G1RD-CT-2002-00698 e-Volution II – Road map for e-business implementation in Extended Enterprises
G1RD-CT-2002-00698 e-Volution Page 1 Task 2.2: MARKET MODULE CONCEPT e-Volution II - Roadmap for...
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Transcript of G1RD-CT-2002-00698 e-Volution Page 1 Task 2.2: MARKET MODULE CONCEPT e-Volution II - Roadmap for...
G1RD-CT-2002-00698 e-Volution
Page 1
Task 2.2: MARKET MODULE CONCEPT
e-Volution II - Roadmap for e-business implementation in Extended Enterprises
Mr. Roberto Citarella, UNISA
Innova Rome, 13 May 2004
G1RD-CT-2002-00698 e-Volution
Page 2
MARKET MODULE CONCEPT
1. PRELIMINARY OT ANALYSIS- Product and Market Assessment- Purchasing criteria analysis- Competitors analysis- Comparison analysis- Influence of e-business on the EE market
2. OT ANALYSIS FOCUSED ON E-SOLUTIONS
- E-sales
- E-procurement
G1RD-CT-2002-00698 e-Volution
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MARKET ANALYSIS: preliminary approach1. P/M assessment, by using Market segmentation analysis
and Portfolio matrix;
2. Purchasing criteria analysis guide customers in their choice during the purchasing process. They are identified and prioritised and then assessed by managers who identify the internal value creating processes that most heavily influences them.
3. This activity aims to describe the most important competitors and gain an understanding of their strengths and weaknesses, compared to the EE under analysis.
4. The qualitative comparison with the previous analysed competitors, using charts and graphics in order to support the manager to recognise the areas on which improving actions have to be taken.
5. This step aims to provide understanding about the O.T. that e-business represents for the market environment and for the specific EE. These activities are designed in two step: gathering detailed information together with OT identification and description.
Internal Analysis
External Analysis
Final Summary
Situation Analysis
Strategy Development
Project Description
Project Implementation and Results evaluation
Check List for Situation Analysis1. Assess Products and markets
2. Analyse Purchasing Criteria
5. E-business impact analysis on the market and the EE
4. Comparison with the competitor
Summary of the analysis
3. Competitors analysis
G1RD-CT-2002-00698 e-Volution
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Product and Market assessment
Product Market table
Financial data in the P/M table
P/M area attractiveness“E” assessment of :-P/M area-Competitive position
– Product definition– Market definition
– Contribution margin analysis
– Matrix representation– Total assessment
Competitive position in P/M area
Matrix portfolio assessment
– P/M area choice
Internediate SWOT analysis
– SWOT item identification
G1RD-CT-2002-00698 e-Volution
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Product and Market assessment
Product Market table
Financial data in the P/M table
P/M area attractiveness“E” assessment of :-P/M area-Competitive position
– Product definition– Market definition
– Contribution margin analysis
– Matrix representation– Total assessment
Competitive position in P/M area
Matrix portfolio assessment
– P/M area choice
Internediate SWOT analysis
–SWOT item identification
1. Determine the Market (segments) of the EE
• Identification through Market segmentation of the relevant Market segments.
Description
Objectives• Identification of the USP
components:extended products and services
• Identification of the most attractive P/Ms through anactual and future matrix positioning
2. Identify EE Products and Services (USP)
3. Matrix portfolio assessment
Assessment of P/MDefine the productsStep Define the Markets
1. Determine the Market (segments) of the EE
• Identification through Market segmentation of the relevant Market segments.
