Guru Prasad Sapna Mehta Rabindranath Sanjay Jain Rishi Khamar Ria Kundu Vishwatej Ayesha Hassan


Strategic planning is the process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing opportunities

The business portfolio is the collection of businesses that make up the company Portfolio analysis is a major activity in strategic planning whereby management evaluates the businesses and projects that make up the company

STRATEGIC BUSINESS UNIT Strategic business unit (SBU) is a unit of the company that has a separate mission and objectives that can be planned separately from other company businesses .

DOWNSIZING Downsizing is the reduction of the business portfolio by eliminating projects or business units that are not profitable or that no longer fit the company’s overall strategy .



PORTFOLIO MANAGEMENT  Portfolio management Steps of new Portfolio management  Future events and opportunities  Dynamic decision  Stages of completion  Resources allocation  Importance of Portfolio management .

GOALS OF PORTFOLIO MANAGEMENT     Value Maximization Balanced Strategic direction Right no of projects .

CORPORATE STRATEGY Portfolio Analysis  How much of our time and money should we spend on our best projects to ensure that they continue to be successful? How much of our time and money should we spend developing new projects . most of which will never be successful?  .


 Strategic Alliance Partnership of two or more firms to achieve strategically significant objectives that are mutually beneficial.GROWTH STRATEGIES Most widely pursued strategies  External mechanisms:  Mergers  Transaction involving two or more firms in which stock is exchanged but only one firm survives. .  Acquisition Purchase of a firm that is absorbed as an operating subsidiary of the acquiring firm.

2 BASIC GROWTH STRATEGIES Concentration    Current project line in industry Growth into related industry Search for synergies Diversification    Into other project lines in other industries Growth into unrelated industry Concern with financial considerations .

RETRENCHMENT STRATEGIES  Turnaround Captive Company Strategy Selling out Bankruptcy     Liquidation .

Advantages of Portfolio Management  Maximizes the return on your product innovation investments Maintains your competitive position Achieves efficient and effective allocation of scarce resources Forges a link between project selection and business strategy    .

Advantages of Portfolio Management  Achieves focus Communicates priorities Achieves balance    Enables objective project selection .

So that effort will b useless . .Disadvantages of Portfolio Management  The official PPM may not accurately reflect the organization activity because some of the project may be excluded.  Below the line project are excluded but they also consume the effort of staff to implement.

.BCG MARTIX  BCG matrix is developed by Bruce Henderson of the Boston consulting group in the early 1970’s.  According to this technique. businesses or products are classified as low or high performers depending upon their market growth rate and relative market share.

BCG MATRIX It is a portfolio planning model which is based on the observation that a company’s business units can be classified in to four categories: • • • • Stars Question marks Cash cows Dogs .


high market share • Stars are leaders in business.STARS High growth. • They also require maintain its large market share. to . heavy investment.

• They extract the profits by investing as little cash as possible .CASH COWS Low growth. high market share • They generate more cash than required.

• . • Number of dogs in the company should be minimized. low market share • Dogs are the cash traps.DOGS Low growth. Business is situated at a declining stage.

• They will absorb great amounts of cash if the market share remains unchanged. low market share • Most businesses start of as question marks.QUESTION MARKS High growth . • . Investments should be high for question marks.

BENEFITS OF BCG-MATRIX • BCG MATRIX is simple and easy to understand. . • It helps you to quickly and simply screen the opportunities open to you. • It is used to identify how corporate cash resources can best be used to maximize a company’s future growth and profitability.

Relative market share and market growth rate. • Problems of getting data on market share and market growth. .LIMITATIONS • BCG MATRIX uses only two dimensions. • High market share does not mean profits all the time. • Business with low market share can be profitable too.






COCA COLA’S FIVE FORCE ANALYSIS      New entrants: Brand loyalty Advertising ability Access to distribution channels Supplier availability .

Substitute products       Pepsi Juice Bottled water Energy drinks Alcoholic drinks Coffee/ tea .

Bargaining power of buyers     Fast food chains Vending machines Convenience stores Super markets .

Bargaining power of suppliers    Low cost of raw materials Low switching costs High volumes of raw materials .

Competitor rivalry     Advertising/marketing strategies Consumer control Expansion opportunities Differentiated products .



a consulting company to develop a portfolio approach with a wider dimension than the .GE/MCKINSEY MATRIX HISTORY  In the late sixties and early seventies. a leading corporation. General Electric. were looking at concepts and techniques for strategic planning  GE asked McKinsey and Company.


