Business Mktg Planning

8/19/2019 Business Mktg Planning

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Business Marketing Planning:

Strategic Perspectives


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New Strategies

New strategies come from new ideas

New ideas often come from new voicesTo meet both domestic and foreigncompetition, B2B firms are recognizing the vital

role of marketing in developing andimplementing successful strategies


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Efective StrategiesEfective strategies share a:A. Responsiveness to market needsB. Ability to exploit the organizations special

competenciesC. Ability to make valid ass mptions abo t

environmental trends

!. Ability to take advantage o" competitivebehaviorE. Realistic basis "or sec ring and s staining a

competitive advantage


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Hierarchy of Strategies ! partsCorporate StrategyWhat businesses are we in? What are our core competencies? How should we allocate resources? What businesses should we be in?

Business-Level StrategyHow do we compete in a given industry? How should we position ourselves against competitors?

How and what is the most efficient way to get to the market? What are our distinctive skills?

Functional StrategyHow can we allocate resources to most efficiently and effectively support

business-level strategies? How can we use resources to meet the firm’s objectives within a specific product market?


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Cross-Functional Connections Explore Interrelationshipsbetween Marketing and Four Business Functions


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B2B TOP PERFORMERS

Marketing managers who know how to get the job done (

functional areas) possess certa in characteristics:1. Responsive & timely2. Perspective-taking a bility t o u nderstand andanticipate o ther f unctional managers’ priorities3. Open, frequent and high quality communicationstyle4. Their word is t heir bond and follow through5. Able to develop

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Successful marketing managers knowhow to integrate functional areas.They:

1. Understand their capabilities2. Capitalize on their strengths3. Facilitate strategies that are responsive

to customer needs

Successful marketing managers assumea central role in strategyimplementation.


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Strategy Success

For a strategy to succeed:

Each firm needs to have a businessconcept that separates them apartfrom their competition.

There are 4 components:1. Customer Interface2. Core Strategy

. Strategic !esources4. "a#ue $et%or&

!efer to ne't Figure


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"alue Network # value network includes those who complement andenrich the organization$

%o we have good relations with suppliers, partners,vendors and other supporters&

'an we partner with others in such a way that we canuse their assets as if they were our own&

()ample* +sing + S as shipping service


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Competitive positioning is abo t beingdiferent and competing in a distinct #ayby sing a ni$ e mix o" c stomerval es.

%ichael &orter states there are six" ndamentals principles that a companysho ld employ "or establishing andmaintaining a distinct strategic position.


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Michael Porter Asks: What is Strategic Positioning?


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%ichael &orter ' Strategic&ositioning

-ight goal* Superior long term -./ instead ofperformance goals 0i$e$, 1 share market'reate and deliver a good customer value proposition'reate a distinctive value chain by offering orperforming similar features but in a different way

#ccept trade3offs* 4ou can5t be everything to everyone,therefore give up some things and reinforce others thatenhance the distinctions(mphasize those element that facilitate the strategic 6fit7

and reinforce them'ontinuity of direction means to define a distinctivevalue proposition and build strong customer relations bystaying consistent to that plan


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Building the Strategic Plan

'ompanies need to do many things well$

However, underperformance is caused by a breakdown

between strategy and operations$

8aplan 9 Norton contend that successful strategice)ecution involves two rules*

a$ +nderstand the :anagement cycle that linksstrategy and operations, and

b$ 8now what tools to apply at each stage of thecycle$


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This system a##o%smanagement to p#an(coordinate and monitor

the #in&s bet%eenstrategy and operations.

The )anagement System


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The Management System(nvolves ) stages:

*. Strategy development+. ,ranslate strategy into ob-ectives

. !esign key processes/. %onitor per"ormance). Adapt the strategy

+ 0ey tools "or s ccess" l strategy implementation are:*. Balanced Scorecard+. Strategy %ap


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Balanced Scorecard

; %eveloped by 8aplan and Norton$;


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Balanced ScorecardBalanced Scorecard

Examines the performance of aExamines the performance of abusiness unit from fourbusiness unit from fourperspectives:perspectives:1.1. FinancialFinancial

.. !ustomer!ustomer

".". #nternal Business#nternal Business$.$. %earning and gro&th%earning and gro&th


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he Balanced Scorecard 3 Translating Strategy /nto.perational Terms

=$ >earning and ?rowth erspective

!$ /nternal rocess erspective

@$ Ainancial erspective

roductivity

>ong3Term

Shareholder "alue -evenue

?rowth

2$ 'ustomer erspective

roduct Service #ttributes -elationship /mage

rice Cuality Time Aunction artnership Brand

:anage.perations

:anage'ustomers

:anage/nnovation

:anage-egulatoryand Social

rocesses

Human'apital

/nformation'apital

.rganization'apitalD D

Cause-and-E!!ect "elationships

%efines the chain of logic by whichintangible assets will betransformed to tangible value$

Custo#er $alue %roposition'larifies conditions that createvalue for the customer$

$alue-Creating %rocesses%efines processes that transformintangible assets into customerand financial outcomes $

Clustering &ssets and &ctivities%efines intangible assets to bealigned and integrated to createvalue$


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Ca se ' Efect Relationship de1nes thelogic that trans"orms intangible assets intotangible assets.

