Winning Market Leadership Strategic Market Planning for Technology-Driven Businesses

by Ryans, Adrian; More, Roger; Barclay, Donald; Deutscher, Terry

• ISBN13: 9780471644309
• ISBN10: 0471644307
• Edition: 1st
• Format: Hardcover
• Copyright: 2000-03-24
• Publisher: Wiley

Summary

Strategic market planning in technology-intensive businesses is more complex and is less manageable than in most other organizations. The technology-driven business environment is intensely competitive, complex, and dynamic, and planning needs to be done quickly and often.Winning Market Leadership offers a refreshing new approach to strategic market planning in these very demanding technology-intensive markets. It provides a systematic and highly integrated process for evaluating market opportunities and for developing strategies to lead in chosen markets. Its proven, highly practical approach to strategic market planning has allowed leading companies worldwide to: plan faster, focus on cash-flow and profitability, create "living plans" that reflect changing market conditions and competitive dynamics, involve cross-functional teams effectively, and drive to "yes/no" decisions. The book resulted from project-based executive programs developed by the authors for corporate clients such as IBM, Nortel Networks, National Semiconductor, and General Electric. This strategic market planning process has been refined and tested with over a thousand managers and executives in North America, Europe, and Asia. Winning Market Leadership: Is targeted at managers in technology-intensive businesses such as computers, telecommunications, software, biotechnology, semiconductors, instruments, pharmaceuticals, and advanced materials. Focuses on the key issues and tough choices faced by executives in very demanding technology-intensive markets. Outlines a clear 10-step process for building winning market plans, including: identifying opportunities, understanding the competition, managing critical relationships, understanding the profit dynamic, and more. Features examples from high-tech companies such as Intel, Compaq, Hewlett-Packard, Glaxo Wellcome, and General Electric. Includes "Key Questions for Executives and Managers" at the end of each chapter that help eliminate "blind spots" in the planning process.Winning Market Leadership is relevant to all executives and managers who play a significant role in developing cross-functional strategic market plans for their business: general managers; marketing managers; strategic planners; managers in business development, engineering, and R&D; and project team leaders.

Author Biography

ABOUT THE AUTHORS The authors are on the faculty of the Richard Ivey School of Business at The University of Western Ontario, Canada’s leading business school. They have worked as a team on school and private consulting initiatives for over a decade. Adrian B. Ryans is Professor of Business Administration. He has served as Dean and Director of Executive Education, and has also taught at Stanford, INSEAD, and IMD. He has served as a marketing strategy and management development consultant to a number of leading companies around the world, including General Electric, Hewlett-Packard, Nortel Networks, IBM, Varian, Fluke, and National Semiconductor. He currently directs the American Electronics Association/Ivey Executive Marketing Program for executives in high-technology companies. Roger A. More is Associate Professor of Business Administration and former Hewlett-Packard Professor of Marketing and New Technology. He has been a professor at the Harvard Business School, and taught at INSEAD and Penn State. A professional engineer and marketing planning and strategy consultant, his clients include General Electric, Nortel Networks, DuPont, Hewlett-Packard, Uddeholm Steel, and ICI. Donald W. Barclay is George and Mary Turnbull Professor. He teaches Marketing Management and Sales Management and is Director, Marketing Management Program at Ivey. He has also taught at Thunderbird and at Memorial University, Newfoundland. Formerly with IBM in sales and national account positions, he now consults to clients such as 3M, Novartis, and the Royal Bank of Canada. Terry H. Deutscher is Professor of Business Administration. During his time at the School, he has served as Associate Dean, Director of Research, and founding director of Ivey’s Executive MBA Program via video-conferencing. He has also held appointments at Cornell University, Ohio State University, the University of British Columbia, and IMD. His consulting clients include IBM, General Electric, Nortel Networks, Philips, and ICI.

