Corporate, Business & Marketing Strategies

7/30/2019 Corporate, Business & Marketing Strategies

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STRATEGIC MARKETING & PLANNING


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For some a harrowing experience!

For others, like Siemensan opportunity to reinventthemselves.

HOW & WHAT DID SIEMENS ACHIEVE?

1. Clear goals for management,2. More transparent operation,3. Turn around ofsemiconductor

business,4. Mobile phone handset business back

on track, &5. Increase in share value.


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The right Corporate Strategy

The right Corporate Strategy tosurvive in a complex & more

demanding business environment.


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Corporate strategy consists ofdecidingon

...the scope and purpose of the

business,

setting clearobjectives,

taking initiatives &investing resources to achieve the

companys objectives.


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Corporate strategy is the way by

which a company creates valuethrough the configuration andcoordinationof its multi-tier

market activities.


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Having a strategy is a matter ofdiscipline. It requires a strong

focus on profitability rather thanjust growth, an ability to define aunique value proposition, and a

willingness to make tough trade-offs in choosing what not to do.Michael E. Porter


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DellComputers direct PC sales & built-to-

order process succeeded;

IBMs transition from being a manufacturerof computer hardware only, to a solutions

provider, to the provider of a smarter planetsucceeded.

Tapal created a new category in Tea and

succeeded.

WHAT DO THESE COMPANIES HAVE INCOMMON?


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1. Unique competitive position2. Activitiestailored to strategy...

3. Clear trade-offs & choices vis--

vis competition4. Competitive advantage backed by

relevant activities

5. Sustainability &

6. Operational effectiveness.


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Boeing counting on

point-to-point

Airbus A380: Pan-European plane;capacity: 555passengers.

Wingspan as tall as a9-storey building;

Weight 560 tons;

Cost: $250 million perplane.

Boeing NOTproducingSuperJumbo;

Boeingsassumption? USairlines want smallerplanes for directroutes hencemarket limited.

Airbus counting on

long-haul flights


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Corporate Strategy requires aFramework consisting of

1. Vision

2. Objectives

3. Capabilities

4. Business Composition

5. Structure, Systems &Processes.


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Why Vision? To answers the question - What is the

corporation about, what does it do?

To provide overall guideline &direction to the business;

Vision needs periodic review: Why?

1. Changes in the environment &2. Need to sustain competitive

advantage.


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Why objectives?

To measure performance e.g.market share growth, qualityimprovements, employee training &

development, earnings growth. At what levels are objectives set?

Several levels -but aligned with

corporate objectives. How does one keep track of

performance?


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What does a Balanced Scorecard do?1. Translate vision into operational

goals;

2. Communicate & link vision withindividual performance;

3. Help in business planning & index

setting;4. Provide feedback, learning for

adjusting strategy as needed.


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Why assets, skills, & capabilities?

1. To create potential for anorganization to compete in different

markets,

2. To provide value to customers, &

3. To create barriers againstcompetitive entry.

ANY EXAMPLE???


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Sonys distinctive capability inminiaturization of electronic products

resulted in the creation ofSonyWalkman, and later, Sony VAIO personalcomputers.

The Internet links computer users toSonys music & entertainment business.


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Why business composition?

Provides directionfor Corporate &

Marketing strategy design. Allows grouping of similar

businesses to form Strategic

Business Units (SBUs), & to facilitatedecision-making.


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SBU = Single product or brand, or a lineof products, or a mix of related products,that meet a similar market need, or a

group of related needs.

SBU = a cohesive organizational unitwith a dedicated team & a separate set of

objectives.

SBU strategies are specific to the SBU.


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Why structure, systems, &processes?

To control & coordinate theactivitiesof various business units &staff functions. Dell Computers offers superior valuethrough customization and promptservice.

easyJet,in Europe offers no-frillsservice in the airline, auto- rental & alliedareas.


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Creating Competitive Advantage butHOW?

Assessing how every business unitcontributes (positively) to thecorporation;

Evaluating them against otherbusinesses, for allocation of resources& investments for the future.


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Does selection ofa sound strategylead to business success?

Does the uncontrollable externalenvironment (demand, competition,

government policies) influencebusiness success?


