1、CONFIDENTIALBU Strategic Plan Template BookTraining materials8 June 2001This report is solely for the use of client personnel.No part of it may be circulated,quoted,or reproduced for distribution outside the client organization without prior written approval from McKinsey&Company.This material was u
2、sed by McKinsey&Company during an oral presentation;it is not a complete record of the discussion.Jim Ayala PHOMelissa Gil PHORegina Manzano PHOSuresh Mustapha PHOSteve Shaw HKOShelly Yeh PHOChoon-Gin Tan SIO1STRATEGY PLANNING INSTRUCTIONSThe objective of these templates is to provide completeness a
3、nd consistency of BU strategic plan submissions.These templates are not intended to replace or constrain BU strategic thinking and should be adapted to reflect a particular BUs sectoral context as requiredEach section begins with a summary that is based on a synthesis of questions and analyses that
4、follow.The suggested approach would be to first complete the relevant back-up analyses and then work towards the overall synthesis2TABLE OF CONTENTSI.Executive summaryII.Environmental and internal assessmentA.Industry dynamics and its implicationsB.Competitive assessmentC.Internal assessmentIII.Stra
5、tegic definition and implicationsA.Strategy articulationB.Strategic initiativesC.Financial projectionD.Risks/contingencies and strategic alternativesIV.Exhibits3BU STRATEGIC PLAN DEVELOPMENTIndustry dynamics and implicationsEnvironmental and internal assessmentCompetitive assessmentInternal assessme
6、ntWhat are the major changes in industry dynamics and resulting opportunities and risks?What are your competitive strengths and weaknesses?How does your current business emphasis fit with industry opportunity and competitive landscape?Strategy articulationStrategic definition and implicationsStrateg
7、ic initiativesFinancial projectionsWhat strategy will your BU pursue over the next 3 years?What will be the impact of major strategic initiatives?What are the expected financial returns of your strategy?+Risk/contingen-cies&strategic alternativesWhat strategic alternatives have you considered?+4I.EX
8、ECUTIVE SUMMARYInstructions:The Executive Summaryprovides a synthesis of theEnvironmental and InternalAssessments and theresultant BU Strategic Plans5II.ENVIRONMENTAL AND INTERNAL ASSESSMENT6IIA.INDUSTRY DYNAMICS AND IMPLICATIONS SUMMARYA.What are the major changes in industry dynamics and the resul
9、ting opportunities and risks?A.2 How is industry structure changing(demand,supply,and industry chain economics)?What are the resulting opportunities and risks?A.3 What is the expected competitor conduct?What are the resulting opportunities and risks?A.4 What are the present and future external facto
10、rs that could present new opportunities and risks?A.1 What industry are you competing in?What are the various segments in the industry?Instructions:The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsInstructions:These subsectionscontain a 1-2 sentencesummary o
11、f the relevantfindings7IIA.INDUSTRY DYNAMICS AND IMPLICATIONS BACK-UP 1A.1What industry are you competing in?What are the various segments in the industry?Industry definitionIndustry segmentation Definition SizingInstructions:Exhibit 1 could providea useful framework foranswering this questionIndust
12、ry definition:Industry segmentation:8IIA.INDUSTRY DYNAMICS AND IMPLICATIONS BACK-UP 2A.2How is industry structure changing with respect to demand,supply,and industry chain economics?What are the resulting opportunities and risks?Economics of demand By segment Substitutes,ability to differentiate Vol
13、atility,cyclicalityEconomics of supply Producer concentration and diversity Import competition Capacity utilization Entry/exit barriers Cost structure(fixed and variable)Industry chain economics Customer and supplier bargaining powerInstructions:Exhibit 2,3 or 4 could providea useful framework foran
14、swering this question9IIA.INDUSTRY DYNAMICS AND IMPLICATIONS BACK-UP 3A.3 What is the expected competitor conduct?What are the resulting opportunities and risks?Major industry competitor moves Marketing initiatives Industry capacity changes M&As,divestitures Vertical integration/disaggregation Allia
15、nces and partnerships Cost control and efficiency improvementsInstructions:Exhibit 2,3 or 4 could providea useful framework foranswering this question10IIA.INDUSTRY DYNAMICS AND IMPLICATIONS BACK-UP 4A.4 What are the present and future external factors that could present new opportunities and risks?
16、Impact and likelihood of major industry discontinuities Changes in regulation/government policy Technological breakthroughsInstructions:Exhibit 2,3 or 4 could providea useful framework foranswering this question11IIB.COMPETITIVE ASSESSMENT SUMMARYB.What are your competitive strengths and weaknesses?