Description
Objectives• Identification of the USP
components:extended products and services
• Identification of the most attractive P/Ms through anactual and future matrix positioning
2. Identify EE Products and Services (USP)
3. Matrix portfolio assessment
Assessment of P/MDefine the productsStep Define the Markets
Wooden products to large customers
Wooden products to distributors
Wooden products straight to consumer
(marginal)Bicycles to large
customersBicycles to distributors
Bicycles straight to consumer (marginal)
Plastic sledges etc. to large customers
Plastic sledges etc. to distributors
Plastic sledges etc. straight to consumer
(marginal)
Additional equipment to large customers
Additional equipment to distributors
Additional equipment straight to consumer
(marginal)
Market (segments)Product/market area covered
Large customers (Public institutions)
Distributors of outdoor toys
Straight to consumerProduct/service (groups)
Additional equipment (import/wholesale)
Chair sledges and wooden sledges (production)
Bicycles (production)
Plastic sledges, (import/wholesale)
PRODUCT – MARKET MATRIX IDENTIFICATION
G1RD-CT-2002-00698 e-Volution
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Product and Market assessment
Product Market table
Financial data in the P/M table
P/M area attractiveness“E” assessment of :-P/M area-Competitive position
– Product definition– Market definition
– Contribution margin analysis
– Matrix representation– Total assessment
Competitive position in P/M area
Matrix portfolio assessment
– P/M area choice
Internediate SWOT analysis
–SWOT items identification
TurnoverCM/CR 2020 40,5 % 2329 38,0 % 168 44,8 % 0,0 % 4517 39,3 %
TurnoverCM/CR 2699 38,0 % 2923 36,0 % 204 39,1 % 0,0 % 5826 37,0 %
TurnoverCM/CR 1076 20,7 % 998 18,1 % 78 25,2 % 0,0 % 2152 19,5 %
TurnoverCM/CR 95 19,4 % 108 17,6 % 5 23,8 % 0,0 % 208 18,5 %
TurnoverCM/CR 0,0 % 0,0 % 0,0 % 0,0 % 0 0,0 %TurnoverCM/CR 5890 33,1 % 6358 31,2 % 455 37,1 % 0 0,0 % 12703 32,3 %
11014
1123
0
39370Total market
17777 20365 1228
15748
Chair sledges and wooden sledges (production)
375
7103 8123 522
Product (groups)
Market (segments) Large customers (Public institutions)
Distributors of outdoor toys
21
310
Total product (groups)
Straight to consumer
114854987 6123
5507
612Additional equipment to all toys (import/wholesale)
490
Plastic sledges, (import/wholesale)
5197
Bicycles (production)
• TURNOVER
• CONTRIBUTION MARGIN
• CONTRIBUTION RATIO
• The values of this matrix will influence the following assessment of the market attractiveness, providing automatic default values for filling in the P/M attractiveness table;
• Future financial data are foreseen by using Neural Network algorithm;
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Product and Market assessment
Product Market table
Financial data in the P/M table
P/M area attractiveness“E” assessment of :-P/M area-Competitive position
– Product definition– Market definition
– Contribution margin analysis
– Matrix representation– Total assessment
Competitive position in P/M area
Matrix portfolio assessment
– P/M area choice
Internediate SWOT analysis
– SWOT items identification
I = I = PPiiLLii
PPii
0. Definition of the scale used on the two axis of the matrix (Attractiveness e Competitive position)
1. Choice of the most important factors related with the Attractiveness and Competitive position
2. Evaluation of factors relevance (weighting phase - Pi -) for the Attractiveness and competitive position of each P/M areas
3. Evaluation of the level (Li) for each analysed factors (Qualitative assessment of predefined questions)
4. Total assessment determined by Attractiveness and Competitive position index for the specific P/M area, according to the following formula
G1RD-CT-2002-00698 e-Volution
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Product and Market assessment
Product Market table
Financial data in the P/M table
P/M area attractiveness“E” assessment of :-P/M area-Competitive position
– Product definition– Market definition
– Contribution margin analysis
– Matrix representation– Total assessment
Competitive position in P/M area
Matrix portfolio assessment
– P/M area choice
Internediate SWOT analysis
– SWOT items identification
Evaluation
RemarksEvaluation
Remarks
One large market in Italy
It has not been given priority to outdoor toys, but this has improved lately
Expected stability, but only marginal growth.
A certain growth is expected - breed improvement is given priority
No competition from other producers, but from distributors who offer more products.
The competition from other Italian and international companies are high.
Rules in the kindergartens: rules regarding replacement of toys/equipment
No new regulations are known
Total assessment: On a scale of 0 - 1, assess the P/M area's attractiveness
1The prospects for the future are good
1The prospects for the future are good
How attractive is the P/M area regarding future potential for growth?
How attractive is the competitive situation of the P/M area?
How attractive is the P/M area regarding laws and regulation?
First P/M area Second P/M area
How attractive is the P/M area's size (total turnover)? H H
H
M
M
M
MM
High market shares concerning chair - medium in other areas, but stabile
High market shares concerning chair - medium in other areas, but stabile
Expected growth, good prices are more important than international trademarks.
The competition may increase regarding international trademarks.
