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Logical Structuring

Case Competition Training


Strategy and Operations January 8, 2008

2005 Deloitte Inc.

Logical Structuring Agenda


Purpose and Objectives
Logical Structuring & Storyboarding Quantitative and Qualitative Observations Professionalism Dos and Donts Appendix

Purpose
The purpose of this session is to help prepare you for this weeks case competition.

Objectives
By the end of this session you should have a better understanding of:

How to logically structure a case presentation:


Logical Structuring & Storyboarding Research Tips How to use quantitative and qualitative data to support your research

Example
Professionalism

How to execute a successful presentation: Examples of previous presentations:

DOs & DONTs

Logical Structuring Agenda


Purpose and Objectives
Logical Structuring & Storyboarding Quantitative and Qualitative Observations Professionalism Dos and Donts Appendix

Why does structure matter?


1. Makes the message precise
Forces the writer to be dead clear about what they are communicating to the reader, preventing messages that are unclear, unintended, or intellectually empty 2. Reveals gaps in thinking

Enables the writer to identify gaps by anticipating and responding to the readers questions before the communication is delivered
3. Provides clarity to the reader Prevents the reader from working to understand the message, thereby eliminating the possibility that your message is misunderstood or ignored entirely
Memo A John Collins telephoned to say he cant make the meeting at 9:00. Hal Johnson says he doesnt mind making it later or even tomorrow, but not before 10:30 and Don Clifford wont return from Frankfurt until tomorrow late. The conference room is booked tomorrow, but free on Thursday. Thursday at 11:00 looks to be a good time. Is that okay with you? Memo B Could we reschedule todays 9:00 meeting to Thursday at 11:00? This would make it more convenient for Collins and Johnson, and would permit Clifford to be present. It is also the only other time this week that the conference room is free.

The Pyramid Structure

Governing Thought: States the answer to the question raised in the readers mind

Explains how or why

Key Line: Major points which, taken together prove the answer

Support: Data and facts which support the key line

An Unstructured Communication

ABC should go online and the first priority should be to defend its current market share

Opportunities and threats

Primary benefits of the internet strategy

ABCs current ABCs Without an customers are competitors online channel ABCs online more likely to are increasing ABC risks sales in 2005 shop online their online losing some could reach than the product customers to $100mm general assortment competitors population

Defend market share

Grow revenue

Develop deeper relationships with customers

Support ABCs operating strategy

A Structured Communication

Governing Thought:

Acme can reduce costs by $10mm in the next 2 years through some operational improvements

Key Line:

Re-engineer core functions to save $5mm

Outsource non-core functions to save $3mm

Differentiate service levels to save $2mm

Support:

Evaluate internal cost of core function

Compare cost of function to best-inclass benchmarks

Adopt best practices based on benchmarks

Select non-core functions

Evaluate cost and service level of potential partners

Choose one partner for each function

Segment customers by value

Determine economic level of service for each segment

Shift lower value segments to lower cost channels

Three Key Rules to Apply When Building a Pyramid


1.
2. 3.

Ideas at any level must be summaries of the ideas grouped below


Derived from high-level ideas Point of a paragraph is a summary of the sentences it contains Idea in each grouping must always be the same kind of ideas All ideas are from the same logical grouping Label idea with a plural noun Ideas in each grouping must be in a logical order

Deductively
Chronologically Structurally Comparatively

Copyright 2006 Deloitte Development LLC. All rights reserved.

Elements of the Introduction

Situation:

A statement about the subject with which you know the reader will agree

Governing Thought: Answer

Complication: The complicating event that create the tension in the story Question: The implicit question that results from the complication

Key Line:

Support:

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Structuring a Response to How

Governing Thought:

Acme must develop a value proposition tailored to the coyote market. How?

S: Acme must increase its focus on the coyote market C: Acme is not currently focused on the coyote market Q: How can Acme focus on the coyote market?

Key Line: Understand the unique needs of coyotes Adapt product line to meet coyote needs Educate coyotes on Acmes ability to meet their needs

Step 1

Step 2

Step 3

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Structuring a Response to Why

Governing Thought:

DrugsRUs should spend $25 million to accelerate the approval process for Antizak Why?

