1、CONFIDENTIALBU Strategic Plan Template BookTraining materials8 June 2001This report is solely for the use of client personnel. No part of it may be circulated, quoted, or reproduced for distribution outside the client organization without prior written approval from McKinsey & Company. This material
2、 was used by McKinsey & Company during an oral presentation; it is not a complete record of the discussion.Jim Ayala PHOMelissa Gil PHORegina Manzano PHOSuresh Mustapha PHOSteve Shaw HKOShelly Yeh PHOChoon-Gin Tan SIOSTRATEGY PLANNING INSTRUCTIONSThe objective of these templates is to provide comple
3、teness and consistency of BU strategic plan submissions. These templates are not intended to replace or constrain BU strategic thinking and should be adapted to reflect a particular BUs sectoral context as requiredEach section begins with a summary that is based on a synthesis of questions and analy
4、ses that follow. The suggested approach would be to first complete the relevant back-up analyses and then work towards the overall synthesis2TABLE OF CONTENTSI.Executive summaryII. Environmental and internal assessmentA. Industry dynamics and its implicationsB. Competitive assessmentC. Internal asse
5、ssmentIII. Strategic definition and implicationsA. Strategy articulationB. Strategic initiativesC. Financial projectionD. Risks/contingencies and strategic alternativesIV. Exhibits3BU STRATEGIC PLAN DEVELOPMENTIndustry dynamics and implicationsEnvironmental and internal assessmentCompetitive assessm
6、entInternal assessmentWhat are the major changes in industry dynamics and resulting opportunities and risks?What are your competitive strengths and weaknesses?How does your current business emphasis fit with industry opportunity and competitive landscape?Strategy articulationStrategic definition and
7、 implicationsStrategic initiativesFinancial projectionsWhat strategy will your BU pursue over the next 3 years?What will be the impact of major strategic initiatives?What are the expected financial returns of your strategy?+Risk/contingen-cies & strategic alternativesWhat strategic alternatives have
8、 you considered?+4I. EXECUTIVE SUMMARYInstructions:The Executive Summaryprovides a synthesis of theEnvironmental and InternalAssessments and theresultant BU Strategic Plans5II. ENVIRONMENTAL AND INTERNAL ASSESSMENT6IIA. INDUSTRY DYNAMICS AND IMPLICATIONS SUMMARYA. What are the major changes in indus
9、try dynamics and the resulting opportunities and risks?A.2 How is industry structure changing (demand, supply, and industry chain economics)? What are the resulting opportunities and risks?A.3 What is the expected competitor conduct? What are the resulting opportunities and risks?A.4 What are the pr
10、esent and future external factors that could present new opportunities and risks?A.1 What industry are you competing in? What are the various segments in the industry?Instructions:The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsInstructions:These subsection
11、scontain a 1-2 sentencesummary of the relevantfindings7IIA. INDUSTRY DYNAMICS AND IMPLICATIONS BACK-UP 1A.1What industry are you competing in? What are the various segments in the industry?Industry definitionIndustry segmentation Definition SizingInstructions:Exhibit 1 could providea useful framewor
12、k foranswering this questionIndustry definition:Industry segmentation:8IIA. INDUSTRY DYNAMICS AND IMPLICATIONS BACK-UP 2A.2How is industry structure changing with respect to demand, supply, and industry chain economics? What are the resulting opportunities and risks?Economics of demand By segment Su
13、bstitutes, ability to differentiate Volatility, cyclicalityEconomics of supply Producer concentration and diversity Import competition Capacity utilization Entry/exit barriers Cost structure (fixed and variable)Industry chain economics Customer and supplier bargaining powerInstructions:Exhibit 2,3 o
14、r 4 could providea useful framework foranswering this question9IIA. INDUSTRY DYNAMICS AND IMPLICATIONS BACK-UP 3A.3 What is the expected competitor conduct? What are the resulting opportunities and risks?Major industry competitor moves Marketing initiatives Industry capacity changes M&As, divestitur
15、es Vertical integration/disaggregation Alliances and partnerships Cost control and efficiency improvementsInstructions:Exhibit 2,3 or 4 could providea useful framework foranswering this question10IIA. INDUSTRY DYNAMICS AND IMPLICATIONS BACK-UP 4A.4 What are the present and future external factors th
16、at could present new opportunities and risks?Impact and likelihood of major industry discontinuities Changes in regulation/government policy Technological breakthroughsInstructions:Exhibit 2,3 or 4 could providea useful framework foranswering this question11IIB. COMPETITIVE ASSESSMENT SUMMARYB. What
17、 are your competitive strengths and weaknesses?B.1 What are the capabilities required to succeed in this industry?B.2 How do you compare against these necessary capabilities?Instructions:The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsInstructions:These sub