FACTORS THAT AFFECT INDUSTRY ATTRACTIVENESS       Industry size Industry growth Market profitability Competition intensity Overall risk and returns in the industry Opportunity to differentiate products and services .

FACTORS THAT AFFECT BUSINESS STRENGTH        Strength of assets Relative brand strength Market share Customer loyalty Relative cost position Distribution strength Access to finance and other investment resources .


MODEL USE AND APPLICABILITY          Grow / Penetrate Invest for Growth Selective Harvest or Investment Selective Investment or Divestment Segment and Selective Investment Harvest for Cash Generation Controlled Exit or Harvest Controlled Harvest Rapid Exit or Attack Business .

Used by permission of General Electric Company. General Electric Corporation. Losers Weak Business Strength/Competitive Position . Corporate Planning and Development.General Electric’s Business Screen C Winners A High Winners B Question Marks D Winners E Medium Average Businesses F Losers Losers G Low Profit Producers Strong Average H Source: Adapted from Strategic Management in GE.

BEST USE  This matrix can be used at all levels within the organization This matrix allows one to set a strategy for the future after mapping the portfolio in the present   The GE McKinsey matrix is important for assigning priorities for investment .

MODEL WEAKNESSES  This model has been criticized by some authors for its ‘pseudo-scientific’ approach This portfolio model relies heavily on managerial judgment   The GE McKinsey matrix pays too little attention to the business environment .

mostly involving software. but also other humanistic and scientific theories In practice.TOP-DOWN AND BOTTOM-UP DESIGN  Top-down and bottom-up are both strategies of information processing and knowledge ordering.  . they can be seen as a style of thinking.

Focuses on the analysis of individual stocks. Thorough study of the company.Bottom Up  Maximize value of the portfolio.   .

and possible approaches to solving the problem.Top-down  The top-down problem solving strategy begins by looking at a problem holistically. .   The system (or program) is treated as a black box where the details of what goes on inside the box is not yet important. This global view gives a good impression of what the problem is / is not.

Strategic Bucket Model: “Implementing strategy equates to spending money on specific projects” .

The process of the Bucket Model  First develops the vision and strategy of the business. Based on these strategies the management of the business allocates R&D and new product marketing resources across each  .

Various dimensions to make the strategic goals Strategic Goals Product Lines Project Types Familiari ty Matrix Geograph y .

Projects Prioritized Within Buckets .

.Difference between Top-Down & Bottom-Up TOP-DOWN  BOTTOM-UP  Detailing is not done in the first level. Proceed from concrete design to abstract entity.  Proceed from abstract entity to concrete design  Individual base element is first specified in great detail.

Difference between Top-Down & Bottom-Up TOP-DOWN  BOTTOM-UP  Begins the design with the top level module. .   Begins the design with the lowest level modules. Used in designing brand new systems. Sometimes used in reverse engineering.

ALTERNATIVE STRATEGY MODEL Kralijic Portfolio Purchasing Model :     Purchase classification Market analysis Strategic positioning Action planning .

PURCHASING APPROACH BODIES     Strategic Items Leverage Items Bottleneck Items Non-critical Items .

PURCHASE CLASSIFICATION MATRIX High Leverage Items Strategic Items Profit Impact Non-Critical Items Bottleneck Items Low Low Supply Risk High .

Purchasing Portfolio Matrix: Strength as a buyer Medium Exploit Balance Diversify Low Medium high Low Supply Market Strength .

Action Plans Three Purchasing strategies for Action Plans  Exploit  Balance  Diversify .

SWOT ANALYSIS  A widely used framework for organizing and utilizing the pieces of data and information gained from the situation analysis…” .







Overdependence on bottling partners Intense competition Target the ageing customers . Big slow decision making can give competitive advantage to the competitor SWOT OF COKE Opportunities Global growth in non-alcoholic ready-todrink beverage industry. Growing global bottle water market Intense competition Booming global functional drinks market Threat Economic climate Health and wellness.the brand is able to create over $ 50million a day Weakness Financial market volatility impacting.Strength Strong leading brands with high level of consumer acceptance Large scale of operations Leading market position Strong cash flows from operations.

Transforming strengths into capabilities Weaknesses can be converted into strengths Threats can be converted into opportunities .SWOT-Driven Strategic Planning  Four issues the marketing manager must recognize:     Assessment of strengths and weakness.


What is Gap Analysis? .


 .  GAP 2: Service Design and Standards  GAP 3: Delivering Service Design to Standards.  GAP 4: Not Matching Performance to Promise.GAP ANALYSIS OF Mc Donald’s GAP 1: Not Knowing What Customers Expect.

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