Consideration is give to:*. &rod ctivity+. 2ong3term shareholder val e

. Reven e gro#th


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Balanced Scorecard seeks to match1nancial ob-ectives #ith b siness nits4gro#th and other li"e cycle stages.

5ro#th stage:* 6peration: ,his stage is #here the company

needs to commit reso rces "or ne# prod ct orservice.

* 7inancial ob-ectives:0no# sales gro#th rate by segment0no# 8 o" reven e "rom ne# prod ct9 services andc stomers


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S stain Stage:* 6peration: ,his stage represents ma-ority o"

b siness #here the strategy is to maintain andgro# slo#ly.

* 7inancial ob-ectives:7oc s on share o" target c stomers and acco nt0no# c stomer and prod ct line pro1tability


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arvest Stage:* %at re SB;s or prod cts

6perations: &rovide only eno gh investment tomaintain prod ct e$ ipment and capabilities.

7inancial 6b-ectives:5oal is payback0no# c stomer and prod ct3line pro1tability


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roductivity

>ong3Term

Shareholder "alue -evenue

?rowth




:anage.perations

:anage'ustomers

:anage/nnovation


rocesses

Human'apital

/nformation'apital




Custo#er $alue %roposition'larifies conditions that create

value for the customer$




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2. CUSTOMER PERSPECTIVE

Claries c onditions t hat createcustomer value

Take i nto consideration:1. Product/Service attributes (price, quality,

time & function)

2. Relationships ( partnerships)3. Image (brand)


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2. CUSTOMER PERSPECTIVE: COREMEASURES

Market Share Proportion of business in a p articular market by:a.% share of marketb.Total number of customersc.Dollars spent or u nit volume sol d

Customer Acquisition Tracks in absolute or relative t erms rate at which SBUattracts an d/or wins n ew customers

Customer Retention Tracks in absolute or relative terms rate at which SBUretains n ew customers

Customer Satisfaction Matches the s atisfaction level of customers on specic

performance cri teria such as q uality, serv ice, delivery,reliability, etc .

Customer P rotability Assesses the net prot on each customer, or a segment,after d educting unique ex penses al located to su pportthat customer or segment

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3. Internal Process Perspective

This highlights the value3creating processesthat define the other processes that willtransform intangible assets into tangible

assets$/t considers*@$ .perations management2$ 'ustomer management!$ /nnovation management=$ -egulatory 9 social processes management


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'ey $alue %ropositions ( Custo#er Strategy he Focus o! Internal Business %rocesses

Operations Management Customer Relationship Management Innovation Management

Low otal Cost Strategy Highly (fficient .perating (ase of 'ustomer #ccess Seek rocess /nnovations rocesses Superb ost3Sales Service ?ain Scale (conomies(fficient, Timely %istribution

%roduct Leadership Ale)ible :anufacturing 'apture 'ustomer /deas for %isciplined, High3 erformance Strategy rocesses New .ffering roduct %evelopment

-apid /ntroduction of (ducate 'ustomers about 'omple) Airst3to3:arket New roducts New roducts Services

Co#plete Custo#er %eliver Broad roduct 'reate 'ustomized Solutions /dentify New .pportunities Solutions Strategy Service >ine for 'ustomers to Serve 'ustomers

'reate Network of Suppliers Build Strong 'ustomer #nticipate Auture 'ustomer for ()tended roduct -elationships Needs Service 'apabilit ies %evelop 'ustomer 8nowledge

Lock-in rovide 'apacity for 'reate #wareness %evelop and (nhance Strategies roprietary roduct /nfluence Switching 'osts of roprietary roduct

Service ()isting and otential /ncrease Breadth-eliable #ccess and 'ustomers #pplications of

Standard (ase of +se

Source* #dapted from -obert S$ 8aplan and %avid $ Norton, Strategy Maps: Converting Intangible Assets into Tangible Outcomes 0Boston* HarvardBusiness School ublishing 'orporation, 2EE= , pp$ !223!==$

