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Mmi vii b company analysis
The document discusses key aspects of corporate success and strategy. It states that the key measure of corporate success is added value, which is the difference between a firm's output and the cost of its inputs. Several examples are given of companies like Microsoft that were adept at adding value. Successful companies effectively match their external relationships and capabilities. The document also discusses the importance of vision and mission statements in guiding corporate strategy and providing shared goals.
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Mmi vii b company analysis
- 1. Company Analysis What isCorporate success and how should it be measured ?
- 2. Corporate Success • Size? • Sales ? • Market share ? • Stock exchange value ? • ROI ? • Growth ? • P/E ratio ?
- 3. Added Value • Thekey measure of corporate success is added value : The difference between a firm’s output and the cost of its inputs.
- 4. Value addition ismeasurable • Microsoft Corporation, Added ( US $ Millions),1992 • Value of output 2750 • Wages and salaries 400 • Cost of capital employed 50 • Cost of materials 1650 • Total input 2100 • Added Value 650
- 5. Who is interestedin the Company’s success ? • Employees / present and prospective • Investors • Customers • Competitors • Suppliers • Analysts / Business professionals • Government Agencies
- 6. Corporate successes • Thekey lesson from histories of Corporate successes is that corporate success is based on an effective match between a firm’s external relationships and its distinctive capabilities.
- 7. Foundations of Success Disney BMW Honda Microsoft Allthe above firms identified their distinctive capabilities, selected the markets best suited to their strengths, and built effective competitive strategies to exploit them. All these companies were adept at adding value.
- 8. Examples of failure •IBM with the most rewarding distinctive capabilities ever enjoyed by any corporation, saw its markets develop in a way that steadily diminished the value of the competitive advantages it derived from them. • Saatchi and Saatchi, once the best known advertising agency in the world, over – extended themselves and diminished in value trying to shift from international recognition to creating an international business.
- 9. Marketing Strategy • NoMarketing strategy is possible without reference to the overall planning of a company. Corporate plans Functional Plans e.g. marketing Sub Functional Plans e.g. Sales Advertising etc.
- 10. Development of amarketing strategy • All strategy formations impact on each other. • Selection of a target market and developing a marketing mix are inter-related. • Both parts of a marketing strategy must be decided together. • Strategies must be evaluated against the company’s objectives not versus alternate target markets or alternate marketing mixes.
- 11. The Company Visionand Mission • While a company is continually adapting to it competitive environment certain core ideals remain relatively steady and guide its strategic decision making process. • These unchanging ideals form the Business Vision and are expressed in the company Mission statement.
- 12. Some Vision statements Avon Tobe the company that best understands and satisfies the product, service and self- fulfillment needs of women - globally DuPont The vision of DuPont is to be the world's most dynamic science company, creating sustainable solutions essential to a better, safer and healthier life for people everywhere.
- 13. Coal India Limited Toemerge from the position of domestic leader to leading global player in the energy sector by adopting best practices from mine to market with due care to environmental and social sustenance.
- 14. TATA STEEL The longjourney of Tata Steel has seen the Company re-define its performance parameters in a number of ways to become the global steel industry benchmark for value creation and corporate citizenship. It ensures a total commitment to its ethical business practices and a people oriented vision. Vision We aspire to be the global steel industry benchmark for Value Creation and Corporate Citizenship
- 15. Mission Consistent with thevision and values of the founder Jamsetji Tata, Tata Steel strives to strengthen India’s industrial base through the effective utilization of staff and materials. The means envisaged to achieve this are high technology and productivity, consistent with modern management practices. Tata Steel recognizes that while honesty and integrity are the essential ingredients of a strong and stable enterprise, profitability provides the main spark for economic activity. Overall, the Company seeks to scale the heights of excellence in all that it does in an atmosphere free from fear, and thereby reaffirms its faith in democratic values.
- 16. We make thedifference through • Our People • By fostering teamwork, nurturing talent, enhancing leadership capability and acting with pace, pride and passion. • Our Offer By becoming the supplier of choice, delivering premium products and services and creating value for our customers. • Our Innovative Approach By developing leading edge solutions in technology, processes and products. • Our Conduct By providing a safe workplace, respecting the environment, caring for our communities and demonstrating high ethical standards.
