Frameworks & Charts for Strategic

Analysis
Reference Handbook
Compiled by : Mahesh Narayan
Analyze using Frameworks
Frameworks
Table of Contents
3
Frameworks to Analyze the Business Environment
Porters Diamond 6
Flying Geese Model 7
PESTLE 8
Cultural Dimensions 9
Frameworks to Analyse an I ndustry (I ncludes Competition)
Value Chain Analysis 11
Value System 12
Profit Pools 13
Porters Five Forces 14
Dynamic Five Forces 15
Perceptual Map 16
RONA Charts 17
Competitive Profile Matrix 18
Product Life Cycle 19
Innovation Adoption Curve 20
Sector Charts 21
Competitor Product Mapping 22
Game Theory 23
Structure Conduct Performance 24
Learning Curve 25
Hoffer Matrix 26
Frameworks to Analyse a Company
External Factor Evaluation (EFE) Matrix 28
Internal Factor Evaluation (IFE) Matrix 29
IE Matrix 30
SWOT Analysis 31
Growth Phases Model 32
Heat Map 33
VRIO Model 34
Table of Contents
4
Frameworks for I dentifying Strategic Options and Choosing Best Strategy
Strategic Position and Action Evaluation (SPACE) Matrix 36
BCG Matrix 37
Ansoff Matrix 38
Ashridge Portfolio Matrix 39
Directional Policy Matrix 40
Public Sector Portfolio Matrix 41
Quantitative Strategic Planning Matrix 42
Fishbone Diagram and Root Cause Analysis 43
ADL Matrix 44
Strategy I mplementation Frameworks
7-S Framework 46
Change Management Framework (Kotter) 47
Change Management Iceberg (Kruger) 48
Dimension and Factors of Change 49
Stage Gate Model 50
Acquisition Integration Approaches 51
Frameworks to Evaluate Performance
Balanced Scorecard 53
DICE Framework 54
Frameworks to Analyze the
Business Environment
5
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Country selection and entry
decisions for business
Assessing comparative advantages
of nations
Assessing industry specific
environment conditions in a
country
The four ingredients that lead to
national comparative advantage are
Availability of key resources
Information to use those resources
The goals of those companies
The pressure to innovate/invest
Companies can select which
countries they want to enter based
on comparing the factors in some
selected countries and seeing which
is most suitable for them
Why are certain industries in certain nations capable of consistent innovation?
This model shows reasons why some nations are more competitive than others
and why some industries within nations are more competitive. The diamond
represents the national playing field that the countries establish for their industries
Porters Diamond
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Analysing the catching-up process
of industrialization of latecomer
economies 3 aspects
Intra-industry aspect: single
industry growing over time
Inter-industry aspect: sequential
appearance and development of
industries
International aspect: subsequent
relocation process of industries
from advanced to developing
countries
Analyzing which country in which
phase helps identify the kind of
products and kind of market entry
to be made there
Depending on the kind of aspect
the company is looking at,
decisions on whether to import or
produce in the country can be made
Are there countries outside the radar of a companys strategy that has potential?
Flying Geese Paradigm is a model for international division of labour in
industries/nation based on dynamic comparative advantage. The paradigm
postulated that weaker nations/industries will catch up with the leaders.
Flying Geese Model
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Used to scan the external macro-
environment in which the firm
operates.
Application shown by an
illustration. For example,
consumer and B2B companies tend
to be more affected by the social
factors, while a global defence
contractor would tend to be more
affected by political factors.
The PEST factors, combined with
external micro-environmental
factors and internal drivers, can be
classified as opportunities and
threats in a SWOT analysis
Gives an overall look at the
environment that the firm faces
Helps in scenario planning in terms
of external environmental factors
Can be further made more firm
specific at different levels
What is the scenario as far as the external environment of a firm is concerned?
PESTLE analysis is a tool that can aid organization making strategies by helping
them understand the EXTERNAL environment in which they operate now and
will operate in future.
PESTLE
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Assessing differences in culture in
creating strategy
Creating organisational structure
and control systems in different
countries or cultures
Finding countries with compatible
work culture so that expanding
there might be easier
Power Distance: The normal
degree of inequality among people
Individualism versus Collectivism:
Individual vs. Group orientation
Masculinity versus Femininity:
Soft vs. Hard culture
Uncertainty Avoidance: Risk
preferences
Long-term versus short-term
orientation: long-term view vs.
shorter term gains
What factors lead to cultural differences in business between countries?
The cultural dimensions proposed by Hofstede are used to understand differences
between different cultures and their orientation towards five key dimensions.
These dimensions lead to different orientations towards business.
Cultural Dimensions
Frameworks to Analyze an
Industry and Competition
10
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Segmenting and analyzing business
cost
Identifying steps in which value is
created
Identifying core competencies
relative to competitors.
Devising the cost advantage using
primary as well as support
activities
A firm can create a cost advantage
by:
- reducing cost of individual chain
activities
- reconfiguring the value chain
Ten cost drivers have been
identified for carrying out cost
analysis at different levels in the
value chain
Using this the value chain can be
configured to be optimal
Which investments are most in line with corporate objectives & get best payback?
Value chain analysis helps companies examine their production and support
processes for their value and contribution to the competitive advantage. It will
exclude the external factors that will likewise influence success
Value Chain Analysis
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To facilitate a better selection of
suppliers, for example, to find
suppliers that have a labor cost
advantage.
To understand the right levels of
vertical integration in the industry,
for example competitors may have
a lower degree of vertical
integration, which could give them
a cost advantage or make them
more vulnerable.
Make or buy decisions are affected
by a downstream analysis of the
value system
Distribution strategy can be
optimized by understanding the
distribution value chain.
Does a companys value chain tie up well with its suppliers and distributors to create a
competitive advantage?
The value system extends the value chain beyond the boundaries of the business
