ela 41 annual conference, marriott hotel, san francisco… · 1 1 business planning strategies that...

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Business Planning Strategies That Deliver Real Value.

Presented by: Jon S. Haas, CLP

Andrew Lea

John O. Steindorf

ELA 41st Annual Conference, Marriott Hotel, San Francisco, CA14th October 2002

WelcomeWelcome

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Strategic Planning for Management

Presented by:

Jon S. Haas, CLP

The TheoreticalThe Theoretical

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Strategic Planning for Strategic Planning for ManagementManagement

Goals for this Section:Goals for this Section:Overview of Strategic PlanningOverview of Strategic PlanningReasons for Strategic PlanningReasons for Strategic Planning

Critical IssuesCritical IssuesAvailable SoftwareAvailable Software

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DefinitionsDefinitions: Strategy: Strategy

•• Bridges the gap between policy & tactics.Bridges the gap between policy & tactics.

•• Means by which policy is effected.Means by which policy is effected.

•• A term that refers to a complex web of A term that refers to a complex web of thoughts, ideas, insights, experiences, thoughts, ideas, insights, experiences, goals, expertise, memories, perceptions, goals, expertise, memories, perceptions, and expectations that provides general and expectations that provides general guidance for specific actions in pursuit of guidance for specific actions in pursuit of particular ends.particular ends.

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DefinitionDefinition: Tactics: Tactics

•• An expedient for achieving a An expedient for achieving a goalgoal

•• Science of securing objectives Science of securing objectives set by strategyset by strategy

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DefinitionDefinition: Strategic : Strategic PlanningPlanning

•• The scheme for achieving your goalsThe scheme for achieving your goals

•• Understanding your market, defining Understanding your market, defining your vision, and executing your your vision, and executing your strategystrategy

•• Creating a guide for the entire Creating a guide for the entire organization to take joint actionorganization to take joint action

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Three Forms of StrategyThree Forms of Strategy

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Three Forms of StrategyThree Forms of Strategy•• Strategy, in general: refers to Strategy, in general: refers to how how a a

given objective will be achieved.given objective will be achieved.

•• Corporate Strategy: defines the Corporate Strategy: defines the markets markets and and businesses businesses in which a in which a company will operate.company will operate.

•• Competitive Strategy: defines for a Competitive Strategy: defines for a given business the given business the basis basis on which it on which it will compete. will compete.

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Business PlanningBusiness Planning

•• Mission Statement: This should clearly Mission Statement: This should clearly state the primary focus of the organization. state the primary focus of the organization. It should include the organization’s major It should include the organization’s major functions and activities. The mission functions and activities. The mission statement should be short and include:statement should be short and include:

1) A description of what the company does.1) A description of what the company does.2) A description of the affects of what the 2) A description of the affects of what the

company does.company does.

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•• Vision Statement: This describes how the Vision Statement: This describes how the company will achieve its mission in the company will achieve its mission in the future. The vision statement has three future. The vision statement has three benefits:benefits:

1) Guidance for future actions.1) Guidance for future actions.2) Basis for detailed and specific goals.2) Basis for detailed and specific goals.3) Strengthen the commitment towards.3) Strengthen the commitment towards.

achieving company goals.achieving company goals.

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•• Writing the PlanWriting the Plan–– General RulesGeneral Rules

•• Plan should be concisePlan should be concise•• Plan should be easy to read and Plan should be easy to read and

understandunderstand•• Plan should convey large and Plan should convey large and

profitable market opportunities for the profitable market opportunities for the businessbusiness

•• Plan should convey the strength and Plan should convey the strength and depth of your management teamdepth of your management team

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Business PlanningBusiness Planning•• Writing the PlanWriting the Plan

–– Standard FormatStandard Format•• Cover PageCover Page•• Executive SummaryExecutive Summary

–– Company’s originsCompany’s origins–– Product or Service, Company’s uniqueness or Product or Service, Company’s uniqueness or

competitive advantagecompetitive advantage–– Company’s goalsCompany’s goals–– Market potentialMarket potential–– Three to Five Year summary of key financial Three to Five Year summary of key financial

forecasts, especially sales and profit/loss.forecasts, especially sales and profit/loss.–– Management Team and its track recordManagement Team and its track record–– Required financingRequired financing–– Exit StrategyExit Strategy

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•• Writing the PlanWriting the Plan–– Standard Format, continuedStandard Format, continued

•• Company descriptionCompany description•• ManagementManagement•• The products and/or servicesThe products and/or services•• The marketThe market•• CompetitionCompetition•• MarketingMarketing•• Financial statements and projectionsFinancial statements and projections

