p 3-Business Analysis Models

16
 Business Analysis Models STRATEGY #1 Model: Strategic Planning Model Stage 1: Strategic Position Stage 2: Strategic Choices Stage 3: Strategic Implementation #2 Model: Johnson and Scholes   Three Levels of Strategy Corporate Strategy Business Strategy Operational Strategy #3 Model  Johnson and Scholes   Strategic Lenses  Design Ideas Experience

Transcript of p 3-Business Analysis Models

Page 1: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 1/16

 

Business Analysis Models

STRATEGY

#1 Model: Strategic Planning Model

Stage 1: Strategic Position

Stage 2: Strategic Choices

Stage 3: Strategic Implementation

#2 Model: Johnson and Scholes – Three Levels of Strategy

Corporate Strategy

Business Strategy Operational Strategy

#3 Model – Johnson and Scholes – Strategic Lenses

 

Design

Ideas

Experience

Page 2: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 2/16

 

STAKEHOLDERS, ETHICS AND CULTURE

#4 Model: Mendelow’s Stakeholders’ Mapping 

  Low

Interest

 High Power  Low 

#5 Model: Charles Handy – Types of Culture

 Power culture Heavily centralized. Allows quick response to changes in environment

Few people make the decisions in the organisation Role culture Lots of formalized procedures. Very bureaucratic. Useful in an

environment that is stable.

Task culture Emphasis on getting tasks done. Work is complex. Rules are hardly

followed . Works well in complex, unstable environments.

 Person culture Purpose is purely to look after the individuals

#6 Model : Miles and Snow – Strategic CulturesOrganizations and the type of strategies they try to follow

 Defender

 organizations

Like strategic options that have worked in the past

Low risks. Secure markets Prospector

 organizations

Like options that would deliver results even if it entails high risks

 Analyzer

 organizations

Will move into new areas only after someone else have done so

 Reactor organizations

Do not plan ahead

3. Keep Informed 1.  Key Players

(Most Important

Stakeholders)

4. Minimal Effort2.  Keep Satisfied

Page 3: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 3/16

 

#7 Model: Johnson and Scholes - The Culture Web

Culture is made up of seven elements. Tells why we do things like we do.

 Rituals and routines What procedures are emphasized?

Symbols Are status symbols used as rewards? –   Employee of the month.What are rewards given for?

Control Systems What is most closely monitored?

Organizational structures How tall/flat?

 Power structures How much centralization is there?

Stories Does news in the Co. focuses on successes or failures?

The Paradigm What assumptions are taken for granted?

#8 Model: Johnson and Scholes – Key Drivers of Change in the business environment

Market Globalization Worldwide customers. Facilitated mainly by the internet

Cost Globalization Worldwide suppliers. Being able to get products and services from

anywhere in the worldGlobal competition Worldwide competitors/rivals

 In addition to these if you have a UK Company use:

Economic Conditions are they are at the time of the exam

Environmental The move towards more environmentally friendly products

Legal Minimum wage for unskilled labor

ENVIRONMENTAL ISSUES

#9 Model – PESTEL – How to analyse the Macro Environment

P  Political  Govt.’s policy on education & infrastructure 

E  Economic State of the economy, interest rates & tax levels

S Social  Attitudes, demographics and household structures

T Technological  New technologies making current products obsolete

E  Environmental  The move toward environmentally cleaner products

L  Legal  Changes in law making it harder or more expensive to operate

Page 4: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 4/16

 

#10 Model - Porters 5 Forces

Competitors (new)

Entrants of new competitors cause prices to dropTo prevent new entrants barriers to entry are needed (high fixed costs

or high capital requirements)

Competitors (existing) Lots of rivalry would cause profit margins to be lower. Market growthis usually slow.

Customers Powerful customers prevent companies from increasing prices or

implementing other changes

Suppliers Powerful suppliers cannot be stopped from increasing the cost of their

supplies

Substitutes Substitutes are of three types: Direct, Indirect and Monetary

 Direct  – customer buys the same product from another company

 Indirect  – customer buys a substitute product for the original one

 Monetary  – customer buys a product that is not similar to the original.

E.g takes a vacation instead of purchasing a TV.

#11 Model –  Porter’s National Diamond 

Reasons why companies in certain countries are more competitive (successful) than others.

 Factor Conditions   Natural resources –  timber, raw materials

  Climate (some products can only grow in some countries)

  Communication infrastructure (roads, bridges etc.)