and recognizes that a business is dependent on relationships with suppliers and
buyers.
Value System
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To identify the new source of profit
Rethink the role of a company in
the value chain
Refocus the company on its
traditional source of profit
Make product, pricing and
operational decisions
Companies using profit pool can
capture the disproportionate share
of profits in the industry
The profit pool helps to get a clear
picture of the profit opportunities
across the segments of the value
chain
Where and how is money being made for the organisation?
It is a strategy model that helps to focus on profit rather than revenue growth. The
idea behind this is to let the managers to look beyond revenues to see the shape of
their industrys profit pool.
Profit Pools
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Developing a competitive
advantage over rival firms.
Furthering the understanding of the
dynamics that influence the
industry and ones position in it.
Assessing the strategic position and
spark ideas for disruptive
initiatives.
The traditional rivals in your
industry are but one source of
competition. Ignore others at your
peril.
Blunting the competition will
require different strategies at the
departmental, business unit and
corporate level.
Understanding the complexities of
competition can help organizations
get beyond simplistic price (and
profit eroding) wars.
How do we gauge the attractiveness of an industry?
The Forces of Competition framework succinctly illustrates the five distinct
sources of competition that organizations must keep on their radar screen. It is an
outside-in business unit strategy tool that is used to gauge the value of an industry
Porters Five Forces
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If the industry is cyclical, then
rivalry within the industry will
necessarily follow cyclical
dynamics, and companies will be
forced to strategize in time-
sensitive fashion
Opens up a line of business
analysis that will look for cycles
and dynamic behavior patterns in
industries, where the objective is to
analyze these patterns for their
strategic significance. An example
of such an industry is the TFT-LCD
industry
How do we gauge the attractiveness of an industry over time?
The dynamic competitive forces framework is used to generate perspective that
views the development of each of the Porters five forces over time
Dynamic Competitive Forces
Within cyclical industries, firm
rivalry is framed by the dynamics
of upturns and downturns, and
particularly by the anticipation of
the tipping points that lead from
one to another
The cyclical dynamics governing competition amongst the
rivals assumes a stable technological trajectory. However,
challenger firms will be looking to enter the market with
either the current technology or an improved version of it.
On the supply side, there are new
process generations. These successive
process generations are driven by
strategic entrepreneurial initiative
The strategic calculations of rival firms
are upset by the entrepreneurial
initiatives taken by firms on the demand
side, which are finding new applications
for the products and thus opening up
new markets
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Introducing a new product
Ascertaining the position of a
product with respect to others
product in the industry
Perception of a product in the mind
of the consumer
Identifying the spot in the
perceptual map where a new
product can be fitted to satisfy the
unfulfilled need of the consumer.
What is the perception of a consumer about a product on basis of some attribute?
Perceptual mapping is used by asset marketers that attempts to visually display the
perceptions of customers or potential customers. Typically the position of a
product, product line, brand, or company is displayed relative to their competition
Perceptual Map
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Used to focus on competitors
management of its asset
Check the profitability of
competitors strategy
They tell us what generic strategies
competitors might be following
High volume, low margin reflected
by high asset turns and low ROS
High price, low volume, reflected
by lower asset turns and higher
ROS
How to assess the financial performance of the competitors?
RONA Charts gives us a look at the return on sales (ROS) for competitors by
assessing the margin the company gets, the asset turnover to see how hard the
assets are working and other such financial parameters.
RONA Chart
= Bubble Size Represents Sales
Value for Each Company
30
20
10
5
3
2
0.5 1 1.5 2 2.5 3
Comp D
Comp F
Comp E
Comp B
Comp A
Comp C
10%
20%
40%
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Asset Turnover
(Log Scale)
5%
ROS: What margin is the company earning
on what it sells?
Asset Turnover: How hard are the companys
assets working?
Return on
Sales
Assets
Turnover
Return on
Net Assets
X =
PBIT
Sales
Sales
Net Assets
PBIT
Net Assets
X =
Net Assets = Fixed Assets + Current Assets (excluding cash) -
Current Liabilities (excluding overdraf t and inter-group loans)
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Evaluating the position of the firm
with respect to its direct
competitors
Looking at various important
factors in the industry and which
ones to strengthen specifically for
the company
Each factor is measured in same
scale meaning the weights remain
the same for every firm, only the
rating varies
As scores increase for competitors
it becomes more and more difficult
to operate and the company must
look at combating that
How to compare the firm with the major players in the industry
Competitive profile matrix show the clear picture to the firm about their strong
points and weak points relative to their competitors. The CPM score is measured
on basis of critical success factors,
Competitive Profile Matrix
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Estimating revenue streams and the
operating time of the product
Indication of when to invest in new
product development
Carrying out strategic planning on
diversification, new product
development or expansion
Building brand extensions or
product lines
Which stage of the life cycle the
product falls in influences the
revenue stream and profitability of
the business
Gives a direction for the company
to grow business and develop long
term strategies
Gives indicators of when to
rejuvenate or exit the business
How can we analyze market acceptance of a product?
The product life cycle is used for analysing market acceptance and maturity stages
of products and industries. It has four stages Introduction, Growth, Maturity and
Decline.
Product Life Cycle
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Introducing a new product and
deciding which markets to target
Trying to decide which consumers
to target at various points in the
product life cycle
Estimating target groups for
communication purposes
