Week 84 (23.11.08)

Learn (Exploring Corporate Strategy - by Gerry Johnson & Kevan Scholes)

Self Review for Group SALP assignment (Pg 10 & 11)

Strategy is the direction and scope of an organisation over the long term: which achieves advantage for the organisation through its configuration of resources within a changing environment, to meet the needs of markets and to fulfil stakeholder expectations.

Levels of strategy

3 levels:
1) Corporate strategy - overall purpose and scope of the organisation; may involve consideration of diversification and acquisition; influenced by the overall mission of the organisation.

2) Competitive or Business Unit Strategy - how to compete successfully in a particular market: the concerns are how advantage over competitors can be achieved; what new opportunities can be identified or created in markets; which products or services should be developed in which markets; and the extent to which these meet customer needs in such a way as to achieve the objectives of the organisation - profitability, market growth or measures of efficiency.

It is therefore very important that there is a clarity about the needs of customers and who competitors are for a particular SBU.

3) Operational strategies - which are concerned with how the component parts of the organisation in terms of resources, processes, people and their skills are pulled together to form a strategic architecture which will effectively deliver the overall strategic direction.

Unlearn

NIL

Relearn

Reading from the above, the context that could be applied to IKEA is:

Corporate Strategy - IKEA mission was to provide good-value home furnishings around the whole at prices that the majority of people were able to afford.

Business Unit Strategy - at IKEA, each store is a separate SBU; but realistically it may be that specific competitive strategies need to differ, perhaps by national geographic markets.


Operational strategies - in IKEA, it is crucial importance that design, store operations and sourcing operations dovetailed into higher-level decisions about product range and market entry.

Week 83 (16.11.08)

Learn

The Competitive Early Warning System:Continued War Gaming (Pg 97)

"Vulnerabilities" are identified using SWOT exercise.

Unlearn

NIL

Relearn

Analyzing Pfizer's SWOT as below:

Strength
Financial resources to pursue licensing and acquisition activity as well as support share repurchases.
Large primary care and global commercial sales infrastructure to attract partnering opportunities.
Deep mid to early stage pipeline with over 100 compounds in clinical development.

Weaknesses
Declining sales base of leading Lipitor franchise.
High level of patent expiration exposure over next few years.
Lack of visible pipeline and poor track record in recent late stage product development.

Opportunities
Pursue new product acquisition opportunities to support near-term top line growth.
Develop more profitable operation through restructuring.
Capitalise on more biologic opportunities with new centre.

Threats
Lipitor patent challenges in various global markets.
Increasing penetration of competing statins and alternate treatments in the cholesterol market.
Champix, new product safety concerns may hold back performance of this high growth franchise.

Week 82 (9.11.08)

Learn

The Competitive Early Warning (CEW) System: Management Action (Pg 157)

• Laying out options and making recommendations increases the appeal of the alert to management.
• Laying out options makes the analysis more "actionable".
• Recommendations save executive time.
• Strategy formation creativity must be cultivated as a "core" skill inside the company.
• One should choose those options that her team believes are the best and recommend them to the management.
• That makes decision easier and quicker or at least focuses the debate.
• Management is, of course, free to disagree, consider other options, or send the CEW team to bring in more intelligence.

Unlearn

NIL

Relearn

The knowledge pool within the team if build correctly, will be unmatched. As currently reflect in our SALP team, the proposed alternative courses of actions put forward include pros and cons. The pro/con analysis draws two important elements as below:

1. Understanding the industry structure and where it is going
2. Crucially for options analysis, understanding competitors' mindset, intentions, drivers and capabilities.

Week 81(2.11.08)

Learn

Early Warning: Using Competitive Intelligence to Anticipate Market Shifts, Control Risk, and Create Powerful Strategies by Ben Gilad, 2004 AMACOM

Chapter 5: Identifying Risk (and Opportunities) - pp 67 to 87

• If a company waits until everyone is certain about the direction of change in its environment and its effect, it is a sure dissonance failure's.
• Forces affecting a company and its industry must be monitored continuously to identify early signs of risk.
• This involves piecing together bits and pieces of intelligence data.
• Steps involve as below:

1. Identify "Change Drivers" (technology/science, govt action, social change & competitors' move)
2. Identify "Industry's uncertainties" - what will the future look like?
3. Identify "Possible divergence from company's assumptions"
4. Identify "Dissonance with company's strategy" (functional policies and pattern of actions)
5. Identify "Strategic risk" - which future is most damaging? (expected loss; impact matrix; competitors' relative posture toward event; effect on the industry structure)

• After identifying the above steps, then generate "scenarios"
• Explore "strategic implications, options, and decisions
• Implement monitoring and contigencies

Unlearn

Reinforce previous learning in Strategic Planning & Implementation Module.

Relearn

In preparation for the SALP (group project), review certain chapters in enhancing my knowledge on strategic planning for Pfizer's 5 years plan (2009-2013). This is critical, as important analysis and risk identification need to be carried out before generating any scenarios and options in our project plan.