ACCA-P3_BPP讲义

nullACCA Paper P3 – Business AnalysisACCA Paper P3 – Business AnalysisCourse slides For exams in December 2009Tutor Contact DetailsTutor Contact DetailsMax Wang Maxwangmiao@163.com Maxwangmiao@hotmail.com Slide *Study TipsStudy TipsFocus Read study text, at least 2~3 times Keep in mind the syllabus structure and inter-relationship among chapters Using your own experience to understand and apply models Read business articles; be aware of recent economic environment and business developments Search the internet for specific topics Active think, active talking, active participation in classroom; learn from each other Practice makes perfect: Homework Chapter 1 Chapter 1 Introduction to P3SyllabusSlide *SyllabusExaminer & format of the examSlide *Examiner & format of the examExaminer: Steve Skidmore Three hour exam + 15 minutes reading timeWhat is P3 about?Slide *What is P3 about?StrategyProcessPeopleInter-related recurring issueWhat is P3 about?What is P3 about?Business analysis v.s. Financial analysis Scope Level Approach Models derived from real-world experience No right answerRole of TheoryRole of TheoryReference point to help generate solutions Framework for structuring answers Specific knowledge test, a few marks Memorizing models cannot guarantee a pass, applying them can.Succeed in an examSucceed in an examImagination Think of ideas on behalf of an organization given to you in the exam Spontaneity Under time pressure the ideas will have to come to you quickly Professionalism The way you set your answer out in a professional manner; writing in a fluent, eloquent business style Common sense and business awareness is keyCourse scheduleCourse scheduleDay 1 Introduction to P3 Mission, objective and strategy Stakeholder, corporate governance and culture Environmental AnalysisCourse scheduleCourse scheduleDay 2 Environmental Analysis (continued) Position Audit Corporate Appraisal Strategy and FinanceCourse scheduleCourse scheduleDay 3 Strategic options Strategic implementation Business process change Course scheduleCourse scheduleDay 4 IT and e-commerce Quality Marketing Course scheduleCourse scheduleDay 5 Project management Managing people Change managementnullWarm-up exercise: Attempt LE1 (Page 14) What is strategyWhat is strategyJS&W: “Strategy is the direction and scope of an organization over the long term, which achieves advantage in a changing environment through its configuration of resources and competence with the aim of fulfilling stakeholder expectations” Environment Resources and competence Stakeholder expectationsLevel of strategyLevel of strategyCorporate Strategy Concerned with the overall purpose and scope of organization an how value will be added to the different parts of the organization Business-level Strategy how to compete successfully in particular market Operational Strategy how the component parts of an organization deliver effectively the corporate and business-level strategy in terms of resources, processes and peopleThe Rational ModelThe Rational ModelSet missionEstablish objectivesExternal appraisalStakeholder appraisalInternal appraisalGeneral strategic optionsStrategic choiceStrategic implementationReview and ControlContext of strategyContext of strategySmall business Multinationals Public sector NFP organizations Intangible products Keep up-to-date business developmentStrategy lensesStrategy lensesExamined 12/08, 6/09Elements of strategic managementElements of strategic managementStrategic Position Environment Capability Stakeholder expectation Strategic Choice Strategic ImplementationLink to definition of strategyStrategy as designStrategy as designThe rational model Clear and explicit objectives Top-down, hierarchical Focus on control Suitable for simple, static environment Strategy as ideasStrategy as ideasFocus on Innovation and new ideas Bottom-up approach Flexible corporate culture Role of manager: create context and condition Strategy as experienceStrategy as experienceMintzberg’s Emergent Strategies Emerge from intermediate and lower levels of the organizational hierarchy Logical incrementalism Adaptation and extension of what has worked in the past Mintzberg’s Emergent Strategies Slide *Mintzberg’s Emergent Strategies Intended strategyUnrealised strategyDeliberate strategyEmergent strategyRealised strategyMintzberg’s Emergent StrategiesMintzberg’s Emergent StrategiesPattern of action develops over time in an organization in the absence of a specific mission and goals “a realized pattern” which was not expressly intended Develop when an organization take a series of actions that with time turn into a consistent pattern of behavior Implies an organization is learning what works in practice Logical incrementalismLogical incrementalismStrategy is a process of serial and incremental decisions Manage guide actions and events towards a conscious strategy in a step by step processFreewheeling opportunismFreewheeling