Finding what characteristics make a
particular consumer fall in a
specific category (through research)
Which customer segment to target
at a product introduction?
Through the product life cycle,
which group of consumers should
we target?
Which customer segments can
improve acceptance of a product in
the market?
What are the characteristics of
different categories of consumers?
What communication channels
should be used for new products?
Who should be the target market be for new product introductions?
The Innovation Adoption Curve classifies people into five categories to show how
they adopt new products. Innovators are typically the first to adopt a product,
while laggards are the last ones to do so.
Innovation Adoption Curve
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Analyzing multiple variables of
market share, sales value and
growth rate of different companies
in the market at the same time
A visual representation is required
for easier analysis
Especially useful in presentations
to the top management by capturing
many key variables in one graph
Companies which are growing
above the average market growth
are typically gaining market share,
and companies below are typically
losing market share
The bubble represents the value of
sales for the most recent year and
provides a way to see relative sales
of different companies, along with
market share.
What is the market share situation of different companies in the market?
Sector charts provide a visual representation of most recent year sales volume on a
chart with the relative market shares of different companies (adjusted to the
largest player with a log scale) against the real annual growth rate.
Sector Charts
20
15
10
5
0
-5
Gaining market share
Losing market share
Average
market
growth
Others
1 0.7 0.5 0.3 0.2 0.1
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Market Share (Relative to Largest Player)
(Log Scale)
= Bubble Size Represents Sales
Value for Most Recent Year
Company A
Company B
Company C
Company D
Company E
Company F
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Analyzing which products or
businesses competitors are directly
competing in
Evaluating which other businesses
can provide competitors with
advantages or synergies
Assessing which products or
businesses to get into to compete
Analyzing competitor portfolio and
relative strengths and weaknesses
Easy view of which businesses and
products competitors are in
Seeing relative business portfolio of
different competitors at once
The status of the range of
businesses in the market
Which are the businesses that
competitors are in?
Which are related businesses in
which other companies are
operating?
What kind of products do my competitors provide in comparison to mine?
Competitor product mapping provides an idea of the kinds of products or
businesses in which competitors are operating in the market. This can then be
compared against the companys own products and businesses.
Competitor Product Mapping
Product Categories
Propreitary Technology AMD Intel Microsoft Linux Intel AMD SUN TI IBM
Application Software Microsoft Linux IBM
Middle Ware Microsoft Linux SUN IBM
Operating System Microsoft Linux SUN IBM
System Hardware Intel Intel AMD SUN IBM
CPU Design AMD Intel SUN IBM
CPU Fabrication AMD Intel TI IBM
Semiconductor Suppliers Software Suppliers System Suppliers
AMD
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Game theory can be used in the
business world to try to anticipate
how rival firms will act when the
firm in question alters it's behavior
To look forward & reason
backward, one has to put
themselves in the shoes/minds of
competitors (players)
Modeling reality is hard. Modeling
what we believe is easier.
Game theory converts second-order
effects into first-order effects.
When thinking about what your
competitor will do, assume that he
or she will make the best possible
choice for themselves. Don't
assume that their decision will be
random!
Brings Clarity in thinking.
Helps in explaining why certain
decision are taken
Helps in explaining how to respond
to certain decisions taken by
competitors
How can we predict responses of other players in the market to our actions?
Game theory provides a reasoned attempt to predict behaviour and applies in
situations where actions by different agents are interdependent. For each game
there are players who have outcomes known as payoffs.
Game Theory
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Analyzing the different factors that
change the market dynamics of an
industry
Taking into account all factors
external conditions, industry
specific conditions and the unique
context of the industry itself
Determining the effect of the
factors on the demand and supply
and other operating factors in the
market
Four main factors are considered
Basic Conditions: factors which
shape the market of the industry,
Structure: attributes which give
definition to the supply-side of the
market
Conduct: the behavior of firms in
the market
Performance: a judgement about
the results of market behaviour
How can we see the market dynamics of an industry?
The Structure-Conduct-Performance paradigm provides an idea of the market
power in the industry, taking into account basic conditions in the market, the
structure of the industry and the behaviour and performance of firms.
Structure-Conduct-Performance
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Costing for a contract where the
same / similar tasks need to be
carried out over time
Use in strategy to estimate how
costs decrease over time.
A curve that depicts a 15% cost
reduction for every doubling of
output is called an 85% experience
curve, indicating that unit costs
drop to 85% of their original level.
Resources (labour and/or material)
required to produce each additional
unit decline as the total number of
units produced over the item's
entire production history increases.
Decline in unit cost can be
predicted mathematically. As a
result, improvement curves can be
used to estimate contract price,
direct labor-hours, direct material
cost, or any other recurring contract
cost.
How does efficiency of organisations increase over time?
As organisations get more experienced they develop more efficiency over time,
Learning curve theory states that as the quantity of items produced doubles, costs
decrease at a predictable rate
Learning Curve
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More information is needed beyond
the usual portfolio analysis models
The Hofer Matrix adds a new
dimension of sales turnover and the
share of the product along with the
competitive position of the firm and
the product life cycle stage
Especially effective to give three
large messages in one model
competitive positioning, total
market turnover and companys
market share
What is the competitive positioning
of each of the companys products?
In which part of the product
evolution cycle are each of the
