Strategy Definition Training & Templates

How to define your
Strategy
Training & Tools
By Former Deloitte
Management
Consultants
2 www.slidebooks.com 2
Objectives of this document
Learn how to define your strategy with a
training and tools created by former Deloitte
Management Consultants
Save your time by using our fully editable
PowerPoint slides that you can reuse for your own
presentation
Table of content
How to define your companys strategy?
Top 8 key strategy tools
2
3
What is the concept of strategy?
1
Click here to download the editable PowerPoint
version at www.slidebooks.com
The concept of strategy has been defined by many authors
Strategy is about being different. It
means deliberately choosing a
different set of activities to deliver a
unique mix of value Michael
Porter
Strategy is about shaping the
future Max McKeown
'Strategy is a set of key choices
about customers, value-added,
differentiation and performance
defining the shape and identity of
the enterprise Michael Hammer
The concept of strategy generally involves 3 components
1.Setting goals
2.Defining a high level plan to
achieve these goals
3.Mobilizing resources to execute
the actions
that can be applied at 3 different levels within a company
Corporate
Business Unit
Market
In which businesses or industries should we invest?
In which markets should we compete with which products?
Which marketing mix should we choose?
Levels Key Questions
The concept of strategy answers a set of questions
Where are we now?
What are our strengths
and weaknesses?
What are the key
opportunities and threats?
Strategy
Where do we want to go?
How do we want to get
there?
What is our high level plan of
actions?
Table of content
2
3
1
The best way to define your strategy is to follow a 4 phase methodology:
Evaluate
situation
Conduct
analysis
Formulate
strategy
Create
strategic
plan

Phase 1: Evaluate situation
Evaluate situation
Conduct analysis
Formulate
strategy
Create strategic
plan
1. Understand current strategy and desired future state

2. Identify key strategic business issues
3. Develop strategic hypotheses to resolve the identified issues
4. Define the scope of the key areas of analysis conducted in the next
phase
Key Steps
Phase 2: Conduct analysis
Evaluate situation
Conduct analysis
Formulate
strategy
Create strategic
plan
1. Analyze market and industry

2. Analyze competition
3. Conduct customer analysis
4. Analyze strengths and weaknesses of internal operations
5. Synthesize the analysis and identify the clients strategic options
Key Steps (selection to be based on hypothesis)
Phase 3: Formulate strategy
Evaluate situation Conduct analysis
Formulate
strategy
Create strategic
plan
1. Evaluate strategic options

2. Conduct financial modeling
3. Develop strategic recommendations
4. Identify the key success factors to follow
5. Identify the potential implementation issues
Key Steps
Phase 4: Create strategic plan
Evaluate situation Conduct analysis
Formulate
strategy
Create strategic
plan
1. Develop high level plan of action to implement the strategic

recommendations including:
A list of projects required to implement the strategic recommendations
The name of the project owners
The key performance indicators (KPIs) for each project
2. Develop a financial plan including:
Profit and Loss (P&L) by relevant unit
Balance sheet forecasts
Cash flow statement forecasts
Funding requirement
Key performance indicators
Key Steps
Table of content
2
3
1
Risk versus Reward matrix
Objective
Description
20
A
B
C
Low
R
e
w
a
r
d
Risk
= Option with an Average Annual Revenue of $100m
Insert your key message
D
High
L
o
w
H
i
g
h
This strategic option seems to be the most
relevant one
Based most of the time on net present
value (NPV) and intangible
Template
20
A
B
C
Low
R
e
w
a
r
d
Risk
= $100m Average Annual Revenue
Insert your key message
D
High
L
o
w
H
i
g
h
SWOT tool
Objective
s w
T
O
Elements in the environment that
could cause trouble for the
business or project
Elements that the project or the
organization could exploit to its
advantage
Characteristics that place the team
or the business at a disadvantage
relative to others
Characteristics of the business or
project that give it an advantage
over others
SWOT
S
T
O
W
SWOT tool
Description 1/2
s w
T
O
Questions: What is the competition
doing? Are there key obstacles for this
organization? Are there financial
considerations?
Examples: Shift in customer
preferences, substitute products,
regulation
Question: What is changing in the
market, with technology, or with
customers?
Example: Unmet customer need,
nascent disruptive technology, loose
regulations, lowering of trade barriers
Question: What are the key
weaknesses of the company/industry?
Example: Weak brand, bad
reputation, high cost structure, strong
competition, weak distribution
Questions: What are the key
advantages of the company/industry?
What do customers see as strengths?
What are the unique resources?
Example; Patents, brand, reputation,
cost advantages, favorable
distribution, strong customer base
SWOT
S
T
O
W
SWOT tool
Description 2/2
s w
T
O
Insert your own text
Insert your own text Insert your own text
SWOT
S
T
O
W
SWOT tool
Template 1/7
SWOT tool
Template 2/7
Strengths
Weaknesses
Opportunities
Threats
Strengths
Weaknesses
Opportunities
Threats
SWOT tool
Template 3/7
Weaknesses
Your own text
Your own text
Your own text
Your own text
Opportunity
Your own text
Your own text
Your own text
Your own text
Threats
Your own text
Your own text
Your own text
Your own text
Strengths
Your own text
Your own text
Your own text
Your own text
SWOT tool
Template 4/7
External
Analysis
Internal
Analysis
Strengths
Your own text
Your own text
Your own text
Your own text
Weaknesses
Your own text
Your own text
Your own text
Your own text
Opportunities
Your own text
Your own text
Your own text
Your own text
Threats
Your own text
Your own text
Your own text
Your own text
SWOT tool
Template 5/7
SWOT
Weaknesses
Threats
Opportunities
Strengths
S
W
O
T
SWOT tool
Template 6/7
Strengths
Weaknesses
Threats
Opportunities
I
n
s
i
d
e