)* &ligning Internal Business %rocesses


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roductivity

>ong3Term

Shareholder "alue -evenue?rowth




:anage.perations

:anage'ustomers

:anage/nnovation


rocesses

Human'apital

/nformation'apital




Custo#er $alue %roposition'larifies conditions that create

value for the customer$




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=$ >earning 9 ?rowth

Intangib#e assets must be a#igned to #ong termstrategy to achieve #ong term gro%th.Intangib#e assets represent +the capabi#ities of

the company,s emp#oyees to satisfy customerneeds.- They inc#ude:

uman capita#

Information capita#/rgani0ation capita#


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Bene1t o" the Balanced ScorecardBene1t o" the Balanced Scorecard

,he Balanced Scorecard helps align ,he Balanced Scorecard helps alignthe 1rms tangible and intangiblethe 1rms tangible and intangibleassets #ith the organization4sassets #ith the organization4sstrategic goals.strategic goals.

See next "rame:See next "rame:< ". 'ligning #nternal Business". 'ligning #nternal Business

(rocesses(rocesses


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'ey $alue %ropositions ( Custo#er Strategy he Focus o! Internal Business %rocesses

Operations Management Customer Relationship Management Innovation Management

Low otal Cost Strategy Highly (fficient .perating (ase of 'ustomer #ccess Seek rocess /nnovations rocesses Superb ost3Sales Service ?ain Scale (conomies(fficient, Timely %istribution

%roduct Leadership Ale)ible :anufacturing 'apture 'ustomer /deas for %isciplined, High3 erformance Strategy rocesses New .ffering roduct %evelopment

-apid /ntroduction of (ducate 'ustomers about 'omple) Airst3to3:arket

New roducts New roducts Services

Co#plete Custo#er %eliver Broad roduct 'reate 'ustomized Solutions /dentify New .pportunities Solutions Strategy Service >ine for 'ustomers to Serve 'ustomers

'reate Network of Suppliers Build Strong 'ustomer #nticipate Auture 'ustomer for ()tended roduct -elationships Needs Service 'apabilit ies %evelop 'ustomer 8nowledge

Lock-in rovide 'apacity for 'reate #wareness %evelop and (nhance Strategies roprietary roduct /nfluence Switching 'osts of roprietary roduct

Service ()isting and otential /ncrease Breadth-eliable #ccess and 'ustomers #pplications of Standard (ase of +se

Source* #dapted from -obert S$ 8aplan and %avid $ Norton, Strategy Maps: Converting Intangible Assets into Tangible Outcomes 0Boston* HarvardBusiness School ublishing 'orporation, 2EE= , pp$ !223!==$

)* &ligning Internal Business %rocesses


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Strategy Map ,he ca se ' efect components o" theBalanced Scorecard template istrans"ormed into vis al model called the

=strategy map .>

,he strategy map allo#s the company todescribe and ill strate its:

6b-ectives9 initiatives ' targets%eas rements sed to assess per"ormance2inkages #hich are the "o ndation o" thestrategic direction


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Strategy Map

,he next "rame ill strates a 1rm4s strategic map"or p rs ing a prod ct leadership strategy.

,o start the company emphasize:&rod ctivity strategy 'Reven e 5ro#th strategy

Re"er to Strategy %ap ,emplate

Balanced Scorecard


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Balanced ScorecardStrategy Map e#plate * roduct >eadership

Ainancialerspective

'ustomer erspective

/nternalerspective

>earning and?rowth

erspective

“Products and Services That !pand !isting Per"ormance #oundaries into the $ighly %esirable&

A Capable' Motivated and Technologically nabled (or)"orce

>ong3Term Shareholder "alue

:anage Total >ife3'ycleroduct 'osts

-evenues fromNew roducts

?ross :argins*New roducts

%roductivity Strategy "evenue +rowth Strategy

High3 erformance roducts* Smaller,Aaster, >ighter, 'ooler, :ore

#ccurate, :ore Storage, BrighterFAirst to market

New 'ustomer Segments

Operations Management Customer Management Innovation Regulatory and Social

Ale)ible-obustrocesses

-apid/ntroduction

of Newroducts

Supply'apacityfor -apid?rowth

/n3line()perimentation

and/mprovement

(ducate'ustomers about

'omple) Newroducts Services

'apture 'ustomer

/deas for Newroducts Services

%isciplined,High3 erformance

roduct%evelopment

roduct%evelopment

Time* Arom /deato :arket

:inimizeroduct >iability

#nd(nvironmental

/mpact

'ontribute to'ommunities

“Find, Motivate, Grow, and Retain the Best Talent”

$uman Capital In"ormation Capital Organi*ation Capital

%eepAunctional()pertise

'reative, "ersatile(mployees* 'ross3

functional Teamwork

"irtual roductrototyping and

Simulation

'omputer3#ided%esign and

:anufacturing0'#% '#:

'reativity,/nnovation

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Business Mktg Planning