products?
How much turnover is generated
from each of the products in the
market?
What is the slice of the companys
share in the turnover?
How can we see how our product is performing in the market?
In the Hoffer matrix, products are shown as circles and, the area of the circle
represents total product turnover. Within the circle the share of a firms product is
shown as a slice of the circle.
Hofer Matrix
Frameworks to Analyze a
Company
27
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Evaluating a companys
opportunities and threats
Prioritizing which opportunities to
take advantage of, and which
threats to address
Adjudging the response of the firm
to each factor, and overall
In conjunction with IFE matrix, for
formulating overall strategy for
company in the IE matrix
What is the prioritization of the
opportunities and threats the
business faces?
How strong is the business strategy
in response to each opportunity /
threat?
Overall how effective is the
strategy of the company for dealing
with the external factors?
A score between 1 to 1.99 is
considered weak, 2 to 2.99
medium, and 3 to 3.99 strong.
How can we visualize and prioritize the opportunities and threats for a company?
The EFE Matrix helps analyze the external factors impacting a business,. Each of
the factors are assigned weights and a rating that reflects the effectiveness of the
firms response. A final score is calculated based on the weighted ratings.
External Factor Evaluation Matrix
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Auditing a companys strengths and
weaknesses
Prioritizing which strengths to
capitalize on, and which
weaknesses to strengthen
Adjudging the response of the firm
to each factor, and overall
In conjunction with EFE matrix, for
formulating overall strategy for
company in the IE matrix
What is the prioritization of the
strengths and weaknesses the
business possesses?
How strong is the business strategy
in response to each strength /
weakness?
Overall how effective is the
strategy of the company for dealing
with the internal factors?
A score between 1 to 1.99 is
considered weak, 2 to 2.99 average,
and 3 to 3.99 strong.
How can we evaluate and prioritize the strengths and weaknesses for a company?
The IFE Matrix helps analyze the internal factors impacting a business,. Each of
the factors are assigned weights and a rating that reflects the effectiveness of the
firms strategy. A final score is calculated based on the weighted ratings.
Internal Factor Evaluation Matrix
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Evaluating strategy the company is
currently using in response to
external and internal factors
Formulating new strategy for the
company based on internal and
external factors
Assessing broad direction for
further strategy formulation or
planning
How is the current strategy of the
business able to deal with external
and internal factors together?
How can strategy be created in
response to external and internal
factors together?
Three main areas that a companys
scores could fall in and strategy
depending on that grow and
build, hold and maintain or harvest
or divest.
How can we formulate strategy based on external and internal factors?
The I-E matrix combines scores from the EFE and IFE matrices, with the IFE
score plotted on the X-axis and the EFE score on the Y-axis. Based on where they
meet, the strategy is appropriately formulated.
Internal-External (IE) Matrix
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Making a decision when a desired
end-state (objective) has been
defined
Carrying out strategic planning
towards a particular objective
Doing pre-crisis planning and
preventive crisis management
Creating a recommendation during
a viability study
How can we use and capitalize on
each strength?
How can we improve each
weakness?
How can we exploit and benefit
from each opportunity?
How can we mitigate each threat?
How can we combine these factors
to get strategies?
How do we identify favorable and unfavorable internal and external factors?
SWOT is a strategic planning tool used to evaluate the strengths, weaknesses,
opportunities, and threats involved in a project or in a business venture. It involves
identifying the objective of the business, and which factors support or hinder it
SWOT Analysis
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Examining what kind of structure
would be appropriate for the firm
Examining what kind of policies to
use during different phases that the
firm goes through
Identifying how a firm needs to
deal with a crisis
Determining how growth of the
firm can be accelerated
Anticipating crises that the firm
might be heading towards
The growth phases each end with a
particular kind of crisis that leads to
the next growth phase.
How can we deal with the crisis
that is occurring?
What is the right organisation
structure, centralization and
formality for the organisation in the
current phase?
How can top management handle
the organisation during the phase
effectively?
How is our organisation growing and how can we direct this growth?
Greniers Growth Phases Model suggests that firms go through six phases of
growth and needs appropriate strategies and structures to cope with this growth,
and suggests what might work in which phase of growth.
Growth Phases Model
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Evaluating which products /
services the opportunities are most
attractive in, and in which regions
Each cell in the matrix here
represents a geographic product
market
In the example shown above,
regions are on the Y-axis, while the
X-axis has different banking
product
Each cell is shaded based on the
likely profitability and growth of
the geographic product market.
For example, in the diagram above,
the credit card market is strong
(hot) in all countries except Peru,
while corporate lending is not a
very attractive option (cold) in
any country.
Where do the key opportunities lie for the organisation?
The heat map depicts the areas of opportunity for the company and how attractive
they are, plotted against the region where these opportunities are the strongest,
and can create maximum possible growth.
Heat Map
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Analyzing the resources of an
organisation and how the business
can best take advantage of them
A business must be capable of
taking advantage of the resource. If
a resource is valuable, rare and
difficult to imitate, a business must
be able to exploit it, otherwise it is
of little use. This may require
reorganising the business.
A resource that is not valuable or is
irrelevant cannot be a source of
competitive advantage.
Rarity is important because if
competitors possess the same
resources, there is no inherent
advantage in the resource
It must be difficult or expensive for
competitors to imitate or acquire
the resource. If not, it confers only
a temporary competitive advantage,
not a sustainable one.