t
h
e

o
r
g
a
n
i
z
a
t
i
o
n
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u
t
s
i
d
e

t
h
e

o
r
g
a
n
i
z
a
t
i
o
n
Helpful Harmful
SWOT tool
Template 7/7
Insert you own text
Strengths
Insert you own text
Weaknesses
Insert you own text
Opportunities
Insert you own text
Threats
S
W
O
T
SWOT tool
Sources of information
Sources of
information
Armstrong. M. A handbook of Human
Resource Management Practice (10th
edition) 2006
"Albert Humphrey The "Father" of TAM".
TAM UK. Retrieved 2012-06-03
Armstrong.M Management Processes and
Functions, 1996,
Hill, T. & R. Westbrook (1997). "SWOT
Analysis: Its Time for a Product Recall".
Humphrey, Albert (December 2005). "SWOT
Analysis for Management Consulting". SRI
Alumni Newsletter (SRI International)
Porters Five Forces tool
Objective
Bargaining power of
Suppliers
Bargaining power of
Buyers
Threat of new
entrants
Threat of
Substitute
products
Description
If the number of new entrants increases,
the profit for all firms in the industry will
tend to decrease
The ability of customers to put pressure
may force the firms in the industry to
decrease their price
The existence of products outside of the
realm of the common product boundaries
increases the propensity of customers to
switch to alternatives
Suppliers of raw materials, components,
labor, and services to the firm can be a
source of power which may result in an
increase of the costs for all firms in the
industry
Intensity of
competitive
rivalry
Rivalry
British Airways
British Midland
Dan Air
Bargaining power of
Suppliers
Fuel companies
Aircraft companies
Labor
Catering suppliers
Bargaining power of
Buyers
Business travelers
Pleasure travelers
Threat of new
entrants
Foreign airlines
National airlines
New companies
Threat of
Substitute
products
Bus, Rail, Car
Video
conferencing
Example for an international airline
Rivalry
Insert your
own text
Bargaining power of
Buyers
Threat of new
entrants
Threat of Substitute
products
Template (1/5)
Bargaining power of
Suppliers
Template (2/5)
Insert a more comprehensive
description
Bargaining power of Suppliers
description
Bargaining power of Buyers
description
Rivalry among firms
description
Threat of Substitute products
description
Threat of new entrants
Template (3/5)
Rivalry
Insert your
own text
Threat of new
entrants
Bargaining power of
Suppliers
Bargaining power of
Buyers
Threat of Substitute
products
Template (4/5)
Rivalry
Insert your
own text
Template (5/5)
Rivalry
Sources of
information
Michael E. Porter. "The Five Competitive
Forces that Shape Strategy", Harvard
Business Review, January 2008, p.86-104
Kevin P. Coyne and Somu Subramaniam,
"Bringing discipline to strategy", The
McKinsey Quarterly, 1996, Number 4, pp.
14-25
Werner Felt, B. (1984), A resource-based
view of the firm, Strategic Management
Journal, Vol. 5, (April-June): pp. 171-180
Michael Simkovic, Competition and Crisis in
Mortgage Securitization
Michael Porter, Nicholas Argyres, Anita M.
McGahan, "An Interview with Michael
Porter", The Academy of Management
Executive
Value Chain tool
Objective
Generic Value Chain
Customer
Value Chain tool
Description 1/2
Firm Infrastructure
Procurement
Human Resource Management
Technology
Inbound
Logistics
Operations
Outbound
Logistics
Marketing
& Sales
After
sales
Service
Support
activities
Primary
activities
There are 3 main steps in performing a value chain analysis:
Identify the sequential
macro activities within
your industry/business
Identify the main activities
for each macro activity
Identify which activity
brings value to the
customer
Analyze the main revenue
and cost drivers
Analyze your strength and
weaknesses compared to
your competitors
Analyze your key areas of
improvement
Decide which strategy to
implement (e.g.
outsourcing strategy,
acquisition strategy, low
cost strategy, etc.) in
order to acquire or
maintain a sustainable
competitive advantage
1.Identify
2.Analyse
3.Decide
Value Chain tool
Description 2/2
Insert your own title
Customer
Value Chain tool
Template 1/7
Insert
your own
text
Insert your
own text
Insert your
own text
Insert your
own text
Insert
your own
text
Support
activities
Primary
activities
Value Chain tool
Template 2/7
Firm Infrastructure
Procurement
Technology
Support
activities
Inbound
Logistics
Operations
Outbound
Logistics
Marketing &
Sales
After sales
Service
Primary
activities
Value Chain tool
Template 3/7
Firm Infrastructure
Procurement
Technology
Support
activities
Value Chain tool
Template 4/7
Firm Infrastructure
Procurement
Technology
Support
activities
Value Chain tool
Template 5/7
Inbound
Logistics
Operations
Outbound
Logistics
Marketing &
Sales
Service (After
sales
support)
Value Chain tool
Template 6/7
Insert your
own text
Insert your own
text
Insert your own
text
Insert your own
text
Inbound Logistics Operations
Outbound
Logistics
Marketing &
Sales
Service (After
sales support)
Insert your
own text
Insert your own
text
Insert your own
text
Insert your own
text
Insert your
own text