- 17. IKEA The IKEA visionis to create a better everyday life for the many people. We make this possible by offering a wide range of well-designed, functional home furnishing products at process so low that as many people as possible will be able to afford them.
- 18. • Unilever The fourpillars of our vision set out the long-term direction for the company – where we want to go and how we are going to get there: • We work to create a better future every day. • We help people feel good, look good and get more out of life with brands and services that are good for them and good for others. • We will inspire people to take small everyday actions that can add up to a big difference for the world.
- 19. • We willdevelop new ways of doing business with the aim of doubling the size of our company while reducing our environmental impact. We've always believed in the power of our brands to improve the quality of people’s lives and in doing the right thing. As our business grows, so do our responsibilities. We recognise that global challenges such as climate change concern us all. Considering the wider impact of our actions is embedded in our values and is a fundamental part of who we are.
- 20. A Vision statementby definition is something you want to become, to achieve, it is a seductive image of an ideal future – whereas a Mission statement explains the purpose of the organization – why it exists – it captures the organization’s soul.
- 21. • The missionstatement helps to set the course but needs to translate itself into more specific objectives which must of course be consonant with the mission statement.
- 22. The Mission statement •Communicates the firm’s core ideology and visionary goals and generally consists of the following three components: a) Core Values to which the firm is committed b) Core purpose of the firm c) Visionary goals the firm will pursue to achieve its mission
- 23. The company’s missionstatement Fred Smith wanted to deliver mail anywhere in the US before 10.30 am. This was his Vision. Fedex states as its mission statement “ People, Service, Profit”. “The core philosophy that governs every activity at FedEx Express is People-Service-Profit (PSP): Take care of our people; they in turn will deliver impeccable service demanded by our customers, who will reward us with the profitability necessary to secure our future. People-Service-Profit: These three words are the very foundation of FedEx Express.”
- 24. Infosys : Puttingit all together • Who we are Our Vision, Mission and Values • Vision "We will be a globally respected corporation.“ • Mission "Strategic Partnerships for Building Tomorrow’s Enterprise.“ • Values We believe that the softest pillow is a clear conscience. The values that drive us underscore our commitment to:
- 25. CLIFE • Client Value:To surpass client expectations consistently • Leadership by Example: To set standards in our business and transactions and be an exemplar for the industry and ourselves • Integrity and Transparency: To be ethical, sincere and open in all our transactions • Fairness: To be objective and transaction- oriented, and thereby earn trust and respect • Excellence: To strive relentlessly, constantly improve ourselves, our teams, our services and products to become the best
- 26. Purpose of theMission statement These are developed to share with managers, employees, and customers. It gives them a shared sense of purpose, direction and opportunity. It guides geographically separated employees to work independently and yet collectively towards a single goal.
- 27. Mission statements: Ideallythree major characteristics 1. Limited number of goals 2. Stress the companies major policies and values 3. Define the major competitive spheres in which the company will work.
- 28. The three basicobjectives of companies 1. Engaged in specific activities performing a socially and economically useful function. 2. Developing an organization to carry on business and implement strategies. 3. Earn enough profit to survive and to grow
- 29. Company Objectives shouldlead to Marketing Objectives • Company objectives guide managers in searching and evaluating opportunities and later planning marketing strategies. • Particular marketing objectives must be set within the framework of larger company objectives • Thus the hierarchy of objectives moves from company objectives down to marketing department objectives • For each marketing strategy firms need objectives for each of the 4 Ps as well as more detailed objectives within each of these areas.
- 30. Corporate Involves applying business planningto different units Business Involves other resources required for identified markets Mkting. Based on Markets/Custo mers/Products
- 31. Marketing Planning withinthe Corporate cycle • Corporate Financial Objectives • Management Audit • Objective and Strategy Planning • Functional Plans (including Marketing Plan) • Corporate Plans
- 32. The Marketing Plan •The Marketing Plan is a written statement of marketing strategy and gives time – related details • It is necessary to know what needs to be done and fills out the marketing strategy. • It is a guide to implementation and control
- 33. Need for aMarketing Plan • It ensures the coordination of all activities in the marketing function and sees that all individual efforts complement each other.
