STM Assignment Workbook

Faculty: Prof. Anshuman Tripathy

Contents
1

Executive Summary............................................................................................................................................................... 4

Industry Overview.................................................................................................................................................................. 5
2.1

Nature and Size of the Industry....................................................................................................................................... 5

2.2

Key Growth drivers for the industry................................................................................................................................. 6

2.3

Identification of Critical Success Factors (CSF)................................................................................................................ 6

2.4

Market Analysis based on CSFs....................................................................................................................................... 7

2.5

Industry Benchmarks....................................................................................................................................................... 7

2.6

PESTEL Analysis............................................................................................................................................................. 12

2.7

Porters Five Forces Analysis.......................................................................................................................................... 13

2.8

Strategic Group Mapping............................................................................................................................................... 13

2.9

Competitive Landscape................................................................................................................................................. 13

2.10 Market Segmentation.................................................................................................................................................... 14

2.11 Buying Criteria Analysis of the Industry......................................................................................................................... 14
2.12 Key trends and future developments............................................................................................................................. 15
3

Company Overview.............................................................................................................................................................. 16
3.1

Company background.................................................................................................................................................... 16

3.2

Timeline with key milestones and their strategic impact............................................................................................... 16

3.3

Vision, Mission, Goals, and Strategic Themes................................................................................................................ 16

3.4

Key Product and Service Portfolio.................................................................................................................................. 16

3.5

Core Competencies of the firm...................................................................................................................................... 16

3.6

Business Model of the organization............................................................................................................................... 16

3.7

3rd Generation Balanced Scorecard (Amalgamation of 1st Generation BSC and Activity System Map)........................19

3.8

SWOT Analysis............................................................................................................................................................... 19

3.9

Competitor Analysis (identify competitors)................................................................................................................... 19

3.9.1

Based on Critical Success factors............................................................................................................................ 19

3.9.2

Based on Financial indicators.................................................................................................................................. 19

Future Growth Strategy for the organization........................................................................................................................ 20

4.1

Portfolio Analysis........................................................................................................................................................... 20

4.1.1

Based on BCG Matrix............................................................................................................................................... 20

4.2

Companys Strategic Roadmap for future...................................................................................................................... 20

4.3

Product Market Investment Strategy............................................................................................................................. 21

4.4

Re-imagining the Organization with the transformed business model or Use-case based on SMAC and IOE................21

1 Executive Summary
Guidelines

The executive summary should provide a brief overview of the organization and the industry in which it
operates. It should also illustrate the results of the analysis made in the report. It should provide the
future growth prospects in the industry for the organization. It should also highlight on the strategy for
any organization to gain competitive advantage in this industry.

2 Industry Overview
2.1 Nature and Size of the Industry
Guidelines

Brief Description of the industry segment or sub segment

History and Evolution of the Industry
Position of Industry depending on Industry Life Cycle (Introduction, Growth, maturity, decline)
Size (% of National GDP) of the industry

History and Evolution of the industry

Key Consumers of this industry and

their changing needs

Stage in the Industry Life cycle

Total Available Market Size (National

and Global)

Total Serviceable Market Size (National

and Global)

2.2 Key Growth drivers for the Industry

Key Growth drivers

Rationale

2.3 Identification of Critical Success Factors (CSF)

Critical Success Factor identified

Rationale

CSF 1 eg. Churn Rate in Telecom

CSF 2 eg. Average Revenue per User in
Telecom
CSF 3
CSF 4

2.4 Market Analysis based on CSFs

Region

CSF 1

CSF 2

CSF 3

CSF 4

Global
North
South
East
India

West
North-East
Central
Note: Use data for the year 2013-14

2.5 Industry Benchmarks

Size of industry:

Category

Indicator

Industry Average of Top 5 Firms or

players serving 75-80% of the market
201112

Industry Level
(National)

Market Size
Size as % of
GDP
Inventory
turnover
Receivables
turnover

201213

201314

2014-15
(till Q3)

Market Leader
201112

2012-13

201314

2014-15
(till Q3)