Table of Contents

Preface	xv
Acknowledgments	xvii
Introduction	1	(26)
The Environment in Which Technology-Intensive Businesses Operate	3	(7)
Complex and Dynamic Market Chains	3	(2)
Network Effects	5	(1)
Speed of Change is High	6	(1)
Blurred Market Boundaries	7	(1)
Markets and Competition Are Global	8	(2)
Strategic Market Planning in a Technology-Intensive Business	10	(2)
Who Should Be Involved in the Process?	10	(1)
Planning Builds Mental Models	10	(1)
Planning Process Must Be Iterative and Continuous	11	(1)
Planning Process Must Be Integrative	12	(1)
Winning Market Leadership: An Integrated Approach	12	(12)
Choose the Arena	13	(1)
Identify Potentially Attractive Opportunities	14	(2)
Understand the Market	16	(1)
Assess Resources and Competencies	16	(1)
Understand the Competitive Challenge	17	(2)
Make Tough Strategic Choices	19	(2)
Plan Key Relationships	21	(1)
Complete the Winning Strategy	22	(1)
Understand the Profit Dynamic	23	(1)
Implement the Chosen Strategy	23	(1)
What Is Different About This Book?	24	(3)
Integrated Planning Process	24	(1)
Process Applies to New or Existing Business Opportunities	24	(1)
Process Is Designed for Managers	25	(2)
Choose the Arena	27	(16)
Introduction	27	(2)
Crucial First Step in the Planning Process	29	(5)
Strategic Business Unit (SBU)	29	(1)
Existing Market Opportunities	30	(1)
New Market Opportunities	31	(3)
Define the Arena	34	(3)
Customers Served	34	(2)
Applications/Functionality Provided	36	(1)
Technologies/Competencies Used	36	(1)
Value-Adding Role	37	(1)
Strategic Drivers and Strategic Paths	37	(3)
Driving Force	37	(1)
Strategic Path	38	(2)
Next Step: Identify the Potentially Attractive Opportunities in the Business Arena	40	(3)
Identify Attractive Opportunities	43	(28)
Introduction	43	(1)
Identifying Potential Market Opportunities	43	(11)
Benefits of Thinking About Market Segments Early in the Process	46	(1)
Segmenting a Market	46	(1)
Possible Segmentation Bases	47	(4)
Segmentation Process	51	(1)
Targeting Issues	52	(2)
Market Segment Attractiveness	54	(12)
Determining the Attractiveness of a Market Segment	55	(10)
Understanding Choices Among Market Chain Opportunities	65	(1)
Market-Driving Opportunities	66	(4)
Exploiting Environmental Change	67	(1)
Sources of Discontinuities or Breakpoints	68	(2)
Next Step: Developing a Deeper Understanding of the Market Opportunities	70	(1)
Understand the Market	71	(32)
Introduction	71	(1)
Adoption of New Products	72	(12)
Types of Innovations	73	(1)
Technology Adoption Life Cycle	74	(1)
Adopter Categories	75	(2)
Driving the Adoption Process	77	(5)
Achieving Market Leadership	82	(1)
Whole Product or Complete Solution	83	(1)
Understanding Buyer Choice/Rejection Behavior	84	(9)
Decision-Making Unit	85	(1)
Choice Criteria	86	(2)
The Choice/Rejection Process	88	(5)
Market Chains	93	(6)
Choices Among Market Chains	93	(3)
Market Chain Dynamics	96	(2)
Market Chains as a Series of Choice/Rejection Processes	98	(1)
Next Step: Assessing Your Resources and Competencies	99	(4)
Assess Resources and Competencies	103	(20)
Introduction	103	(1)
The Process of Assessing Resource/Competency Fit	104	(1)
Core Competencies	105	(6)
What Is a Core Competency?	105	(3)
What Is a Constraining Incompetency?	108	(1)
Identifying Core Competencies	109	(1)
Identifying Your Organization's Core Competencies	110	(1)
Managing Core Competencies	111	(4)
Should You ``Make'' or ``Buy'' Strategic Activities Associated with Core Competencies?	112	(1)
Customer Value and Profit Creation Model	113	(1)
Mapping Competencies and Customer Requirements	114	(1)
Assessing a Market Opportunity: Fit With Core Competencies	115	(5)
Next Step: Understanding the Competitive Challenge	120	(3)
Understand the Competitive Challenge	123	(22)
Introduction	123	(2)
Process of Competitive Analysis	125	(1)
Issues in the Competitive Analysis Process	126	(15)
Identification of Competitors	126	(2)
How Do They Compete?	128	(6)
How Are They Doing Now? How Will They Do in the Future?	134	(3)
Analysis of Strategy Driving Forces	137	(4)
Pulling the Competitive Information Together	141	(1)
Actions-Consequences-Evidence (ACE) Framework	141	(1)
Next Step: Making the Tough Choices	142	(3)
Make Tough Strategic Choices	145	(22)
Introduction	145	(2)
Strategic Issues	147	(2)
What Is a Strategic Issue?	147	(1)
How Many Strategic Issues?	148	(1)
Types of Strategic Issues	148	(1)
Developing a Winning Strategy for an Opportunity	149	(10)
Cost Leadership	149	(2)
Differentiation	151	(2)
Strategic Breakpoint	153	(2)
Risks of Adopting a Differentiation Strategy	155	(2)
Sustaining the Competitive Advantage	157	(1)
Convergence of Cost Leadership and Differentiation	158	(1)