17、B.1 What are the capabilities required to succeed in this industry?B.2 How do you compare against these necessary capabilities?Instructions:The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsInstructions:These subsectionscontain a 1-2 sentencesummary of the re
18、levantfindings12IIB.COMPETITIVE ASSESSMENT BACK-UP 1B.1 What are the capabilities required to succeed in this industry?Privileged assets that create competitive advantage,e.g.physical assets,location/”space”,distribution/sales network,intangible assets(intellectual capital,network,brands,talents)Dis
19、tinctive skills/competencies that create competitive advantage,e.g.innovation,talent developmentInstructions:Exhibit 5 could providea useful framework foranswering this question13IIB.COMPETITIVE ASSESSMENT BACK-UP 2B.2 How do you compare against these necessary capabilities?Strengths and weaknesses
20、of your competitive position vs.necessary capabilitiesBenchmark performance against the industrys relevant key performance indicators(KPIs)*,with margin and market share as the required minimumStrengths and weaknesses of your competitive position vs.necessary capabilities:Benchmark performance again
21、st the relevant industrys KPIs:Instructions:Exhibits 6 and 7 couldprovide a useful frameworkfor answering this questionInstructions:Exhibit 8 could providea useful framework foranswering this question*KPIs are a handful of levers that drive the value of the industry/business14IIC.INTERNAL ASSESSMENT
22、 SUMMARYC.How does your current business emphasis fit with the industry opportunities and the competitive landscape?C.1 Which segments of the business are providing the highest returns?C.2 What have been the performance trends along major BU KPIs?C.3 Which intangible assets*could be near-term potent
23、ial sources of value?Instructions:The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsInstructions:These subsectionscontain a 1-2 sentencesummary of the relevantfindings*Please refer to Exhibit 12 for further description15IIC.INTERNAL ASSESSMENT BACK-UP 1C.1 Wh
24、ich segments of the business are providing the highest returns?*Relevant BU segments(based on customer,product,geography,channel)Operating contribution estimates for each segmentInstructions:Exhibit 9 could providea useful framework foranswering this question*Based on latest available,1-2 year histo
25、rical financial statements16IIC.INTERNAL ASSESSMENT BACK-UP 2C.2 What have been performance trends along major BU KPIs?KPI performance trends over the last 3-5 years,e.g.return on capital employed(ROCE),operating income,margins,capital employedAssessment of underlying trend driversExpected evolution
26、Instructions:Exhibits 10 and 11 couldprovide a useful frameworkfor answering this questionROCE=Operating income x(1-tax rate)All interest bearing debt(short and long)+minority interest+stockholders equity17IIC.INTERNAL ASSESSMENT BACK-UP 3C.3 Which intangible assets could be near-term potential sour
27、ces of value?Identification of in-house intellectual property,talent,networks,brand/imageConversion into sources of valueInstructions:Exhibit 12 could providea useful framework foranswering this question18III.STRATEGIC DEFINITION AND IMPLICATIONS19IIIA.STRATEGY ARTICULATION SUMMARYA.What strategy wi
28、ll your BU pursue over the next 3 years?A.1 Where to compete?A.2 What is your customer value proposition for the different segments you are going to serve?A.3 What is your business model?Instructions:The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsA.4 How d
29、oes your chosen strategy exploit industry opportunities and address industry/competitive threats?Instructions:These subsectionscontain a 1-2 sentencesummary of the relevantfindings20IIIA.STRATEGY ARTICULATION BACK-UP 1A.1 Where to compete?Where are you going to compete along these dimensions and why
30、:Target market Distribution channels Product(breadth and depth)Geographic scopeInstructions:Exhibit 13 could providea useful framework foranswering this question21IIIA.STRATEGY ARTICULATION BACK-UP 2A.2 What is your customer value proposition for the different segments you are going to serve?Target
31、customer definition Benefits that you will offer the customers Product pricing Position against competition vis-vis the benefits provided and the price chargedWho is your target customer?What are the explicit benefits you provide to your customers?What perceived value do you provide to the customer
32、better than competition?How much value do your customers attach to the benefits you provide?22IIIA.STRATEGY ARTICULATION BACK-UP 3A.3 What is your business model?Delivery and communication of customer value proposition(value delivery system)Competitive advantage in delivering these benefits to the c
33、ustomer How will the value proposition be provided and communicated?Which of your BUs existing strengths can be leveraged?What skills/capabilities do you need to build?Instructions:Exhibit 15 could providea useful framework foranswering this question23IIIA.STRATEGY ARTICULATION BACK-UP 4A.4 How does
