bothe hw econ and art

Organization Strategic Analysis Project [E]: Sample format

I have used variations on the format below in reports to the chairman of United Technologies, two governors of California, and two Presidents of the United States. I do not require you to follow this format exactly, but it will help you organize your thinking and make your product more accessible to a busy reader. (And I will deduct points for sloppy/disorganized writing.) That in turn will help you when you re-use your report outside of class (e.g., as a writing sample in job-hunting.)

Whether or not you follow this format, I strongly urge you to do the following:

(1) Start with an outline of the overall project. Writing stream-of-consciousness will result in a rambling and disorganized product. An outline will discipline you to organize your thoughts. Start with my suggestion below, but modify it as needed to suit your style and subject.

(2) Realize that you are writing a business analysis, not an English paper. Use short, declarative, factual sentences wherever possible. Restrict editorializing to the last section (E3, options and recommendations).

(3) Be kind to your reader by using section headers and subheaders to keep them oriented as they read. Paragraphs should be short, no more than a quarter-page each.

(4) Present your data in table or graph form—the reader can grasp it much faster than if it is buried in text.

(5) Summarize your main points in a “Summary” or “Conclusions” section at the beginning or end of your document. Some authors do both.

Throughout what follows, “company” can be replaced by “organization”. Even nonprofits and governments operate in an “industry” and have “competitors.”

Memorandum

To: CEO and Board of Directors, X Company From: Joe Doe Date: Nov. XX, 2005 Subject: Industry and Company Strategic Analysis, with Recommendations for Future Initiatives

This outline essentially combines what in the course will be both assignments E2 (descriptive analysis ) and E3 (prescriptions). Roughly speaking, section G in this outline corresponds to E3. The memo outline follows:

Remember, your audience is the board of directors, a group of VERY business senior decisionmakers. E1 should be no more than one page; E2 five pages; and E3 three pages. If you can be thorough with fewer words, briefer is better.

A) Summary/Highlights (1-2 paragraphs)

B) Company definition: Business segments

C) Industry/competitor description – Market shares – Growth rates – Events

D) Market description (by segment, if needed) – Penetration – Growth

E) Key events and trends in market/industry – Entrants (i.e., industry fragmentation) & exits – Mergers & Acquisitions (i.e., industry consolidation) – Technological changes – Public policy changes – Opportunities and threats to our company

F) Company Strategy - Key source of competitive advantage (core competencies) Strengths and weaknesses relative to each competitor - Company performance (financial, product, other)

…..G) Comparison to specific competitors Profitability Marketing/branding Operations/costs …Make as quantitative as possible: Comparisons are most meaningful when they reflect measurement

G) Strategic objective, and options - Key corporate improvement objective - Options for achieving objective - Analysis of options, including impact of profits - Recommendation(s) (Conclusions)

For the purposes of this course, you will find it useful to consider Michael Porter’s competitive analysis framework (to be covered in Week 8). Porter is mentioned less explicitly in professional analyses, but he is often in the background.

E3 is intended to be primarily a menu of options, analysis of those options, and a recommendation. Realize that although in academic papers it is sufficient to offer only a descriptive analysis, decisionmakers want your prescriptive analysis—i.e., your suggestion as to what decision they should make. This is harder, but necessary.

When presenting quantitative data—e.g., revenues and market shares for each competitor--wherever possible you should do so with tables or figures. A picture really is worth a thousand words.

Information sources can include:

Most important: the business reference collection at the Knight Library. Try it out on the library’s website. Great online sources of company data

include Value Line, Hoovers, Zacks, and Yahoo Financial. Also: a) The business press (Business Week, Forbes, Fortune, the WSJ, or industry

trade publications). You should attach at least one such article to your E1 submission.

b) Specialized trade press that covers your particular industry. Likewise, your industry probably has a trade association which provides services to its members, including publications.

c) Company annual reports (available in the “investor relations” section of company websites). Note that company-issued info always puts the firm in the best possible light. DO NOT rely exclusively on company info—also use analyst reports, or the press.

d) Company regulatory filings available at the SEC website; e) Analyst reports available (often for a price) at the websites of major financial

companies (e.g., Merrill Lynch, Citigroup, Fidelity, or UBS Paine Webber). Free/cheap reports are often available at financial information portals such as Yahoo Financial. Zacks summarizes analyst recommendations.

f) Interviews with company officials.

The table on p. 94A of the UO reader is a good list of summary corporate performance measures. I will discuss each in an early class.

Often you will find that you don’t have enough information and will need to improvise. It’s no different when such an analysis is conducted in a professional setting. All you can do is make assumptions—but you should document your sources or explain your guesses. Your reader can then make their own judgment about the quality of those assumptions.

This folder also includes several examples: one fictional example drafted by me, and several superior memos produced by past students in my course. These will help you understand the E project’s expectations. Note that, as noted in the syllabus, I will be using essentially high professional standards for grading this assignment: If I was the company’s VP for strategy and a subordinate handed your submission in, would I feel comfortable passing it along to the CEO? If the answer is strongly “yes”, the submission will get a high score (essentially an “A”); a weak “yes” means a “B”, and “nos” will yield Cs, Ds, and lower. I will try to provide feedback so that you can improve your next submission.