Reasonably good , but it can be improved
Because of the companies weak trademark the prices are forced.
Stabile
The margin could decrease because of the pressure from the store chains.
1 OK 1
Not part of the standard assortment in the chain stores, hence the prices are forced.
Total assessment: On a scale of0 - 1: assess the company'sposition in the P/M area
How good is the EE market share in the P/M area?
How good is the expected development in the EE's market shares?
How good are the EE's margins in the P/M area?
How good is the expected development in the EE's margins?
First P/M area Second P/M area
M
M
M
M
H
L
L
L
I = I = PPiiLLii
PPiiTotal evaluation for each P/M areas
P/M ATTRACTIVENESS TABLE
COMPETITIVE POSITION TABLE
G1RD-CT-2002-00698 e-Volution
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Product and Market assessment
Product Market table
Financial data in the P/M table
P/M area attractiveness“E” assessment of :-P/M area-Competitive position
– Product definition– Market definition
– Contribution margin analysis
– Matrix representation– Total assessment
Competitive position in P/M area
Matrix portfolio assessment
– P/M area choice
Internediate SWOT analysis
– SWOT items identification
Assume that the large customer will prefer electronic purchase solutions.
Electronic purchase solutions.Producers as ourselves are becoming distributors.
e-buiness will probably be used by most of the suppliers towards the large customers.
- e-business will probably be used by most suppliers towards their distributors. Possible suppliers downwards integration
To which extent to you believe that e-solutions may contribute to strengthening the company's position in the P/M area?
First P/M area Second P/M area
To what extent do you believe that the implementation of e-solutions may increase the attractiveness of the P/M area?
Product/market area 1 Product/market area 2 Product/market area 3
H = HighM = MediumL = Lowfor qualitative answer.
Graduation of influence of e-business on attractiveness and EE position on the specific P/M area
The answers influence directly the position of the second bubble in the following Matrix representation.The 2nd bubble provide a clear picture of the future tendency
G1RD-CT-2002-00698 e-Volution
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Product and Market assessment
Product Market table
Financial data in the P/M table
P/M area attractiveness“E” assessment of :-P/M area-Competitive position
– Product definition– Market definition
– Contribution margin analysis
– Matrix representation– Total assessment
Competitive position in P/M area
Matrix portfolio assessment
– P/M area choice
Internediate SWOT analysis
–SWOT items identification
First P/M area
Second P/M area
P/M
are
a at
trac
tive
nes
s
Weak
Low
High
Strong
2nd priority
Not a priority 3rd priority
EE position in the P/M area
1.st priority2nd priority
Not a priority 3rd priority
Matrix area Description
1st Priority: High score on both attractiveness and competitive position.
2nd Priority: High score on attractiveness but not on the EE competitive position the EE should decide whether it is possible to achieve a better position in the market.
3rd Priority: High score on EE competitive position but a low score on attractiveness assessment of how attractive is this market, and if this is enough to render an acceptable profit ('milk' the P/M areas for as long as possible without making too large investments)
Not a priority: Low score on both attractiveness and EE position consider withdrawing from the market if profits are not satisfactory or future prospects are not brighter.
The position of the bubbles in the Matrix quadrants influence the P/M areas choice.
G1RD-CT-2002-00698 e-Volution
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Purchasing criteria analysis 1/41. Gather information about customers' purchasing criteria, and
about the way in which your organisation accomplish them;• Internal workshop by Marketing department• Direct or phone interview• Market research
2. Research results documentation;
3. Assess how your main competitors satisfy customers' purchasing criteria and benchmarking;
4. Conclusion: EE’s SWOT assessment according to the investigation of consumers' purchasing criteria
– Product quality– Delivery precision– …
Purchasing criteria
prioritised
Value creating activities’
identification
– Production– Distribution–…..
Performance assessment
– Qualitative assessment of each internal value creating activities
– Comments– e-solution id.
INTERMEDIATE SWOT ANALYSIS
EE Purchasing criteria analysis
Competitors Purchasing
criteria analysis
FINAL SUMMARYBenchmarking between the EE criteria and the competitor n°1 for each specific criterion.
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Purchasing criteria analysis 2/4
1. Purchasing Criteria identified & prioritised
2. Value creating activites identification
3. Performance assessment4. Cause description5. E-solution contribution
3. Performance - assessment
4. Comments5. e-solution which may contribute to solve a problem
Product quality Production + High product quality
Access to satisfactionfeedback amongst internetcustomers .