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•• Writing the PlanWriting the Plan–– Don’ts…Don’ts…

•• make unrealistic assumptionsmake unrealistic assumptions•• underestimate the difficulties in growingunderestimate the difficulties in growing•• assume that the reader knows industry jargonassume that the reader knows industry jargon•• include long, tedious or overly technical infoinclude long, tedious or overly technical info•• include highly confidential or proprietary infoinclude highly confidential or proprietary info•• avoid discussing the risk to the businessavoid discussing the risk to the business

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•• Critical Points to avoid:Critical Points to avoid:–– Failing to plan in the first placeFailing to plan in the first place–– Shrugging off values and visionShrugging off values and vision–– SecondSecond--guessing the customerguessing the customer–– Underestimating your competitionUnderestimating your competition–– Ignoring your own strengthsIgnoring your own strengths–– Mistaking a budget for a planMistaking a budget for a plan–– Shying away from reasonable risksShying away from reasonable risks–– Allowing one person to dominate the planAllowing one person to dominate the plan–– Being afraid to changeBeing afraid to change–– Forgetting to motivate and rewardForgetting to motivate and reward

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The “ThreeThe “Three--Legged Stool”Legged Stool”

•• Management: Centers on the work of the Management: Centers on the work of the organization; concerned with performance at organization; concerned with performance at the individual level.the individual level.

•• Leadership: The ability to influence the Leadership: The ability to influence the directions, goals, and efforts of others through directions, goals, and efforts of others through the means that include, but go beyond, the the means that include, but go beyond, the simple exercise of authority.simple exercise of authority.

•• Governance: The means through which power Governance: The means through which power and authority are exercised in an organization.and authority are exercised in an organization.

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Strategic PlanningStrategic Planning

•• Initial Questions to Initial Questions to ask:ask:–– What strategies assure What strategies assure

the greatest growth in the greatest growth in profitability?profitability?

–– What is the fastest What is the fastest way to assure you way to assure you have a good strategy?have a good strategy?

–– What will create What will create sustainable success sustainable success over a longer period of over a longer period of time?time?

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•• The Eight Maxims of Strategy:The Eight Maxims of Strategy:–– Adjust your ends to your meansAdjust your ends to your means–– Keep your object always in mind, while Keep your object always in mind, while

adapting your plan to circumstancesadapting your plan to circumstances–– Choose the line of least expectationChoose the line of least expectation–– Exploit the line of least resistance Exploit the line of least resistance –– so so

long as it can lead you to any objective long as it can lead you to any objective that would contribute to your underlying that would contribute to your underlying objectobject

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•• Strategic Maxims, continued:Strategic Maxims, continued:–– Take a line of operation which offers Take a line of operation which offers

alternative objectivesalternative objectives–– Ensure that both plans and dispositions Ensure that both plans and dispositions

are flexible are flexible –– adaptable to circumstancesadaptable to circumstances–– Do not throw your weight into a stroke Do not throw your weight into a stroke

whilst your opponent is on guard whilst your opponent is on guard –– whilst whilst he is well placed to parry or evade ithe is well placed to parry or evade it

–– Do not renew an attack along the same Do not renew an attack along the same line (or in the same form) after it has line (or in the same form) after it has once failedonce failed

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Competitive StrategyCompetitive Strategy

•• Fundamentals:Fundamentals:–– Overall Cost Overall Cost

LeadershipLeadership–– DifferentiationDifferentiation–– FocusFocus

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Competitive StrategyCompetitive Strategy

•• Forces Affecting Competitive Forces Affecting Competitive Strategy:Strategy:–– The threat of entry by new competitorsThe threat of entry by new competitors–– The intensity of rivalry among existing The intensity of rivalry among existing

competitorscompetitors–– Pressure from substitute Pressure from substitute

products/servicesproducts/services–– The bargaining power of buyersThe bargaining power of buyers–– The bargaining power of suppliersThe bargaining power of suppliers

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Turbo BPR 2.5Turbo BPR 2.5

•• Its origins and original purposeIts origins and original purpose•• Use in our business modelingUse in our business modeling•• Modules:Modules:

–– Strategic PlanningStrategic Planning–– Operational AnalysisOperational Analysis–– AlternativesAlternatives–– ActualsActuals

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Turbo BPR 2.5Turbo BPR 2.5

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State of the Company State of the Company ReportReport

The format is a series of questions, designed to be used to conduct an analysis of a company, including the areas of:

Management

Operations

Marketing

Sales

The person conducting the analysis follows the format of this questionnaire* specifically, as it was created with the logic needed to execute the Business Process Reengineering study.