18、sectionscontain a 1-2 sentencesummary of the relevantfindings12IIB. COMPETITIVE ASSESSMENT BACK-UP 1B.1 What are the capabilities required to succeed in this industry?Privileged assets that create competitive advantage, e.g. physical assets, location/”space”, distribution/sales network, intangible a
19、ssets (intellectual capital, network, brands, talents)Distinctive skills/competencies that create competitive advantage, e.g.innovation, talent developmentInstructions:Exhibit 5 could providea useful framework foranswering this question13IIB. COMPETITIVE ASSESSMENT BACK-UP 2B.2 How do you compare ag
20、ainst these necessary capabilities?Strengths and weaknesses of your competitive position vs. necessary capabilitiesBenchmark performance against the industrys relevant key performance indicators (KPIs)*, with margin and market share as the required minimumStrengths and weaknesses of your competitive
21、 position vs. necessary capabilities:Benchmark performance against the relevant industrys KPIs:Instructions:Exhibits 6 and 7 couldprovide a useful frameworkfor answering this questionInstructions:Exhibit 8 could providea useful framework foranswering this question* KPIs are a handful of levers that
22、drive the value of the industry/business14IIC. INTERNAL ASSESSMENT SUMMARYC. How does your current business emphasis fit with the industry opportunities and the competitive landscape?C.1 Which segments of the business are providing the highest returns?C.2 What have been the performance trends along
23、major BU KPIs?C.3 Which intangible assets* could be near-term potential sources of value?Instructions:The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsInstructions:These subsectionscontain a 1-2 sentencesummary of the relevantfindings* Please refer to Exhibi
24、t 12 for further description15IIC. INTERNAL ASSESSMENT BACK-UP 1C.1 Which segments of the business are providing the highest returns?*Relevant BU segments (based on customer, product, geography, channel)Operating contribution estimates for each segmentInstructions:Exhibit 9 could providea useful fra
25、mework foranswering this question* Based on latest available, 1-2 year historical financial statements16IIC. INTERNAL ASSESSMENT BACK-UP 2C.2 What have been performance trends along major BU KPIs?KPI performance trends over the last 3-5 years, e.g. return on capital employed (ROCE), operating income
26、, margins, capital employedAssessment of underlying trend driversExpected evolutionInstructions:Exhibits 10 and 11 couldprovide a useful frameworkfor answering this questionROCE = Operating income x (1- tax rate) All interest bearing debt (short and long) + minority interest + stockholders equity17I
27、IC. INTERNAL ASSESSMENT BACK-UP 3C.3 Which intangible assets could be near-term potential sources of value?Identification of in-house intellectual property, talent, networks, brand/imageConversion into sources of valueInstructions:Exhibit 12 could providea useful framework foranswering this question
28、18III. STRATEGIC DEFINITION AND IMPLICATIONS19IIIA. STRATEGY ARTICULATION SUMMARYA. What strategy will your BU pursue over the next 3 years?A.1 Where to compete?A.2 What is your customer value proposition for the different segments you are going to serve?A.3 What is your business model?Instructions:
29、The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsA.4 How does your chosen strategy exploit industry opportunities and address industry/competitive threats?Instructions:These subsectionscontain a 1-2 sentencesummary of the relevantfindings20IIIA. STRATEGY ART
30、ICULATION BACK-UP 1A.1 Where to compete? Where are you going to compete along these dimensions and why: Target market Distribution channels Product (breadth and depth) Geographic scopeInstructions:Exhibit 13 could providea useful framework foranswering this question21IIIA. STRATEGY ARTICULATION BACK
31、-UP 2A.2 What is your customer value proposition for the different segments you are going to serve? Target customer definition Benefits that you will offer the customers Product pricing Position against competition vis-vis the benefits provided and the price chargedWho is your target customer?What a
32、re the explicit benefits you provide to your customers?What perceived value do you provide to the customer better than competition?How much value do your customers attach to the benefits you provide?22IIIA. STRATEGY ARTICULATION BACK-UP 3A.3 What is your business model? Delivery and communication of
33、 customer value proposition (value delivery system) Competitive advantage in delivering these benefits to the customer How will the value proposition be provided and communicated?Which of your BUs existing strengths can be leveraged? What skills/capabilities do you need to build?Instructions:Exhibit