Insert your own
text
Insert your own
text
Insert your own
text
Insert your
own text
Insert your own
text
Insert your own
text
Insert your own
text
Insert your
own text
Insert your own
text
Insert your own
text
Insert your own
text
Value Chain tool
Template 7/7
Insert your
own text
Insert your own
text
Insert your own
text
Insert your own
text
Inbound Logistics Operations
Outbound
Logistics
Marketing &
Sales
Service (After
sales support)
Insert your
own text
Insert your own
text
Insert your own
text
Insert your own
text
Insert your
own text
Insert your own
text
Insert your own
text
Insert your own
text
Insert your
own text
Insert your own
text
Insert your own
text
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text
Insert your
own text
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text
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text
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text
Sources of
information
"Decision Support Tools: Porter's Value
Chain". Cambridge University: Institute for
Manufacturing (IfM)
Porter, Michael E. (1979). "How competitive
forces shape strategy"
Angel Gurra "The Emergence of Global
Value Chains: What Do They Mean for
Business"
Porter, Michael E. (1985). Competitive
Advantage: Creating and Sustaining
Superior Performance
Value Chain tool
Value Driver tree
Objective
Company Value
Creation
Increase net
operating
profit less
adjusted
Taxes (NOPLAT)
Improve
capital
allocation
Capital
deployment
Decrease
operating
expenses
Increase
gross profit
Cost of
capital
Decrease
manufacturing
costs
Increase
revenues
Reduce
distribution
costs
Reduce
selling
costs
Reduce
R&D costs
Reduce
administrative
costs
Improve product mix
Increase price
Decrease staffing
Reduce cost of inputs
Lower support functions costs
N/A
Reduce inventories
Optimize scheduling
Improve plant utilization
Lower Customer Service costs
Decrease staffing
Improve process
Increase volume
Optimize physical network
Increase productivity
Use alternative distribution
Increase Accounts payable
Improve capital investment
Reduce Accounts receivable
Value Drivers
Value Driver tree
Description
Insert your text
Your text
Your text
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Value Driver tree
Template 1/11
Generic Value Drivers Company specific Value Drivers
Insert your text
Your text
Your text
Your text
Your text
Your text
Your text
Value Driver tree
Template 2/11
Your text
Your text
Your text
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Value Driver tree
Template 3/11
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Value Driver tree
Template 4/11
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Value Driver tree
Template 5/11
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Value Driver tree
Template 6/11
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Value Driver tree
Template 7/11
Placeholder
Placeholder
Placeholder
Placeholder
Placeholder
Placeholder
Placeholder
Value Driver tree
Template 8/11
Text
Text
Text
Text
Text
Text
Text
Text
Text
Text
Value Driver tree
Template 9/11
Text
Text
Text
Text
Text
Text
Text
Text
Text
Text
Text Text Text
Unit or additional information
Value Driver tree
Template 10/11
Replace the text by your own text
Text
Text
Text
Text
Text
Value Driver tree
Template 11/11
Text
Text
Text
Text
Text
Text
strong weak
Effect
Sources of
information
Competitive Value Management by
Hermann J. Stern
EVA by Stephen F
Value Driver tree
Ansoff Growth Matrix tool
Objective
Market Development
Strategy
Diversification
Strategy
Product Development
Strategy
Market Penetration
Strategy
Current New
New
Current
Products
Market
The Product/Market Growth matrix tool assists top executives to consider 4 key
strategic options:
Description
Gain more market
share with their current
products in their
current markets
Develop new products
for its existing
markets
Develop new products
in new markets
Develop new markets
for current products
Market Development
Strategy
Diversification
Strategy
Product Development
Strategy
Market Penetration
Strategy
Current New
New
Current
Products
Market
Title
Template 1/9
Market Development
Strategy
Diversification
Strategy
Product Development
Strategy
Market Penetration
Strategy
Current New
New
Current
Products
Market
Title
Template 2/9
Current New
New
Current
Products
Market
Title
Template 3/9
Market Development
Strategy
Market Penetration
Strategy
Diversification
Strategy
Product Development
Strategy
Market Development
Strategy
Diversification
Strategy
Product Development
Strategy
Market Penetration
Strategy
Current New
New
Current
Products
Market
Template 4/9
Template 5/9
Insert your own text Insert your own text
Template 6/9
Market Development
Strategy
Diversification
Strategy
Product Development
Strategy
Market Penetration
Strategy
Current New
New
Current
Products
Market
Title
Template 7/9
Market Development Strategy
Diversification
Strategy
Product Development
Strategy
Market Penetration
Strategy
C
u
r
r
e
n
t