. * Questionnaire available from the Instructor

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SummarySummary

•• A Strategic Plan is a guide for the A Strategic Plan is a guide for the entire organization to take action.entire organization to take action.

•• Strategies are what we are going to Strategies are what we are going to do to close the gap between where do to close the gap between where we are and where we want to be.we are and where we want to be.

•• Use the Planning process to list your Use the Planning process to list your actions and prioritize them.actions and prioritize them.

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SummarySummary

•• Basic Marketing Strategy:Basic Marketing Strategy:Find a need and fill it!!!Find a need and fill it!!!

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Questions?Questions?

Thank you for your time and attention. JON S. HAAS, CLP

[email protected]

(386)860-6537

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Allegiant Allegiant HH PartnersPartnersI N C O R P O R A T E DI N C O R P O R A T E D

Business Planning Business Planning Strategies that DELIVER Strategies that DELIVER REAL VALUEREAL VALUE

By: John O. SteindorfBy: John O. Steindorf10:3010:30----NoonNoonOCTOBER 14, 2002OCTOBER 14, 2002

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Presentation SummaryPresentation Summary

•• Mission, Purpose & Mission, Purpose & NicheNiche

•• Strategic ObjectivesStrategic Objectives•• Tactical GoalsTactical Goals•• Marketing PlanMarketing Plan•• Capitalization/FundingCapitalization/Funding•• InfrastructureInfrastructure•• Back OfficeBack Office•• Management ReportingManagement Reporting•• Differentiating Differentiating

ActivitiesActivities

•• Profit MaximizationProfit Maximization•• Incremental Income Incremental Income •• Expense ManagementExpense Management•• Incremental SavingsIncremental Savings•• Attributes for SuccessAttributes for Success•• Implement StrategiesImplement Strategies•• Measuring SuccessMeasuring Success•• Achieving SuccessAchieving Success•• Coping with FailureCoping with Failure

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Identify Your Mission, Identify Your Mission, Purpose, and NichePurpose, and Niche

•• Review or Create Mission StatementReview or Create Mission Statement–– Include top prioritiesInclude top priorities–– FocusFocus–– DeliverablesDeliverables

•• Understand Purpose and RoleUnderstand Purpose and Role–– Parental ObjectivesParental Objectives–– ReportingReporting

•• Define Your NicheDefine Your Niche

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Establish Strategic Establish Strategic ObjectivesObjectives

•• Target Markets/Risk Acceptance Target Markets/Risk Acceptance CriteriaCriteria–– Portfolio ConcentrationsPortfolio Concentrations–– Underwriting GuidelinesUnderwriting Guidelines

•• Identify Product OfferingsIdentify Product Offerings•• Analyze Strengths and Analyze Strengths and

WeaknessesWeaknesses

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Establish Tactical GoalsEstablish Tactical Goals

•• Determine Competitive AdvantagesDetermine Competitive Advantages•• Analyze Competitors (Existing and Analyze Competitors (Existing and

Future)Future)•• Threats and ChallengesThreats and Challenges•• Review current Market OpportunitiesReview current Market Opportunities•• Differentiate YourselfDifferentiate Yourself•• Define InfrastructureDefine Infrastructure

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Determine a Marketing Determine a Marketing PlanPlan

•• Market PositioningMarket Positioning•• Establish Marketing Establish Marketing

InfrastructureInfrastructure–– Direct/IndirectDirect/Indirect–– CompensationCompensation–– Objectives/Quotas/BudgetObjectives/Quotas/Budget–– Advertising and ExpensesAdvertising and Expenses–– Organization Chart ReportingOrganization Chart Reporting

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Define a CapitalizationDefine a Capitalizationand Funding Infrastructureand Funding Infrastructure

•• Venture Capital or Private/Angel Venture Capital or Private/Angel InvestorsInvestors

•• Institutional InvestorsInstitutional Investors•• Banking RelationshipsBanking Relationships•• Asset Securitization Asset Securitization •• Portfolio Orientation and Portfolio Orientation and

ManagementManagement•• Syndication StrategySyndication Strategy

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Develop an InfrastructureDevelop an Infrastructure

•• Marketing PlanMarketing Plan•• Capitalization and Funding Capitalization and Funding

StrategiesStrategies•• Back Office Policies & Back Office Policies &

ProceduresProcedures•• Portfolio ManagementPortfolio Management•• Management Reporting & Management Reporting &

TrackingTracking

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Back Office Policy/ProceduresBack Office Policy/Procedures

•• Procedural Checks and Procedural Checks and BalancesBalances

•• Staffing RequirementsStaffing Requirements•• Headcount SensitivityHeadcount Sensitivity•• BenchmarkingBenchmarking

