Documentos de Académico
Documentos de Profesional
Documentos de Cultura
Topics
Greiners growth model Market driven organisation Value Disciplines of Treacy and Wiersema Currys pyramid MABA Analysis QRM
Branding Pentagram Value stream mapping Balanced score card Metrics share of heart, mind, market Metrics Customer profitability Metrics- advt and web
MANAGEMENT
IS THE PROCESS OF DESIGNING AND MAINTAINING AN ENVIRONMENT IN WHICH INDIVIDUALS , WORKING TOGETHER IN GROUPS , EFFICIENTLY ACCOMPLISH SELECTED AIMS
Definitions Of Management
)Mary Follett :-- The art of getting things done through people. )Peter Drucker :--- Managers give direction to their organizations, provide leadership and decide how to use organizational resources to accomplish goals )Richard daft :;;-- Management is the attainment of organizational goals in an effective and efficient manner through planning, organizing , leading and controlling organizational resources. )Griffin : Management is a set of functions directed at the efficient and effective utilization of resources in the pursuit of organizational goals.
Forces on Organization
Markets Workforce Technology Values Local, Domestic Homogeneous Mechanical Stability, Efficiency Global Diverse Electronic (Digital) Change, Chaos
New Paradigm
Conflict, Competition
Collaboration
Strategies
comes from the Greek word Strategos meaning Art of the general Military used the word strategy to mean grand plans made in the light of what it is believed an adversary might or might not do. Defn of strategy : 1) General program of action and deployment of resources to attain comprehensive objectives Alfred Chandler : Determination of the basic long term objectives of an enterprise and the adoption of course of action and allocation of resources necessary to achieve these goals.
Glueck : A unified , comprehensive and integrated plan designed to assure that the basic objectives of the enterprise are achieved
Michael Porter : : Developing and communicating the companys unique position, making trade-offs and forging fit among activities.
LG Corporate team
FMCG Division
Colour TV Business
VCD/DVD business
Washing Machine
Refrigerator
A/C
Levels Corporate
Corporate office /head office
SBU
SBU
SBU
SBU
Business Level
functional
Operations
Marketing
Personnel
Finance
Functional level
Five Concepts
Production concept Product concept Selling concept Marketing concept Societal marketing concept
Definitions of MARKETING
The performance of business activities that direct the flow of goods and services from producer to consumer. Getting the right goods , to the right people in the right place , at the right time , at the right price , with the right level of communication profitably. Identifying the needs, wants , desires of consumers and fulfilling them in such a way that the customer is delighted and the company objectives are met profitably. Solving customer problems profitably.
STP
Segmentation: -- is essentially the identification of subsets of buyers within market who share similar needs and who demonstrate similar buyer behavior.T he world is made up from billions of buyers with their own sets of needs and behavior. Segmentation aims to match groups of purchasers with the same set of needs and buyer behaviors. Targetting -- After the market has been separated into segments, the marketer will select a segment or series of segments and target them.
Positioning: is the act of designing the companys offer and image so that it occupies a distinct and valued place in the target customers mind.
SEGMENTATION Variables
North South, East, West Major Metros, Sub Metros, Town Hot, cold, humid
Psychographic
Lifestyle
Personality
SEGMENTATION
0-11,12-19,20-34 etc. Male, Female 1-2,3-4,5+ school, Graduate, PG Farmer, Professional, Housewife, Retired <15k,16-25k,26-35k etc. Hindu, Muslim, Sikhs, Christians
SEGMENTATION
D) Behavioral
Benefit Use Related 1) Usage Rate: 2) Awareness Status 3) Brand Loyalty Use-Situational Time/Objective
Heavy, Medium , Light users Unaware, aware, interested enthusiastic. Strong, Medium , None
P1
P2
P2M1
P3
M1
M2
M3
P1
P2
P2M1
P3 P3M2
P2M3
M1
M2
M3
P1
P1M1
P2
P2M1
P3 P3M1
M1
M2
M3
P1
P2
P2M1
P3
P2M2
P2M3
M1
M2
M3
P1
P2
P3
M1
M2
M3
Positioning
Positioning starts with the product. But Positioning is not what you do to a product. Positioning is what you do to the mind of the prospect. Easiest way to get into the mind - Be First KODAK- Photography Xerox -- Copier Hertz --- Rent-a car
Positioning
6 STEPS IN POSITIONING PROGRAM What position do you own What position do you want to own? Whom must you outgun Do you have enough money. Can you sustain . Do you match your position.
Positioning Strategies
Attribute Positioning Benefit Positioning Use /Application Positioning User Positioning Competitor Positioning Quality / Price Positioning Product category Positioning
MARKET-DRIVEN STRATEGY
Market-Driven Strategy Becoming Market Oriented Distinctive Capabilities Creating Value for Customers Becoming Market Driven Challenges of a New Era for Strategic Marketing
MARKET-DRIVEN STRATEGY
All business strategy decisions should start with a clear understanding of markets, customers, and competitors.
