BeBeyond Business

Frameworks Introduction
The table on next page is an abstract of useful frameworks and tools in
Business. You can apply these frameworks to understand better about
marketing, business case analysis.

Who should read these frameworks?
Applicants for Marketing: please read 4P analysis, Porters 5 C forces
Applicants for Consulting: please read carefully all frameworks
frequently used in case interview.
Applicants for Sales: please read PRODUCT part in 4P analysis to think
about product difference.
Applicants for Auditing: please read the form to understand what
business risk is.
















BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530


Typical business issues and related frameworks

BUSINESS ISSUES POTENTIAL FRAMEWORK
Profitability (in general
operations related question)

Market Expansion (in
general strategy related
question)
Opportunity Assessment:
Always think internal and
external factors

- Product (e.g. new product
launch)







Product Life Cycle curve
- Business Unit Core competencies
Value Chain
- Overall market - Porters Five Forces

- BCG matrix
- Assess valuation /
maximization
Net Present Value
Competitive Analysis 3Cs (Customer, Company, Competition)
SWOT (Strengths, Weaknesses, Opportunities, Threats)
Marketing Strategy 4Ps (Product, Price, Promotion, Place)

BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530

Market expansion and Opportunities Assessment

Market expansion matrix
BCG Matrix
Choosing a strategy
Industry analysis: Porters five forces
Internal - External factors
Acquisition analysis
Value Chain Analysis
Product Life Cycle






BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530


Framework for Low cost vs. Niche player

Strategy Low Cost Differentiation
Required
Capabilities
Requires large and dedicated
manufacturing facilities. Lean overhead.
Requires ability to identify and deliver
on non-price based purchase criteria.
You need strong marketing, flexible
manufacturing, etc.
Typical
Markets
Commodity, low-growth markets belong
to this category, and in general, markets
where products present no differentiation
and little brand awareness.
In these markets, customers make
their purchasing decisions following
non-price factors like quality, delivery,
features, etc.
Market
Timing
Markets are mature or declining Markets can be emergent, growing or
declining
Examples Grain, gold, paper, floppy disks,
transportation
Breakfast cereal, formal attire, wine


Porters 5 Forces - Industry Analysis
This framework is applicable to new business opportunity and firm strategy questions.


BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530

Barriers to Entry increase with:
Economies of scale
Proprietary product differences
Brand recognition
High switching costs for the
customer
Capital requirements
Difficulty to access distribution
channels
Absolute cost advantage of
incumbents
Learning curve advantages
Access to necessary inputs
Proprietary low-cost product
design
Government regulation,
restrictions on entry
Expected retaliation
Buyer Power increases with:
Bargaining leverage
Buyer concentration, Small
number of buyers
Low buyer switching costs
Buyer information
Buyer ability to integrate
backward
Availability of substitute products
High price elasticity
Low product differentiation
High brand recognition of buyers
products
Low impact on buyer's product
quality.
Decision makers' incentives


Rivalry increases with:
Industry growth
High Fixed costs +low variable
costs
High value added
Intermittent overcapacity
Low product differentiation
Low brand recognition.
Low switching costs.
Number of competitors.
Corporate stakes.
High fixed costs or highly
specialized assets.
High barriers to exit.

Supplier Power increases with:
Differentiation of inputs
Importance of supplier's
product/service in cost
Structure of industry.
Lower Switching costs of
suppliers
Higher impact of inputs on cost or
differentiation
Lower Number of substitute
inputs
Higher threat of forward
integration.
Lower importance of volume to
suppliers
Lower Supplier concentration

Threat of substitute increases with:
Relative performance of substitutes.
Lower switching costs.
Higher buyer propensity to substitute.






BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530

Internal-External Factors
This framework is especially applicable to new market and company strategy questions.
The question you are looking to answer is whether the firm strategy aligns internal factors
with external environmental considerations.

Internal Considerations
Core competencies of the firm
Company mission and goals (consider its objectives for employees, the community,
the environment, technology, etc.)
Company organizational structure
Firm resources (labor, technology, internal systems)


Environmental Factors
Industry trends (including a five forces analysis)
Constraints (government regulations, laws, union/labor agreements, societal
pressures, etc.)
Competitor activities (plans for expansion, financial strength, etc.)


Product Life Cycle Curve





Phase 1
On this phase, the focus should be on R&D and engineering. You should refer to product definition
and need generation with little or no competition.

BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530

Phase 2
This phase should emphasize marketing. The challenge is now to manage rapid growth while
maintaining quality. You should expect new entrants

Phase 3
This phase focuses on manufacturing and cost. Prices fall and competition intensifies.

Phase 4
High cost and low share competitors exit. This phase focuses on being low-cost or niche player.


BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530

Competitive analysis: The 3 Cs - Customer,
Company, Competition
This is a basic framework but is very useful. It is especially applicable to business strategy and
new market opportunity questions.


BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530

Marketing strategy: the 4 Ps
Apply this framework to marketing and new product development questions.
Product
I. Must fit within positioning decision and market segmentation (e.g. high end, low
end; consumer, industry)
II. Differentiated good vs. commodity
III. Features and capabilities
IV. Reliability, quality, brand name, reputation
V. Packaging, size
VI. Service, warranties
VII. Future strategy for the product

Placement (Distribution)
I. Channel (decision based on product specifics, level of control desired and
margins desired)
II. Coverage - tradeoff between coverage levels and costs
III. Inventory - levels, turnover, carrying costs
IV. Transportation - alternatives, efficiencies, costs

Promotion
I. The Buying Process:
A. Consumer awareness for the product
B. Interest for the product
C. Trial
D. Repurchase
E. Loyalty
II. Select sales method: Pull (advertising...) or Push (discount to distributor...)
III. 5 categories of promotional efforts:
A. Advertising: medium, reach (share of target market reached) and frequency
(number of times reached).
B. Personal Selling: when direct contact with buyer is needed.
C. Sales Promotion: Incentives to consumer, sales force and channel members.
BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530


Consumer incentives: coupons, refunds, samples, premiums, and contests.
Trading force incentives: Sales contest, Point of purchase displays, spiffs
(payments to dealers), trade shows, franchise reputation, in-store
demonstrations.
D. Public Relations and Publicity.
E. Direct sales.

Price
I. Considers both retail price and discounts.
II. What strategy? MC=MR? Skim (high price, make profits now)? Penetrate (low
price, gain market share)?
III. Seek volume or profits?
IV. Perceived value, cost-plus-margin pricing?
V. How does price relate to the market, size, product life cycle, and competition?
VI. Economic incentives to channel (commissions, margin).
VII. Establishes barriers to entry.


BeBeyond Career Workshop, Shanghai
Copyrights 2006, BeBeyond, Inc., Strictly Confidential
www.BeBeyond.com Tel: 021-6422 8530