Product selection and additional services
Product development 0
Good selection of products and additional equipment, but lack of additional services as order status.
Cooperate with more foreignsuppliersanddistributeseveraldifferent product typesby theinternet (establish amarketplace), offer additionalequipment and services asmounting, display the orderstatus via the internet, products adjustedfor special purposes,etc.
Delivery precision Distribution -
Not always positive because of delays by the forwarding agent.
Use of the existing market
places on the internet to locate
forwarding agents who provide
better service (service
warranties etc.)
Prices compared to quality
Marketing/ sales +
Product's prices are on the average, but they are well known for their high quality products.
Purchase and sales solutions.
Handle customer requests
Service and support -
Not able to handlerequests from thecustomersasfastastheywishandthey oftenlackinformation (e.g. orderstatus)
Customer support via the internet.
1. Purchasing criteria
prioritised:
2. Value creating activity(ies) that most heavily influence(s)
the purchasing criterion
Extended Enterprise
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Purchasing criteria analysis 3/4
1. Purchasing Criteria identified & prioritised
2. Performance assessment
3. Cause description4. E-solution contribution
TEMPLATE FOR COMPETITOR ANALYSIS
Competitor 1 - name
Competitor 1
Performance - assessment
Comments (Description of cause)
Any e-solution making your
competitor better
Product quality + Top quality
Product selection and additional services
- Produces outdoor products for wintertime use (snow racers and plastic sledges).
Delivery precision+ The distributors believe that
they are good.Prices compared to quality
0 High prices, but they ensure high quality
Handle customer requests
+ Fast and friendly feedback
Purchasing criteria prioritised
G1RD-CT-2002-00698 e-Volution
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EE and the customers' needs
EE and its top competitor
Any comments
Product quality Production + 0
Product selection and additional servicesProduct development 0 0
Delivery precision Distribution - -
Prices compared to quality Marketing/ sales + +
Handle customer requests Service and support - -
SummaryValuecreatingactivitiesthatmostheavily influence the purchasingcriterion
Purchasing criteria (from market research-
prioritised
Purchasing criteria analysis 4/4
These qualitative values are picked from the previously analysed tables.
Summary: the EE vs competitors
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Competitor analysis 1/2
Competitor's position in the market and competitive advantages
Assessment of competitor's value creating activities – S.W.
–P/M areas served by the competitor – Competitor's market position and market share
Description of competitors’ current e-solution
Intermediate OT Analysis
– Information (one way) – Communication (two way)– Trade/e-Commerce– Business Integration
– Based on the description and the assessment of main competitors – describe intermediate OT elements
Procurement ProductionMarketing/ sales
DistributionService and support
+ + 0 +
Excellent at branding
None in particular
Are known as quick and friendly
Uncertain
The production is somewhat unstable.
Some distributors say
that the salesmen are to
pushing. None in particular
Assessment of cost efficiency
Strengths
Weaknesses
Effective on purchase, large quantities and hence low prices.
Very new the equipment
used.
Primary activities
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Competitor analysis 2/2
Procurement ProductionMarketing/ sales
DistributionService and support
Information (one way)
Present the products on the Web site
Communication(two ways)
Distributors can order the products through the internet.
Trade/eCommerceBusiness integration
Types o
f eB
usin
ess
-Inte
rnet-
solu
tions
Primary activities
The value-creating activities
Description of competitors’ current e-solution for each value creating activities
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Comparison with competitors 1/3