S: Approval for DrugsRUs new lifestyle drug Antizak is taking longer than expected C: DrugsRUs can spend $25 million to accelerate the approval process Q: Should DrugsRUs spend $25 million to accelerate the approval process?

Key Line: The Antizak market is expected to top $1 billion per year

Earlier approval allows DrugRUs more time before patent protection expires, which is worth $200 million in profit Reason 2

Competitors are developing a substitute that may capture the market if launched first Reason 3

Reason 1

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Which Question is Raised - How or Why?


S: C: Q: A: The plant is not meeting its widget production goals The production line is frequently stopped because of insufficient parts What should the plant do differently? The parts procurement process needs to be redesigned to reduce fulfillment time

S:

Sows Ear Inc. developed a silk purse product line 2 years ago

C: Since then, the silk purse division has been unprofitable Q: What should Sows Ear do? A: Sows Ear Inc. should abandon its silk purse product line

S: C: Q: A: S: C: Q: A:

ABC, a book retailer, is considering developing an online channel The online retail book market is dominated by 2 strong players Should ABC develop an online channel? Yes, ABC should go online You have undertaken a number of initiatives to improve customer service Customer service continues to result in decreased customer satisfaction How can we improve customers service? We must redesign customer service

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Clarifying Grouped Ideas

List the Points

Identify the Type of Point

Summarize the Points

Order the Points

Activities:

Synthesize findings from interviews, research and analysis Create a list of key points

Put the points into categories by defining the kind of problem being discussed, attempting to use similar level of abstraction across categories

Write a sentence that states the essence of each category

Put the points in logical order, such as order of importance or time order

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The Importance of MECE

Example Making Dinner: Select menu Buy ingredient Prepare courses Mobile Phone Types: Analog Digital GSM

Mutually Exclusive

Do any of the points overlap?

MECE

Collectively Exhaustive

Have all possibilities been covered?

Reasons to acquire competitor ABC: Complimentary customer base Superior technology Digestible size

Points across horizontal levels of the pyramid should be MECE (Mutually Exclusive, Collectively Exhaustive)

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Storyboarding
Creating a storyboard provides an outline for the presentation and the path you will follow:
Uses Pyramid Structure as a foundation Maps out the storyline of a presentation

Establishes team and judging panels expectations about what is to be produced and delivered
Helps organize work and define data needs Establishes evaluation frameworks and criteria used in the assessment Facilitates greater productivity and higher quality Keeps an engagement focused

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Creating the Storyboard

Governing Thought:

Cutting Edge Corporation should close its razor manufacturing operation in Wisconsin and manufacture razors in Mexico

Situation Complication (Question) Page 2

Page 1

Key Line:

Overall costs in Mexico are 75% lower than in Wisconsin, resulting in recovery of moving costs in 6 months

Mexico provides an operating environment that is as stable as Wisconsin, ensuring continuity of operations

Manufacturing technology is more advanced in Mexico than in Wisconsin, enabling Cutting Edge to leverage leading edge capabilities

Each requires a set-up page

Support: One page for each idea

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Logical Structuring Agenda


Purpose and Objectives
Logical Structuring & Storyboarding Quantitative and Qualitative Observations Professionalism Dos and Donts Appendix

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Quantitative and Qualitative Observations


Its important to use both quantitative and qualitative observations to support your recommendation
Qualitative data and analysis is required as hard justification for your recommendation (e.g., dollar savings, head count reduction) Qualitative data can be used to support and explain the meaning of quantitative research

Combining methods leads to a balanced, persuasive argument


Definition Numerical and statistical Most suitable when the objective is to measure or quantify data Answers the what questions Interpretive and insightful Pending lawsuits Consumer trends Examples Firm stock value Market share Net Present Value Sources financial statements statistical studies surveys

Quantitative

censuses
press releases annual reports

Qualitative

Most helpful when the goal is to understand situations or provide context Answers the how and why" questions

Market perception industry white papers analyst reports

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Research Tips
Structuring your research using a defined approach can help you research effectively in a short period of time
Several models can be applied to help you structure your research. One example is Porters Five Forces

Your approach to case research should mirror the logical structuring of your presentation
Governing Thought (Recommendation) Key Lines Support