Category

Indicator

Industry Average of Top 5 Firms or

players serving 75-80% of the market
201112

Activity Ratios

Payables
turnover
Asset
turnover
Current ratio

Liquidity Ratios

Quick ratio
Cash ratio
Debt-toassets ratio

Solvency Ratios

Debt-tocapital ratio
Debt-toequity ratio
Interest
coverage
ratio
Gross profit
margin

Profitability Ratios

Operating
profit margin
Net profit

201213

201314

2014-15
(till Q3)

Market Leader
201112

2012-13

201314

2014-15
(till Q3)

Category

Indicator

Industry Average of Top 5 Firms or

players serving 75-80% of the market
201112

margin
Return on
assets (ROA)
Return on
equity (ROE)
Price to
Earnings
(P/E)
Valuation Ratios or
Price Ratios

PEG Ratio =
(P/E Ratio) /
Projected
Annual
Growth in
Earnings per
Share
Price to Cash
Flow
Price to Book
(P/B)
Price to Sales
Dividend
Yield

201213

201314

2014-15
(till Q3)

Market Leader
201112

2012-13

201314

2014-15
(till Q3)

Category

Indicator

Industry Average of Top 5 Firms or

players serving 75-80% of the market
201112

Dividend
Pay-out Ratio
Enterprise
value (EV is
market
capitalisation
plus debt
minus cash)/
EBITDA
Staff
Turnover or
Industry
Attrition Rate
Competitive Ratios

Staff Cost/
Salary as
percentage
of Sales
Operating
Expenses as
percentage
of Sales
Depreciation
as
percentage

201213

201314

2014-15
(till Q3)

Market Leader
201112

2012-13

201314

2014-15
(till Q3)

Category

Indicator

Industry Average of Top 5 Firms or

players serving 75-80% of the market
201112

201213

201314

2014-15
(till Q3)

Market Leader
201112

2012-13

201314

of Sales
Fixed Assets
to Sales
Revenue
Advertising
as
percentage
of Sales
In case you come across other benchmark ratios used in particular Industry, then please include them as well.

2014-15
(till Q3)

2.6 PESTEL Analysis

Category
Political

Economic

Social

Technological

Environmental

Legal

Description

Key factors for analysis

Rationale

2.7 Porters Five Forces Analysis

Porters Five Forces

Description

Key factors for analysis

Buyer Power

Supplier Power

Existing Competition

Threat to new
entrants

Total No of firms (Listed as well

as Unlisted)
No of large firms

Entry/ Exit barriers and costs

Threat to substitutes

Effect of
Complementors

2.8 Strategic Group Mapping

2.9 Competitive Landscape

Value propositions ( Low Cost, Differentiation, Niche)

Competitive Strength Assessment (Normal and Weighted)

Rationale

2.10 Market Segmentation

Key Products and/or Services

Regions

2.11 Buying Criteria Analysis of the Industry

Parameter

Details

End-user Segments

Significance Attached (Low,

Medium, High)

Ex

It is the loan duration over

which the borrower has to
repay the loan.

Individual Customers

High

Loan Term for Banking Sector

Loans

SMEs
Corporate

High
High

Impact of buying criteria on consumer choices

Listing of key buying criteria for different consumer segments

The impact of the buying criteria is graded on the basis of the intensity and duration of their impact on the current market
landscape. The magnitude of the impact has been categorized as described below:

Low - Negligible or no impact on the market landscape

Medium - Medium-level impact on the market
High - Very high impact with radical influence on the growth of the market

2.12 Key trends and future developments

Key Trend

Impact on Industry (Low, Medium, High)

Trend
Trend
Trend
Trend

examples

1
2
3
4

Analysis of Trends with High Impact and High Certainty to be carried out
Impact on strategies or business models to be highlighted

Certainty of Impact (Low probability,

medium probability, high probability)

3 Company Overview
3.1
3.2
3.3
3.4
3.5
3.6

Company background
Timeline with key milestones and their strategic impact
Vision, Mission, Goals, and Strategic Themes
Key Product and Service Portfolio
Core Competencies of the firm
Business Model of the organization

Key Partners

Key
Activities

Value
Propositions

Who are our Key Partners?

