industry opportunity and petitive landscape? Strategy articulation Strategic definition and implications Strategic initiatives Financial projections ? What strategy will your BU pursue over the next 3 years? ? What will be the impact of major strategic initiatives? ? What are the expected financial returns of your strategy? + + + + Risk/contingencies strategic alternatives ? What strategic alternatives have you considered? + 7 ? INDUSTRY DYNAMICS AND IMPLICATIONS ? Economics of demand – By segment – Substitutes, ability to differentiate – Volatility, cyclicality ? Economics of supply – Producer concentration and diversity – Import petition – Capacity utilization – Entry/exit barriers – Cost structure (fixed and variable) ? Industry chain economics – Customer and supplier bargaining power What are the major changes in industry dynamics and the resulting opportunities and risks? How is industry structure changing with respect to demand, supply, and industry chain economics? What are the resulting opportunities and risks? What is the expected petitor conduct? What are the resulting opportunities and risks? What are the present and future external factors that could present new opportunities and risks? ? Major industry petitor moves – Marketing initiatives – Industry capacity changes – MAs, divestitures – Vertical integration/disaggregation – Alliances and partnerships – Cost control and efficiency improvements ? Impact and likelihood of major industry discontinuities – Changes in regulation/government policy – Technological breakthroughs Key question Subquestions Issues to be considered* * May or may not be applicable to all BUs What industry are you peting in? What are the various segments in the industry? ? Industry definition ? Indust