  Knowledge bases and logistic systems

 Firm StrategyStructure &

 Rivalry

  Attitude to short term profits

  National culture

  Level of domestic rivalry

 Demand Conditions   Market segmentation of home market

  Sophistication of buyers (Japanese demand high quality vehicles)

  Position within product life cycle in home market

  Anticipation of buyer needs

 Related and 

Supporting Industries

  Strengths of suppliers

  Quality of suppliers

Porter’s national diamond must only be used when a company is moving to another country. Will

it gain or lose benefits?

Page 5: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 5/16

 

STRATEGIC CAPABILITY

#12 Model: The nine M Model

Nine possible areas where an organization can be strong:-

   M achinery

   M oney

   M aterials

   M en and Women

   M akeup (culture)

   M arkets

   M anagement information

   M anagement

   M ethods (processes)

#13 Model: Porter’s Value Chain

Porter divides a business into nine different areas:

The five primary activities:  (What customers are interested in)

Inbound logistics e.g. JIT system

Operations Manufacturing the products

Outbound logistics Getting the products to the customers

Marketing and Sales After sales service

ServiceThe four secondary activities: (what happens at Head Office)

Firm infrastructure How is the Co. organized? Tall/ flat

Human Resource mgt. The quality of staff 

Technology Development Technology is anything that is not people

Procurement Buying the things that we store. Economies of scale

Who our suppliers are etc.

Page 6: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 6/16

 

#14 Model Porter’s Value Network  

This is an extension of the value chain to include customers and suppliers. For example:

Customers – retailer selling low priced basic products.

The customer value chain will place heavy emphasis on low cost inbound logistics means that

The manufacturer’s value chain should emphasize low cost production means that

The manufacturer will choose suppliers whose value chain emphasize low cost materials.

#15 Model: The product Life Cycle

Introduction Low sales and the problem of attracting new customers

Growth Product grows in popularity. May enter new markets

Maturity Profits at their highest but may have many rivals

Senility Sales fall to zero

#16 Model – Nanaka and Takeuchi – Tacit and explicit knowledge

Tacit knowledge is knowledge that staff possesses

Explicit knowledge is knowledge that has been recorded by the organization

Nanaka and Takeuchi say knowledge can be transferred by:

 Socialization

 – 

 informal exchanges/discussions where knowledge is shared    Externalization  –  Formal. The knowledge is documented or recorded. 

   Internalization  –  using own ideas to

  Combination  –  putting together different areas

Page 7: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 7/16

 

STRATEGIC OPTIONS:

#17 Model: Ansoff’s Growth vector matrix 

Existing Markets New Markets

New Products

Existing Products

#18 Model: Porter’s Generic Strategies One possibility is to change how the company competes. Porter describes three possibilities:

Cost Leadership Being the cheapest within a category

 Product differentiation Being the best within a particular category

 Focusing on a particular type of  customer

#19 Model: Johnson and Scholes’ Strategic Clock  Strategies can be placed on a clock 

1 No frills Low price Low added valueUsed for market entry – need a great deal of customers who are price conscious

2 Low price Low Price Medium added valueUse cost leadership to provide a better value product than rivals

3 Hybrid Low price High added value Needs low cost base (economies of scale). Can be used short term for the market entry or to build up market

 share.

4 Differentiation Medium Price High added value Aim is to build up market share by charging reasonable price

5 Focused differentiation High Price Medium added value Looks for high premium for high degree of differentiation

6 Failing strategy High Price Medium added value

7 Failing Stretegy High Price Low added value

8 Failing Strategy Medium price Low added value

Product Development

Diversification

-  Direct

-  Indirect

Market Penetration Market Development

Page 8: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 8/16

 

 

#20 Model: The BCG MatrixLow Market Share High 

High

Market

Growth

Low

STRATEGIC CHOICE:

#21 Model: Johnson and Scholes - Strategic RationaleThe three ways that Head Office can create value in the business

Portfolio Managers These businesses find undervalued companies, acquire them and then aim to

improve profitability.

Synergy managers These businesses look for synergy between existing and future SBUs.

Parental developers These companies look to use the competencies based at Head Office, such as tight

financial control, to improve the performance of all SBUs.

#22 Model: The Ashridge Portfolio ModelThis model links with the Strategic Rationale Model to see which divisions are the most useful to

keep and which should be closed or sold off.

