1. PIRNAY FabriceNVS 2001-20021 New Ventures Strategy PIRNAY Fabrice 2001 - 2002 Session 8 Appendix

2. PIRNAY Fabrice NVS 2001-2002 2 I. The External Analysis II. The Value Chain Concept Appendix

3. PIRNAY Fabrice NVS 2001-2002 3 l Its purpose is to understand the external environment as it affects the enterprise l 3 levels of analysis: a. Macro General changes in business environment b.Industry Specific changes within the industry c.Competitive Particular strategies of competitors I. The External Analysis

4. PIRNAY Fabrice NVS 2001-2002 4 Three Levels Connect Firm Level Industry Level Macro Level Competitors Suppliers SubstitutesCustomers Demographic Technological Political/Legal Social Economic Global

5. PIRNAY Fabrice NVS 2001-2002 5 l Demographic l Economic l Sociocultural l Political/legal l Technological l Global a. Macro Level

6. PIRNAY Fabrice NVS 2001-2002 6 a. Macro Level

7. PIRNAY Fabrice NVS 2001-2002 7 l B.C.G. Matrix 2 l Five Forces Model (M. Porter) w The threat of new entrants w The bargaining power of suppliers w The bargaining power of customers w The threat of substitution w The intensity of rivalry among competing firms b. Industry Level

8. PIRNAY Fabrice NVS 2001-2002 8 c. Competitive Level l Strategic Groups l…l…

9. PIRNAY Fabrice NVS 2001-2002 9 l The value chain depicts the steps it takes to produce and distribute a product from the supplier of raw material to its final consumer l Each member adds a small piece of value to the final product before it is purchased by the end consumer II. The Value Chain Concept

10. PIRNAY Fabrice NVS 2001-2002 10 Raw Materials Manufacturing Distribution Understanding the Value Chain

11. PIRNAY Fabrice NVS 2001-2002 11 Raw Materials Manufacturing Distribution Transportation/ Storage Intermediate Manufacture Transportation/ Storage Assembly Transportation/ Storage Understanding the Value Chain

12. PIRNAY Fabrice NVS 2001-2002 12 Understanding the Value Chain Dow Chemicals Intel Dell Comp USA Raw Materials Manufacturing Distribution Transportation/ Storage Intermediate Manufacture Transportation/ Storage Assembly Transportation/ Storage

13. PIRNAY Fabrice NVS 2001-2002 13 Raw Materials Manufacturing Distribution Backward Integration Forward Integration Understanding the Value Chain

14. PIRNAY Fabrice NVS 2001-2002 14 Exploitation forestière Abattage et débit des grumes Fabrication de la pulpe Fabrication du papier Opérations de transformation Opérations de distribution A B C D E F G The Value Chain : An Example