–– Turnaround TimeTurnaround Time–– ThroughputThroughput

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Management Reporting & Management Reporting & TrackingTracking

•• Redundancy and ReportingRedundancy and Reporting•• Monitor Results and Track Monitor Results and Track

ProgressProgress•• Recognize Marketing CyclesRecognize Marketing Cycles

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Differentiating ActivitiesDifferentiating Activities

•• Customer Relationship Customer Relationship ManagementManagement

•• Industry or Equipment Industry or Equipment SpecializationsSpecializations

•• Solicitation of FeedbackSolicitation of Feedback•• Partnering PhilosophyPartnering Philosophy

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Maximizing ProfitabilityMaximizing Profitability

•• Optimizing SpreadsOptimizing Spreads•• Fee Income OpportunitiesFee Income Opportunities•• Expense ManagementExpense Management•• Process ImprovementProcess Improvement•• Incremental RevenueIncremental Revenue•• Utilize Balance Sheet for Utilize Balance Sheet for

UnderwritingUnderwriting•• Consulting vs. Consulting vs.

Underwriting/SyndicationUnderwriting/Syndication

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Incremental Income Incremental Income OpportunitiesOpportunities

•• Transaction Fees Transaction Fees –– DocumentationDocumentation–– Commitment Commitment –– LegalLegal–– ProcessingProcessing–– Asset Inspections/RemarketingAsset Inspections/Remarketing

•• Syndication of Underwritten TransactionsSyndication of Underwritten Transactions•• Sale of Exposure/Concentration IssuesSale of Exposure/Concentration Issues•• Portfolio AdministrationPortfolio Administration•• Consulting/Brokerage/Asset ManagementConsulting/Brokerage/Asset Management

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Proper Expense ManagementProper Expense Management

•• Systems and ProceduresSystems and Procedures•• HeadcountHeadcount•• InfrastructureInfrastructure•• OutsourcingOutsourcing•• Process Improvement with Process Improvement with

Checks/BalancesChecks/Balances•• Play “Devil’s Advocate”Play “Devil’s Advocate”•• Necessary vs. LuxuryNecessary vs. Luxury

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Incremental SavingsIncremental Savings

•• Evaluate Outsourcing OptionsEvaluate Outsourcing Options•• ReRe--deploy Talented Headcountdeploy Talented Headcount•• Hire “wellHire “well--rounded” Personnelrounded” Personnel•• Squeeze the Proverbial Orange Squeeze the Proverbial Orange

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Attributes for Optimal Attributes for Optimal SuccessSuccess

•• OpenOpen--mindedness, Flexibility & Creativitymindedness, Flexibility & Creativity•• Know your Limitations Know your Limitations •• Limit and Retain your FocusLimit and Retain your Focus•• Optimize your ExpertiseOptimize your Expertise•• Evaluate Opportunity CostsEvaluate Opportunity Costs•• Leverage Prior SuccessesLeverage Prior Successes•• Hire Best and BrightestHire Best and Brightest•• Remain PatientRemain Patient

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Implementing Business and Implementing Business and Marketing StrategiesMarketing Strategies

•• ANTICIPATE SHORTANTICIPATE SHORT--TERM CHANGESTERM CHANGES–– Supply and DemandSupply and Demand–– Market LiquidityMarket Liquidity–– Budgets and QuotasBudgets and Quotas–– CyclicalityCyclicality

•• REACT TO LONGREACT TO LONG--TERM TRENDSTERM TRENDS–– Mergers and ConsolidationsMergers and Consolidations–– Tax Law and Accounting BoardTax Law and Accounting Board–– Interest RatesInterest Rates–– EconomyEconomy

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Measuring Your SuccessMeasuring Your Success

•• Learn from Competitors’ Business Learn from Competitors’ Business ModelsModels

•• Validate your AssumptionsValidate your Assumptions•• Solicit Feedback “360 Style”Solicit Feedback “360 Style”•• Benchmark Quantitatively and Benchmark Quantitatively and

QualitativelyQualitatively

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Achieving Corporate SuccessAchieving Corporate Success

•• Stay in Touch with the MarketsStay in Touch with the Markets•• Understand the Market DynamicsUnderstand the Market Dynamics•• Refine your Niches Refine your Niches •• Continuous DifferentiationContinuous Differentiation•• Evaluate with an Opportunity Cost in Evaluate with an Opportunity Cost in

MindMind•• Recognize Upside/Downside Recognize Upside/Downside

ImplicationsImplications

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Coping with FailureCoping with Failure

•• Admit your Mistakes and Learn Admit your Mistakes and Learn from Themfrom Them

•• Limit your ScopeLimit your Scope

Marketing Strategies Marketing Strategies That Deliver Real ValueThat Deliver Real Value

Andrew LeaAndrew LeaMcCue Systems Inc.McCue Systems Inc.