Feel(How much overlap between the CSFs of the division and the parent)

High Benefits/Low Field

Value Trap (business may not be of benefit

unless the parent can develop itsskills)

High Feel/High Benefits

Heartland Business

(Parent should concentrate on thesebusinesses)

Low Field/Low Benefits

Alien Business(should be sold out)

High Feel/Low Benefits

Ballast Business(parent should leave business to

run on its own) 

Question mark Stars

Dogs Cash Cows

Page 9: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 9/16

 

#23 Model: Johnson and Scholes SFA testJohnson and Scholes suggest that for any option to be considered seriously it must pass threetests.

  Suitable

  Feasible

  Acceptable

MARKETING:

#24 Model: Value Based Marketing

#25 Model: The Marketing MixThe marketing mix states that once a market segment has been identified then the following

needs to be decided.

  Product  Price

  Place

IMPROVING BUSINESS PROCESSES

#26 Model: Hammer and Champy – Business process re-engineering (BPR)The ideas behind BPR are:

  Managers try to see how processes affect each other

  Try to think of one continuous process from when the customer makes contact with the

company until payment is received  This long process can then be broken down into a number of smaller processes

  IT can be used to make processes more efficient /effective

  Look at the processes from the customers point of view

#27 Model: Rummler and Brache – Gaps and DisconnectsThe emphasis in this model is on the problems involved when different department need to

communicate. This identifies three levels where problems occur.

  The organization as a whole

  The process

  The job

They also divide the types of problems into three kinds:

  Those to do with departments trying to pursue different goals  Those to do with processes being poorly designed or being implemented poorly  Those to do with processes being managed poorly

Page 10: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 10/16

 

#28 Model: Harmon’s Process Strategy Matrix There are four approaches to change depending on:

  Is the process strategically important? (does it tie up with SWOT?)

  Is the process complex?This leads to

  High Importance/Complex processes – focusing on staff   High Importance/Simple - Use an automated ERP solution

  Low Importance/Complex – Outsource

  Low Importance/Simple – Automate

Low Complexity High

ERP(Bespoke Enterprise Resource Planning

System)

 High Importance/Low Complexity 

STAFF(make sure they are able to do it)

 High Complexity/High Importance

AUTOMATE(off the shelf system)

 Low Complexity/Low Importance

OUTSOURCE(Marketing. IT)

High Complexity/Low Importance 

#29 Model: Skidmore and Eva – Stages in selecting softwareWhen a company decides to purchase a specially written package (bespoke model) there are five

stages it goes through.

  Obtain tenders

  First pass selection

  Second pass selection  Implementation

  Managing long term relationships

Page 11: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 11/16

 

E-BUSINESS:

#30 Model: Mc Farland’s Grid This looks at how important IT is to the organization in particular how it can help with the

organization’s strategy 

The grid looks at:

  The impact of current IT systems on gaining an advantage

  The potential impact of future IT systems on gaining an advantage

Current High/Future Low

Factory Position

Current High/Future High

Strategic

Current Low/Future Low

Support

 Future High/Current Low

Turnaround

# 31 Model: Nolan’s use of IT within the organizationNolan argues that organizations go through six distinct stages in their use of IT

  Initiation  – use of IT for support functions

  Contagion  – rapid and uncoordinated growth in the use of IT

 Control – senior management attempt to control the use of IT, often preventing newdevelopments

  Integration  –  IT hardware is used to support the organization’s strategy 

  Data Administration  – the emphasis switches to using information and knowledgerather than the technology

  Maturity  – IT and information are used to support the organization’s strategy 

Like with all other types of strategy we should ensure that any approach to e-commerce is

  Suitable

  Feasible

  Acceptable

#32 Model: The 6 I’s of e-marketing

  Interactivity

  Integration

  Intelligence

  Industry

  Independence

  Individualisation

Page 12: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 12/16

 

 #33 Model: Adcock’s guide to Customer Relationship Management (CRM)  In order to build relationships with customers, businesses need to:

  Build a customer database

  Develop customer oriented service systems

  Have more direct contacts with customers

#34 Model: The customer life cycleThe relationship with customers goes through four stages.

Customer selection – what type of customer do we want?

