STRATEGIC MANAGEMENT

SUBMITTED BY: BRIAND DAYDAY

SUBMITTED TO: PROF. HILDA TEODORO
DATE SUBMITTED: MAY 8, 2012

MANILA JOCKEY CLUB – BETTING OPERATIONS DIVISION

Proposed Strategy

Based on the above findings of MJC’s Betting Operations Division, the strategies to be
implemented to achieve added value and financial progress is a combination of market
penetration and market development.

Strategic Objective

Since running a horseracing racetrack incurs high operating expenses, the industry has been
generating enough for the service to self-sustaining. In order for MJC to realize substantial
profit, there is a need for MJC to hype up its betting operations and further exploit its
markets. Hence, the overall objective of:

“Increase sales yearly by 10% from 2012 – 2015”

In order for this strategy to materials MJC has to achieve the following objectives.

On service development – OTB benchmarking

 To establish benchmarks determining OTB performance per area; performing and
underperforming OTBs.
 To further establish strategic locations for OTB expansion within and outside of
Metro Manila.

On market penetration – Strategic OTB positioning

 To identify and relocate betting terminals, which are not fully maximized.
 To identify available resources (betting terminals) for OTB expansion.
 To develop strategies based on the established benchmarks and findings.
Market Penetration

Over the years horseracing has been generating a steady gross profit, with an average
increase of 4% per annum. However year-by-year the expenses incurred also increases,
leaving little revenue for MJC to work and expand its service. Hence, it is important for MJC
to maximize its resources due to its high purchase and maintenance costs. Once maximized
incremental increases per OTB area can be realized. And based on the external and internal
analysis, there is a need for MJC to reassess some existing OTB locations, and at the same
time expand to booming municipalities.

Action Plans and Programs

Completio Team
Plans n Date Action Plans Responsible
Obtaining OTB Applicants
through TV ads. And subliminal
OTB Expansion Q3 2012 messages Marketing
Extended Analysis of BEP vs.
Q4 2012 Current OTB Status Marketing
Q1 2013 - Pulling out of machines from
2014 OTBS Operations
Market Research of possible
Q1 2013 OTB (CALABARZON) Marketing
OTB
Developmen
Q2 2013 Analysis of potential OTB Site t
Development of OTBS Q3 2012 Classification of OTBS (A-C) Operations
OTB
Developmen
Q3 2012 Site Inspection t
Warning Letter to Improve
Q4 2012 facilities Operations
Q4 2012 Follow-up (1 month) Operations
OTB
Actions to be taken Developmen
Q4 2012 (Continue/discontinue) t
OTB and OPERATOR
INCENTIVE PROGRAM Q1 2013 Mechanics/Specifics Operations
Teller Incentive Program Q1 2013 Mechanics/Specifics Marketing
Monitoring System, Daily
Ticket Monitoring Q4 2012 Monitoring
Other Programs
Introduction of new programs
OTB Operators Assembly Q1 2013 (OTB incentive program) BOD
Tellers Seminar Q4 2012 - Training of MJC and OTB hired BOD
 2014 tellers
Standardization of BOD policies
Operations Manual Q4 2012 & procedures BOD and HR
Balance Scorecard

BOD BALANCE SCORECARD OBJECTIVES MEASURES TARGETS INITIATIVES

FINANCIAL Financial Growth Profitability Increase Revenues >= 8% OTB expansion
Marketing promotions

Cost Efficiency Maintain 30% decrease Favourable Activity Based Costing

in expenses variance

INTERNAL High Operation Improve operational Teller absences 97% teller Teller incentive program
Efficiency procedures & policies attendance

Teller complaints 0 complaints Teller trainings & seminars

Improve status of <= 0.004% in Strict implementation of

shortages shortages policies

Business Provide market research Sales efficiency per +10% sales Strategic allocation of
Development regarding areas of new cluster per cluster terminals
and existing OTBs.

CUSTOMER Customer Loyalty Maintain high level Customer Satisfaction 80% C.S Upgrade of OTB facilities
service Survey Rating rating

Business Maintain good OTB operator 0 complaints OTB general assembly

Relations (OTB relationships w/ OTB complaints
operators) operators

Align operator strategies OTB operator initiated 20% + OTB OTB incentive program
with MJC goals and marketing promotions foot traffic
objectives
GROWTH OTB Expansion OTB expansion in Increase OTB Sales in >=10% Market research and market
untapped locations (CALABRAZON) segment analysis

Introduce new services Initiate profit New Launching of iOTB

Other sources of to OTB operators generating services programs Product lockouts
income