Who are our key suppliers?
Which Key Resources are we
acquiring from partners?
Which Key Activities do
partners perform?
What Key Activities do our
Value Propositions require?
Our Distribution Channels?
Customer Relationships?
Revenue streams?
What value do we deliver to
the customer?
Which one of our customers
problems are we helping to
solve?
What bundles of products and
services are we offering to
each Customer Segment?
Which customer needs are we

Motivations for partnerships

Optimization and economy
Reduction of risk and uncertainty
Acquisition of particular resources and activities

Categories
Production
Problem Solving
Platform/Network
Characteristics
Newness
Performance
Customization
Getting the Job Done
Design
Brand/Status
Price
Cost Reduction

satisfying?

Customer
Relationship
s

Customer
Segments

Key
Resources

Channels

What type of relationship

does each of our
Customer Segments expect
us to establish and maintain
with them?
Which ones have we
established?
How are they integrated with
the rest of our business
model?
How costly are they?
For whom are we creating
value?
Who are our most important
customers?
What Key Resources do our
Value Propositions require?
Our Distribution Channels?
Customer Relationships?
Revenue Streams?
Through which Channels do
our Customer Segments want
to be reached?
How are we reaching them
now?
How are our Channels
integrated?
Which ones work best?

Risk Reduction
Accessibility
Convenience/Usability

Mass Market
Niche Market
Segmented
Diversified
Multi-sided Platform
Types of resources
Physical
Intellectual (brand patents, copyrights, data)
Human
Financial
Channel phases
1. Awareness
How do we raise awareness about our companys products and
services?
2. Evaluation
How do we help customers evaluate our organizations Value
Proposition?
3. Purchase

Cost
Structure

Revenue
Streams

Which ones are most costefficient?

How are we integrating them
with customer routines?
What are the most important
costs inherent in our business
model?
Which Key Resources are
most expensive?
Which Key Activities are most
expensive?

For what value are our

customers really willing to
pay?
For what do they currently
pay?
How are they currently
paying?
How would they prefer to
pay?
How much does each
Revenue Stream contribute to
overall revenues?

How do we allow customers to purchase specific products and services?

4. Delivery
How do we deliver a Value Proposition to customers?
5. After sales
How do we provide post-purchase customer support
Is your business more
Cost Driven (leanest cost structure, low price value proposition,
maximum automation, extensive outsourcing)
Value Driven (focused on value creation, premium value proposition)
Sample characteristics
Fixed Costs (salaries, rents, utilities)
Variable costs
Economies of scale
Economies of scope
Types
Asset sale
Usage fee
Subscription Fees
Lending/Renting/Leasing
Licensing
Brokerage fees
Advertising
Fixed pricing
List Price
Product feature dependent
Customer segment
dependent
Volume dependent
Dynamic pricing
Negotiation (bargaining)
Yield Management

Real-time-Market

3.7 3rd Generation Balanced Scorecard (Amalgamation of 1st Generation BSC and Activity System Map)
3.8 SWOT Analysis
3.9 Competitor Analysis (identify competitors)
3.9.1 Based on Critical Success factors
3.9.2 Based on Financial indicators

4 Future Growth Strategy for the organization

4.1 Portfolio Analysis
4.1.1 Based on BCG Matrix

4.2 Companys Strategic Roadmap for future

Near Term (<- 2 years)
Growth Areas
High Level Tasks
Potential Benefits to be
achieved
Rewards
Risks
Key Success Factors

Mid Term (2-5 years)

Long Term (5-10 years)

4.3 Product Market Investment Strategy

Country of
Investment

Category of
Investment

Industry
Reward to
Risk Ratio (A)

Country
Reward to Risk
Ratio (B)

Risk Adjusted
Rewards
( 0.65A +
0.35B)

Product Market
Investment Strategy

Investment
Rationale

Which Industry?

Strategic Alliance?

High Profit?
Potential
Market ?

Which
Product/service?

Mergers/acquisitions?
FDI?

Cost
efficiencies?

Ratio calculations based on reward and risk ratings from Business Monitor International Report March 2014

4.4 Re-imagining the Organization with the transformed business model or Use-case based on SMAC and
IOE

Reimagining
Reimagining
Reimagining
Reimagining
Reimagining

Business Models
Business Processes
Customer Segments
Products & Services
Workplaces

Reimagining Channels