34、 your chosen strategy exploit the industry opportunities and address the industry/competitive threats?Industry attractiveness and implication review Alignment of strategy and environmental realitiesInstructions:A review of the section on Industry Dynamics and Implications,together with the framework
35、s used(Exhibit 2,3 or 4)is useful for answering this question24IIIB.STRATEGIC INITIATIVES SUMMARYB.What will be the impact of major strategic initiatives?B3.How much value will be created from each strategic initiative?B4.What resources willeach strategic initiativerequire?Instructions:The answer to
36、 thisoverarching questionrequires a recapitulationof the sections mainfindingsB1.What major strategic initiatives are required to successfully implement your selected business model?B2.What are the sources of value created from each strategic initiative?Instructions:These subsectionscontain a 1-2 se
37、ntencesummary of the relevantfindings25IIIB.STRATEGIC INITIATIVES BACK-UP 1B.1 What major strategic initiatives are required to successfully imple-ment your selected business model?Possible strategic initiatives list26IIIB.STRATEGIC INITIATIVES BACK-UP 2B.2 What are the sources of value created from
38、 each strategic initiative?Sources of value from each strategic initiative(e.g.,EBIT,capital employed)Category of initiativesVolume increaseEBIT impact viaPrice increaseCost reductionOtherInvest-mentCapital employed impact viaDivest-mentCapitalefficiency*Other *E.g.improved working capital employmen
39、t,increased asset utilization,changes to asset ownershipSpecific actionable initiatives 27IIIB.STRATEGIC INITIATIVES BACK-UP 3Operating income ongoing impact 2001-2004PhP millionsCapital employed ongoing impact 2001-2004PhP billionsPresent operating incomeVolume increasePrice increaseCost reduction
40、benefitAdditional costsTotal ongoing operating incomePresent capital employedImproved capital efficiencyDivestmentsInvestments(capex and acquisitions)Total ongoing capital employedB.3 How much value will be created from each strategic initiative?one-time EBIT impact=one-time costs=Financial impact f
41、rom each strategic initiative Expected financial outlay for each initiative+=+=28IIIB.STRATEGIC INITIATIVES BACK-UP 4B.4 What resources will each strategic initiative require?Resources required to make strategy work Availability of resources in the organization Plan for filling resource gapsCategori
42、es of initiativesSpecific actionable initiativesPeople/skillsResource requirementsFundingEx-Com involvement 29IIIC.FINANCIAL PROJECTIONS SUMMARYC.What are the expected financial returns of your strategy?C.3 What is your expected cash generation ability over the medium term?C.4 What is your expected
43、capital productivity?C.2 What is your projected net income in the next few years?C.1 What are the key assumptions?Instructions:The answer to thisoverarching questionrequires a recapitulationof the sections mainfindingsInstructions:These subsectionscontain a 1-2 sentencesummary of the relevantfinding
44、s30IIIC.FINANCIAL PROJECTIONS BACK-UP 1C.1 What are the key assumptions?Profit and loss(e.g.revenues,costs,margin)Balance sheet Corporate center directives Corporate center assumptionsBASE CASEBusiness unit assumptionsRevenuesMarket sizeMarket sharePriceCostsInput costsProduction costsOther costs(e.
45、g.SG&A)MarginsGross marginOperatingmarginCapitalPlannedinvestments/divestmentsChanges inworking capital2002KEY FORECAST ASSUMPTIONS20032004Growth rateCorporate center assumptions200220032004Key economicindicatorsGDP growthConsumerprice indexExchange rate(PhP/USD)91-day T-billrateCorporate taxrateIns
46、tructions:These are the minimumrequired assumptions.Feel free to add otherassumptions relevant to your BU31IIIC.FINANCIAL PROJECTIONS BACK-UP 2C.2 What is your projected net income in the next few years?Income statement forecastBASE CASEHistoricalSalesCost of goods soldGross profitOperating expenses
47、Operating profitOther expensesTaxesNet profit1999FORECASTED INCOME STATEMENT2000In PhP millionForecast2001*200220032004CAGR1999-2004Growth analysisSales(%)Gross profit(%)Operating profit(%)Net profit(%)Margin analysisGross margin(%)Operating margin(%)Net margin(%)*Key assumptions not listed earlier
48、should be detailed at the bottom of the chart.The impact of planned initiativeson the revenues and costs should be established clearly with additional attachments if requiredBest estimates on possible actual results Instructions:These are the minimum required income statement accounts and analyses.F
49、eel free to add other accounts and analyses relevant to your BU32IIIC.FINANCIAL PROJECTIONS BACK-UP 3C.3 What is your expected cash generation ability over the medium term?Cash flow forecastInstructions:These are the minimum required cash flow statementaccounts.Feel free to add other accounts releva
50、nt to your BUBASE CASEOperating profitDepreciation and amortizationOther non-cash operatingexpensesNet operating cash flowIncrease/(decrease)in workingcapitalOther operating cash flowTotal operating cash flowFORECASTED CASH FLOW STATEMENTHistorical19992000Forecast2001*200220032004CAGR1999-2004Capita