  Customer acquisition  – pursuing the customer to buy for the first time

  Customer retention  – keeping the existing customers by continually meeting their needs

  Customer extension – persuading existing customers to buy more through:

o  Upgrading to newer versions

o  Upgrading to more expensive versions

o  Cross-selling

PEOPLE IN ORGANISATION:

# 35Model: Mintzberg’s Structural configurations Mintzberg divides the organization into six areas:

  Ideology  – the culture of the organization

  Strategic Apex  – senior management

  Middle Line  – middle managers

  Operating core  – employees directly involved in the production of goods and services

  Technostructure – providing technical support

  Support staff   – providing general support

Mintzberg then classifies organizations based on which of the areas are most important

  Machine bureaucracy – operating core is the most important

  Simple structure  – strategic apex is the most important

Page 13: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 13/16

 

# 36 Model: Hackman characteristics of job enrichment

  Range of skills and talents

  Task closure

  Task significance

  Autonomy

  Feedback 

Japanese managementThis includes a number of techniques:

  Total Quality Management (TQM)

  Cellular manufacturing where multi-skilled teams of workers are responsible for thecomplete assembly of something

  Just-in-time manufacturing

Job re-engineering

  This is simply the change in the tasks of an individual after the business processes have

been re-engineered.  This is likely to be significant if IT is being used to radically alter the process.

PROJECT MANAGEMENT

#37 Model: Tuckman’s stages of Group Formation 

  Forming

  Storming

  Norming

  Performing

#38 Model: Belbin’s Personality Mix 

  Co-ordinator

  Shaper

  Plant

  Monitor-evaluator

  Resource-investigator

  Implementer

  Team worker  Finisher

Page 14: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 14/16

 

CHANGE AND DEVELOPMENT

#39 Model: Johnson and Scholes – Types of Change

There are two aspects to change:

  The scope of the change – minor or fundamental  The nature of the change – gradual or sudden

Johnson and Scholes then classify change as:

  Adaptation – minor and gradual

  Reorganization – minor and sudden

  Evolution – fundamental and gradual

  Revolution – fundamental and sudden

#40 Model: Balogun and Hope Hailey – Acceptance of Strategic Change

Fundamental change is likely to be resisted unless there are good reasons for stakeholders to

accept it.

Balogun and Hope Haley list the contextual features which stakeholders will consider:

 Time – is the organization in a crisis or is there time for gradual change?

  Scope  – will many people/divisions/depts.. be affected or just a few?

   Preservation  – are there processes, competences and staff that will need to be retained?

   Diversity  – different parts of the business may have their own culture and interests. Will

the proposed change impact on these?

  Capability  – do senior mgt. have the knowledge and experience to deal with change?

  Capacity  – does the organization have the resources required to undertake the change?

   Readiness  – are the key stakeholders aware of why change is needed and are they likely

to accept it?

   Power  – can senior managers force change even if it is against the wishes of other

stakeholders?

They argue that it is necessary to answer all the above questions before change is implemented.

Page 15: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 15/16

 

#41 Model: Lewin’s Force Field Analysis 

Lewin identifies that there are always two forces at work whenever change is being considered:

  Driving Force

  Restraining Force

He argues that change will not take place unless the driving force outweighs the restraining ones.

To do this:

  Build up the driving forces

  Reduce the restraining forces

#42 Model: Maurik – Qualities of the Transformational Leader

Leaders in a dynamic environment need to:

  Change from within

  Empower others

  Work with teams

  Provide clarity of direction

  To be visionary

#43 Model: Lewin’s 3 step process

Lewin identifies that three stages are necessary for something to change

  Unfreeze – it must be accepted that change is needed

  Change – the change takes place

  Refreeze – it should be made difficult to go back to the earlier position

Page 16: p 3-Business Analysis Models

5/14/2018 p 3-Business Analysis Models - slidepdf.com

http://slidepdf.com/reader/full/p-3-business-analysis-models 16/16

 

#44 Model: Johnson and Scholes - Approaches to Change Management

The approaches to change management are:

  Participation –  involving employees directly in decision-making

  Coercion – forcing employees to accept change  Negotiation – employees and employer bargain over approach and goals.

In addition:

  Education  – mgt explain what is happening and why

  Support  – mgt provide counseling and other services to help individuals

Finally:

Manipulation  – mgt. only tell employees information which supports change, not telling them

information which would build resistance.

#45 Model: Johnson and Scholes – management of Turnaround

The seven elements to successfully turnaround a company are:

  Crisis stabilization –  stop things from getting worse 

  Changes to management –  fire some managers

  Communication with stakeholders – tell them the what and the why

  Attention to target markets  Concentration of effort  – concentrate on core business

  Financial restructuring  – turning debts to equity

  Prioritization  – do most urgent things first