m
a
r
k
e
t
N
e
w

m
a
r
k
e
t
Current products New products
Template 8/9
Diversification Strategy
Product Development Strategy
Market Penetration Strategy
Market
Development
Strategy
Diversification
Strategy
Product
Development
Strategy
Market
Penetration
Strategy
Market Penetration Strategy
Diversification Strategy
Product Development Strategy
Template 9/9
Strategic
options
Sources of
information
Porter, Michael (1987). "From Competitive
Advantage to Corporate Strategy". Harvard
Business Review. MayJune (3): 4359
Ansoff, I.: Strategies for Diversification,
Harvard Business Review, Vol. 35 Issue
5,Sep-Oct 1957, pp. 113-124
McKinsey Seven-S tool
Objective
Shared Value
Staff
Strategy
Skill
System
Style
Structure
The Seven-S tool is based on the theory that an
organization is not just Structure, but is
comprised of seven elements distinguished by the
hard S and soft S
The 3 hard S, Structure, Strategy, and Systems,
are practical and easily identifiable. The 4 soft S,
Skills, Staff, Style, and Shared Values, are
somewhat less easily discerned and are less
tangible
The Seven-S diagram depicts how each of the
elements influences, and is influenced by all of the
other elements
Continuously evolving and changing, the soft S
are determined by the people at work in the
organization and hence, are difficult to anticipate or
to influence. Although subterranean in nature, they
can and do have a great impact on the hard S
Description (1/2)
The model can be used to help identify what needs
to be realigned to improve the organization
performance, or how to maintain alignment during
a period of change
Description 2/2
The plan devised to maintain and build
competitive advantage over the competition
The daily activities and procedures that staff
members engage in to get the job done
The way the organization is structured and
who reports to whom
The employees and their general capabilities
The style of leadership adopted
Called "superordinate goals" when the model
was first developed, these are the core
values of the company that are evidenced in
the corporate culture and the general work
ethic
Style
Strategy Staff
System
Shared
value
Structure
The actual skills and competencies of the
employees working for the company
Skill
The 3 hard S The 3 hard S
Template 1/6
What is the strategy?
What is the plan of action to achieve the
objectives?
How does the company deal with
competitive pressure?
How does the company deal with the
changes in customer demands?
What are the main systems used by the
organization? (e.g. accounting systems, HR
systems,)
How those systems are managed?
What is the organizational form?
How do the various business units align
themselves?
How do the various business units
communicate and coordinate activities?
Is decision making centralized or
decentralized?
What is the staff profiles?
What positions are represented within the
team?
What positions need to be filled?
What is the top management style?
Is there a real team spirit within the
organization?
Is there an efficient communication between
the different teams?
Do employees tend to be competitive or
cooperative?
What are the core values of the people in the
organization?
What is the team culture?
Style
Strategy Staff
System
Shared
value
Structure
What are the key skills represented within
the company/team?
What are the skills requirement?
Are they any skills gaps?
How are skills monitored and assessed?
Skill
Step 1: Summarize the current situation
Answer the following
key questions
Answer the following
key questions
Template 2/6
Style
Strategy Staff
System
Shared
value
Structure
Insert your own text Skill
Step 2: Summarize the target situation
Template 3/6
Step 3: Double check that the 7 S in your target situation are aligned
Structure Strategy System
Shared
Value
Staff Style Skills
Structure