But how do you know what your recommendations are before conducting your research? Answer: Guess.
Based on your initial impressions of the case, generate some hypotheses on what you think the company should do. Then, based on your hypotheses, look for supporting evidence The advantage of this approach is that it can dramatically reduce the amount of time spent on research. You will be focusing your efforts on facts that support your hypotheses

Begin by creating a research log


This is a file that documents all of the research sources that have been reviewed and includes a summary of key findings, facts and sourcing information. A research log allows for easy dissemination of key findings saving time. Assign a format and owner up front

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Example

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Logical Structuring Agenda


Purpose and Objectives
Logical Structuring & Storyboarding Quantitative and Qualitative Observations Professionalism Dos and Donts Appendix

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Professionalism Execution of the presentation


There are two key avenues for case competitors to convey professionalism:
(1)The execution of the presentation (2)The presentation materials Assign roles early subject matter experts and presenters Who answers questions on which topics? Rehearse the presentation to clearly define: Sequence what order will the team members will present in? Duration how long should each section take?

Hand-offs how will each section of the presentation smoothly and logically transition from one team member to the next?
Contingency plan which sections could be reduced or eliminated? Pay special attention to numbers, statistics, charts and analysis Inability to convincingly defend figures is a common pitfall

Be able to recall sources and assumptions without having to use reference material

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Professionalism Presentation Materials


Alignment
Check text and object alignment to ensure a consistent look across slides Ensure headings and text boxes are in the same place, as you flip through your slides Colour Scheme A muted colour scheme is generally recommended Avoid dark backgrounds, very bright colours or too many colours Ensure that your colour scheme both prints well and projects well Font

Sans-serif font styles tend to work best: Arial, Verdana, Tahoma


Font size should be readable, but not too large (min ~12pt) Consistency Be consistent with font size, font style and colour scheme Be consistent with punctuation at the end of bullets - Either use it or do not, but do not use it inconsistently Be consistent with overall structurei.e. use of tag lines versus just headers Use the slide master to create a template to ensure consistency
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Logical Structuring Agenda


Purpose and Objectives
Logical Structuring & Storyboarding Quantitative and Qualitative Observations Professionalism Dos and Donts Appendix

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DOs & DONTs


DOs
Brainstorm as a team to develop a strategy and agree to an execution plan Divide and conquer the work to efficiently execute on the plan Determine required tasks, dependencies and agree to roles for each team member

Have each person create their slides based on an agreed upon template (designed in Slide Master)
Avoid version control issues by having one person own the master and others provide send over their slides for inclusion in the master Proof-read your presentation for spelling, grammar, content and logic

Recognize each others strengths in determining roles for the presentation


Group members should present material they are most comfortable with Confident speakers can present larger portions of the presentation Leave time to rest the night before the presentation

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DOs & DONTs


DONTS
Dont fall victim to analysis paralysis Instead, set a deadline for making a recommendation decision and stick to it You will not come up with a recommendation that is irrefutable and 100% supported by the facts, so at some point, your group must make a decision and run with it spend the rest of the time supporting your decision and creating a compelling story Agree upfront on a conflict resolution method (e.g. vote or unanimous agreement) Disagreements can lead to productive discussions, so take a few minutes to hear each point of view and then make a decision on next steps

Dont let disagreements impact your teams dynamics

Dont leave facts or figures unsourced always include references in the research log for easy footnoting in your final presentation Dont leave formatting until the end

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Last Years Case Competition Topic


Question In early 2006, managers in technology and media companies around the world observed Google with awe, envy, and fear. The companys opportunities seemed boundless. What would Google do next? Two Options One option was to stay focused on the companys distinctive competence: developing superior search solutions and monetizing those solutions through targeted advertising. Alternatively, Google could branch into new arenas: Build Google into a portal like Yahoo! Or MSN by aggregating content into thematic channels Extend Googles role in e-commerce beyond search into a more active role as an intermediary facilitating transactions Challenge Microsofts hegemony over the PC desktop by developing products to compete with Office and Windows

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Evaluation Criteria
Analysis
Identified key problems Used supporting facts/data Drew accurate conclusions Considered risk Offered original insights

