BUSINESS PLANNING & STRATEGIES

1. BUSINESS PLANNING & STRATEGIES PRESENTATION FOR STUDENTS OF BITS PILANI DUBAI CAMPUS 23rd April 2014

2. OBJECTIVES OF BUSINESS • Profitability: sole motive of business; all other objectives are subservient to profit motive • Stability: cautious and conservative objective • Growth: increase in assets, manufacturing facilities, increase in sales volume through existing products or new products, improvements in profits or market share, increase in manpower, acquisition • Efficiency: rationally choosing appropriate means to achieve goals; doing things in best possible manner; utilizing resources in a most suitable combination to get highest productivity • Survival: function of nature of ownership, nature of business competence of management, general and industry conditions, financial strength of the enterprise, etc.

3. COMPONENTS OF BUSINESS ENVIRONMENT • External – factors outside the organisation which provides opportunities or poses threats • Internal – factors within the organisation which impart strengths or cause weaknesses of a strategic nature • Business Environment can be described in terms of the opportunities and threats operating in the external environment apart from the strengths and weaknesses existing in the internal environment

4. BUSINESS PLANNING PROCESS

5. FRAMEWORK OF STRATEGIC MANAGEMENT • Stage One: Beginning – starting point – Where are we now? – situational analysis in the environmental context – SWOT Analysis • Stage Two: End – destination – Where we want to be? – vision and mission • Stage Three: Means – How to get there? • Stage Four: Evaluation – Which is the best way? – SWOT Analysis • Stage Five: Control – How can we ensure arrival at the destination?

6. BENEFITS OF STRATEGIC MANAGEMENT • Strategic Management required for both survival and growth • “Survival of the fittest” propagated by Darwin • “Fittest” are not “largest” or “strongest” organization but those who can change and adapt successfully with the changes in business environment • Benefits of Strategic Management: • helps to be proactive • provides framework for all major business decisions • Ensures good future • Serves as a corporate defense mechanism against mistakes and pitfalls • Helps to evolve core competencies and competitive advantages

7. CHASE

8. PESTLE ANALYSIS • P – Political – political stability, ideologies, taxation policy, regulatory bodies, government policies, government term and change, thrust areas of political leaders • E – Economic – situation, trends, market and trade cycles, specific industry cycles, end-user drivers, interest and exchange rates, inflation and unemployment, consumer spending • S – Socio-cultural – lifestyle trends, demographics, attitudes and opinions, brand image, buying patterns, ethnic/religious factors, media views and perception • T – Technological – replacement technology, maturity of technology, manufacturing maturity, innovation potential, technology access, licensing, patents, intellectual property rights • L – Legal – business and corporate laws, employment law, competition law, health & safety law, international treaty and law, regional legislation • E – Environmental – ecological/environmental issues, environmental hazards, environmental legislation, energy consumption, waste disposal

9. VISION Vision is the ultimate goal, dream and the guiding star of the Organisation NIKE • "To bring inspiration and innovation to every athlete* in the world"* If you have a body, you are an athlete. TOYS ‘R’ US • "Our Vision is to put joy in kids’ hearts and a smile on parents’ faces." AMAZON • "Our vision is to be earth's most customer centric company; to build a place where people can come to find and discover anything they might want to buy online." IKEA • Ikea’s Vision “Affordable solutions for better living”.

10. MISSION • Mission is focused on present business scope – “who we are and what we do” – the reasons for our existence • Mission describes who our customers are and what we produce as outcome for them • Mission amplifies what brings the firm to this business or why it is there, what existence it seeks and what purpose it seeks to achieve as a business firm • Mission defines the role that an organisation plays in the society • “What business we are in” - answer should be marketing or external perspective and not restated to general activities or production according to Peter Drucker

11. CORE VALUES • Describes how the business should be conducted • Desired culture of the organisation • Principles that guide the behaviour of the people involved in the organisation

12. STRATEGY • Shutting doors first and then keeping only one door open • Strategy is to unravel complexity and to reduce uncertainty of the environment. • Strategy seeks to relate the goals of the organization to the means of achieving them. • Strategy is partly planned and partly reactive

13. COMPETITIVE ENVIRONMENT • Who are the competitors? • What are their products and services? • What are their market shares? • What is their financial position? • What gives them cost and price advantage? • What are they likely to do next? • Who are the potential competitors?

14. PORTER’S FIVE FORCES MODEL • Competitive Analysis – five forces model of competition • The five forces are: • Rivalry among existing firms • New entrants • Substitute products • Suppliers bargaining power • Customer bargaining power

15. REVOLUTIONARY THINKING • User friendly system • Define User • Steve Jobs question User? Who?

16. AMAZING SENTENCE I do not know where family doctors acquired illegibly perplexing handwriting; nevertheless, extraordinary pharmaceutical intellectuality counterbalancing indecipherability transcendentalizes intercommunication's incomprehensibleness.

18. CASE STUDY – iPAD Mini • Announced on October 23, 2012 • Released on November 2, 2012 • 7.9 inch screen • Competitors – Kindle Fire and Nexus 7 • Market Response???

20. COMPETE OR COLLABORATE

21. MERGER OF SAMSUNG & APPLE

22. GROW OR SHRINK

23. DIVERSIFICATION

24. WARREN BUFFETT’S RULES • Rule No.1 – Do not lose any of your shareholders’ money • Rule No.2 – Do not forget rule No.1 Module Title | Etisalat Academy

25. SUCCESSFUL BUSINESSMAN • How did you become successful in business? • Two words – Right Decisions • How do you take those Right Decisions? • One word – Experience • How did you gain that Experience? • Two words – Wrong Decisions

26. THANK YOU follow-up queries: tpanand@motivaluate.com Please visit my blog: tpanand.blogspot.com (TP Talks)