Harvard Business School

Video

User's Manual
How to Use the Video Program
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Contents Primary Audiences 2

Uses of the Video 3

Operating Managers
3

Strategic Planners
3

Human ResourcelTraining Executives 3

Educators 4

Consultants/Ad Agencies 4

Directors 4

Using the Video for Individual Study 4

Using the Video in Planning Sessions 5

Using the Video as a Motivational and 8

Communications Tool

Using the Video in Courses on Strategy 8

Using the Skil Corporation Case Study 9

Additional Readings on Michael Porter's Concepts 12

 - - - - -

Primary Audiences

The subject of the video is an a common language for discussing

important one for managers and strategy
employees in any business. An
effective competitive strategy exposure to other companies and
that the organization under­ their experiences
stands and accepts is a necessity
for long-term success. understanding of the importance
The video points out several of strategy
broad benefits of developing a
competitive strategy:

concepts and tools for developing

strategy

Primary A wide variety of audiences can Advisers

Audiences use the video. Primary audiences
include: strategic and other consultants

market researchers
Operating Managers and
Employees advertising agencies

senior executives with responsibil­ directors

ity for strategy
managers at all levels who contrib­
ute to strategy and need to under­
stand it
a broad cross-section of employees
who are important in carrying out
strategy
Each of these audiences, of course,
has different needs and may use
the video in different ways. Possi­
ble uses are outlined on the follow­
ing page for each group. Beginning
on page 4, this manual provides
detailed guidelines for the most
common uses of the video.

Staff with Special

Responsibilities for Strategy
or Management Development

strategic planners

human resource executives

corporate training and develop­

ment personnel

business school faculty, trainers,

and other educators

2
 Uses of the Each type of user can employ the
Video video in various ways. Some of the
most important include the
following:

Operating
People who have some direct role as a motivational tool in manage­
Managers
in strategy formulation or imple­ ment meetings
mentation in a strategic business
unit can use the video in the fol­ as a device to help communicate
lowing ways: the company's strategy to employ­
ees [see "Using the Video as a
for self-study [see "Using the Video Motivational and Communica­
for Individual Study," p. 4.] tions Tool," p. 8.]

as part of a planning session to

discuss company strategy with
the senior management team [see
"Using the Video in Planning
Sessions," p. 5.]

Strategic
The video provides a framework to kick off the planning process
Planners
for thinking about strategy that [see "Using the Video as a Motiva­
can be useful to the strategic plan­ tional and Communications Tool:'
ning function. Planners can use it p.8.]
in the following ways:
combined with the strategic plan­
for self-study [see "Using the Video ning guidelines to train and edu­
for Individual Study," p. 4.] cate division personnel [see "Using
the Video for Individual Study,"
as a catalyst for meetings of com­ p.4.]
pany planners [see "Using the Ski1
Corporation Case Study," p. 9, and to help structure planning sessions
"Using the Video in Planning Ses­ with division personnel in which
sions," p. 5.) the strategic planner is a facilitator
[see "Using the Video in Planning
Sessions," p. 5.]

Human for self-study [see "Using the Video
Resource/ for Individual Study:' p. 4.]
Training
.• Executives as part of a formal program of self­
study for promising managers or
as a recommendation to key man­
agers for self-study [see "Using the
Video for Individual Study," p. 4.]
in formal company education pro­
grams [see "Using the Skil Corpo­
ration Case Study," p. 9, and "Using
the Video in Courses on Strategy,"
p.8.)
as a tool for communicating the
company's strategy [see "Using the
Video as a Motivational and Com­
munications Tool:' p. 8.]