opportunismNo planning, grab opportunities when they arise Entrepreneurs who enjoy taking risksChapter 2Chapter 2Mission, objective and stakeholdersStrategic Planning ProcessStrategic Planning ProcessMission: the purpose of organization E.g. maximizing shareholder wealth through operating a supermarket or treating patients in a hospital Objectives: quantified, time limited targets StrategyObjective setting: SMARTObjective setting: SMARTSpecific Measurable Achievable Realistic Time-related Chapter 2Chapter 2Stakeholder, ethics, corporate governance and cultureStakeholdersStakeholdersDefinition: Group or individuals whose interest are directly affected by the activities of organization Examples: Employees and managers Customers Suppliers Shareholders Fund suppliers Communities, unions, the whole societyWhat interest do they have?Stakeholder theoryStakeholder theoryStrong View Each stakeholder in the business has a legitimate claim on management attention. Management’s job is to balance stakeholder demand Weak View Satisfying stakeholders such as customers is a good thing-but only because it enables the business to satisfy its primary purpose, the long term growth in owner wealthMendelow’s Matrix Slide *Mendelow’s Matrix InterestPowerLowLowHighHighMinimal EffortKeep InformedKeep SatisfiedKey PlayersWhy analyze stakeholderWhy analyze stakeholderOne pillar of strategic position Strategic choice: acceptability Ethics in BusinessEthics in BusinessJS & W define ethical stance as: “the extend to which an organization will exceed its minimum obligations to stakeholders” Four ethical stance: Short-term shareholder interestLong-term shareholder interestMultiple stakeholder obligationShaper of societyCorporate GovernanceCorporate GovernanceMore details are covered in P1 Derived from the separation of ownership and control Agency theory, adverse selection, moral hazard, information asymmetry Board and directors Refer to Combined Code Governance systemsGovernance systemsAnglo-Saxon model UK, US and Australia Single level of board membership: one tier Rhine model Germany, Netherlands and Switzerland Two tier board, employee representation in supervisory board Japanese model External parties (bank) involved Consensus but slow Latin model Heavy state involvement Corporate Social Responsibility Corporate Social Responsibility CSR centers on the approach taken by organizations to provide benefit to society in general, rather than specific stakeholders Common areas of CSR: Work creation and training program Sponsorship of art and sports Employee welfare program Community welfare program Support of educational institutions Contribution to overseas aid Environmental programsDifferent views on CSRDifferent views on CSRThe shareholder view The long-term self-interest view The stakeholder view ? Which view LE 8 represent?Organizational cultureOrganizational culture Culture is the set of values, guiding beliefs, understandings and way of thinking shared by members of an organization Culture will affect: Approach to strategic planning. Strategy as design, experience or ideas Perception about competitors Perception about customers Management style Attitude to stakeholders Ethical behavior Attitude to CSRCultural web Slide *Cultural web Org’n structureSymbols & TitlesControl systemsRituals & routinesMyths & storiesOrganisational Assumptions (The Paradigm)Power relationsExamined 12/08Cultural webCultural webChapter 4Chapter 4Environmental issuesThe EnvironmentSlide * P L S T Competition Market FirmSupply ChainThe EnvironmentEEExamined 12/08Identify O & TMacro-environment: PESTEL analysisMacro-environment: PESTEL analysisPolitical Taxation policy, government stability, foreign trade regulations Economic Interest rate, inflation, business cycle, unemployment rate, disposable income Social Demographics, social mobility, income distribution, lifestyle, attitude to work and consumption, education Technological R&D, new discoveries, speed of technological transfer and rate of obsolescenece Ecological/environmental Environmental damage, environmental protection Legal Taxation, employment law, monopoly legislationInternational Environment: Porter’s Diamond Slide *Firm strategy, Structure and Rivalry Related and supporting industriesDemand conditionsInternational Environment: Porter’s Diamond Factor conditionsPorter’s DiamondPorter’s DiamondFactor conditions: Basic factors: land, natural resources Advanced factors: infrastructure, skill base Demand conditions: Economics of scale Learning curve Related and supporting industry Strong supply chain, easy access to component and knowledge sharing Firm strategy, structure and rivalry National culture & rivalry drive up quality and innovationIndustry Environment: Porter’s 5 Forces Slide *Industry Environment: Porter’s 5 Forces SuppliersPotential entrantsBuyersCompetition and rivalrySubstitutes Examined 6/08Porter’s 5 forcesPorter’s 5 forcesCan