The market and the customers that form the market should be the starting pint in shaping business strategy.
Determine the impact of changes on customer satisfaction Increase the rate of product innovation Pursue strategies to create competitive advantage
Market Orientation
Information Acquisition
Gather relevant information on customers, competition, and markets Involve all business functions
Intuits Quicken
Share information and develop innovative products with people from different functions Zaradiagnosis and Shared action
Inter-functional Assessment
value
DISTINCTIVE CAPABILITIES
Capabilities are complex bundles of skills and accumulated knowledge, exercised through organizational processes, that enable firms to coordinate activities and make use of their assets.
Capabilities
Desirable Capabilities
Difficult to Duplicate
Organizations Process
EXTERNAL EMPHASIS Outside-In Processes INTERNAL EMPHASIS Inside-Out Processes
Spanning Processes
Customer order fulfillment Pricing Purchasing
Financial management Cost control Technology development Integrated logistics Manufacturing/ transformation processes Human resources management Environment health and safety
Distinctive Capabilities
Creating Value:
Customer value is the outcome of a process that begins with a business strategy anchored in a deep understanding of customer
Benefits
Costs
Value Composition
Product Services
Employees
Benefits
Value (gain/loss)
Costs (sacrifices)
MARKET-DRIVEN STRATEGIES
Escalating Globalization
It is important to understand the differences (and similarities) between the developed economies and the new world beyond. Market opportunities Competitive threats Partnering opportunities Outsourcing initiatives
Responsibilities to stakeholders
Horizontal Structure
relocation/design of facilities personnel movement reward systems formal procedures social orientation project budgeting
fast access to information from any location and remotely accelerated trend towards flatter organizations virtual team-working across geographical and organizational boundaries new approaches to supplier relationship management (SRM) and customer relationship management (CRM) managing and controlling outsourcing of more business processes and activities to specialist suppliers
Matrix
TRADITIONAL DESIGNS
MarketFocused
ProductFocused
Product-Focused Structure
Organizational Transformation
Hybrid organization forms Designs linked to value strategy and
core capabilities
Organizing Concepts
Centralized Formalized Nonspecialized
BUREAUCRATIC
Internal (hierarchical) Organization of Activity
TRANSACTIONAL
External (market) Organization of Activity
ORGANIC
RELATIONAL
Executive Qualifications
Strategic Alliances
Idea Generation Idea Screening Concept Development & Testing Marketing Strategy Business Analysis Product Development Market Testing Commercialization
Eight Stages
1) Idea Generation :
Source of New Product Ideas:Customers , Employees, Competitors Products and services , sales team Idea Generating Techniques : Brain Storming , Need/Problem Identification , Problem /Need Identification
2) Idea Screening: Drop Error Go Error
6) Product Development: 1) Develop Prototype 2) Functional & Consumer Tests 7) Market Testing : Testing in select outlets with actual brand name and packaging 8) Commercialization : When to enter the market How to enter the market
BRANDING
Defn:- A name ,symbol, design which is intended to identify the goods ,services of one company and to differentiate the goods from those of competitors. BRAND NAME DECISION
Individual Brand Name : P & G :- Ariel, Pantene A Blanket Family Name : Philips Company Name combined with individual product names:Britannia 50-50 Videocon Bazoomba
BRANDING
Brand Strategy Line Extension Brand Extension Multi Brand New Brands
Brand Strategies
Existing
Existing Brand Name
New
New
Brand
New Brands
Name
Brand Strategies
Line Extensions : occur when a company introduces additional items in the same product category under the same brand name such as new flavors, forms, colors, added ingredients, package sizes . e.g : ZEN LXI,ZEN VXI, SURF, SURF EXCEL, SURF EXCEL BLUE Splendour , Splendour Plus Coke, Diet Coke, Vanilla Coke Clinic AllClear, Clinic Plus
Brand Extensions : Using an existing brand name to launch a product in a new category e.g --- Honda automobiles, motorcycles, lawnmowers etc. Sony (Handycams, Colour TV, Digital camera etc.) AMUL, Videocon,LG
e.g --Rejoice, Pantene, Head & Shoulders WagonR, Zen , Alto Electrolux, Kelviantor, Allwyn Videocon, Sansui, Akai, Toshiba
New brands : When a company launches products in a new category , a new name is given In deciding whether to give new name , the company should consider the following1) Is the venture large enough 2) Will it last long enough 3) Does the new product require the boost power of existing powerful brand name 4) Is it best to avoid existing brand name in case the new product fails. 5) Will the cost of establishing a new brand name be covered by the probable sales and profits.