3
 Uses of the Video (cont.)
Educators Business school faculty, trainers,
and other educators can use the
video as part of courses [see "Using
the Video in Courses on Strategy,"
p.8.].
Consultants! Advisers to companies on strategy
Ad Agencies or in fields that bear on strategy
can use the video in their own
organizations as well as to facili­
tate dialogue with clients. Some
possible uses are the following:
Inside the Company
- for self-study [see "Using the Video
for Individual Study," below]
- as part of internal training pro­
grams [see "Using the Skil Corpo­
ration Case Study," p. 9, and "Using
the Video in Courses on Strategy,"
p.8.]
Directors Directors have the responsibility
to approve strategic plans and
ensure sound strategic thinking.
Directors can use the tape:
- for self-study [see "Using the Video
for Individual Study," below]
Using the The video covers a great deal of
material. Gaining the greatest ben­
Video for efit from it will require concentra­
Individual tion, preparation, study and
Study follow-up.
The following guidelines will
enhance the learning experience
for most viewers using the video
for individual study. Viewers will
have different ways of learning,
however, and the sequence of steps
can be modified accordingly.
• Use the Viewer's Guide to gain an
overview of the video.
4
IThe article covers the same material as
Competitive Strategy, Chapter 1.
With Clients
- as a recommendation to individual
client executives [see "Using the
Video for Individual Study," below]
- as part of meetings held for clients
[see "Using the Video as a Motiva­
tional and Communications Tool,"
p.8.]
to help structure planning sessions
in which the consultant!agency
representative plays the role of
facilitator [see "Using the Video in
Planning Sessions," p. 5.]
- to recommend or give to senior
corporate executives [see "Using
the Video for Individual StudJj"
below]
- as a catalyst at board retreats or
planning meetings [see "Using the
Video in Planning Sessions," p. 5.]
. Read the Harvard Business Review
article "How Competitive Forces
Shape Strategy" (included in the
supplementary materials ).' This
article describes Porter's concepts
for industry analysis, the first seg­
ment of the video. Viewers are also
encouraged to consult Competi­
tive Strategy, Chapter 2. 2 Most
viewers will benefit from at least
briefly reviewing the reading mate­
rial in advance. Some users may
prefer watching the video first and
then reading.
2Competitive Advantage, Chapter 1, covers
the same ground, for viewers who have
access to this book. These chapters cover
Porter's concepts for competitive
positioning.
•
Use the Viewer's Guide to follow
along with the video and to record
additional notes.
After each segment of the tape,
pause to apply the concepts and
ideas to your own business. [For
ideas on how to do this, as well as
questions to consider, see "Using
the Video in Planning Sessions,"
below.]
Using the The video can be used as a catalyst
Video in or facilitating device for planning
sessions to discuss competitive
Planning strategy. An effective session
Sessions should include representatives
from each of the important func­
tional departments of the business
le.g., marketing, manufacturing,
service delivery, finance, sales).
Ideally, the meeting will be held in
a location where distractions are
minimized. If such a session is
held on company premises, it is
important either to hold it during
off-hours or to strictly limit inter­
ruptions. A minimum of four to
six hours should be available for an
initial session. Ideally, an entire
day or more will be committed.
Good planning sessions
involve preparation. Even for an
initial session, each participant
should be given an assignment.
Possible questions to prepare at
the start include:
1 in one meeting, keeping a record of
What is our explicit or implicit
strategy today?
2 to revisit each section and refine
... What are the important trends in
our industry?
5
Prepare the Skil Corporation case
study before watching Segment 6
of the tape. [For preparation ques­
tions, see "Using the Skil Corpora­
tion Case Study," p. 9.]
After absorbing the material in the
video, deepen your understanding
of the subjects through additional
reading [see ''Additional Readings
on Michael Porter's Concepts,"
p.12.]
3
What are the external issues facing
our company?
4
What are the internal issues?
5
What are the most important deci­
sions we need to make soon?
Good planning sessions are
frequently not one-time events
but take place over a series of
meetings. Each meeting involves
preparation, discussion, synthesis,
and assignments for the next ses­
sion. Between sessions, partici­
pants gather information and
involve other members of the
organization.
The following is an agenda for
a single extended meeting. This
agenda can be broken into several
separate meetings. Alternatively,
the entire agenda can be covered
the gaps in knowledge encountered
in answering each question. Subse­
quent meetings can be scheduled
the thinking, based on intervening
preparation.
 Using the Video in Planning Sessions (cont.)

Preparation: Answer the five questions listed on

page 5.

Readings: Read the Harvard Business Review Some users may prefer watching
article "How Competitive Forces the video first and then reading.
Shape Strategy" (included in the
supplementary materials):' This
article describes Porter's concepts Use the Viewers Guide to follow
for industry analysis, the first seg­ along with the tape and to record
ment of the video. Viewers are also additional notes.
encouraged to consult Competi­
tive Strategy, Chapter 2. 4 Most
viewers will benefit from at least
briefly reviewing the reading mate­
rial in advance.

Meeting Discuss current strategy. The 3

Agenda: objective is to reach agreement on
the strategy that is actually being
followed and to get it down on
paper. This is important for creat­
ing a common frame of reference
and for making current strategy
explicit.
Show Segment 1 of the video.
Discuss industry analysis.
1
How many distinct industries
• do we compete in? The company
needs a separate competitive strat­
egy for each distinct industry.
Subsequent questions should be
answered for each industry.
How attractive is the industry
structure? Does its underlying
attractiveness fit with the histori­
cal profitability of industry
participants?
4
What are the important trends
affecting industry structure?
5
Is the industry becoming more or
less attractive?
6
What actions could our company
take to improve industry struc­
ture? Can these be integrated into
our competitive strategy? How?

2 Show Segments 2-6 of the video

What is the structure of our on competitive positioning. Dis­
industry? cuss the Skil case study [see
"Using the Skil Corporation Case
Study," p. 9.].

