【正文】 ediumPote ntialS ubscribersS ubscribersto S e rviceS e rvice P roviders In eProportion of In eto S ervice P rovide rPrice of S ervicesC ost of A cce ssA dve rtising In e ++++++++++ /+++++? ++++1 2 3 4 5 6 78 9 10 11 12 13 1415 16 17 18 19 20 2122 23 24 25 26 27 2829 30 31 32 33 34 35M ap p in g th e cau seeffect relatio n sh ip s B u ild th e F in an cial M o d el b ased o n cau seeffects id en tifiedApproach When To Apply Financial Modeling is effective in analyzing how a pany’s performance, in core areas of business, will be affected by pursuing different courses of action. This tool facilitates an understanding of various causeeffect and provides a model by which to test various what if statements. Financial Modeling Follow these steps to successfully create a Financial Model Step 1 Gather information on key drivers ie. ? From the cash flow analysis performed as part of the SVA ? Data and insight from Voice of the Customer is another source of insight Step 2 Map the relationships and identify factors which reinforce one another vs. those that have a negative relationship (. increase in price may have a negative effect on demand) Step 3 Build the financial model based on the causeeffect relationships identified Step 4 Gather data from industry analysis or internal corporate data Step 5 Test the quality of the model by doing manual calculations on some what if” Step 6 Perform what if to assess the pleteness of the model Citations Client and Industry Experience Financial Modeling ? Flemings Fund Management Ltd (FFML)/Banking/KIT database ? Galileo/Travel/ Spencer Lin Vasu Krishnamurthy ? Osh Kosh B’ Gosh?SP/Retail/Mike Weiss ? PwC MCS/Consulting/Vasu Krishnamurthy ? United Airlines/Travel/Vasu Krishnamurthy ? Robert M. Grant, “Contemporary Strategy Analysis”, 3rd Edition Source List The Fit vs. Attractiveness Model optimizes strategy by developing a sense of the realistic state of the market and pany affairs. The Model pares product fit with a market to product fit with a pany’s objectives. Fit vs. Attractiveness Model Summary The Fit vs. Attractiveness Model ? Baked Goods ? Bulbs ? Cheese ? Fruit ? Kitchenware ? Meat/Seafood ? Nursery Stock ? Snacks/Candy ? Stationery ? Decorative Accessories ? Indoor Plants ? Nuts ? Seeds ? Trees/Shrubs ? Gourmet Food ? Bed/Bath ? Pool/Patio/Gardening ? Crafts ? Personal Care/Grooming ? Specialty Apparel ? Camping Equipment ? Children’s Apparel ? Drug/Vitamins/Health Food ? Hardware/Tools ? Hosiery/Lingerie ? Women’s Apparel ? Men’s Apparel ? Women’s Large Size Apparel ? Athletic Equipment ? Fishing Equipment ? Hunting Equipment ? Sporting Good Apparel Category Fit With Company High Medium Low Low Medium High Category Attractiveness CATEGORY EVALUATION SPECIALTY/SPINOFF Categories included in existing or planned specialty books Remended additional specialty book venture EXAMPLE Approach Fit vs. Attractiveness Model Step 1 Identify product, category or market overall attractiveness as being low, medium, or high. Plot along xaxis. Step 2 Identify product category, or market fit with pany objectives as being low, medium, or high. Plot along yaxis. Step 3 Evaluate newly created matrix。 aim to reveal products, categories, or markets that fall under high overall attractiveness and high fit with pany objectives. When to Apply The Fit Vs. Attractiveness Model is used to analyze a new product or service offering’s fit within a pany, in parison to the overall attractiveness of the product or offering. This particular model requires judgements which are subjective in nature。 one should be aware that this model may oversimplify the market situation. Citations Client and Industry Experience Fit vs. Attractiveness Model Source List ? Galileo/Travel/ Spencer Lin Vasu Krishnamurthy ? PwC MCS/Consulting/Vasu Krishnamurthy ? Paul Elkin, “Mastering Business Planning and Strategy: The Power and Application of Strategic Thinking” ? Henry Mintzberg, James Brian Quinn, Sumantra Ghoshal, “The Strategy Process” Five Forces Analysis Summary The Five Forces Analysis evaluates the attractiveness of an industry. Five Forces Analysis DRIVERS OF MARKET ATTRACTIVENESS POTENTIAL ENTRANTS Entry barriers are high if there are: ? Economies of scale ? Product differentiation ? Capital requirements ? Limited access to distribution channels ? Restrictive government policies ? Potential retaliatory reaction of incumbents INDUSTRY COMPETITORS Rivalry is intense if: ? Competitors are numerous or roughly equal in power or size ? Industry growth is slow ? There are high fixed costs or the product is perishable ? The product lacks differentiation or switching costs ? Capacity is augmented in large increments ? Exit barriers are high ? Rivals are diverse in strategies, origins, and personalities SUBSTITUTES Threat of substitutes is high if: ? There is an abundance of products or services that serve the same function ? The priceperformance tradeoff of substitutes is attractive SUPPLIERS Bargaining power of suppliers is greater if: ? The supply industry is dominated by a few panies or is more concentrated than the buying industry ? The supply product is differentiated or there are high switching costs ? There are few substitutes ? The buying industry is not an important customer of the supply industry ? The supply industry poses a credible threat of forward integration BUYERS Bargaining power of customers is greater if: ? The customer group is concentrated or buys in large volume ? Products purchased are undifferentiated ? Prod