Selecting the Portfolio of Opportunities	159	(4)
Balance Market Attractiveness and Ability to Win	159	(1)
Displaying the Portfolio of Opportunities	160	(3)
Making Clear Strategic Choices	163	(2)
Next Step: Managing Critical Relationships	165	(2)
Manage Critical Relationships	167	(26)
Introduction	167	(1)
Why Are Relationships Critical?	168	(2)
The Market Web	170	(4)
A Generic Market Web and an Example	171	(3)
A Managerial Perspective on Market Webs	174	(3)
Market Webs as Value-Creating Systems	174	(1)
Evolution of the Market Web	175	(1)
Managing Critical Relationships	176	(1)
Market Chain Strands	177	(1)
Customer and Supplier Relationships	177	(1)
Off-Market Chain Strands	178	(3)
Formal and Informal	178	(1)
Collaborative Product Development Alliances	179	(1)
Co-Marketing Alliances	179	(1)
Horizontal Selling Alliances	180	(1)
Knowledge and Influence Strands	181	(2)
Knowledge Strands: Learning From Others in the Web	181	(1)
Influence Strands: Affecting Choice/Rejection Processes	182	(1)
Value-Added Partnerships: A Key Relationship Form	183	(4)
Partnering Success Factors	184	(3)
Managing ``Sticky'' Strands in the Web	187	(2)
Relationships and the Market Opportunity	189	(1)
The Opportunity	189	(1)
The Winning Strategy	190	(1)
Next Step: Completing the Winning Strategy	190	(3)
Complete the Winning Strategy	193	(30)
Introduction	193	(2)
A Framework	193	(2)
Define a Clear Competitive Position in the Opportunity	195	(1)
Complete the Total Product/Service Solution	196	(2)
Plan to Gain Market Chain Commitment	198	(2)
Basic Issues	199	(1)
Work Through Pricing Challenges	200	(9)
The Impact of Context	201	(1)
Pricing Objectives	202	(4)
Other Challenges	206	(3)
Plan to Influence Customers and End Users	209	(4)
Customer Interface Strategies	209	(3)
Advertising and Promotion	212	(1)
Apply Strategic Thinking to Emerging Challenges	213	(1)
Evaluate the Current Strategy	214	(6)
Are You Going After an Attractive Market Opportunity?	215	(1)
Can You Win with Your Proposed Strategy?	216	(2)
If You Win, Will It be Worth It?	218	(1)
Other Considerations	219	(1)
Detail and Use the Plan	220	(1)
Next Step: Understanding the Profit Dynamic	221	(2)
Understand the Profit Dynamic	223	(24)
Introduction	223	(1)
The Profit Dynamic	224	(10)
The Drivers of Positive Cash Flow: Total Margin Generated	225	(1)
Negative Cash Flow Drivers: Fixed Costs and Investments	226	(1)
Cash Flow Profiles	227	(1)
The Profit Dynamic	228	(2)
An Alternative Form of the Profit Dynamic	230	(1)
Locating Key Sensitivities in the Profit Dynamic	231	(3)
New Product Opportunities and the Profit Dynamic	234	(4)
The Critical Importance of Adoption Rate	235	(3)
Applying the Profit Dynamic to Individual Customers	238	(1)
Product-Service Integration and the Profit Dynamic	239	(3)
Integrated Product-Service Opportunities	239	(2)
Management of the Integrated Product-Service Profit Dynamic	241	(1)
Managing the Profit Dynamic in Market Chains: Creating Strategic Leverage	242	(2)
Identifying Points of Strategic Leverage	242	(2)
Strategic Leverage and Adoption Rates	244	(1)
Next Step: Implementing the Strategy	244	(3)
Implement the Winning Strategy	247	(24)
Introduction	247	(5)
A Process for Managing Implementation	252	(2)
The Case for Change	254	(5)
The Need for Strategic Change	254	(2)
Types of Change	256	(3)
Specification of the Implementation Plan	259	(5)
The Questions	260	(3)
The Challenge	263	(1)
Communicating Implementation	264	(3)
Monitoring Implementation	267	(1)
Conclusion	268	(3)
The System that Makes the Process Happen	271	(32)
Introduction	271	(1)
Planning Systems	272	(4)
Need for Planning Systems	274	(2)
Design of a Planning System	276	(9)
Factors Influencing the Design of a Planning System	276	(2)
Major Planning System Design Decisions	278	(4)
No One Right Planning System	282	(2)
Balanced Interaction	284	(1)
Planning System in a Large, Sophisticated Company	285	(5)
Overview of the Planning System	286	(1)
Develop Options for SBU	286	(2)
Detailed Planning for Selected Option	288	(1)
Develop Budgets and Detailed One-Year Operating Plan	289	(1)
Implementation and Monitoring	289	(1)
An Effective Strategic Market Planning Process	290	(4)
Is Both Integrated and Iterative	290	(1)
Is Question Driven	291	(1)
Combines Hard Data with Soft Intuitive Judgment	291	(1)
Focuses on Implementation	291	(1)
Recognizes That the Process Is as Important as the Plan	292	(1)
Encourages Managers to Say No	292	(2)
Challenges Industry and Company Norms	294	(1)
Key Success Factors in an Effective Planning System	294	(6)
Effective Teams	295	(2)
Supportive Corporate Culture	297	(1)
Integration with Other Key Processes	298	(1)
Key Support Systems in Place	299	(1)
Conclusion	300	(3)
Index	303