34、 15 could providea useful framework foranswering this question23IIIA. STRATEGY ARTICULATION BACK-UP 4A.4 How does your chosen strategy exploit the industry opportunities and address the industry/competitive threats? Industry attractiveness and implication review Alignment of strategy and environment
35、al realitiesInstructions:A review of the section on Industry Dynamics and Implications, together with the frameworks used (Exhibit 2,3 or 4) is useful for answering this question24IIIB. STRATEGIC INITIATIVES SUMMARYB. What will be the impact of major strategic initiatives?B3. How much value will be
36、created from each strategic initiative?B4. What resources willeach strategic initiativerequire?Instructions:The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsB1. What major strategic initiatives are required to successfully implement your selected business mo
37、del?B2. What are the sources of value created from each strategic initiative?Instructions:These subsectionscontain a 1-2 sentencesummary of the relevantfindings25IIIB. STRATEGIC INITIATIVES BACK-UP 1B.1 What major strategic initiatives are required to successfully imple-ment your selected business m
38、odel? Possible strategic initiatives list26IIIB. STRATEGIC INITIATIVES BACK-UP 2B.2 What are the sources of value created from each strategic initiative? Sources of value from each strategic initiative (e.g., EBIT, capital employed)Category of initiativesVolume increaseEBIT impact viaPrice increaseC
39、ost reductionOtherInvest-mentCapital employed impact viaDivest-mentCapitalefficiency*Other * E.g. improved working capital employment, increased asset utilization, changes to asset ownershipSpecific actionable initiatives 27IIIB. STRATEGIC INITIATIVES BACK-UP 3Operating income ongoing impact 2001-20
40、04PhP millionsCapital employed ongoing impact 2001-2004PhP billionsPresent operating incomeVolume increasePrice increaseCost reduction benefitAdditional costsTotal ongoing operating incomePresent capital employedImproved capital efficiencyDivestmentsInvestments (capex and acquisitions)Total ongoing
41、capital employedB.3 How much value will be created from each strategic initiative?one-time EBIT impact = one-time costs = Financial impact from each strategic initiative Expected financial outlay for each initiative+=+=28IIIB. STRATEGIC INITIATIVES BACK-UP 4B.4 What resources will each strategic ini
42、tiative require? Resources required to make strategy work Availability of resources in the organization Plan for filling resource gapsCategories of initiativesSpecific actionable initiativesPeople/skillsResource requirementsFundingEx-Com involvement 29IIIC. FINANCIAL PROJECTIONS SUMMARYC. What are t
43、he expected financial returns of your strategy?C.3 What is your expected cash generation ability over the medium term?C.4 What is your expected capital productivity?C.2 What is your projected net income in the next few years?C.1 What are the key assumptions?Instructions:The answer to thisoverarching
44、 questionrequires a recapitulationof the sections mainfindingsInstructions:These subsectionscontain a 1-2 sentencesummary of the relevantfindings30IIIC. FINANCIAL PROJECTIONS BACK-UP 1C.1 What are the key assumptions? Profit and loss (e.g. revenues, costs, margin) Balance sheet Corporate center dire
45、ctives Corporate center assumptionsBASE CASEBusiness unit assumptionsRevenuesMarket sizeMarket sharePriceCostsInput costsProduction costsOther costs(e.g. SG&A)MarginsGross marginOperatingmarginCapitalPlannedinvestments/divestmentsChanges inworking capital2002KEY FORECAST ASSUMPTIONS20032004Growth ra
46、teCorporate center assumptions200220032004Key economicindicatorsGDP growthConsumerprice indexExchange rate(PhP/USD)91-day T-billrateCorporate taxrateInstructions:These are the minimumrequired assumptions. Feel free to add otherassumptions relevant to your BU31IIIC. FINANCIAL PROJECTIONS BACK-UP 2C.2
47、 What is your projected net income in the next few years? Income statement forecastBASE CASEHistoricalSalesCost of goods soldGross profitOperating expensesOperating profitOther expensesTaxesNet profit1999FORECASTED INCOME STATEMENT2000In PhP millionForecast2001*200220032004CAGR1999-2004Growth analys
48、isSales (%)Gross profit (%)Operating profit (%)Net profit (%)Margin analysisGross margin (%)Operating margin (%)Net margin (%)*Key assumptions not listed earlier should be detailed at the bottom of the chart. The impact of planned initiativeson the revenues and costs should be established clearly wi
49、th additional attachments if requiredBest estimates on possible actual results Instructions:These are the minimum required income statement accounts and analyses. Feel free to add other accounts and analyses relevant to your BU32IIIC. FINANCIAL PROJECTIONS BACK-UP 3C.3 What is your expected cash gen
50、eration ability over the medium term? Cash flow forecastInstructions:These are the minimum required cash flow statementaccounts. Feel free to add other accounts relevant to your BUBASE CASEOperating profitDepreciation and amortizationOther non-cash operatingexpensesNet operating cash flowIncrease/(d