What kind of resources can the company take strategic advantage of?
Understand resource or capability to determine competitive potential: Value,
Rarity, Imitability (Ease/Difficulty to Imitate), and Organization (ability to exploit
the resource or capability).
VRIO Analysis Model
Frameworks for Identifying
Strategic Options and Choosing
Best Strategy
35
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Conducting market analysis of a
firm or a business
Deciding on the strategy that the
company should undertake based
on internal and external factors
Adjudging which factors in the
environment and internal to the
company are important
Getting a broad direction for further
strategy planning
The SPACE matrix uses four
factors to suggest the strategy type
These are Financial Strength (FS).
Competitive Advantage (CA),
Environmental Stability (ES) and
Industry Strength (IS)
Depending on scores on each of
these factors an appropriate
strategy type is indicated
A matrix is created with the four
factors and the scores for the X and
Y axis are plotted
What kind of strategies should the business undertake, given its situation?
The Strategic Position and Action Evaluation or the SPACE Matrix is a four-
quadrant framework which indicates whether aggressive, conservative, defensive,
or competitive strategies are most appropriate for a given enterprise or company.
SPACE Matrix
FS
ES
CA IS
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Analyzing strategic options for
different products or businesses in a
companys portfolio
Allocating resources to different
products in the portfolio
Determining future movement of
the product in the market
Determining which products are
likely to be the most profitable for a
company
Business growth rate is a proxy for
industry attractiveness and relative
position shows competitive
advantage.
Through these two measures the
profitability of the business can be
estimated
A company with a strong
diversified portfolio can really
capitalize on its growth
opportunities
How do we determine the profitability of certain businesses or products?
The BCG Matrix classifies products based on the growth rate of the business
plotted against the market share of the company relative to the nearest competitor
in the market into four categories stars, cash cows, dogs and question marks.
BCG Matrix
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
38
Determining the growth strategies a
company can consider
Assessing current performance to
decide future strategies
Matching competencies of the
company to the strategic options
that it has
Allocating resources to different
departments in the company
Determining future resources and
competencies needed for growth
Four different strategies based on
products and markets targeted
How should the company grow
through tapping into existing
markets or getting into new ones?
Should the company develop new
products or stick with current ones?
How much risk is the company
ready to undertake for growth?
How are the resources to be
allocated to ensure future growth?
How can we grow our business?
The Ansoff Product-Market Growth Matrix allows marketers to consider ways to
grow the business via existing and/or new products, in existing and/or new
markets and helps companies decide what course of action should be taken.
Ansoff Matrix
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
39
Assigning ownership and autonomy
for strategy among businesses of a
large firm
Deciding the amount of
centralization needed for businesses
in a firm
Deciding on which businesses to
get into and which ones to divest
from
Framing strategy for mergers and
acquisitions
The business gets classified as one
of four options based on the amount
of help the parent unit can give
Which businesses should we look
at entering?
Which businesses might we be
better off exiting from ,or hiving off
as separate companies?
What kind of businesses should we
acquire or merge with?
How can the parent unit add value for its business units?
The Ashridge Portfolio Matrix gives a classification of the businesses in a
companys portfolio based on how much value the parent unit can add to it,
plotted against the parents understanding of the business.
Ashridge Portfolio Matrix
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
40
Assessing the business prospects
for profitability in a sector
Assessing how well the company
can compete or use its competitive
capabilities in the sector or business
Making decisions on which
businesses to get into and which to
divest from
Framing strategy for mergers and
acquisitions
Based on the classification of the
business into one of the 9 cells, the
company can decide on the strategy
to adopt
How can the business rationalize its
operations to use its capabilities to
the best?
What kind of businesses can
provide the best profitability to the
company?
What kind of strategies should a firm adopt towards different businesses?
The Directional Policy Matrix defines the strategic positions that a firm can
undertake for different businesses, based on the prospects for the sectors
profitability mapped against the firms competitive capabilities.
Directional Policy Matrix
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
41
Classifying businesses or activities
for which there is a need or
political support, rather than a
reference to customers
Judging ability to effectively serve
the public
Recognizing which businesses or
activities to allocate resources to
Assessing which businesses or
activities it is necessary to build
competencies in
The matrix classifies businesses
into four categories:
The system is doing well in the
public sector star and should not
change and should fund highly
Political hot boxes have public
support but not enough
competencies to carry out
Golden fleeces are likely to have
budget cuts
Back drawer issues have low
priority for funding
How can activities / businesses be classified in the public sector?
In the public sector, rather than customers, classification must be done according
to the amount of public support a business can garner. This is plotted against the
ability of the system to serve effectively.
Public Sector Portfolio Matrix
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
42
Some alternatives have been
identified and the company is
trying to choose between them
Objective criteria and an analytical
approach are required to decide
between strategic options
Internal and external critical
success factors are identified
Using inputs on external and
internal factors from other
frameworks, the QSPM gives us
the relative attractiveness of each
strategic option identified.
Cumulative impact of each internal
and external factor is taken into
account
Which strategy is the most
attractive, given the internal and
external factors affecting the firm?
How can we decide which strategy is most suitable for our organisation?
The Quantitative Strategic Planning Matrix (QSPM) gives a systematic approach
for evaluating alternate strategies, and helps to decide which strategy is best suited
for the organization based on external and internal factors..
Quantitative Strategic Planning Matrix
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
43
Finding the root cause of a
problem, especially a quality one
Identifying various different factors
that lead to an overall effect
Structuring a brainstorming session,
finding mutually exclusive,
collectively exhaustive categories
Considering various strategic
options and related issues
Options are being developed in a
group with little quantitative data
In the absence of hard data, a
fishbone diagram can help group
various issues into MECE
categories
How can we provide structure to a
brainstorming session?
How can we develop strategic
options from various unstructured
ideas?
How can we structure the analysis process for a problem?
Ishikawa diagrams/fishbone diagrams/cause-and-effect diagrams are diagrams that
show the causes of a certain event. It also has multiple uses as a structuring model
that helps companies develop and assess their strategic options.
Fishbone Diagram & Root Cause Analysis
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
44
Plotting what role the business
plays in the marketplace
Trying to get a big picture view of
the industry and business
Determining which strategic
options would most fit the unique
situation the business is in
Assessing which businesses the
company might be better off exiting
from and which ones more
resources should be allocated to
High level strategies that may be
successful for the business
Mapping the industry life cycle
stage gives an overall view of the
marketplace and the role that the
specific business plays in it
Gives an idea of the overall
strategies, which can then be
detailed and implemented
How can we assess different strategic options?
The ADL Matrix helps analyze strategy based on how strong the competitive
position of the company is and which stage of the life cycle the industry is in
currently.
ADL Matrix
Strategy Implementation