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Business & Marketing strategies reflectoverall corporate strategy.

A key measure of success is the impact

they have on results.

Factors that influence the result:

1. Strategic choices a business or functionmakes;

2. Environmental factors.


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Role of the Marketing Director/ CMO:

1. Strategy formulation &

2. Ensuring consistency withbusiness priorities &

3. Ensuring integration with other

functional strategies.


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From a customer perspective,strategy must:

Have market attractiveness, Possess clearcustomer

orientation,

Communicate value advantage.


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Strategicsituation analysis

Market-DrivenProgramDevelopment

Implementing

and ManagingMarket-Driven

Strategy

DesigningMarket-Driven

Strategies

The Marketing Strategy Process


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Strategic Situation Analysis:1. Market vision, structure and

analysis:

Analyzing markets/ forecastingchanges;

Evaluating competitive strategies -strengths, limitations & plans;

Deciding when to enter new markets,how to serve existing markets, whento exit unattractive markets.


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Strategic situation analysis:

2. Segmenting/ creating marketsegments

Examine differences in customersneeds & wants, &

Identify buyers with similarcharacteristics. HOW?

Use information on peoples past

behavior, preferences, reasons forbuying

Q: What kind of people consume RedBull?


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Strategic situation analysis:

3. Continuous Learning about Markets:

Sensing what is happening or likely tohappen.

Adjusting to (or pre-empting)

changing customer preferences orcompetitive initiatives or threats.


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What is involved?

1. Market targeting & strategic

positioning;

2. Building marketing relationships; &

3. Developing & introducing new products.


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1. Market targeting and strategicpositioning

Influence of situational factors e.g.

industry type, nature of business &extent of product differentiation.

The challenge: Deciding how, when, &

where to compete.

Segment selection: Calculatingsegment potential & identifyingim ortance for firm.


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1. Market targeting and strategicpositioning

Deciding on positioning strategy

what is positioning strategy?Combination of the 4Ps - product,

price, promotion, value-chain

In relation to competition.Seeking the best match between valuerequirements of the target & theorganizations distinctive capabilities.


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Frozen food is a very competitivesupermarket/ retail category becauseretail space is limited. Brands by K&N

have invested in a chain of retailoutlets to gain competitive advantageand continue to capitalize on it.

1. Market targeting and strategic

positioning


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2. Marketing Relationship Strategies:

A collaborative effort betweencustomers, channel members, suppliers,& internal teams for the commongood.

General Mills and Nestle, competitorsin business, collaborated to form

Cereal Partners Worldwide (CPW)their compatible management styleled to success.


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IBM competes in software with Oracle, butpartners with them in businessconsulting

competes with Microsoft in software,but partners with the company in someregions to sell Intel severs.

Cisco Systems, longtime IBM partnersnow compete in areas that were seen asIBMs domain.


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3. Developing & introducing New

Products:Finding & evaluating ideas,

Selecting/ developing those most

promising,Designing marketing programs,

Market testing, and

Market introduction. Innovation plays a major role in new

product developmentthe 3M example


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Minnesota Mining and Manufacturing(3M) has a reputation for innovation.

What are their Core Strategies?

Keep business units small;

Encourage experimentation/ risk-taking;

Motivate & rewarding innovators;

Stay close to the customer;

Share technology with other firms; &

Avoid killing projects that staffsupports.


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1. Preparing the Marketing Plan &Budget;

2. Implementing the Plan;

3. Using plan to Manage & Control

Strategy.


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1. Preparing the Marketing Plan &

Budget; Plan outline:

A. Strategic Situation Summary

B. Market Target (Description)C. Objective for Market Target

(Sales, Profits, Position)

D. Marketing Program PositioningStrategy

E. Forecasts & Budgets.


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Marketing Program Positioning

Strategy:1. Product strategy

2. Distribution strategy

3. Price strategy

4. Promotion strategy

5. Marketing Research

6. Coordination with Other BusinessFunctions.


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1. Escalating globalization.

2. Technological diversity & uncertainty.3. The Internet Era: Web 2.0.

4. Increased focus on ethical business

behaviour & CSR.

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Corporate, Business & Marketing Strategies

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