6
3The article covers the same materTalas- ------'Competitive Advantage, ChapterT covers -
Competitive Strategy, Chapter 1. the same ground, for viewers who have

access to this book. These chapters cover

Porter's concepts for competitive

positioning.
 Using Ihe Video in Planning Sessions (coni.)

Discuss competitive positioning. 7

What should our future competi­
1 tive strategy be?
What generic strategy are we
what generic strategy?
following?
what specific policies in each
2
function?
What are the strategies of each of
our significant competitors and what goals?
I their likely future behavior? [Addi­
tional information may be needed Note: See "Additional Readings on
1 on competitors for follow-up
meetings.]
Michael Porter's Concepts," p. 12,
for references to readings that pro­
vide further concepts and tech­
3 niques for answering questions.
What is our relative cost position?
What steps could be taken to
reduce cost consistent with our Show Segment 7 of the video.
strategy? [Additional analysis on
cost may be necessary for follow­
Discuss the ongoing strategic man­
up meetings.]
agement process in the company.
4
1
What are our sources of differentia­

What action steps are necessary to

tion relative to competitors? Are

refine our strategy and implement

we commanding a price premium

it?
that justifies our differentiation?

How could we more effectively dif­

2
ferentiate? [Additional analysis

What measures should we use to

may be necessary on buyer needs,

track our progress?

sources of differentiation, and the

extra costs of differentiation for

follow-up meetings.]

How should the strategy be com­

municated both inside and outside

the organization?

What is our target scope? Is it rein­

forcing our competitive advantage?

4
How can we improve our ongoing
6

planning process?
What realistic alternatives do we

have? What are the pros and cons

of each?

The first session in the series Video is viewed individually as

involves watching the video, dis­ part of preparation for the meeting.
cussing the Skil case, identifying
issues to be resolved in the compa­
ny's own business, and creating an
agenda for a series of future meet­
ings to discuss the company's
strategy.

7
 Using the The video can be an effective moti­
Video as a vational tool as well as a way to
help communicate strategy to a
Motivational broad range of employees. To use it
and Communi­ as a motivational or communica­
cations Tool tions tool, the video can be shown
at meetings of managers. It may be
shown as a stand-alone session in
such meetings. However, it is more
effective to combine the video
with other sessions that address
the company's situation, such as
the following:
a report by the chief executive on
the company's strategy
Using the The video can be used as part of
Video in undergraduate, graduate, or execu­
tive courses in business policy;
Courses on competitive strategy; and others
Strategy that cover problems of competi­
tion and competitive positioning.
As part of individual preparation.
Students are assigned to view the
video or segments of the video on
their own, in preparation for class
sessions.
In a special screening for the entire
class.
In class. The way in which the
video is shown in class depends on
the length of class sessions. The
video can be shown in segments,
and discussion of the topic area
can follow each segment. The
video can also be discussed by giv­
ing students the assignment to
relate segments to case studies pre­
Viously used in the course.
8
breakout group5lDamsider the
sunepc issues~thecom­
pany: ~.,. poup reports and
disc ''5C!JMIe­
reports br dirisioo managers on
how they are applying the concepts
in their units
a session, led by the director of
strategic planning.. that discusses
the upcoming strategic planning
process and how the concepts will
be part of it
The video is best used after the
section of the course in which the
basic concepts of strategy have
been introduced. It should be posi­
tioned in the section of the course
on competitive analysis and strat­
egy development.
With the Skil Corporation case.
The introduction to Skil can be
shown in class or outside as prepa­
ration. The next class session c:m
then be devoted to discussing the
Skil case [See "Using the Skil Cor­
poration Case Study;" p. 9, for more
detailed guidelines.] The tape seg­
ment on the actual Skil strategy
and Segment 7 can be shown at the
end of the class discussion or in
the following class.
Note: College and university
instructors and training directors
can obtain a Teaching Note by
using the order form included in
the supplementary materials.
Using the The Skil Corporation case is
Skil Corporation designed to allow managers to
practice their skills in strategy
Case Study development in an actual company
and then to compare their thinking
with what the management of
Emerson Electric actually chose to
do. The following is one format for
using the case.

Readings: Use the Viewer's Guide to gain an viewers will benefit from at least
overview of the video, to follow briefly reviewing the reading mate­
along with the tape and to record rial in advance. Some users may
additional notes. prefer watching the video first and
then reading.
Read the Harvard Business Review
article "How Competitive Forces Read the Skil Corporation case
Shape Strategy" (included in the study.
supplementary materials).' This
article describes Porter's concepts
for industry analysis, the first seg­
ment of the video. Viewers are also
encouraged to consult Competi­
tive Strategy, Chapter 2." Most

Viewer 1
3

Preparation What is your analysis of the struc­

What is Skil's competitive strategy

Questions: ture of the portable electric power

in 1979? How would you evaluate

tool industry? Has it been struc­

its relative position?

turallyattractive?