Frameworks
45
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
46
Evaluating what changes need to be
made in hard and soft factors for
change in strategy to take place?
Assessing what the likely
impediments to implementing a
new strategy are
Judging how each of these factors
are impacting each other when a
new strategy is being chosen
Developing means to tackle
problems with strategy
implementation
Each of the factors can answer
some key questions on strategy
Hard factors strategy, structure
and systems can be changed
through formal policy making
Soft factors shared values, skills,
staff and style need to be changed
more through informal mechanisms
Assessment of each factor,
dependence on the other, and how
they all affect implementation of
strategy
What are the factors to be considered for a successful strategy implementation?
The 7-S Framework describes 7 factors to organize a company in a holistic and
effective way. Managers should take into account all these 7 factors, which are
interdependent, to ensure successful implementation of a strategy.
7-S Framework
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
47
Looking at creating a more long
term cultural change through
strategy
Enforcing hard elements in strategy
through employees
Creating a new vision or mission
for the company to imbibe
Reinforcing messages of new
strategy from top management to
lower level managers
This framework is typically applied
for a longer timeframe than others
because it is based on creating a
new culture
Large scale changes that require
significant employee commitment
can be created through this
How can top management create
understanding and buy-in, and
reduce complacency among
employees?
How can change lead to a new culture being created?
John Kotters eight step change management framework provides the key to an
overall picture of creating a new culture in the long-term of the company.. Starting
from getting rid of complacency, it ends with continuing to emphasize newness.
Change Management Framework
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
48
Assessing potential barriers to
change in the organisation
Managing organisation political
and power for strategic change
Gauging who might be supporters,
and who might be opponents for
proposed change
Identifying target segments of
employees for strategic change
initiatives
Helps moving beyond simple issue
management into deeper insights
on management of power, politics
and perceptions
Identifying who are affected by the
change, and changing attitudes and
behaviours of employees
Looking at soft factors in
combination with hard factors
while implementing change
How can we deal with barriers in the organisation while creating change?
Wilfried Krgers Change Management Iceberg gives a picture of going beyond
the visible issues, below the iceberg to emphasize management of perceptions
and beliefs, and management of power and politics in the organisation.
Change Management Iceberg
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
49
Looking at key variables to include
while implementing change
Creating a broad implementation
plan for strategic change with
further breakdown for each factor
Assessing the external and internal
factors that go into making a
strategic change successful
Evaluating how each factor has
contributed to change overall
The notion of change as an
iterative, cumulative process
Successful strategy seen as a result
of interaction between the 3
dimensions
Factors that need to be managed to
manage overall change
Evaluating how change has affected
the 3 dimensions and 5 factors
provides an idea of the success of
the strategy implementation
What are the dimensions of change and what are the factors to be considered?
Andrew Pettigrew and Richard Whipp identified 3 interdependent factors of
change content, context and process. They also identified five interrelated
factors that needed to managed for successful change.
Dimensions and Factors of Change
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
50
Creating a systematic approach for
diffusing innovation in the firm
Breaking down and reviewing
innovations so that resources can be
reallocated appropriately
Prioritizing innovations, especially
new products being developed
Cross-functional inputs or overall
organisation orientation are needed
for successful innovations
Complex innovation process is
broken down into smaller parts
Reviews happen throughout the
innovation cycle to ensure
resources are being allocated
appropriately
Accelerated product development,
more information and more top
level commitment
Organizing innovation can be a
source of competitive advantage
How can innovation be managed for a company systematically?
The Stage Gate model prescribes an idea of stages from the initial idea discovery,
passing through various gates, which form the entrance to the next round. An
idea goes to the next round only if it meets certain requirements at the gate.
Stage Gate Model
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
51
Assessing how to implement a
strategic acquisition and integrate
the new business with other
businesses in the portfolio
Deciding on the level of autonomy
and control systems for new
acquisitions
Evaluating interdependences of
different businesses in the portfolio
Four approaches are indicated.
In Preservation, management
should keep nurturing the business
In Symbiosis, management must
ensure simultaneous boundary
preservation and permeation
In Holding, management must not
integrate much and generate value
through transfers
In Absorption, management must
try to wholly absorb the business
into current businesses
How can companies choose the right approach to integrate acquisitions?
The Acquisition Integration Approaches give us an idea of the different
approaches a company can take to integrate an acquisition using two criteria: need
for strategic interdependence and need for autonomy.
Acquisition Integration Approaches
Frameworks to Evaluate
Performance
52
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
53
Translating strategy vision into
action
Trickling top level strategy to lower
levels of divisions, functions, teams
and individuals
Identifying specific and measurable
key result areas and the linked key
performance indicators linked to
each perspective
Goal setting for different levels is
done based on a centralised strategy
broken down into pieces
Each perspective has certain key
result areas and key performance
indicators which can be applied at
all levels
Moving beyond traditional profit,
revenue and market share measures
to look at a holistic performance
management
Longer-term decisions are made
because of a larger picture view
Feedback is looped back in to
create new strategies
How can strategic performance be measured for a company?
The Balanced Scorecard is the most famous performance measurement tool that
considers four perspectives on performance financial, customer, internal and
learning & growth. It evaluates performance based on all four parameters.
Balanced Scorecard
Reference Handbook
Key Question Answered
Description
Typical Output Format
Use When Typical Key Takeaways and Results
54
Evaluating which projects or
initiatives to take up
Tracking performance of a project
or initiative over time
Assessing necessity to make
changes over time to keep score at
the best level
Comparing current initiatives with
previous ones carried out
Using a series of questions a score
from 1 to 4 is assigned to each
factor
Then the DICE score is calculated
as per the formula
Score of a project or change
initiative is tracked over time and
compared with old projects
Necessary changes are made as and
when required to improve scores
The lower the score, the better the
project
How can performance of a project or a change initiative be measured?
The DICE framework has identified four components to evaluate the performance
of certain projects or change initiatives duration, integrity, commitment of top
managers and of affected employees and effort.
DICE Framework
Say it with Charts
Charts
Table of Contents
Need of charts Why Charts? 58
Quantitative Charts Line chart 59
Quantitative Charts Bar chart 60
Quantitative Charts Column chart 61
Quantitative Charts Stack chart 62
Quantitative Charts Area chart 63
Quantitative Charts Pie chart 64
Quantitative Charts Donut chart 65
Quantitative Charts Bubble chart 66
Quantitative Charts Spider/Radar chart 67
Quantitative Charts Waterfall chart 68
Quantitative Charts XY Scatter chart 69
Quantitative Charts Spotlight chart 70
Quantitative Charts Hybrid chart 71
Quantitative Charts Market Map 72
Quantitative Charts Gantt chart 73
Quantitative Charts Pert chart 74
Quantitative Charts Pareto chart 75
Quantitative Charts Speedometer chart 76
Quantitative Charts Horizon chart 77
Quantitative Charts Heat chart 78
Quantitative Charts Lollipop chart 79
Quantitative Charts Crocodile chart 80
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
Format Adopted
Classification:
Comparing
data

