Description
Book SynopsisStrategic marketing planning in technology-intensive businesses (e.g. , computers, telecommunications, software, biotechnology, semiconductors, and pharmaceuticals) is more complex and unmanageable than in most other businesses, traditionally taking up huge amounts of management time and producing plans that are quickly obsolete.
Table of ContentsPreface xv
Acknowledgments xvii
Chapter 1: Introduction 1
The Environment in Which Technology-Intensive Businesses Operate 3
Complex and Dynamic Market Chains 3
Network Effects 5
Speed of Change is High 6
Blurred Market Boundaries 7
Markets and Competition Are Global 8
Strategic Market Planning in a Technology-Intensive Business 10
Who Should Be Involved in the Process? 10
Planning Builds Mental Models 10
Planning Process Must Be Iterative and Continuous 11
Planning Process Must Be Integrative 12
Winning Market Leadership: An Integrated Approach 12
Choose the Arena 13
Identify Potentially Attractive Opportunities 14
Understand the Market 16
Assess Resources and Competencies 16
Understand the Competitive Challenge 17
Make Tough Strategic Choices 19
Plan Key Relationships 21
Complete the Winning Strategy 22
Understand the Profit Dynamic 23
Implement the Chosen Strategy 23
What Is Different About This Book? 24
Integrated Planning Process 24
Process Applies to New or Existing Business Opportunities 24
Process Is Designed for Managers 25
Chapter 2: Choose the Arena 27
Introduction 27
Crucial First Step in the Planning Process 29
Strategic Business Unit (SBU) 29
Existing Market Opportunities 30
New Market Opportunities 31
Define the Arena 34
Customers Served 34
Applications/Functionality Provided 36
Technologies/Competencies Used 36
Value-Adding Role 37
Strategic Drivers and Strategic Paths 37
Driving Force 37
Strategic Path 38
Next Step: Identify the Potentially Attractive Opportunities in the Business Arena 40
Chapter 3: Identify Attractive Opportunities 43
Introduction 43
Identifying Potential Market Opportunities 43
Benefits of Thinking About Market Segments Early in the Process 46
Segmenting a Market 46
Possible Segmentation Bases 47
Segmentation Process 51
Targeting Issues 52
Market Segment Attractiveness 54
Determining the Attractiveness of a Market Segment 55
Understanding Choices Among Market Chain Opportunities 65
Market-Driving Opportunities 66
Exploiting Environmental Change 67
Sources of Discontinuities or Breakpoints 68
Next Step: Developing a Deeper Understanding of the Market Opportunities 70
Chapter 4: Understand the Market 71
Introduction 71
Adoption of New Products 72
Types of Innovations 73
Technology Adoption Life Cycle 74
Adopter Categories 75
Driving the Adoption Process 77
Achieving Market Leadership 82
Whole Product or Complete Solution 83
Understanding Buyer Choice/Rejection Behavior 84
Decision-Making Unit 85
Choice Criteria 86
The Choice/Rejection Process 88
Market Chains 93
Choices Among Market Chains 93
Market Chain Dynamics 96
Market Chains as a Series of Choice/Rejection Processes 98
Next Step: Assessing Your Resources and Competencies 99
Chapter 5: Assess Resources and Competencies 103
Introduction 103
The Process of Assessing Resource/Competency Fit 104
Core Competencies 105
What Is a Core Competency? 105
What Is a Constraining Incompetency? 108
Identifying Core Competencies 109
Identifying Your Organization’s Core Competencies 110
Managing Core Competencies 111
Should You “Make” or “Buy” Strategic Activities Associated with Core Competencies? 112
Customer Value and Profit Creation Model 113
Mapping Competencies and Customer Requirements 114
Assessing a Market Opportunity: Fit With Core Competencies 115
Next Step: Understanding the Competitive Challenge 120
Chapter 6: Understand the Competitive Challenge 123
Introduction 123
Process of Competitive Analysis 125
Issues in the Competitive Analysis Process 126
Identification of Competitors 126
How Do They Compete? 128
How Are They Doing Now? How Will They Do in the Future? 134
Analysis of Strategy Driving Forces 137
Pulling the Competitive Information Together 141
Actions-Consequences-Evidence (ACE) Framework 141
Next Step: Making the Tough Choices 142
Chapter 7: Make Tough Strategic Choices 145
Introduction 145
Strategic Issues 147
What Is a Strategic Issue? 147
How Many Strategic Issues? 148
Types of Strategic Issues 148
Developing a Winning Strategy for an Opportunity 149
Cost Leadership 149
Differentiation 151
Strategic Breakpoint 153
