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Lecture Study Notes Part 2.docx

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Queen's University
COMM 200

Lecture 9- Developing Strategy Conclusion #1: Strategy are actions undertake as a result of a point of view possessed by a management team - It is a reflection of a management team’s point of view relating to: what we should do, why we should do it, where we will play, and how we will win - This point of view is built around our perception of the marketplace as a result of our internal and external analyses - The successful execution of strategy lies in the alignment of the business in support of the strategic objectives identified Strategy- Alignment and Linkage Strategic Planning Process- Building our Response Assessing Industry Attractiveness PESTEL Analysis - Looks at legal, political, economic, socio-cultural, technological, and environmental changes in the marketplace Market Structure Analysis - Looks at what type of marketplace we are dealing with: pure competition, monopolistic competition, monopoly, and oligopoly Porter’s Five Forces - There are five overarching forces that impact determinations/conclusions associated with: o The forward-looking attractiveness of an industry o The relative position (to competitors) of an organization within that industry - The core assessment factor is “profit potential” - The “profit” conclusion centers around: o Price attractiveness and potential o Cost competitiveness and controllability o Margin management o Resource availability and accessibility - The Five Forces: supplier power, buyer, power, threat of new entrants, threat of substitutes, intensity of rivalry - Focus of Porter’s 5 Forces… What is Changing? o Industry landscape- position power, price control o Disruptive innovations… technology, scientific, R&D, and soft innovations o Market convergence o Shift to, or in degree of, Complementary Dependency (occurs when your success is dependent upon an external relationship, technology, or factor which stimulates and sustains demand for your product/service) your competitive advantage is dependent upon someone or something else o Shift in the “value curve” … what drives the purchase decision Market Dynamics- What is Changing? SWOT Analysis - External analysis- opportunities and threats - Internal analysis- strengths and weaknesses Conclusion #2: Strategy is as much about knowing what to do as what not to do - Strategy is a response to perceived opportunity, problem, or challenge - Strategies should be framed around core pillars or guiding principles which should not be compromised - Strategy needs to take into account the competencies, capabilities, and capacity of the organization DGOC Model- An Easy Way to Think of Strategy Porter’s Generic Strategies Porter’s- Strategic Positioning Conclusion #3: Strategy should build competitive advantage - Strategy should leverage and enhance current, and develop new, distinctive capabilities - Areas for establishing competitive advantage: customer responsiveness, product/service innovation, quality, specialization, etc., comparative advantage, geography, regulation, subsidies, technology, etc., and business process execution Conclusion #4: Strategic is proactive, not reactive - Strategy should be “event” or reaction drive - Strategy should be proactive and time-paced in pursuit of a well-defined and appropriately-focused vision - Strategy, however, should be thought of as fluid vs. static. As situations change, strategies need to be revisited and potentially modified - Failure to establish direction and a reactive approach to growth result in organizational fragmentation and inefficiency Strategy Planning & Execution- Fluid vs. Static External Risk Triggers - VUGA: volatility, uncertainty, globalization, and adversity Lecture 11- Marketing Role of Marketing - Simple definition: design, develop, and communicate value The Six Rs of Marketing- Value Generation - Right need - Right solution - Right value proposition - Right connector - Right price - Right message The Marketing Equation - Value Proposition (Market Position) + Marketing Mix (Marketing effort)  Value (which translates to profitable market share) Going Back to Basics- Here is what matters Strategy and Marketing Strategy and Marketing- 4 Stages of Integration - External/Internal Analysis o Company o Markets (customers) o Competitors - Opportunity Analysis - Portfolio Analysis - Marketing Mix Development and Execution Ansoff Matrix (Product/Opportunity Matrix) Portfolio Analysis BCG Model - Invest, Reposition, Maintain & Defend, Divest - Evaluation Criteria- Metrics o Return on Assets o Profitability o Market Share o Market Potential o Industry Attractiveness o Investment Requirement o Investment Payback Period o Strength of Value Proposition Assessing Future Product Potential- Additional Detail Portfolio Assessment- 6 Key “Rules of the Road” for Marketers to Understand - Marketers should resist the temptation to pursue “margin sucking maggots” (highest quality at lowest price) - Marketers should avoid taking an “average value” position in the marketplace (stuck in the middle) - Customer’s don’t buy products or services… they buy solutions to problems or needs - Customers will not pay more for a product if they can get a similar product for less - The more complex the problem being solved in, the more the opportunity to create uniqueness, and the lower the price sensitivity of the customer - Servicing a diverse market with a standardized product builds customer dissatisfaction into your offering (trying to be all things to all people) Marketing Process Segmentation - Using market research to define a target market “Right Need and Fit” “Pain to Pay for the Solution to the Pain” Approach - Target market can be as small as 3% of the industry! Customer Profiling- What does your customer base want? Lecture 12- Marketing II Three Key Focal Points of Marketing Research Investments in marketing research should look to ass
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