Branding Pentagram
New Market
Market Development
Diversification
Market Development Geographical expansion: Opening retail outlets in other areas. e.g --- Mc-Donalds, Shoppers Stop Channel expansion : If only present in consumer market, then look at institutional sales also.
Greiner's Growth Model describes phases that organizations go through as they grow. All kinds of organizations from design shops to manufacturers, construction companies to professional service firms experience these. Each growth phase is made up of a period of relatively stable growth, followed by a "crisis" when major organizational change is needed if the company is to carry on growing.
Dictionaries define the word "crisis" as a "turning point", but for many of us it has a negative meaning to do with panic. While companies certainly have to change at each of these points, if they properly plan for there is no need for panic and so we will call them "transitions". Larry E. Greiner originally proposed this model in 1972 with five phases of growth. Later, he added a sixth phase (Harvard Business Review, May 1998). The six growth phases are described
Phase 1: Growth Through Creativity Here, the entrepreneurs who founded the firm are busy creating products and opening up markets. There aren't many staff, so informal communication works fine, and rewards for long hours are probably through profit share or stock options. However, as more staff join, production expands and capital is injected, there's a need for more formal communication. This phase ends with a Leadership Crisis, where professional management is needed. The founders may change their style and take on this role, but often someone new will be brought in.
Phase 2: Growth Through Direction Growth continues in an environment of more formal communications, budgets and focus on separate activities like marketing and production. Incentive schemes replace stock as a financial reward. However, there comes a point when the products and processes become so numerous that there are not enough hours in the day for one person to manage them all, and he or she can't possibly know as much about all these products or services as those lower down the hierarchy. This phase ends with an Autonomy Crisis: New structures based on delegation are called for.
Phase 3: Growth Through Delegation With mid-level managers freed up to react fast to opportunities for new products or in new markets, the organization continues to grow, with top management just monitoring and dealing with the big issues (perhaps starting to look at merger or acquisition opportunities). Many businesses flounder at this stage, as the manager whose directive approach solved the problems at the end of Phase 1 finds it hard to let go, yet the mid-level managers struggle with their new roles as leaders. This phase ends with a Control Crisis: A much more sophisticated head office function is required, and the separate parts of the business need to work together.
Phase 4: Growth Through Coordination and Monitoring Growth continues with the previously isolated business units re-organized into product groups or service practices. Investment finance is allocated centrally and managed according to Return on Investment (ROI) and not just profits. Incentives are shared through company-wide profit share schemes aligned to corporate goals. Eventually, though, work becomes submerged under increasing amounts of bureaucracy, and growth may become stifled. This phase ends on a Red-Tape Crisis: A new culture and structure must be introduced.
Phase 5: Growth Through Collaboration The formal controls of phases 2-4 are replaced by professional good sense as staff group and re-group flexibly in teams to deliver projects in a matrix structure supported by sophisticated information systems and team-based financial rewards. This phase ends with a crisis of Internal Growth: Further growth can only come by developing partnerships with complementary organizations.
Phase 6: Growth Through Extra-Organizational Solutions Greiner's recently added sixth phase suggests that growth may continue through merger, outsourcing, networks and other solutions involving other companies. Growth rates will vary between and even within phases. The duration of each phase depends almost totally on the rate of growth of the market in which the organization operates. The longer a phase lasts, though, the harder it will be to implement a transition.
Growth
Rate (%) 10
10x
0.1 x
Industry Competitors
Substitutes (Threat of substitutes)
Industrywid e
Differentiation
Overall Cost Leadership Requires construction of efficient scale facilities Cost minimization in areas like R&D, ADVERTISING, SERVICE, SALES FORCE ETC.
To achieve cost leadership --- upfront capital investment in state-of-the art equipment/plant is required. e.g --- Texas instruments, DU PONT, Black & Decker, Bic, Kodak etc. Timex has specialised in manufacturing simple low cost watches for the mass market.
Differentiation ---- creating something that is perceived industrywide as unique. Differentiation can take many forms --- Design / brand image--- Mercedes Technology--- Bose -- speakers and sound system Service--- Maruti Dealer Network caterpilar, Videocon Quality-- Maytag Rolex watches are handmade of gold and stainless steel and are subjected to strenuous tests of quality and reliability Nikon , HP, Cross
Focus-- Focusing on a particular buyer group , segment of the product line,, or geographic market The strategy rests on the premise that the firm is able to serve the narrow strategic target very well, more effectively and efficiently then competitors who are competing more broadly.