Breaking
data
Tracking
data
Correlation

An example or a Sample Question

Characteristics, where to use
Visual representation
I mportant characteristics,
I nferences
Other important information
4 main types
(based on functionality)
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
58
Why charts?
Why do we need charts?
Charts (or graphs) are a visual description of raw data serving many purposes. The various
advantages of charts make them invaluable tools in presentations and reports.
What are charts?
What is the significance of charts?
Impactful way to represent
Trends are easier to spot
Fluctuations/abrasions get
amplified
Generate credibility
A way to represent qualitative
information qualitatively
Proficient way to compare across
different dimensions
Way to handle large information with
greater ease
Selective information can be shown
without losing out extra information
Excellent way to depict complex
relationship between large number
of variables
Increased recallability and reduced
cognition time of audience
Aesthetically appealing presentation
Integration with software's for advance
analysis once created
Advantages of using charts? Classifying charts
Primary classification is based on
the presence or absence of
numerical data:
Quantitative charts
Qualitative charts
Charts can also be classified based
on their usage in :
comparing data
breaking data into smaller
parts
Tracking data over time
Key question
Classification:
Comparing
data
Breaking
data
Tracking
data
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
59
Line Charts
To compare two or more sets of data over many time periods
Growth, other trend, revenues, profitability, cost, projections, break-even analysis
Increasing/decreasing trends easily
spotted
Excessively cluttered data points
simplified
Significant intersections can be analyzed
(eg. Break-even)
Outliers can be easily spotted
Significant spikes or falls can be spotted
How this chart will help?
You wish to track the daily stock price of two key stocks over the past two months
Is most useful if number of points
is large in each data set
Classification:
Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
60
Bar Charts
To compare and see multiple data sets over many time periods
Comparison across products, product contribution, cost breakup
Absolute values (of data) can be deduced
from the graph directly
Increasing/decreasing trends easily
spotted
Significant intersections can be analyzed
(eg. Break-even)
Is useful for one-to-one comparison
across data sets
How this chart will help?
You have sales and profits data of your company for the past 10 years; how to analyze it?
Should be avoided if number of
points in each data set is large (>15)
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
61
Column Charts
How this chart will help?
You have sales and profits data of your company for the past 10 years; how to analyze it?
To compare and see multiple data sets over many time periods
Comparison across products, product contribution, cost breakup
Absolute values (of data) can be deduced
from the graph directly
Increasing/decreasing trends easily
spotted
Significant intersections can be analyzed
(eg. Break-even)
Is useful for one-to-one comparison
across data sets
Has better readability than bar charts as
it is easier for eyes to compare vertical
distances
Should be avoided if number of
points in each data set is large (>15)
Horizontal (bar) and vertical
(column) charts can be used
interchangeably in most cases
Classification:
Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
62
Stack Charts
Is used for comparing data after breaking it into parts
Relative percentage share of each entity/parameter, revenue, cost breakup, profitability
Used when %age share is supposed to be
compared
Used to track change in certain
parameters contribution over time
How this chart will help?
What is the break up of sales of your product from different regions for each particular year?
Classification:
Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
63
Area Charts
Comparison of X*Y for different entities
Area under the curve proportional to
desired variable
How this chart will help?
If used over normalized data, area
charts can be substitutes for a
stacked bar chart
What is the break up of sales of your product from different regions for each particular year?
Classification:
Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
64
Pie Charts
Is used for comparing data after breaking it into parts
Relative share of each entity/parameter, demographic, market share
Clear visualization of companies` market
power
Exploded pie chart is to demarcate the
desired from the rest
How this chart will help?
Pie charts and stacked bars can be
used interchangeably depending
upon situation
What is your market share with respect to your competitors in the industry?
Classification:
Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
65
Donut Charts
Clear visualization of companies market
power
Exploded pie chart is to demarcate the
desired from the rest
How this chart will help?
Pie charts and stacked bars can be
used interchangeably depending
upon situation
Is used for comparing data after breaking it into parts
Relative share of each entity/parameter, demographic, market share
What is your market share with respect to your competitors in the industry?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
66
Bubble Charts
Used to represent 3 or more dimensions on 2d graph, e.g. Market size + Growth + time
Size of bubble is a clear indicator of
market size (or other dimension)
Distance of the bubbles centre from the
two axes is also quantifiable
How this chart will help?
The bubble can also be replaced by
pie charts to add another
dimension to the analysis
How to present change in market size and profitability over time?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
67
Spider or Radar Charts
Multiple objects can be analyzed simultaneously across multiple dimensions
Easy comparison on given parameters
Area inside the web is also quantifiable
and an important indicator for
comparison
How this chart will help?
If number of dimensions is large
(>10) each hand can be represented
by a straight line independent of
the others
How to evaluate different companies across multiple dimensions (market share, profitability, brand
equity, reliability, assets etc.)?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
68
Waterfall Charts
Waterfall Chart is a form of data visualization which helps in determining the cumulative
effect of sequentially introduced positive or negative values.[1] The waterfall chart is also
known as a Flying Bricks Chart due to the apparent suspension of columns (brick) in mid-air.
Break up at each stage can be used to dig
deeper into the analysis
To find out marginal increase or
decrease (in absolute terms) over the
last time period
Easy to understand and draw inferences
Aesthetically appealing
How this chart will help?
How to analyze the value added at each step of the parent process?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

A waterfall chart can be used for

understanding or explaining the gradual
transition in the quantitative value of an
entity which is subjected to increment or
decrement.
For instance, it can be used for
visualizing the profit/loss which results
from summation of revenue coming in
from different sources and subsequent
decrement of all expenses
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
69
XY Scatter Charts
Used to find out distinct groups or clusters
To study the correlation between two separate data samples
This chart type does not fall under the
aforementioned three categories
(Comparing / breaking / tracking)
Useful to analyze various companies in
the industry and group them according
to some desired dimensions
Clarity of pattern (linear or quadratic
etc.) shows the strength and nature of
correlation between the two
Most useful for raw data when there is
no prior idea of the nature of data
(preliminary research)
How this chart will help?
Clusters are also helpful for
segmentation
A scatter plot is a type of
mathematical diagram using
Cartesian coordinates to display
values for two variables for a set of
data.
How is the age of target customers related to their consumption patterns?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
70
Spotlight Chart
To compare the performance of two or more candidates based on a set of attributes
Useful to analyze results of market
survey studies, particularly in cases
where customers rate on a scale
How this chart will help?
It is important to select the shades
in the Pie to make sure that
candidates performing well are
clearly differentiated from the bad
performers
How to benchmark the ratings we get from a market survey?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
71
Hybrid Charts
Used to do 2
nd
level analysis
Analysis can be done at 2nd level; for eg.
Country's share in particular industry
and in turn company's share in a
particular country
How this chart will help?
How to represent the share of each of a companys products in the entire market (FMCG for instance)?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Can be used to decompose 1item in a

pie chart into its sub-items
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
72
Market Map
Market maps are a good method to depict the market share, market segments and the level of
fragmentation in the market, between different products / services and between different
players for each segment.
Evaluating competitors in the market based
on segments in which they operate and
market share
Analyzing relative market share of company
between different segments
In the example given here, the medical
devices industry revenues are divided by
the segments within the market on the X
axis
The Y-axis represents market share of each
player in each segment.
Inference?
How to represent the market share of multiple companies and their split in terms of product offerings?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Some of the key takeaways from this

