Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 1© Copyright Troy Dyer 2004 Business Opportunities Identifying a Business Opportunity means identifying an unfulfilled need in the market, for which there is a customer willing pay for in exchange of the service or product. It is easy to identify an existing opportunity then totally new or innovative ideas The success rate of any new idea is 1:100, hence quite risky

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 2© Copyright Troy Dyer 2004

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 3© Copyright Troy Dyer 2004 Types of Opportunities An unmet need is met by a new service or product A new product or services replaces an existing product or service A new product or service may be created because of a new technology, or pure innovation or changing social or economic conditions. The new product or service may create additional value to the customer, reduced cost, saves time or increases convenience or saves energy or makes him happy.

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 4© Copyright Troy Dyer 2004 Connecting personal vision to business strategy Personal Vision Business Vision Business Strategy Business Opportunit y

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 5© Copyright Troy Dyer 2004 Constructing & Deconstructing Personal & Business Vision Personal and / or Business Vision (1) Core Ideology Envisioned Future Core Values Core Purpose 10 to 30 yr “BHAG” Vivid Description The individual and / or company’s essential mores and principles that guide its choices and actions Enacted and not merely espoused values The individual and / or company’s essential reason for existing and for going forward Long term mission “Big, Hairy, Audacious Goals” Can be quantitative or qualitative Involves David vs. Goliath type of thinking Dreaming “the impossible dream” A clear picture of what the future will look like Guided by passion, emotion and conviction A compelling image to which everyone can relate (1) Model adapted from Building Your Company’s Vision by James Collins and Jerry Porras (HBR, Sep-Oct, 1996)

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 6© Copyright Troy Dyer 2004 Using PESTLE framework to identify growth opportunities Strategic Forces (PESTLE framework) Categories of Entrepreneurial Business Opportunity Ideas for business opportunities Investment criteria Top 5 Opportunities P E S T L E Model developed by Audax Ideas Management Consulting PESTLE Forces: Political Economic Social Technology Legal Environmental

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 7© Copyright Troy Dyer 2004 Combining the PESTLE analysis with an industry structure analysis to identify growth opportunities Supplier Power Buyer Power New Entrants Substitute s Industry Rivalry Political Technological Economic Social Legal Environmental Adapted from model in Competitive Strategy - by Michael Porter

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 8© Copyright Troy Dyer 2004 Linking personal vision, business vision, business opportunity and business strategy Relative Competitive Position (RCP) Relative Attractiveness (RA) Competitors CustomersCapabilities Ideal New Venture Position Industry MarketVenture RCP: a measure of: (1) The extent of our capabilities to provide a product or service, (2) which our customers want and are willing to pay for, (3) in a manner which is better than our competitors, in a sustainable and value- adding manner RA: a measure of the combined attractiveness of: (1) The venture in terms of its economic profile and harvest potential (2) The market in terms of its capacity to generate large, sustainable and growing profits (3) The industry in terms of the relative power of various forces which determine the size and share of margins Core Competencies Opportunity Personal and business Vision Entry Point: What are the ventures out there that: (1) we want to create or develop (2) represents a business opportunity (3) we can (or could) do well at Model developed by Audax Ideas Management Consulting

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 9© Copyright Troy Dyer 2004 The RA/RCP matrix provides a useful approach to mapping out a business strategy (2) Build required capabilities (3) Identify niche opportunities (1) Invest & pursue opportunity (4) Avoid / Wait & Re- assess in future High Low HighLow Relative Competitive Position Relative Attractiveness of Opportunity Business economics, risks and projected returns on investment Market size, growth and potential margins Industry structure and degree of competitiveness Macro-economic, political & regulatory environment Customer needs & wants Competitor capabilities Our capabilities

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 10© Copyright Troy Dyer 2004 The Business Development Matrix is another way to map out different strategies for growing a business Product Development Market Development New Business Development Market Penetration Identify opportunities for each type of business development Assess relative attractiveness of different opportunities Assess our relative competitive position in the pursuit of different opportunities Agree overall business development strategy Identify opportunities for each type of business development Assess relative attractiveness of different opportunities Assess our relative competitive position in the pursuit of different opportunities Agree overall business development strategy New Existing NewExisting Target Customers & Markets Products & Services

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 11© Copyright Troy Dyer 2004 The work done on business strategy fits into an overall Business Plan framework The industry and the company and its products / services Market research and analysis Economics of the business Marketing plan Design and development plans Manufacturing and operations plan Management team Overall schedule Critical risks, problems, and assumptions The financial plan Proposed company offering Source: New Venture Creation, by Timmons and Spinelli - Chapter 12 Financial Analysis Industry and Market Analysis Manufacturing / Operations Analysis Organisation Design Product Design Other Appendices Description of the business concept, the business opportunity and the business strategy Target market and projections Competitive advantages Executive Summary Costs Economics, profitability Harvest potential The lead entrepreneur & the management team The offering to investors Detailed Contents

Design Institute - Prototype Awards Seminar - 20 November Presentation on Business Strategy Page 12© Copyright Troy Dyer 2004 The Prioritization Matrix may be used to structure a more detailed Action Plan Potential Impact of the Action (in terms of positive contribution to business objectives High Low Ease of Implementation (in terms of complexity, resource requirements, etc 1. Quick Hits - actions with highest priority 2. Other quick hits - second level of priority 3. Medium term actions - detailed plan may be required 4. List actions now, review later to see if priority has changed List the actions and then evaluate, categorize and prioritize according to the above matrix