Competitive Strategies
Michael Treacy and Fred Wiersema suggest companies can gain leadership positions by delivering superior value to their customers in three strategies or value disciplines Operational excellence Customer intimacy Product leadership
18-27
Competitive Strategies
Basic Competitive Strategies Operational excellence refers to a company providing value by leading its industry in price and convenience by reducing costs and creating a lean and efficient value delivery system e.G WALMART
18-28
Competitive Strategies
Basic Competitive Strategies Customer intimacy refers to a company providing superior value by segmenting markets and tailoring products or services to match the needs of the targeted customers E.G IBM
18-29
Competitive Strategies
Basic Competitive Strategies Product leadership refers to a company providing superior value by offering a continuous stream of leading-edge products or services. Product leaders are open to new ideas and solutions and bring them quickly to the market. E.G APPLE
18-30
Competitive Strategies
Basic Competitive Strategies Product leadership refers to a company providing superior value by offering a continuous stream of leading edge products or services. Product leaders are open to new ideas and solutions and bring them quickly to the market.
18-31
BRAND EQUITY
BRAND EQUITY : is a set of brand assets and liabilities linked to a brand , its name and symbol , that add to or subtract from the value provided by a product or service to a firm and /or to that firms customers. For assets or liabilities to underlie brand equity they must be linked to the name and/or symbol of the brand.
BRAND EQUITY
The assets and liabilities on which brand equity is based can be grouped into 5 categories 1) Brand Loyalty 2) Name awareness 3) Perceived quality 4)Brand associations in addition to perceived quality 5)other proprietary assets : patents, trademarks,channel relationship etc.
BRAND EQUITY
Name Awareness Brand Loyalty Brand Equity Provides value to customer by enhancing customers Interpretation /Processing of information. Confidence in the purchase decision. Use satisfaction/delight Perceived quality Brand Associations Other proprietary brand assets
Provides value to firm by enhancing:Efficiency and effectiveness of marketing programs Prices/Margins Brand Extensions Trade Leverage Competitive advantage
Brand Loyalty
Brand Loyalty pyramid
Committed buyer
Satisfied buyer with switching costs Habitual buyer- no reason to change Switchers /price sensitive- indifferent- no brand loyalty
Brand Awareness
Ability of a potential buyer to recognize or recall that a brand is a member of a certain product category.
Top of Mind Brand recall Brand Recognition Unaware of brand The awareness Pyramid
Graveyard Recognition
Brand
Niche Brands
Low
Low
Recall
High
BRAND RECOGNITION
Brand Recognition: Familiarity and Liking : Recognition reflects familiarity gained from past exposure . Recognition doesn't necessarily involve remembering where the brand was encountered before, why it differs from other brands , or even what the brands product class is. It is simply remembering that there was a past exposure to the brand. When consumers see a brand and remember that they have seen it before (perhaps even several times) , they realize that the company is spending money to support the brand. Since it is generally believed that companies will not spend money on bad products , consumers take their recognition as a signal that the brand is good.
Brand Recall
A brand (for e.g. HDFC Bank) is said to have recall if it comes to consumers minds when its product class (for e.g. , banking companies ) is mentioned. Whether or not a customer recalls your brand can be the deciding factor in getting on a shopping list or receiving a chance to bid on a contract. The graveyard model was developed by Young and Rubicam Europe under the guidance of Jim Williams. In this model , brands in a product class are plotted on a recognition v/s recall graph.
Currys Pyramid
CURRYS Pyramid
80% of the revenue comes from 20% of the customers. Some customers in the bottom 80% of customer base can even lose you money to service. By analyzing customers in this way we help build and maintain a customer driven culture within the organization. The first step in putting Currys Pyramid into practice is obviously to determine the different segments were going to have, and then finding which customers belong to which segments. Then create different packages/incentive programs for each of the different segments.
Suppose we have an airline company called Emirates Airlines which decides to segment its customers according to how long they have been customers, and how much revenue they generate each month. We could plot this in the following matrix:
As you can see, in the grid above were plotting monthly spend against length of time as a customer. Based on Currys Pyramid, Emirates Airlines decide to segment their customers so that the top 1% are considered gold, the next 4% are silver, the next 15% are bronze, and the remaining 80% are white. Our matrix might now look like this
Now that the customers are classified into gold, silver, and bronze, Emirates Airlines needs to work out what packages to offer each segment to increase its value to the airline. What packages the airline offers will of course depend on what the airline is aiming to achieve, but lets take a look at a few obvious example packages: For gold customers we might want to ensure we dont lose them as customers, so we might offer free flights anywhere in the world for themselves and their immediate family once per year, when they keep gold status for an entire year.
If the research revealed that gold customers are not so price conscious then the above offer might not be appropriate, our big spenders might not be interested in free economy flights. Instead gold customers may continue to be loyal if Emirates offer great service. In this case it may be more appropriate for the airline to offer gold members free chauffeur driven transportation to and from the airport, taking some of the stress out of travel for the customer.
For silver members we might want to encourage them to become gold members so we can realise more revenue from them, for example, we might offer a one month taster of some of the benefits they could be getting from gold membership, such as chauffeur driven transport to and from the airport.