What’s Happening?!. Job creation incentive program seems to have backfired financially on the state of California. Three California congressmen are questioning the sale of IBM’s PC manufacturing to a China company based on national defense concerns.
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Job creation incentive program seems to have backfired financially on the state of California.
Three California congressmen are questioning the sale of IBM’s PC manufacturing to a China company based on national defense concerns.
SBC is negotiating to buy AT&T for $16 billion.
Knight-Ridder advertising revenue for 2004 was $648
million. Newspaper revenue was $747 million. Online media
revenue was $31 million.
Oracle expects higher profits. Seeks closer ties with IBM.
New university – Cal State East Bay.
The Vision to Action
Role and significance of IT?
Decided that it would become the global leader in
the large appliance industry.
Initially identified product technology and
procurement as key factors to realize this goal.
Added information systems as an essential third
factor to achieve this goal.
Successful companies are the result of good
Talented leadership is demonstrated in the following
Implementing a Vision:
Strategy, Tactics and Business Plan
Provide an understanding of how to transition a vision into reality through strategy, tactics, and business plans.
Better appreciate how strategies should dictate the role and significance of information systems.
Understand challenges that a company faces in formulating appropriate strategies.
The Four Components of Possible Business Success
Reduce the economic cost and human trauma of automobile
accidents and provide services that delight consumers.
Plan of Action:
Make major changes to the definition of their business and
Align core business strategies based on these changes.
The most straight-forward part of the entire process.
Deals with allocation of funds, people and other
As has been emphasized: the point of all of this is to
make things happen. Key to such an effort:
Implementing a Vision:
Strategy, Tactics and Business Plan
If we know where we are and something about how we got there, we might see where we are trending--and if the outcomes which lie naturally in our course are unacceptable,to make timely changes.Abraham Lincoln President of the United States
If the strategy is a hammer, the tactic is a nail. The actual end results are accomplished by the nail. If the nail isn\'t hammered correctly then the battle is lost. Sometimes the hammer also misses the nail.
Managers must be prepared to engage in heightened
international competition and have the ability to:
Whether dealing with vision, strategies or tactic think customer!
Remember that a major difference between companies is how they treat their customers.
Also the importance of doing necessary homework on competitors.
1. What products and/or services do we intend to offer?
2. What price range of products do we intend to offer?
2. What customer targets do we intend to pursue?
3. What geographic markets do we intend to address?
4. How will we obtain products to sell to our customers?
5. How will we deal with sales to our customers?
6. What company structure do we intend to create?
7. What information systems approach will we take?
Focus versus breadth:
Speed to market
strategies is competitive analysis.
executable and achievable.
must be achieved, expense levels that must be managed and
resources that must be applied.
force behind everything that the company does.
How important are they, really?
Do business strategies really make a difference between success and failure of a company?
Are the goals achievable?
Do key operating policies address the goals?
Do key operating policies reinforce each other?
Do the goals and policies match the resources available to the company relative to competitors?
Does the timing of the goals and policies reflect the company’s ability to change?
Do the goals and policies exploit industry opportunities?
Do the goals and policies deal with industry threats that are possible with available resources?
Does the timing of the goals and policies reflect the ability of the environment to absorb the planned impact.
Are the goals and policies consistent with societal concerns?
Communication and Implementation Considerations:
Are the goals understood by the implementers?
Is there congruence between the goals and policies and the values of the implementers to insure commitment?
Is there sufficient management capability and availability to assure effective implementation?
A. What is the company doing now?
Assumptions about the company’s relative position, strengths and weaknesses, competitors and industry trends.
B. What is happening in the business environment (industry).
Validity of industry opportunities and significance of threats.
Key factors for competitive success.
Capabilities and limitations of existing and potential competitors.
Company strengths and weaknesses relative to present and future competitors?
C. What should the company do?
Test the assumptions and strategy.
Consider alternative strategies.
Chose the strategy that best relates to the company’s situation relative to external opportunities and threats.
Progressive decided that it was really
in the business of reducing human
trauma and economic costs of auto
We seek to be an excellent, innovative,
growing and enduring business by reducing
the human trauma and economic costs of
auto accidents in cost-effective and profitable
ways that delight customers.