charts are:
How much market share does
the company have in each
segment?
Who are the key players in each
segment in the market?
How much of the revenues are
accounted for by each of the
segments in the industry?
Which segments are the most
likely to growstrongly?
Where does opportunity to
garner market share lie?
Comp A
Comp B
Comp C
Comp D
Comp E
Comp F
Others
Comp C
Comp A
Comp B
Comp F
Others
Comp B
Comp A
Comp D
Others
Comp E
Segment 1 Segment 2 Segment 3
0%
100%
0% 100%
Market Share
(Companies stacked in
decreasing order)
Segment Size (Stacked in decreasing order)
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
73
Gantt Charts
Analyzing operational activities and budgeting or marketing plan
Operations Sequencing
Allocation of resources
Also helpful in tracking the present
status of various activities
Timelines
Inference?
Is also useful for communicating
expected timelines for various
deliverables in a consulting
assignment
How to schedule various activities of a department over a given time period?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
74
Pert Charts
The Program (or Project) Evaluation and Review Technique, commonly abbreviated PERT, is a
model for project management designed to analyze and represent the tasks involved in
completing a given project.
Operations Sequencing
Allocation of resources
Communicating the thought process
behind selection of critical path
Timelines
How to find the critical path (shortest) to complete a given activity?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

PERT is a method to analyze the

involved tasks in completing a given
project, especially the time needed to
complete each task, and identifying the
minimum time needed to complete the
total project.
PERT is valuable to manage where
multiple tasks are going simultaneously
to reduce the redundancy
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
75
Pareto Charts
Analyzing operational activities and commenting on efficiencies and resource allocation
To find the top most clients in terms of contribution to revenue of your firm
Sheds light on the largest issues facing
our team or business
Describes the 20% of sources causing
80% of the problems
Provides insight into where to focus
efforts to achieve the greatest
improvements
The purpose of the Pareto chart is to
highlight the most important among a
(typically large) set of factors.
Which clients generate the maximum revenue for your company?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

The bars display the values in

descending order, and the line graph
shows the cumulative totals of each
category, left to right.
The left vertical axis is the frequency of
occurrence, but it can alternatively
represent cost or other important unit of
measure.
The right vertical axis is the cumulative
percentage of the total number of
occurrences, total cost, or total of the
particular unit of measure. Because the
reasons are in decreasing order, the
cumulative function is a concave
function
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
76
Speedometer Chart
Track the progress or growth and nearness to target, revenue targets, market share target
Where we are and how far we are from
the target
Aesthetically appealing and impactful
Easy to infer proximity to the goal
What is our present status with regard to the pre-set goals?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

A very effective chart for showcasing

dashboards
Speedometer Chart generates one or
more dials. Each chart represents a
certain parameter depicted as a dial
reading; one value for each dial.
Program uses a customized XY chart
with two auto shapes to generate the
dials
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
77
Horizon Charts
Provides inferences through time series data and also helpful in tracking stock performance.
Users can scan huge amounts of data points across all relevant time series and immediately
identify areas of concern that require closer scrutiny
Provides overview of a large number of
time series in a limited rectangular space
Allows for an overview of a large
number of time series
Helps in identifying areas of concern
that require closer scrutiny
What is the daily performance of stocks of your company and all your competitors over a period of say 2
months?
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Spot extraordinary behaviors and

predominant patterns
View each item independently from the
others
Make comparisons between items
View changes with enough precision to
determine if further examination is
required
Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
78
Heat-map Charts
Makes sense of large volume of data, helpful in representing financial data such as stock index
movement
Representing large numbers of data
points in ways that would be tough to
interpret using traditional tables or
charts
Often used to look at financial data like
stock market results
A heat map is a graphical
representation of data where the
values taken by a variable in a two-
dimensional map are represented
as colors
Classification:
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Which factors are important, where does the opportunity lie

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
79
Lollipops
Can I come up with creative data displays of my own ?
Lollipops are a technique that helps you display in one sole slide a large number of detailed
information across a large selection of objects (competitors, products, etc). It requires an Excel
table and the Bubble function in the Chart Menu
Create Excel table with all the data
required : one object / criteria per row
(eg competitor) and one measure per box
vertically (eg plant capacity of
competitors plant)
Plot
A Lollipop chart is simply a creative
answer to a regular problem : how to
display a large number of data points,
the detail of which is necessary but less
important that the overall picture it
paints
Any solution you may come up with that
solves your display issue has got to be a
good one !
Tip1 : always try creative solution
on paper before launching into big
Excel manipulation
Tip2 : remember that a nicely laid
out Excel table is always a more
powerful visual than a
cumbersome graph ...
Plant sizes & total capacity by competitor, Storage products industry, Europe, 1998
Plant size
(k tonnes),
0
10
20
30
40
50
60
70k
Total Capacity
(k tonnes)
60k
tonnes
UK
E
D
D
UK
D
D
D
UK
B
UK
B
E
NL
NL
D
SF
S
N
Competitor
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
80
Crocodile Chart
Can I come up with creative data displays of my own too ?
Crocodile Charts are a technique that helps you display in one sole slide how the issue you are
studying narrows down to your specific area of focus. It requires an Excel table and the Bubble
function in the Chart Menu
Create Excel table with all the data
required
Plot 4 bars
Add connecting lines
Tip : it is easier to add lines across
all bars and delete unnecessary one
upon finalizing the chart than the
other way round
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Global Continental National Regional
Land
UK
North
South
Europe
Sea
Crocodile chart, Oil reserves, 1995
Comparing
data
Breaking
data
Tracking
data

Comparing
data

Breaking
data
Tracking
data
Correlation

Sample Question
How this chart will help? Chart Description
Tool Description
Typical Output Format
Used for:
Reference Handbook
Happy Analysis using Frameworks &
Charts
Reference:
http://www.andypope.info/charts.htm
http://www.valuebasedmanagement.net/
http://faculty.fuqua.duke.edu/~moorman/GeneralMills/Section2/S
ection2.htm#3Cs
http://www.provenmodels.com/
This handbook is compiled for academic reference purposes only.
Contact: mahesh158@gmail.com
Frameworks & Charts for Strategic
Analysis