Presentation
Spoke clearly and concisely Structured storyline well Slides were visually attractive Showed enthusiasm and professionalism

Recommendation
Followed logically from analysis Dealt with all issues raised Used decision criteria

Question & Answer


Answered question posed Provided convincing explanations Admitted weakness Answered as a team

Showed sounds business judgment


End result was practical/realistic

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Last Years 2nd Place Case

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Bright Colour Scheme

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32

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1. Communicate recommendation in the beginning of the presentation


2. Set expectations

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35

36

37

Evaluate each recommendation against the 3 criteria

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40

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Data Sourcing

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Pretty Pie Chart

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Last Years Winning Case

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Terry Huang Aron Lau Ke Zhang Godmans Chow

What is the situation?

Question: What should Google do?

Complication: Company is facing boundless opportunities.


Stay focused with Googles distinctive competencies. Branch into new arenas.

Recommendation: Google should stay with its core

competencies providing superior search solutions


Agenda

$6.5 billion by end of 2011


Introduction New frontiers? Growth Strategy Growth Strategy

Growth Strategy

Implementation

Overview of the approach

Measurement Metrics:
Market Potential Fit with Mission

What should Google do?

Use Pyramid Structure to Frame the Storyboard

Option 1

Branch into new areas

Extend Googles core search & targeting competencies.

Option 2

Build Google into a portal

Extend Googles role into ecommerce

Develop Products to Compete with Office & Windows

International Search

Mobile Advertising

Narrowcasting

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation

Google should stay focus with its core competence

Driven by Company Philosophy


It is best to do one thing really, really well developing superior search solutions

Market Potential
Has opportunity to further monetize its search solutions through targeted advertising
U.S. and International Paid Market Search Forecast ($ billions)
U.S. Market International Market

U.S. and International Internet Users Forecast (million users)


U.S.

2.5 0.6
2003E

4.3 1.5
2004E

6.4 3.3

9.6 5.9

7.9

11.6 10.2

13.4 12.5

International

2005E

2006E

2007E

2008E

2009E

2003E

2004E

2005E

2006E Time

2007E

2008E

2009E

Time
Charts data sourced from provided Business Case Description Introduction New frontiers? Growth Strategy Growth Strategy

Growth Strategy

Implementation

Google should not branch into new arenas. The three arenas proposed deviates from the company mission, or have tremendous risks (market potential).

Googles mission - To organize the worlds information and make it universally accessible and useful. Inconsistent Font

Build Google into a portal


Were not in the portal business, were in the business of making all the worlds information accessible and useful.

Extend Googles role in e-commerce

Develop products to compete with Office and Windows


There is strategic leverage in building an ecosystem around content and advertising that is an extension of our search mission. - Schemidt

Acting as an intermediary facilitating transactions (Google Checkout) is consistent with the mission of the company.

- Schemidt

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation

Google should not extend in e-commerce or develop products to compete with Microsoft due to the high risks (market potential) involved.

Extend Googles role in e-commerce 1. Strong competition: eBay has 39.2% of the e-commerce market. eBay facilitates eCommerce by offering tools such as PayPal1. PayPal has 24% market share of U.S. online payments market. It is eBays major electronic payment method1. 2. No incentive for PayPal users to switch to using Google Checkout 3. Despite Google Checkouts launch in June, 2006. PayPal posted revenues of $417 million, a 37% growth rate compared with 2005s fourth quarter2. Inconsistent Alignment

1 Wikipedia.org 2 CNN.com Introduction New frontiers? Growth Strategy Growth Strategy Growth Strategy Implementation

Google should not extend in e-commerce or develop products to compete with Microsoft due to the high risks (market potential) involved.

Develop products to compete with Office and Windows 1. Strong competition: Microsoft 2. Difficult for new entrant: OpenOffice currently only has 14% of the enterprise software market as of 2004 Hard to convince user to switch to new desktop applications1 3. Relatively small potential revenue The market for Office is only an annual revenue of $1 billion1 Too small of a market size comparing to Google's currently advertising business (140 million vs. 6.1 billion)

1 Wikipedia.org

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation

Google should continue to strengthen its expansion into the international online advertisement market.