We seek to be an excellent, innovative, growing and enduring business by cost effectively and profitably reducing the human trauma and economic costs of auto accidents and other mishaps, and by building a recognized, trusted, admired, business generating brand.
We seek to earn a superior return on equity and to provide a positive environment which attracts quality people who develop and achieve growth plans.
Customer Value Proposition:
Our customer value proposition provides a litmus test for customer interaction, relationships and innovation.
Fast, Fair, Better
That’s what you can expect from Progressive. Everything we do recognizes the needs of busy customers who are cost-conscious, increasingly savvy about insurance and ready for easy, new ways to quote, buy and manage their policies, including claims service that respects their time and reduces the trauma and inconvenience of loss.
Progressive’s core values are pragmatic statements of what works best for us in the real world.
They govern our decisions and behavior.
We want them to be understood and embraced by all Progressive people.
Growth and change provide a new perspective, requiring regular refinement of core values.
Integrity We revere honesty. We adhere to high ethical standards, report precisely and completely, encourage disclosing bad news and welcome disagreement.
Golden Rule We respect all people, value the differences among them and cope with them in the way we want to be dealt with. This requires us to know ourselves and to try to understand others.
Objectives We strive to communicate clearly Progressive’s ambitious objectives and our people’s personal and team objectives. We evaluate performance against all these objectives.
Excellence We strive constantly to improve in order to meet and exceed the highest expectations of our customers, shareholders and people. We teach and encourage our people to improve performance and to reduce the costs of what we do for customers. We base our rewards on results and promote on ability.
Profit The opportunity to earn a profit is how the competitive free-enterprise system motivates investment to enhance human health and happiness. Expanded profits reflects our customers’ and claimants’ increasingly positive view of Progressive.
Currently Chairman of the Board
“We sell speed, not insurance.”
Glenn Renwick, President and Chief Executive Officer
Raymond Voelker, Chief Information Officer
“My world collapsed recently during a strategic planning meeting between the information systems organization and our marketing department.”
“How can we in IS help you to realize your goals?” asked the IS Director. This seemed like a good open-ended question, and I was waiting for the vice-president of marketing to embrace IS in his confidence. We were prepared to act as a full business partner with the marketing department.
“Beyond capacity planning for your computers, I don’t know how you can help. I’m not even sure what your role is in all of this” replied the VP of Marketing.
Semi-automated batch system (out-dated)
Increased complexity for route salesman and plants
10 day information float
Communications Network and Hand-held Computer
Increased complexity for route salesman and plants
Reduced information float to 24 hours
Decentralized Marketing Organization
Long John Silver
All American Food (A&W)
Created as Tricon Global Restaurants on October 6, 1997 as a spin off from Pepsi.
The world’s largest quick service restaurant company with more than 33,000 units in more than 100 countries involving 840,000 employees.
36% are outside the US
In 1992 McDonalds had 4,000 international restaurants. Today it has over 16,000 with a $1 billion profit from these operations.
Yum! has 11,800 (6,800 KRC and 4,400 Pizza Hut) with nearly $400 million in international profit.
Burger King is third with a profit of $50 million.
Seven countries but China, UK, Mexico and Korea will receive most of the capital investment with an objective of opening 1,000+ new international units.
China currently has 800 KFCs and 100 Pizza Huts with plans to open 200 new units per year.
65% of this growth will be through joint venture partners and franchises.
McDonalds has been the envy of this industry since its units average $1.6 million a year (almost twice that of Yum!)
Multi-branding gives customers more choices and variety.
Typically, sales rise at least 20% when a second brand is added to another Yum! brand. Has added $100,000 to $400,000 to a unit.
Pasta Bravo will be tested as a multi-brand with Pizza Hut.
40% of multi-branding is being done by franchisees.
A New Strategy
Hello, Porter Competitive Model!
Risks to be Avoided
Emerging Opportunities and Threats
External Impact of Strategies and Tactics
Internal Impact of Strategies and Tactics
Source: The Art of Strategic Planning
for Information Technologies
Suggest strategies that should be tested against
dumb-sizing (take your choice)
should not be based solely on cost
The Importance of these
Factors as Key Priorities
Continues When People
Are Empowered with