Strategist Presentation Harvard University Strategic Management MGMT 5000 April 29th, 2015 Good Strategy Bad Strategy: iTATA

“MAGICAL” solution to strategy… 2 Myths About Good Strategy

Be Driven.. Safely Drive Smart, Drive Safe, Drive iTATA 3 iTATA Strategic Move - Joint Venture - Tata and Apple

Joe, Board of Director General and Administrative Faisal, Board of Director Operations Naz, Narrator Pallavi, Board of Director Marketing and Sales Fredrick, Board of Director Human Resources Peter, Board of Director Logistics Shelagh, Board of Director Service Francis, Board of Director Finance 4 Team Strategist

5 Strategy Gone Bad Four (4) Signs of Bad Strategy 1.Fluff 2.Failure to face the problem 3.Mistaking goals for strategy 4.Fuzzy or overly complex strategic objectives

6 Heart of a Strategy Rumelt’s Kernel concept from Good Strategy Bad Strategy Strategic Management course concept from textbook

7 Strategy Gone Bad Four (4) Signs of Bad Strategy 1.Fluff 2.Failure to face the problem 3.Mistaking goals for strategy 4.Fuzzy or overly complex strategic objectives

●Template Strategy ○Poor Planning ●Quick fixes via Organization structure ○Competency Companions ●Good Strategy is, as Rumelt says - ○Rare ○Coherence coordinating actions, policies ○Resources to meet organizational objectives ○Gathers power from its rareness ○Difficult to imitate 8 Good Strategy | Bad Strategy

Tata Manufacturing Advantages ○Cost Leadership ○Strategic locations provide logistical advantage ○Operational economies of scale ○Vertical integration opportunities 9 Setting up for Good Strategy Manufacturing Component

10 Setting up for Good Strategy Designing Component Processes Driven by Value Chain Analysis

Three Phases of Strategy ●Premeditation ○Focus Target segments ■Strategic location ○Corporate social responsibility ■Physically challenged drivers ●Anticipation ○Porter’ Five forces ■Watch competitors and substitutes ○SWOT Analysis ■Build Differentiation upon your strengths ●Coordinated Actions ○Strategic implementation ■Coherent actions ○Cost Leadership actions 11 “Discovering hidden power in the situation is the best way to compete with your rivals.” Setting up for Good Strategy More on Designing Component

●Identify Growth Opportunities ○Hump Chart and the BCG Matrix ●Measure the Financial Performance ○Assure strategy, implementation and execution should contribute to the bottom line ●Sustainable Competitive Advantage ○V (value add) R (rare) I (inimitable) N (non-substitutable) 12 Setting up for Good Strategy Financial Component

A Chain Link System ○As strong as the weakest subunit ○Improving every link via Internal Analysis ○End-to-end Value Chain deployment ○Creating chain linked constellations of strategy ○Makes competitive imitation difficult 13 Setting up for Good Strategy Chain Link Methodology

●A Healthy Growth ○Fact based financial analysis ○Competitive advantage ○Prosumer - integrating customers value chain ●Purpose of Strategy ○To identify sustainable competitive advantage ○Value adding, rare, hard to imitate or substitute ○Good leadership alone is not sustainable ○Create competitive advantage 14 Setting up for Good Strategy Growth and Sustainability

●Deepening Advantages ○Increasing value for stakeholder ○Cost Leadership advantage ●Broadening Extent of Advantages ○Creating higher demand for advantaged products or services ●Strengthen the Channels ○Blocking easy replication and imitation by competitors 15 Setting up for Good Strategy Competitive Advantage Porter’s Five Forces

16 Setting up for Good Strategy Porter’s Five Forces

●Navigate Through Uncertainty ○Comprehensive industry life cycle analysis ○Integrate Cost Leadership and Differentiation strategies ●Gain Success During Uncertainty ○Consistent and sustainable direction - unified vision ○By maintaining a vision clearer than rivals ●Yields Competitive Advantage ○Managing Innovation 17 Setting up for Good Strategy Riding the wave of change

●Inertia - Firms Failure to Adapt to Change ○Understanding rivals’ inertia & inefficiencies ■SWOT External Environment Analysis ○Understanding own strengths ■SWOT Internal Environment Analysis ○Inertia could be - Routine, Cultural or by Proxy ●Entropy - Firms Regression Over Time ○Value chain analysis ■Continued revision of strategy ○Capitalize on First mover effect ■Broadening Extent of Advantages 18 Setting up for Good Strategy Inertia and Entropy

●Bad Strategy is pervasive in organizations ○Lack of clear objectives. coherent actions and choices ○No focus and too much fluff ○Strengths are not the focus ●Specific components of Good Strategy ○Kernel (diagnosis, guiding policy, coherent action) ○Measurable goals and objectives ○Focus and concentrated efforts on strengths ●Good Strategy can be sustained over time ○Focus on deepening and extending advantages ○Competitive advantage via external and internal analysis ○Strategic advantage is a journey not a destination 19 Conclusions Boardroom Meeting Takeaways

Good Strategy | Bad Strategy - Real Life Takeaways ● Team started with bad strategy ○No focus ○Working with a template ● Team figured out what worked for us ○Started using each other strengths ○Put piecemeal process back together for accountability ● Continued focus until the end - sustained strategy ○Broke the law of inertia and looked for positive change during process ○Continued momentum to fight entropy 20 Conclusions Team Strategist

Resources & Tools

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Q&A iTATA Be Driven.. Safely Drive Smart, Drive Safe, Drive iTATA