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SummarySummary

•• BrandingBranding•• PositioningPositioning•• Designated DriversDesignated Drivers•• Crafting the MessageCrafting the Message•• Marketing as a Martial ArtMarketing as a Martial Art

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Marketing Marketing –– Why Bother?Why Bother?

§§ BrandingBranding§§ PartneringPartnering§§ InternalInternal§§ StrategicStrategic§§ SellingSelling

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BrandingBrandingWhat Does This Company Mean?What Does This Company Mean?

§§ ContentContent§§ Media (Media (The Medium is the MessageThe Medium is the Message))§§ ProductsProducts§§ ActionAction§§ Success (testimonials)Success (testimonials)

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PositioningPositioning

§§ GorillasGorillas§§ NicheNiche--ers ers / Boutiques/ Boutiques

–– InnovatorsInnovators–– TopTop--FeedersFeeders–– BottomBottom--FeedersFeeders

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§§ DominationDomination§§ ConfusionConfusion§§ WedgingWedging§§ CrumbCrumb--feedingfeeding§§ ReRe--FramingFraming

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ReRe--FramingFraming–– Changing the SubjectChanging the Subject–– ReRe--defining the Problemdefining the Problem–– Creating RelevanceCreating Relevance

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BuyersBuyers

RolesRoles§§ ApproversApprovers§§ Choosers / EliminatorsChoosers / Eliminators§§ InfluencersInfluencers

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BuyersBuyers

Strata Strata §§ CC--levellevel§§ UpperUpper--ManagementManagement§§ MiddleMiddle--Management Management §§ OperationsOperations§§ TechnicalTechnical§§ EndEnd--UsersUsers

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Decision DriversDecision DriversBusiness Outcomes / MotivatorsBusiness Outcomes / Motivators

§§ CC--levellevel§§ UpperUpper--ManagementManagement§§ MiddleMiddle--Management Management §§ OperationsOperations§§ TechnicalTechnical§§ EndEnd--UsersUsers

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Decision Drivers Decision Drivers EmotionalEmotional

§§ SelfSelf--AggrandizementAggrandizement§§ Something for NothingSomething for Nothing§§ FearFear

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Decision Drivers Decision Drivers EmotionalEmotional

•• FearFear–– Loss of competitive positionLoss of competitive position–– Loss of revenueLoss of revenue–– Project FailureProject Failure–– Loss of authority / faceLoss of authority / face

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Crafting the MessageCrafting the MessageAre youAre you talkin'talkin' to ME?to ME?

•• BuyersBuyers•• PartnersPartners•• InvestorsInvestors•• WorkforceWorkforce

–– NowNow–– LaterLater

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Crafting the Crafting the MessageMessage

§§ Emotional DriversEmotional Drivers§§ Business DriversBusiness Drivers§§ MultiMulti--Level Business Level Business

OutcomesOutcomes§§ Reason to Act NowReason to Act Now

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Crafting the MessageCrafting the Message

§§ Tell them what you’re Tell them what you’re going to tell them.going to tell them.§§ Tell them.Tell them.§§ Tell them what you’ve told Tell them what you’ve told

them.them.

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Designing the MessageDesigning the Message

§§ The First 4 SecondsThe First 4 Seconds§§ Look and feelLook and feel§§ Designed or not?Designed or not?§§ GraphicsGraphics§§ Language level & densityLanguage level & density

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Then it's war! Then it's war! Marketing as a Martial ArtMarketing as a Martial Art

§§ FrontalFrontal§§ FlankingFlanking§§ JiuJiu--Jitsu / Tai ChiJitsu / Tai Chi§§ GuerillaGuerilla§§ M.A.D.M.A.D.§§ Mind WarfareMind Warfare

Andrew LeaAndrew LeaMcCue Systems Inc.McCue Systems Inc.

650650--348348--0650 Ext 11710650 Ext [email protected]@mccue.com

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Thank YouThank You

•• The Management of Acme Leasing & The Management of Acme Leasing & Drayage Company would like to thank you Drayage Company would like to thank you for your time and your help with this for your time and your help with this project! project!

•• Jon, Andrew, and John are all available for Jon, Andrew, and John are all available for additional questions and conversation. additional questions and conversation. Please remember to pick up their business Please remember to pick up their business cards before you leave today.cards before you leave today.

ela 41 annual conference, marriott hotel, san francisco… · 1 1 business planning strategies that...

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