Strategy

System
O O O

Shared
Value

Staff

Style

Skills

Template 4/6
Style
Strategy Staff
System
Shared
value
Structure
Insert your own text Skill
Step 3: Summarize the main gaps between the current and target situation
Template 5/6
Action #1
Action #2
Action #3
Action #1
Action #2
Action #3
Action #1
Action #2
Action #3
Action #1
Action #2
Action #3
Action #1
Action #2
Action #3
Action #1
Action #2
Action #3
Style
Strategy Staff
System
Shared
value
Structure
Action #1
Action #2
Action #3
Skill
Step 4: Create a plan of action to fill the gaps (1/2)
Template 6/6
Step 4: Create a plan of action to fill the gaps (2/2)
Week 1 2 3 4 5 6 7 8 9 10 11
Starts on 7/1 14/1
Phase 1
1.1 Action
1.2 Action
1.3 Action
Phase 2
2.1 Action
2.2 Action
Phase 3
3.1 Action
3.2 Action
3.3 Action
To add a column or a row, select a column or a row, click
right and select Insert
Use Distribute Columns Evenly and Distribute Rows Evenly
in Layout ribbon to keep columns and rows equal in width
Sources of
information
Structure is Not Organization -Business
Horizons, June 1980
A Brief History of the 7-S ("McKinsey 7-S")
Model - Tom Peters' blog post describing the
origins of the model
Five Whys Problem Solving tool
Objective
Description
Problem
Statement
Why?
Why?
Why?
Why?
Why?
Problem
Solution
True root cause of the
problem
Sometimes the root causes
become evident after 2 or 3 whys,
sometimes a deeper dive may be
required
Clearly define high level problem
statement
Answer the
question and ask
again why
Template 1/6
Insert problem
statement
Why?
Why?
Why?
Why?
Why?
Insert problem
Solution
Insert your answer
Insert your answer
Insert your answer
Insert your answer
Insert your answer
Template 2/6
Insert problem
statement
Why?
Why?
Why?
Why?
Why?
Insert problem
Solution
Insert your answer
Insert your answer
Insert your answer
Insert your answer
Insert your answer
Template 3/6
Insert problem
statement
Why?
Why?
Why?
Why?
Why?
Insert problem
Solution
Insert your answer
Insert your answer
Insert your answer
Insert your answer
Insert your answer
Template 4/6
Insert problem statement
1.Why? Insert your answer
Template 5/6
Template 6/6
Sample
Text
Sample
Text
Sample
Text
Sample
Text
Sample
Text
Sample
Text
Sample
Text
Your own text Your own text Your own text
Your own text Your own text
Your own text Your own text
Sources of
information
Taiichi Ohno; foreword by Norman Bodek
(1988). Toyota production system: beyond
large-scale production. Portland, Or:
Productivity Press
"Five Whys Technique". adb.org. Asian
Development Bank. February 2009
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1. Understand current strategy and desired future state

1. Analyze market and industry

1. Evaluate strategic options

1. Develop high level plan of action to implement the strategic

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Strategy Definition Training &amp; Templates

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How to define your

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1. Understand current strategy and desired future state

1. Analyze market and industry

1. Evaluate strategic options

1. Develop high level plan of action to implement the strategic

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Strategy Definition Training & Templates

Strategy Definition Training & Templates