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Nikita Devi

Divya Iyer

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Reality was recognizable

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Then things started to look funny

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Then it was harder to recognize and disjointed

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You could still tell what was going on

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7/28 ut it was getting harderand harder

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8/28Finally it became impossible

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Author tells that Business strategy is likePicassos paintings

In the beginning, things were prettystraightforward. it was very clear what washappening in the picture. But over time, itbecame more difficult to understand the

painting, the message, the patternuntil in theend you were left guessing what Picasso waspainting.

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Our job is to figure out the PATTERN

that lies hiddenunderneath the apparent

chaos on the surface.

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DoctorsThey connect symptoms with the

causes, and use that insight to developpowerful, on target analyses andprescriptions to help their patients.

BusinessEvery industry is reshaped bypatterns of strategic change that candrastically shift profit and power across thelandscape. Sometimes the patterns move

slowly sometimes they move rapidly butchange is always occurring.

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PROFIT

PATTERNS

30 Ways to Anticipate

And Profit from Strategic Forces

Reshaping Your Business

ADRIAN J. SLYWOTZKY AND DAVID J. MORRISON

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The idea of profit pattern thinking is animportant addition to strategy as it helps to makesense of a lot of the traditional work done inmaking strategies like PEST Analysis, FiveForces Model and Value Chain.

It is more important to do what is strategically

right than what is immediately profitable.

- Philip Kotler

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This book presents 30 patterns that arechanging the landscape of every business.Understanding them can help you make movesand countermoves that lead to sustained

profit growth.

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They are :-

Mega Patterns

Value Chain Patterns

Customer Patterns Channel Patterns

Product Patterns

Knowledge PatternsOrganizational Patterns

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MEGA PATTERNS

These models do not address anyparticular dimension of the activity(customer, channels of distribution and

value chain), but have an overall andtransversal influence.

They owe their name Mega to theirrange and impact of the different

economic sectors and duration.

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VALUE CHAIN PATTERNS

It consist of the evolution of relations acompany has with the different levelsof its value-chain: customers,distribution channels, products and raw

materials.

Should certain tasks be sub-contracted

out or brought back in to the company? Change the supplier or strengthen links

with him?

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CUSTOMER PATTERNS

It concern the RISKS brought about bychanges in customer attitudes, in termsof the loss or creation of value.

Are all customers profitable?

WHAT are the limits of segmentation?WHO is the ideal customer?

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CHANNEL PATTERNS

These patterns how distribution tendenciesinfluence value creation.

Distribution channels multiply in line with

consumer segmentation. They can also reduce in number, as in the

case of French supermarkets, where baker,dairyman, butcher and fishmonger are all

found in the same shop. The intermediaries inthese channels can similarly appear ordisappear.

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PRODUCT PATTERNS

These patterns show how value hasmigrated, over the past 15 years, fromthe product to other elements, such as

the brand, integrated solutions andblockbusters.

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KNOWLEDGE PATTERNS

As the economy passes from thefabrication of physical goods to theapplication of useful ideas, these

patterns will multiply in the years tocome.

Knowledge gained through the activitypermits the redefinition of this activity,

using information on consumers, productsand internal organisation.

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ORGANIZATIONAL PATTERNS

These illustrate the new business paradigm, value-creation, and the future paradigm, the balance ofattention given to products, customers and internaland external organisation of the company.

A companys share in value-creation will depend ontwo main imperatives:

the system must be perfectly tuned to thecompanys strategic plan, and

sufficient energy must be expended to executethe plan brilliantly.

The common factor in these models is the close linkbetween the talent of the company and itscustomers.

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Switchboard Profit Model

Buyers Sellers

Multiple sellerscommunicating with

multiple buyers

a high-value

intermediary as thecommunication pathways

(the switchboard)

The switchboard reduces

the costs to both buyersand sellers

Example:

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F