U.S. internet user is 30% of all users in the world. By 2009, it will decrease and become 27.7%.
U.S. vs International Internet Users (in millions)
986

U.S. online ads spending slowed down recently while online ads spending from the international market are increasing at a faster speed.
Online Ads Spending Growth Rate Chart
250
Growth Rate (%)

597 500 183 203

687

769

854

939

North America Western Europe Asia Latin America Australia/ New Zealand Total

200 150 100 50 0 1999 2000 2001 2002 2003 2004 2005 2006 Time

U.S. International

219

235

251

266

274

2003E 2004E 2005E 2006E 2007E 2008E 2009E Time


eMarket.com

eMarket.com

The Winning Case Used Extensive DATA to Back Up its Statement


Introduction New frontiers? Growth Strategy Growth Strategy Growth Strategy Implementation

International Online Advertising Entry Analysis

Who is the competition?

How do their products & services differ

What are the potential barriers to entry

How does Google become a player?

What are the risks

Yahoo, MSN, Local search engines (Baidu)

Google's competitors entered the market earlier, and tailored products to adapt to local customers.

Perhaps government regulations (censorship issue in China)

Partner with local companies, leverage our leading technology, and adapt to local environment.

Late to the game. Lack of understanding of the local environment

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation

We believe the emerging mobile advertising market is a fit for both Googles technological expertise and philosophies. The potential of the mobile user base is promising, projected to rise to 1 billion users of 3G data services by 2011. Mobile advertising revenues is expected to reach $2.9 billion dollars by 2011.

More Data!!
1,000 users (millions)
$2,900.00 (millions)

Mobile Ad Revenues

3G User Base

$1,400.00 (millions)

100 users (millions)

Asia Europe Business: 3G in the world : June 20th 2006

2006

2011

2006

TVweek.com: Nov 15th 2006

2011

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation

Mobile advertising market analysis before entry.

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation

We believe the emerging narrowcasting market is a fit for both Googles technological expertise and philosophies. Narrowcasting revenue in the US is projected to reach $1.2 billion by 2009 - >$700 million in network/software operations. Targeted online gaming advertising worth is projected to be worth $0.5 billion by 2010.

Even More Data!!!


$750 (million)

US Narrowcasting Revenue
$450 (million)

Online Gaming Ad Worth

$500 (million)

$100 (million)

2006

CapV InfoStats March 2005

2009

2006

Businessweek Jan 2007 Growth Strategy Implementation

2010

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Narrowcasting market analysis before entry

Who is the competition?

How do their products & services differ

What are the potential barriers to entry

How do we become a player?

What are the risks?

Inaccurate forecast of market.

EK3, Scala, ipSigns

Current infrastructure of fixed targeted content that is not user targeted

Privacy concerns, government billboard regulations, aesthetic trends

Partner with existing players, leverage Googles user targeted algorithms for more targeted ads.

Changing government regulations on public ads.

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation

Google can approach to enter the international online searching and advertising market with relative ease. To continue strength its expansion in the international online advertisement market Identify potential international market to expand its service Conduct market research to understand customer behavior Develop localized applications and adapt to taste of local customers Cooperate with local business (partnership, M&A)

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation

Google can approach to enter the narrowcasting and mobile advertising market with relative ease

Inconsistent Font

Tie into the current and emerging markets with Googles current Google Google Google Froogle Blogger Maps Mobile News technology and infrastructure.
Google Server Retail Targeted User System Corporate Group/Individual Integrator Hospitality Services Public Spaces Advertiser/Contents ____ Gamers Anyone ____ Mobile device users

San Fran Wifi ____ Game developers ____ Mobile service providers

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation

Googles projected growth in the next 5 years

International Search $4.98B ($2.4B market with 20% annual growth)

Recommendation Again Backed Up by DATA!

Clear Visual Representation


Combined revenue growth of an additional $6.5B by the end of 2011.

Mobile Advertising : $1.0B(assuming 1/3 market share)

Narrowcasting: $0.5B (assuming 1/3 market share)

Introduction

New frontiers?

Growth Strategy

Growth Strategy

Growth Strategy

Implementation