Risks of Adopting a Differentiation Strategy 155
Sustaining the Competitive Advantage 157
Convergence of Cost Leadership and Differentiation 158
Selecting the Portfolio of Opportunities 159
Balance Market Attractiveness and Ability to Win 159
Displaying the Portfolio of Opportunities 160
Making Clear Strategic Choices 163
Next Step: Managing Critical Relationships 165
Chapter 8: Manage Critical Relationships 167
Introduction 167
Why Are Relationships Critical? 168
The Market Web 170
A Generic Market Web and an Example 171
A Managerial Perspective on Market Webs 174
Market Webs as Value-Creating Systems 174
Evolution of the Market Web 175
Managing Critical Relationships 176
Market Chain Strands 177
Customer and Supplier Relationships 177
Off-Market Chain Strands 178
Formal and Informal 178
Collaborative Product Development Alliances 179
Co-Marketing Alliances 179
Horizontal Selling Alliances 180
Knowledge and Influence Strands 181
Knowledge Strands: Learning From Others in the Web 181
Influence Strands: Affecting Choice/Rejection Processes 182
Value-Added Partnerships: A Key Relationship Form 183
Partnering Success Factors 184
Managing “Sticky” Strands in the Web 187
Relationships and the Market Opportunity 189
The Opportunity 189
The Winning Strategy 190
Next Step: Completing the Winning Strategy 190
Chapter 9: Complete the Winning Strategy 193
Introduction 193
A Framework 193
Define a Clear Competitive Position in the Opportunity 195
Complete the Total Product/Service Solution 196
Plan to Gain Market Chain Commitment 198
Basic Issues 199
Work Through Pricing Challenges 200
The Impact of Context 201
Pricing Objectives 202
Other Challenges 206
Plan to Influence Customers and End Users 209
Customer Interface Strategies 209
Advertising and Promotion 212
Apply Strategic Thinking to Emerging Challenges 213
Evaluate the Current Strategy 214
Are You Going After an Attractive Market Opportunity? 215
Can You Win with Your Proposed Strategy? 216
If You Win, Will It be Worth It? 218
Other Considerations 219
Detail and Use the Plan 220
Next Step: Understanding the Profit Dynamic 221
Chapter 10: Understand the Profit Dynamic 223
Introduction 223
The Profit Dynamic 224
The Drivers of Positive Cash Flow: Total Margin Generated 225
Negative Cash Flow Drivers: Fixed Costs and Investments 226
Cash Flow Profiles 227
The Profit Dynamic 228
An Alternative Form of the Profit Dynamic 230
Locating Key Sensitivities in the Profit Dynamic 231
New Product Opportunities and the Profit Dynamic 234
The Critical Importance of Adoption Rate 235
Applying the Profit Dynamic to Individual Customers 238
Product-Service Integration and the Profit Dynamic 239
Integrated Product-Service Opportunities 239
Management of the Integrated Product-Service Profit Dynamic 241
Managing the Profit Dynamic in Market Chains: Creating Strategic Leverage 242
Identifying Points of Strategic Leverage 242
Strategic Leverage and Adoption Rates 244
Next Step: Implementing the Strategy 244
Chapter 11: Implement the Winning Strategy 247
Introduction 247
A Process for Managing Implementation 252
The Case for Change 254
The Need for Strategic Change 254
Types of Change 256
Specification of the Implementation Plan 259
The Questions 260
The Challenge 263
Communicating Implementation 264
Monitoring Implementation 267
Conclusion 268
Chapter 12: The System that Makes the Process Happen 271
Introduction 271
Planning Systems 272
Need for Planning Systems 274
Design of a Planning System 276
Factors Influencing the Design of a Planning System 276
Major Planning System Design Decisions 278
No One Right Planning System 282
Balanced Interaction 284
Planning System in a Large, Sophisticated Company 285
Overview of the Planning System 286
Cycle One: Develop Options for SBU 286
Cycle Two: Detailed Planning for Selected Option 288
Cycle Three: Develop Budgets and Detailed One-Year Operating Plan 289
Implementation and Monitoring 289
An Effective Strategic Market Planning Process 290
Is Both Integrated and Iterative 290
Is Question Driven 291
Combines Hard Data with Soft Intuitive Judgment 291
Focuses on Implementation 291
Recognizes That the Process Is as Important as the Plan 292
Encourages Managers to Say No 292
Challenges Industry and Company Norms 294
Key Success Factors in an Effective Planning System 294
Effective Teams 295
Supportive Corporate Culture 297
Integration with Other Key Processes 298
Key Support Systems in Place 299
Conclusion 300
Index 303