be used for environmental and industry analysis Understand the inherent attractiveness or profitability of a particular industry Identifying actions on each individual force Strong link to BPR, IT and Quality issues Question practice – end of Chapter 4Slide *Question practice – end of Chapter 4 Q1You should now be able to attempt the following key questions from the BPP Learning Media Practice and Revision Kit: Q3 Q5Chapter 5Chapter 5 Position AuditStrategic capabilityStrategic capabilityStrategic capabilityResourcesCompetenceThreshold capabilities Threshold resources Threshold competenceCapability for competitive advantage Unique resources Core competenceQualities of strategic capabilitiesSlide *Qualities of strategic capabilitiesValuable to buyer (customer) Rarity Robustness (difficult for competitors to imitate) Non-substitutabilityResources versus position based strategyResources versus position based strategyPosition based strategy Organization to analyze the environment and position itself with appropriate competence and resource to compete Resource based strategy Sustainable competitive advantage comes through possession of distinctive resources Remain faithful to core competence in the face of external changes JS&W claims that resource based strategy is best suitable for organization strategic developmentOrganisation’s resourcesSlide *Organisation’s resourcesMachinery Make-up Management Management information systemM’s modelMaterials Manpower Methods Money Markets Cost efficiencyCost efficiencyA threshold capability Public sector: Value for money Private sector: customer value lower price Source of cost efficiency Economy of scale Growth Experience (learning curve) Knowledge Mgmt Supply cost Supply chain Mgmt Process and production design Process redesign nullSlide *INTERNAL : RELATIVE TO COMPETITIONWEAKNESSESSTRENGTHSEXTERNAL: PRESENT TO ALL INDUSTRY MEMBERSOPPORTUNITIESTHREATSSWOT Analysis Examined 12/07, 6/09Corporate ParentSlide *Corporate Parent3 value-creating roles: Envisioning corporate intent Intervention to improve performance Provision of services, resources and expertisePortfolio managersSynergy managersParental developersExamined 12/08Financial controlStrategic controlStrategic planningAshridge ModelAshridge ModelHeartland businessBallast business Value trap businessAlien businessLowHighAbility to add valueOpportunity to add valueHigh Portfolio Analysis- BCG Matrix Slide * Portfolio Analysis- BCG Matrix Relative Market ShareMarket or Industry Growth RateHighHighLowLowStarQuestion Mark or Problem ChildCash CowDogExamined 12/08Portfolio Analysis- BCG MatrixPortfolio Analysis- BCG MatrixCan be applied to products, SBUs, divisions Balanced portfolio and distribution of resources Sufficient successors Product Life Cycle Slide *Product Life Cycle $TimeSalesProfit; cashflowIntroGrowthMatureDecline- ve+ ve0Examined 6/08, 6/09Importance of product innovationImportance of product innovationCan be a major source of competitive advantage Attract early adopters Lock-in customers Learning curve cost efficiency Defining the industry standard Price skimming Legal protection of intellectual property !Risky in early phases of product life cyclenullSlide *Inbound LogisticsOperations Outbound LogisticsMarketing & SalesServicePrimary ActivitiesProcurementHuman Resource ManagementTechnology DevelopmentFirm InfrastructureSupport ActivitiesValue ChainSupport Activities Primary ActivitiesExamined 12/07Value system (network)Value system (network)SupplierOrganizationDistributorCustomerBenchmarkingBenchmarkingWhat is benchmarking: Benchmarking is the systematic comparison of a service, practice or process Why benchmarking: To provide a target for action in order to improve competitive position Types of benchmarking: Internal benchmarking External benchmarking Functional benchmarking Strategic benchmarking Danger of benchmarking LE8What is knowledge?Slide *What is knowledge?InformationDataKnowledgeSales Day BookSales LedgerKey contactKnowledge managementKnowledge managementDiscover or identify knowledge Capturing knowledge Sharing knowledge Distributing knowledge Levering knowledge Maintaining knowledgeObtainStoreShareKnowledge management systemKnowledge management systemOffice automation system Groupware (Lotus notes) Intranet Expert system Data warehouse Data miningChapter 6Chapter 6Corporate AppraisalnullSlide *INTERNAL : RELATIVE TO COMPETITIONWEAKNESSESSTRENGTHSEXTERNAL: PRESENT TO ALL INDUSTRY MEMBERSOPPORTUNITIESTHREATSSWOT Analysis Examined 12/07, 6/09nullSlide *STRENGTHS WEAKNESSESWT StrategiesWO StrategiesSO StrategiesST StrategiesTOWS ApproachOPP’S THREATSQuestion practice – end of Chapter 6Slide *Question practice – end of Chapter 6 Q4You should now be able to attempt the following key questions from the BPP Learning Media Practice and Revision Kit: Q13 (a) Q14 Q2Chapter 5Chapter 5Strategic options Strategic optionsStrategic optionsStrategic