1. Fundamentals of Strategy: Strategy and Operations Douglas Reid dreid@business.queensu.ca @douglasreid

2. Strategy concept Fixing strategy – operations misalignments Application to FCMB – future planning ------------------------------------------------------- Personal development plan

3. You are here

4. To become a more effective leader, I will… Do more of… ___________________ ___________________ ___________________ ___________________ ___________________ Do less of… ___________________ ___________________ ___________________ ___________________ ___________________ Start doing… ___________________ ___________________ ___________________ ___________________ ___________________ Stop doing… ___________________ ___________________ ___________________ ___________________ ___________________

5. How we’ll not learn

6. Introduction (s) Strategy in action Break The strategy concept Strategy at FCMB From strategy to action Lunch How strategy changes

7. Describe your customers. List ALL the benefits that your camera creates for them. What must your company be good at doing so that you are able to create these benefits? What tasks must you do inside your company, and what tasks should you hire others to do? Which competitor(s) do you worry about, and in each case, why?

8. Segmentation Generic strategy Core competence Value chain Creating competitive advantage Advantage preservation

9. Defining Strategy

10. Strategy is often expressed this way… For (thecustomer segment we want to serve) Who want (the outcome sought by that customer) Our product or service is a (our part of the solution) That features (key benefit provided). Unlike (our main competitors) Our product or service provides (key point[s] of difference) As supported by (what makes the difference possible) And protected by (why competitors cannot easily overcome it).

11. Customer willingness to pay Strategy Cost of delivering what the customer buys

12. Customer willingness to pay Strategy Cost of delivering what the customer buys

13. Increases willingness to pay? Meets hurdle rate for capital? Do it! Yes Yes No No Decreases cost? Meets hurdle rate for capital? Yes Yes No No Teach

14. Implementation happen primarily by changing the allocation of resources consistent with objectives

15. Money Brands, equipment, IP, licenses, machinery, information, etc. Any non-human asset of an organization that a manager can deploy

16. People Skills

17. Time Duration, sequence and project choices to which you apply the money and people that you have

19. Strategy Actions taken to increase customer willingness to pay And/or reduce cost. Actions mean allocation and coordination of: * Money * People * Time Uniquely, as a system.

20. How does strategy help you?

21. What assumptions are you relying upon?

22. So sometimes, strategy must change

23. Even good strategies decay… Replication Supplantation Exhaustion Evisceration Source: Hamel, 2009

24. Major trends that will affect the Bank… Political ____________________________________________________________ ____________________________________________________________________ ____________________________________________________________________ Economic ___________________________________________________________ ____________________________________________________________________ ____________________________________________________________________ Social ______________________________________________________________ ____________________________________________________________________ ____________________________________________________________________ Technological ________________________________________________________ ____________________________________________________________________ ____________________________________________________________________ Global ______________________________________________________________ ____________________________________________________________________ ____________________________________________________________________

25. New entrants Buyers Suppliers Rivals Substitutes Source: Porter, 1980

26. Think of a time in your entire experience with the Bank when you have felt most excited, most engaged and most alive. What factors made this such a great experience?

27. Misalignment

28. Advice Strategy must fit the future environment… …while respecting what FCMB has become as a result oflearning from its past, including successes and failures.

29. Let’s summarize

30. Tomorrow…