2 What are the strategic options

How is the industry structure available?

changing in 1979? Are these

changes for better or for worse? 5

What strategy would you recom­

mend for SkiP What generic strat­

egy? What specific policies?

Show Segments 1-5 of the video,
viewing the tape in segments,
pausing to discuss each. Show the
introduction to Skil in segment 6.
Stop the tape.
Break into small discussion groups
to consider the preparation ques­
tions about Skil.
Regroup to discuss the case.

9
'The article covers the same material as
Competitive Strategy, Chapter 1.
6Competitive Advantage, Chapter I, covers
the same ground, for viewers who have
access to this book. These chapters cover
Porter's concepts for competitive
positioning.
------ --------------

Using the Skil Corporation Case Study (cont.)

1 focus on industrial tools

What are the issues facing Skil in
1979? become the low-cost
producer
industry structure and changes)
become the premium
competitors? producer

Skil strengths and weaknesses? focus on high service channels

[Areas to discuss: cost position, (e.g., hardware stores, home
brand name, channels, product centers)
line, international position]
become the low-cost
2 producer
What strategic options does Skil
have? become the premium
producer
stay the same-unacceptable
focus on circular saws only

become the differentiated producer

of a wide line of tools sold to all others

channels
3

become the low-cost producer What strategy should Skil choose?

The strategy should include key

focus on consumer tools policies in all functions of the

business-e.g., product line, man­

become the low-cost ufacturing, channels, marketing,

producer geographic scope. [Take a vote to

help reach closure.]

become the premium

producer 4
What are the essential action steps
that Skil should take? What prob­
lems must be overcome in imple­
menting the strategy? How should
Skil minimize them?

10
 Using the Skil Corporation Case Study (cont.)
The short segment from the Har­
vard Business School class can be
shown as part of preparation, dur­
ing the Skil discussion, or at the
conclusion of the discussion,
depending on the sophistication
of the group and the need for
additional input to facilitate
analysis. For a group requiring
Show remainder of Segment 6 of
the video.
Discuss Skil's actual strategy in
comparison to the group
discussion.
Identify lessons to be learned.
11 --------------------------- - - - -
much guidance, the segment
should be shown as part of prepa­
ration. For a group with better
analytical skills and more experi­
ence in developing strategy, it can
be shown during the discussion
of strategic options [question 2
on previous page] or at the con­
clusion of the session.
Show Segment 7 of the video.
Conclude the session with a dis­
cussion of strategic planning
processes.
 Additional Industry Analysis Cost
Readings Porter, Michael E. Competitive Advantage,
on Michael Competitive Strategy: Techniques Chapters 2, 3
Porter's for Analyzing Industries and
Concepts Competitors (New York: The Free
Press, 1980)
Chapters I, 7-12 Differentiation

Porter, Michael E. Competitive Advantage,

Competitive Advantage: Creating
Chapters 2, 4
and Sustaining Superior Perform­

ance (New York: The Free Press,

1985)

Chapter 13
Focus

"End-Game Strategies for Declin­ Competitive Advantage,

ing Industries," Michael E. Porter Chapter 7
and Kathryn Rudie Harrigan, Har­
vard Business Review, July-August Competitive Strategy, Chapter 7
1983.

Competitive Positioning­
Overview
Competitive Strategy, Chapter 2
Competitive Advantage,
Chapters 1, 14, 15
Competitor Analysis
Competitive Strategy, Chapters
3,4,5, and Appendix
Competitive Advantage,
Chapters 2-4, 6, and 14

12
 Substitute Products Corporate Strategy for
Diversified Firms
Competitive Advantage, Chapter 6
"Prom Competitive Advantage to
Corporate Strategy," Michael E.
Porter, Harvard Business Review,
Technology May-June 1987.

Competitive Advantage, Chapter 5 Competitive Advantage,

Chapters 9-11
"How Information Gives You
Competitive Advantage," Michael Competitive Strategy, Chapter 16
E. Porter and Victor E. Millar,
Harvard Business Review,
July-August 1985.
Strategic Planning Process

"The State of Strategic Thinking:'

International or Global The Economist, May 23, 1987
Strategy

Competition in Global Industries,

Edited by Michael E. Porter, Alliances
(Boston: Harvard Business School
Press, 19861 Competition in Global Industries,
Chapter 1,3-5, 12, and others as Chapters 10 and 11
needed

Competitive Strategy

"How Global Companies Win

Out," Thomas Hout, Michael E.
Porter, and Eileen Rudden,
Harvard Business Review,
September-October 1982.

13 .. _ - - - _. . . . . _. _ _... _----­