1. Summary assessment of how the EE fulfils the customers' purchasing criteria in comparison with its competitors;
2. Summary assessment of EE’s productivity compared to those of the direct competitors;
3. Assessment of EE’s current e-solutions (if any) compared with its competitors‘;
4. Description of strengths, weaknesses, opportunities and threats based on the summaries above.
INTERMEDIATE SWOT ANALYSIS
- Purchasing criteria analysis
- Value creating act. analysis
- E-solution analysis
Extended Enterprise Competitors
FINAL SUMMARYBenchmarking between the EE and the competitors
Purchasing criteria comparison
G1RD-CT-2002-00698 e-Volution
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Comparison with competitors (Value creating act. Analysis) 2/3O
wn
com
pany
Com
petit
or 1
Com
petit
or 2
Com
petit
or 3
+
0
-
Ow
n co
mpa
ny
Com
petit
or 1
Com
petit
or 2
Com
petit
or 3
+
0
-
Ow
n co
mpa
ny
Com
petit
or 1
Com
petit
or 2
Com
petit
or 3
+
0
-O
wn
com
pany
Com
petit
or 1
Com
petit
or 2
Com
petit
or 3
+
0
-
Ow
n co
mpa
ny
Com
petit
or 1
Com
petit
or 2
Com
petit
or 3
+
0
-
Ow
n co
mpa
ny
Com
petit
or 1
Com
petit
or 2
Com
petit
or 3
+
0
-
Ow
n co
mpa
ny
Com
petit
or 1
Com
petit
or 2
Com
petit
or 3
+
0
-
Procurement Production Marketing/ sales Distribution Service and supportManagement and administration
Product development
Support activitiesPrimary activities
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Comparison with competitors (e-solution) 3/3
Procurement ProductionMarketing/
salesDistribution
Service and support
EE
A Web sitecontaining information aboutthe offeredproducts
Competitor 1Present theproducts on theWeb site
Competitor 2Publishing information aboutproducts
Competitor 3
Information (one way)
The value-creating activities
Primary activities
Examples of e-solution– Information (one way) – Communication (two way)– Trade/e-Commerce– Business Integration
G1RD-CT-2002-00698 e-Volution
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E-business impact on the EE market
Information gathering O.T description of EE partners
• Specific e-business related survey (MM help on line - CSP);
• External link by using the Information Selector (CSP - WWW)
• EE networks
• Trade association
DESCRIPTION OF OPPORTUNITY
• Opportunity definition
• Improvement of current business /new business model
• Improvement the Opportunity create in term of cost, revenues, market situation
DESCRIPTION OF THREATS
• Threats definition
• Threats description
• Description of how this threat may influence costs, revenues or market position
Opportunity Impact on business model
Opportunity description Costs Improvements
Access to more customers both national and international
Improvement of existing business models
Internet sales allows to sell to more customers. They may use their own Web site or a marketplace for buying the products.
Less sales costs per customer
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COMPLETE FRAMEWORK PRELIMINARY APPROACH
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OT ANALYSIS (based on the ranking algorithm): STEPS and STAGES
Market
requirements
Trend
Analysis
Customers
Analysis
Competition
Analysis
Products/services
Analysis
TREND FINDING
TREND FILTERING
TREND FORMATTING
TREND FOCUSING
Suppliers
Analysis
IN CASE OF E-PROCUREMENT ANALYSIS
Three kind of analysis allowed:
1. E-SALES 2. E-PROCUREMENT
Each analysis is divided in steps and each step is divided in stages.
1. Collecting data2. Ordering data table3. Charts and Histograms4. Ranking Algorithm
1. Collecting data2. Ordering data table3. Charts and Histograms4. Ranking Algorithm
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OT ANALYSIS (based on the ranking algorithm) : FINAL SCENARIOS
SWOT SWOT SWOT
SWOT SWOT
Opportunities
Start from trend analysis:
Country C (rank=60)
Customer analysis:
Customers G (rank=33)
Customers M (rank=30)
Customers H (rank=29)
Competitors analysis:
Competitor W (rank=10)Competitor B (rank=13)Competitor A (rank=22)
Product analysis:
Product T (rank=48)Product J (rank=37)Product S (rank=32)
Threats
Start from trend analysis:
Country H (rank=12)
Customers analysis:
Customers D (rank=15)
Customers K (rank=22)
Customers E (rank=26)
Competitors analysis:
Competitor E (rank=43)Competitor J (rank=36)Competitor Q (rank=35)
Product analysis:
Product O (rank=15)Product C (rank=26)Product R (rank=27)
OUTPUT
OPPORTUNITIES AND THREATS QUANTITATIVE PORTFOLIO GENERATION
OUTPUT
OPPORTUNITIES AND THREATS QUANTITATIVE PORTFOLIO GENERATION
At the end of the Market Analysis, four final classifications generated by the system concerning the four stages of analysis (TREND, CUSTOMERS/SUPPLIERS, COMPETITORS, PRODUCTS AND SERVICES).
Possibility of choosing the stage considered the most interesting to start the final scenario from.
Automatic alignment for each of the three elements of other stages having the highest rank for the country/region of the segment selected.