PRACTICE CASE PART 1                                                          MGT 487 - Rothschild

 

The purpose of PRACTICE CASE PART 1 is to introduce you to the process of performing an External Analysis (Industry and Competition Analysis) and an Internal Analysis  (Company Situation Analysis). Performing a complete External and Internal Analysis will pave the way for you to complete PRACTICE CASE PART 2. In PRACTICE CASE PART 2 you will Identify Keys Issues a company must address, Develop Strategic Alternatives/Recommendations, and Describe Implementation Plans.


External Analysis – Industry and Competition Analysis (based on Chapter 3)

 

Dominant Economic Characteristics of the Industry (5pts) 
1. What are the industry’s dominant economic traits?

Develop a profile of the dominant economic characteristics of your company’s industry using Table 3.1 as your guide. You should provide one or two sentences that clarify your point and when appropriate use specific percentages and figures.

  

Competition Analysis (5pts)

2. What is the competition like and how strong are each of the competitive forces?

Use Porter’s Five Forces Model to assess the strength of each of the five forces and why?

Example:

Rivalry among competing sellers (strong)
In paragraph form answer why you've determined that it is strong.

Threat of potential entry (weak) 
In paragraph form answer why you've determined that it is strong.

 

Driving Forces (5pts)

3. What are the drivers of change in the industry and what impact will they have?

Identify the top three to five drivers of change within this industry and why. Use subheads to clearly identify each driver.

 

Competitive Position of Major Companies/Strategic Groups (5pts)

4. Who are the key competitors and which are in the strongest/weakest competitive position?

Using strategic group mapping to identify competitors, potential rivalries and why. Answer the "why" and provide and interpretation of the "map" in a paragraph(s) immediately following the figure.

 

Competitor Analysis (5pts)

5. What strategic moves are rivals likely to make next?

Identify competitor’s strategies and who to watch and why? Use the chart on page 105 to guide your thinking. Your output should look like the chart provided in class.

 

Key Success Factors (5pts)

6. What key factors will determine competitive success of failure?

Specify the key success factors in bulleted list, with most critical key success factors identified at the top of the list. Walk through each of the 7 KSF types identified in Table 3.4. If there are none within a category, be sure to state NONE under that category to indicate that you have at least considered it.

 

Industry Prospects and Overall Attractiveness (5pts)

7. Is the industry attractive and what are its prospects for above average profitability?

Based your conclusions on the factors identified on page 108-109.  However write your response following the bullet points under item 7 of Table 3.5. Use the bullet points as subheads followed by paragraphs.


Internal Analysis – Company Situation Analysis (based largely on Chapter 4)


Company’s Present Strategy and Strategic Performance Indicators (5pts)

1a. What is the company’s present strategy? 
-Competitive Approach - be specific here.

-Competitive Scope
-Company’s Functional Strategies

-Recent Strategic Moves

-Concluding Logic Behind Above

 

1b. How well is the present strategy working then? (10pts)

-Strategic Performance

-Financial Performance
-Are they an above- average industry performer?

Consider market share ranking and trend, profit margins, net profits, return on investments, economic value and comparisons to industry averages, overall financial strength, stock price trends, sales growth, image and reputation

-          Must do a complete financial ratio analysis here and compare to industry averages and top competitors.

-          Must do a graph for sales and profits

-          Must make statement of overall financial condition and support for why you made that judgment

 

SWOT Analysis (5pts)

2a. What are the company’s strengths, weaknesses, opportunities, and threats

Using a bulleted item approach, prioritize a list of the company’s SWOTs. In parenthesis, provide evidence of the S, W, O, or T.

Example:

- Strengths – Resource Strengths and Competitive Capabilities

Alliances and joint ventures (partnership with Shimano gears and accessories)

Product innovation skills (first to develop state of the art aluminum front forks)

And so on for other OWTs.

 

2b. Competitive Value of any Company SWOT
Summary of what lessons can be distilled from the SWOT

 

Strategic Cost and Value Chain Analysis (5pts)

3. Are the Company’s Prices and Costs Competitive?

Using available information, conduct a value chain analysis, examining upstream, company, and downstream value chains.

 

Competitive Strength Assessment and Conclusions (5pts)

4. How strong is the company’s competitive position?

Generate a weighted competitive strength assessment and draw conclusions about it’s competitive position.

 

Major Strategic Issues the Company Must Address (5pts)

5. What strategic issues does the company need to face?

Based on both your External and Internal Analysis, draw some conclusions by identifying the strengths and weaknesses of a company’s current strategy and identifying the issues that need to be addressed.

Overall quality: 10 pts (Organization and Formatting, Sources, Synthesis)

Remember:

  1. Do not confuse industry data and analysis with company data and analysis. The data you collect for industry analysis will apply to all competitors in that particular industry.  Anything specific that your company is doing is part of the internal data collection and analysis.
  2. Use subheads and underlining to identify each section of your Practice Case.
  3. Number pages.
  4. Use the tools provided throughout chapters.
  5. Always provide an interpretation of your data
  6. A picture is worth a thousand words. Graph, charts; spreadsheets for competitive strength assessment.
  7. Be sure to cite sources as footnotes and provide separate bibliography page.
  8. Use a consultant’s language. “We find”, “The data suggests”.
  9. Table of Contents should include sections and page numbers.