- 34. Broad Components ofa Marketing Plan • A) The Marketing Mix offered Target Market For How Long ? • B) Co. resources ( shown as cost ) needed monthly/qtly • C) Results Expected ( Sales /Profits / Customer Service/ Control Procedures)
- 35. Stages in aMarketing Plan • Mission • Corporate Objectives • Marketing Audit • SWOT analysis • Assumptions • Marketing Objectives and Strategies • Estimated Expected results • Identify Alternative plans and budgets • Budget • First year detailed implementation program
- 36. A Typical MarketingPlan sets out A) The Market • The size and growth rate • Its distribution by Region and Competitive brand • Sales by Population strata • Sales by category of Consumer
- 37. B) The TargetCustomer Age, Social/ Income class, Education levels, Attitudes towards product and its use Product data/ formulation, efficiency of performance vs. competition Packaging, price,Product superiority vs Competition
- 38. C) Competition Competitive brandsand their market share Analysis of competitive advertising in terms of theme, media, expenditure
- 39. D) Marketing Objectives Shortand long – term aims of the marketing strategy in terms of : • Period • Target consumer • Distribution Policy • Market Research Plans • Product Development Policy • Budget of all Marketing activity • Two imperatives : Documentation / Periodic review
- 40. Need for SWOT •To ensure the successful implementation of a marketing strategy a firm needs to go through a process of : • Identification of major strengths, weaknesses , opportunities and threats based on analysis of company’s resources, customers , competitors and other aspects of the external company environment
- 41. SWOT • SWOT standsfor strengths, weaknesses, opportunities, and threats. Strengths and weaknesses are internal factors. • A strength could be: • your specialist marketing expertise. • a new, innovative product or service • location of your business • quality processes and procedures • any other aspect of your business that adds value to your product or service.
- 42. • A weaknesscould be: • lack of marketing expertise • undifferentiated products and service (i.e. in relation to your competitors) • location of your business • poor quality goods or services • damaged reputation • Opportunities and threats are external factors.
- 43. • An opportunitycould be: • a developing market such as the Internet. • mergers, joint ventures or strategic alliances • moving into new market segments that offer improved profits • a new international market • a market vacated by an ineffective competitor
- 44. • A threatcould be: • a new competitor in your home market • price wars with competitors • a competitor has a new, innovative product or service • competitors have superior access to channels of distribution • taxation is introduced on your product or service
- 45. • Simple rulesfor successful SWOT analysis • Be realistic about the strengths and weaknesses of your organization • Analysis should distinguish between where your organization is today, and where it could be in the future • Be specific. Avoid gray areas. • Always analyze in context to your competition i.e. better then or worse than your competition • Keep your SWOT short and simple. Avoid complexity and over analysis • Remember SWOT is subjective.
- 46. Key uses ofSWOT • Build on Strengths • Resolve Weaknesses • Exploit opportunities • Avoid threats • A SWOT is an integral part of any Marketing Plan
- 47. Company Resources To succeed,every company needs some competitive advantage. This arises out of some unique resource or resources it possesses. Breakthrough opportunities come from using these strengths and from avoiding direct competition with firms with similar strengths.
- 48. Discovering Company strengths •Evaluate all functional areas • Evaluate products and Markets • Evaluate Specialized knowledge of Company personnel
- 49. Company resources vs.firm’s successes and failures • An analysis of past successes and failures correlated with the firm’s resources can throw light on reasons for either and lead to framing of realistic and successful future strategies.
- 50. • Financial strengthis a major factor to be considered in looking at opportunities. Where initial capital outlay is very high this may prove to be a barrier to a company from taking advantage of an attractive opportunity thrown up by the environment.
- 51. Intimate Customer relationsand low – cost quality manufacturing are other resources a company may utilize effectively. Production capability / flexibility / outsourcing are other resources to be considered.
- 52. Marketing Strengths • Reputationand customer awareness of a product • Patent for a product • Good relations with distribution channel partners • Effective use of Information Technology • Promotion and price resources • Thorough understanding of the Marketing Environment