optionsHow to competeDirection of growthMethod of growthPorter’s generic strategyAnsoff’s matrixOrganic or acquisitionStrategic Options – step 1Slide *Generic strategiesDirection of growthMethods of growthStrategic Options – step 1Porter’s Generic Strategies Slide *Cost leaderDifferentiatorStuck in middlePorter’s Generic Strategies Low CostHigh CostLow PriceHigh PriceHigh CostLow PriceHigh ProfitHigh ProfitLow ProfitExamined 12/07Basis of Competitive Advantage Slide *Basis of Competitive Advantage SCOPECOMPETITIVE BASISBroadNarrowCost LeadershipDifferentiationCost FocusDifferentiation FocusLow costDifferentiateStrategy Clock Slide *Strategy Clock Examined 12/07Sustaining competitive advantageSustaining competitive advantagePrice based strategy (cost leadership) Accept reduced margins (high volume) Reducing cost Winning a price war Focus on specific market segmentation Differentiation based strategy Continuous R&D Making limitation difficult Difficulty in transfer of resource and competence High switch cost Lock-in MS Windows Internet explorerStrategic Options – step 2Slide *Basis of competitionDirection of growthMethods of growthStrategic Options – step 2Ansoff’s MatrixSlide *Ansoff’s MatrixMARKETPRODUCTPresentNewWithdrawal Consolidation PenetrationProduct DevelopmentMarket DevelopmentDiversification Related UnrelatedPresentNewExamined 6/09Market penetrationMarket penetrationEntire market is growing Organization with competitive advantage Competitors leaving the market Low level investment and reduced risk (not always?)Product developmentProduct developmentExisting market new product New features Different quality versions Additional models and size Growth potential in the market High market share, brand image, competitive advantage Continuous innovation is the only way to prevent obsolescence Need to react to technological development Organizational structure based on product divisions Medium risk (initial stage of product life cycle) Market developmentMarket developmentRepositioning existing product to new market Additional geographic market Attract other market segments Company identify potential opportunities for market development Company’s resources are structured to produce a product that is very costly to switch technology Company’s distinct competence lies with product but also has strong marketing competence Medium risk DiversificationDiversificationNew product into new market High risk Use of diversification: Vertical integration Forward & backward Horizontal integration Competitive, complementary or by-product Conglomerate ? What are the advantage and disadvantage or each optionDiversificationSlide *DiversificationFirmExamined 12/08Strategic Options – step 3Slide *Basis of competitionDirection of growthMethods of growthStrategic Options – step 3Method of growthMethod of growthOrganic growth Less risky Less costly Slow Barriers to entry Competitor reaction Acquisition Fast Easy access, low competitor reaction Costly and risky Cultural clash AllianceJoint development strategiesSlide *Joint development strategiesInstead of acquiring a company outright, could expand through cooperative ventures: Joint ventures Strategic alliances Franchises – eg McDonald’s, Body Shop, KFC LicencesExamined 6/09Evaluating Strategic OptionsSlide *Evaluating Strategic OptionsSuitability Acceptability Feasibility Corporate ParentSlide *Corporate Parent3 value-creating roles: Envisioning corporate intent Intervention to improve performance Provision of services, resources and expertisePortfolio managersSynergy managersParental developersExamined 12/08Financial controlStrategic controlStrategic planningAshridge ModelAshridge ModelHeartland businessBallast business Value trap businessAlien businessLowHighAbility to add valueOpportunity to add valueHighQuestion practice – end of Chapter 7Slide *Question practice – end of Chapter 7 Q19You should now be able to attempt the following key questions from the BPP Learning Media Practice and Revision Kit: Q20 Q37(b) Q39(a)Chapter 8Chapter 8Organising for successOrganizational structureOrganizational structureStructureProcessRelationshipsStrategyTypes of structureSlide *Types of structurebasic structural types: Simple/Entrepreneurial Functional Divisional MatrixSimple/EntrepreneurialSimple/EntrepreneurialFinanceMarketingDistributionProductionFunctionalFunctionalBoard of DirectorsFinanceMarketingResearch & developmentProductionPersonnelProduction AProduction BProduction CDivisionalDivisionalProduct divisions Geographic divisions Holding companyProduct divisionsProduct divisionsManaging directorProduct A managerProduct B managerProduct C managerCorporate accountantHRITLogisticAccountsOperationSalesR&DGeographic divisionsGeographic divisionsManaging directorSouthern region managerMidlands region managerNorthern region managerCorporate accountantHRITLogisticAccountsOperationSalesHRITLogisticHolding CompanyHolding CompanyParent companyCo